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Final Edit Version Indd SMALL FILE SIZE.Indd Corporate Reporting - : The Competitive Landscape Corporate Reporting: The Competitive Landscape* *connectedthinking Building Public Trust Awards Judges 2 Contents Winners & Highly Commended 3 4 Introducing Best Practice 5 6 12 18 22 26 Tax Reporting 30 People 34 Corporate Responsibility 36 Economic Performance 38 40 Other Publications 43 Introduction 2 In the year that we celebrate our fifth annual Building Public Trust Awards (BPTA), I am delighted to introduce our first compendium of best practice — Corporate Reporting: The Competitive Landscape. As with the awards event, in this publication we celebrate the best of corporate reporting by UK-listed companies and the public sector. As we engage with companies on corporate reporting and consider the demands for greater accessibility and transparency, we find that an understanding of how others are responding is essential. The BPTA process provided us with valuable insights, as the initial part of the process consisted of a review of reporting by the FTSE 350 as well as more than 90 public sector bodies. During this process, we captured examples of best practice, which demonstrate what good reporting actually looks like. This publication brings our insights and best practice examples together in one compendium – I hope you find it useful. The challenge for every business remains the same as in previous years: to get ahead of the curve and recognise that simply meeting regulatory reporting requirements is unlikely to satisfy the expectations of investors and other key stakeholders. If companies are to be properly understood and valued, there is a growing need for them to explain their full contribution to wealth creation and other aspects of life. This publication provides a snapshot of some of the key information that businesses need to report in order to win the trust of all those stakeholders who sustain the corporate sector, and who rely on it for their employment, taxes and pensions. I am particularly pleased to note the continuing improvement in reporting that has occurred in the past 12 months, partly due − in my view − to the introduction of the Business Review. While this has been an obvious catalyst for change, and one I support for its principles-based framework, we should not ignore the many companies that have taken it upon themselves to improve their reporting way beyond the regulatory norm. If your company is featured in this publication, I congratulate you. You are providing inspiration to others. You are helping to create a competitive mechanism that will continue to move reporting forward, and ensure that it fulfils its overriding objective: to communicate clearly with the capital markets and other key stakeholders. Kieran Poynter UK Chairman PricewaterhouseCoopers LLP Corporate Reporting: The Competitive Landscape Building Public Trust Awards Judges 2 The Building Public Trust Awards judging panel is made up of the leading business figures below, and is led by the Chairman of the judges, John Coombe. Between them the judges cover a wide range of disciplines and hold an unparalleled array of knowledge about the key issues that businesses face today. In order to maintain its independence, PricewaterhouseCoopers does not hold a position on the final judging panel. John CoombeSir John Bourn KCB Professor Sir Nick Anderson Philippa Foster Andrew Likierman Back OBE John Coombe is Chairman Sir John Bourn is the Sir Andrew is Professor of Nick Anderson is Head Philippa Foster Back became of Hogg Robinson Group plc Comptroller and Auditor Management Practice at the of Research at Insight Director of the Institute of and a Non-Executive General of the UK. London Business School. Investment, the asset Business Ethics in 2001. Director of HSBC Holdings He is also the Chairman He is also a Non-Executive management arm of HBOS. She was formerly Group plc and Home Retail Group of the Professional Oversight Director of Barclays Bank He has more than 20 years’ Treasurer at EMI. She holds plc. He is a member of the Board and a member of the and the Bank of England. investment management Non-Executive Directorships Supervisory Board of Financial Reporting Council. His previous posts have experience, as both a fund including Institute of Directors Siemens AG and a Trustee In addition he is Chairman of included Non-Executive manager and analyst. and is a past president of the of The Royal Academy of the World Bank’s Multilateral Chairman of MORI and Nick joined Insight from Association of Corporate Arts Trust. Formerly he was Audit Advisory Group. a Managing Director of Schroder Investment Treasurers. She is Chair CFO of GlaxoSmithKline plc HM Treasury. Management in 2003. of the UK Antarctic and a member of the UK He is a member of the Heritage Trust. Accounting Standards Board. UK Accounting Standards Board and the Corporate Reporting Users, Forum. Professor David Begg Baroness Denise Peter Elwin Anita Skipper Kingsmill CBE Anita Skipper joined Morley Professor David Begg, Baroness Denise Kingsmill Peter Elwin is Head of Fund Management as Head of Principal