I’ve joined the investor advisory group (IAG) of the Financial Reporting Council (FRC, tiny news release) and this week I spoke at the FRC Lab conference.
The IAG aims to “provide a regular forum for the FRC to engage with representatives from across the investment chain on various issues, including our strategy and plan and new policies and standards, on governance, stewardship, reporting and audit matters.”
Business has more than investors as stakeholders (it includes YOU and civil society etc.), so if there is any item in the corporate reporting agenda that you wish to communicate to the FRC – first, you can write direct to the FRC! but second, feel free to tell me and I will pass the views on as part of my work in this area.
I joined Sallie Pilot and Stephanie Maier and Douglas Radcliffe for a discussion at the FRC Lab conference this week. If you'd like to share a view on corporate reporting, ESG, intangibles, wider-metrics, GAAP, Non-GAAP and what would be useful to you as an investor or wider stakeholder then do get involved with a Financial Reporting Lab project (see link here).
I made the point that intangibles are a large part of companies values today but many aspects are poorly reported (eg human capital, brands, innovation). See blog post on Intangible Capital.
AI and technology will impact future reporting, but arguably we are not using the tools today as effectively as we could.
From the corporate side, the demands are ever increasing. It will be up to boards and management to self-define what is material and sustainable to them, (and to convince their stakeholders) but if key items are missing then pressure will be seen from investors, wider stakeholders and regulators.
Other discussion centred around are disclosures:
Clear on how they are aligned to strategy
Transparent in regard to calculation and adjustments
Contextual, including description of both performance and position and what went well an what went badly.
How the metrics are reliable including information on monitoring
Clear on the level of consistency year on year and across time
The current Arts blog, cross-over, the current Investing blog. Cross fertilise, some thoughts on autism. Discover what the last arts/business mingle was all about (sign up for invites to the next event in the list below).
My Op-Ed in the Financial Times (My Financial Times opinion article) about asking long-term questions surrounding sustainability and ESG.
Some popular posts: the commencement address; by Nassim Taleb (Black Swan author, risk management philosopher), Neil Gaiman on making wonderful, fabulous, brilliant mistakes; JK Rowling on the benefits of failure. Charlie Munger on always inverting; Sheryl Sandberg on grief, resilience and gratitude.
How to live a life, well lived. Thoughts from a dying man. On play and playing games.
A provoking read on how to raise a feminist child.