of Tanaka Business originally rose to prominence Accounting and Valuation Corporate Governance in 1993. School and Professor of as an employment lawyer. research at Cazenove, She is currently on the Board of Economics at Imperial She became Deputy Chair of advising institutions in the International Corporate College, previously the Competition Commission Europe and the US, and Governance Network and taught at Oxford University in 1997 and in 2001 headed corporate clients of a member of several corporate and Birkbeck College. the UK Government’s task JPMorgan Cazenove. governance committees, A CEPR Research Fellow force into women’s He is a member of the UK including those of the ABI. since its inception in 1984, employment. She chaired Accounting Standards Board, She has played an important he has published widely the Accounting for People the IASB’s Analyst Reporting role in developing governance on macroeconomics. Taskforce and is Group, the Corporate practices in the UK and worldwide. He is a Fellow of the Royal a Non-Executive Director of Reporting Users Forum, Society of Edinburgh, and British Airways and Senior and the ICAEW’s working the City and Guilds Institute. Advisor to the Royal Bank party on reporting financial 2 of Scotland. performance. Winners & Highly Commended 3 The 2007 winners of the Building Public Trust Awards are shown below, along with the highly commended companies. Each company has excelled in their particular area through clear and transparent disclosures, and we congratulate each of them for their efforts. We would recommend that you take time to view these disclosures, which offer some of the best examples of reporting seen in the UK. FTSE 100 Winner Highly Commended Winner Highly Commended The Capita Group Plc Lonmin Plc AstraZeneca PLC Punch Taverns plc Land Securities Group PLC WPP Group plc FTSE 250 Winner Highly Commended Great Portland Estates plc Signet Group plc Workspace Group PLC Winner Highly Commended Cookson Group plc BT Group plc HSBC Holdings plc Winner Highly Commended Ministry of Defence Highways Agency Metropolitan Police Service Winner Highly Commended Vodafone Group Plc Anglo American plc Success Diageo plc Winner Highly Commended Severn Trent Plc Cadbury Schweppes plc Highly Commended in alphabetical order Imperial Chemical Industries PLC Corporate Reporting: The Competitive Landscape Capturing Best Practice Over the past decade, PricewaterhouseCoopers has been acknowledged as a leader in promoting good corporate reporting and the monitoring of best practice. Throughout this period we have invested significant resources in research and thought leadership in order to advance our understanding of, and provide insights into, what creates value in corporate reporting. This extensive body of analysis underpins our judgement of the key areas of reporting and the criteria we use to assess them. 4 During 2007 PricewaterhouseCoopers undertook its most In addition, we continued to monitor good examples of reporting around comprehensive review of corporate reporting in the FTSE other key areas - corporate responsibility, people reporting and economic 350 and public sector to date. This review covered six key performance, which are also featured in this publication. areas – overall narrative reporting in both the public and private sectors, and the reporting of measures of success, Finally, at the end of this document, a PricewaterhouseCoopers executive remuneration, pensions and tax by FTSE 350 expert in each area sets out their thoughts on the future and the companies. challenges facing companies. The review included all companies in the FTSE 350* and For further examples of best practice in corporate reporting please the 90 largest public sector bodies and was conducted using visit our website: internal experts in each of the key areas. We assessed each company’s report against a range of objective criteria specific to each key area. This criteria covered basic compliance with required regulations, but also included other elements that we believe companies should be reporting on: these are outlined in more detail over the following pages. As part of the process, reviewers looked beyond the specifics to consider the document as a whole. For example, was there something about a company’s disclosures that made it stand out against its peer group? PricewaterhouseCoopers would like to express our Did the company do something notable that helped aid our sincere thanks to all the companies that have allowed understanding? A positive answer to these questions helped us to feature their work in this publication. We also offer us to identify the best practices shown in the peer group. congratulations for the commitment and energy that all these companies have shown in helping to elevate The remainder of this publication is organised into sections the quality of corporate reporting in the UK. that align with the key areas of our review. In each area we identify the specific areas of disclosure we were looking for, then we explain what we found, and finally provide recommendations for companies preparing their next report.
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