How to create an effective annual report?
Drawing up an annual report takes a lot of effort. How can you make sure all that effort produces the best possible result?
An effective annual report will, first and foremost, tell a relevant story. A story that not only incorporates reflection on the past year from a financial perspective, but also presents a strategic forecast of things to come. It provides an insight and helps stakeholders make better decisions. Aside from that, the annual report is increasingly becoming a PR tool. A way to inspire trust and generate positive exposure. In short, an effective annual report serves multiple purposes.
But the question is: how do you create an effective annual report?
Record your objectives in a reporting roadmap
The first step is to develop a reporting roadmap: a vision as to what you would like to achieve and how you intend to achieve it. The central question at this point is: which purposes does our annual report have to serve?
Start out by taking stock of the latest trends and developments in corporate reporting. See whether you can find inspiration from what similar organisations are doing. Next, analyse the current situation under review and describe the target situation. Finally, conduct a gap analysis to formulate the steps you have to take to get there. A reporting roadmap will help you make the right choices and garner internal support for them.
Identify relevant information using a materiality matrix
Readers want information that is genuinely relevant to them. But how do you determine what is relevant to whom?
First of all, it is of course important that you comply with the necessary legal requirements. The information you are presenting, which is largely of a financial nature, will be most relevant to specific stakeholders, such as regulatory bodies. However, stakeholders are becoming increasingly interested in non-financial issues as well.
The materiality matrix is a tool that you can use to figure out what your readers want to read. It is a priorities matrix that is used to record which non-financial issues are relevant to both internal and external stakeholders. These are called material issues. Organisations that comply with corporate social responsibility reporting guidelines, such as the Global Reporting Initiative (GRI4) or Integrated Reporting, are already using a materiality matrix. A nice example is the interactive materiality matrix of Ford.
You can identify material issues by asking internal and external stakeholders in the form of a survey or by organising a roundtable session, for example.
Develop user stories
As soon as you know which information is the most relevant to your readers and must therefore be included in your report, the next step is to find out how stakeholders prefer to consult this information. One way to do so is by developing user stories. User stories are brief descriptions of what your key stakeholders want from the annual report. A user story is all about defining your readers’ needs: ‘as user X, I want function X/action X with value X/achieving goal X as the benefit.’
Example 1: ‘As the industry regulator, I want to be able to download the annual financial statements in PDF format in order to audit them and to facilitate archiving of the annual report.’
Example 2: ‘As a journalist, I want fast access to the organisation’s business model on my mobile.’
User story input is also obtained by asking stakeholders. You can do this by using roundtable sessions to also ask about stakeholders’ media preferences. Desk research, such as analysing website statistics or existing stakeholder analyses, offers useful insights for user stories as well.
Come up with a cross-media concept
The next step is to develop a concept. This concept should define your starting points in terms of issues to address, wording and illustrations. The organisation’s corporate identity and core values are not the only key input for this concept - the user stories are crucial too.
With a cross-media concept, i.e. a concept that uses both online and offline channels, you will be meeting the needs of as many stakeholders as possible. This way, you will guarantee that you broadcast the annual report effectively.
Create content that matters
As soon as you have gained an idea of which information is relevant, developed the main user stories and come up with a cross-media concept, you can get started with content creation. Make sure you base content on the outcomes of the materiality matrix. Supplement the main material issues with information that you are legally obliged to provide and turn it into a coherent and accessible story. Always bear in mind the medium and target group you are writing for: when creating PDF content targeted at professionals, you can be more comprehensive and use more jargon. Online content for a broader audience should be formulated more concisely and accessibly. Aside from that, it is always a good idea to pay attention to your online findability. This will further extend your annual report’s reach - and therefore its impact.
Publish ‘online first’
A cross-media concept with customised content? Sounds like a laborious and costly process. The solution lies in smart use of technology. Online first publishing software makes reporting even more efficient and effective. Online first publishing, also referred to as multichannel publishing, makes it possible to publish content from one single online source to multiple channels: mobile, tablet, desktop and PDF. This is far more efficient as it allows certain steps in the process, such as import and synchronisation, to be automated. It also speeds things up, reduces the risk of human error and lets you publish sooner and simultaneously on different channels. Having only one source version makes version control a lot simpler as well.
What's more, online first publishing makes communications a lot more effective, as it allows very targeted communication with stakeholders. Facetbase, F19’s online first publishing platform, lets you easily custom format and enrich content for each channel. A media mix can, for example, comprise a brief, functional summary for the mobile channel, an interactive and visually stunning public version for desktop and tablet PCs, and the complete story for publication in PDF format. All published from one single source. Learn more about online first reporting here.
Generate structural exposure for your annual report
An annual report will also be made more effective by structural promotion. First of all, this means launching it: generate interest around the publication date using press releases, social media, newsletters and online publications. After the actual publication, you can highlight certain parts of the annual report to very specific target groups. Information from the annual report can, for example, be used to provide context for news about the company, or provide in-depth insights to accompany the organisation's other marketing efforts.
By making the annual report part of integrated marketing communications, you will greatly increase the annual report’s reach and impact.
No one wants you to share old information, so you have to get new information out there the whole year round. Stakeholders want to know what is going on right now. Needless to say, a considerable part of the annual report has to be validated and approved before it can be published. That’s a legal requirement. But there is always information that is new and relevant, and that can be disclosed sooner - information about carbon emissions, for example, or other non-financial performance indicators. One example of this is ProRail’s online KPI dashboard.
The online channel offers a wide array of options for enriching annual reports with up-to-date information. You can also offer access to quarterly and half-yearly reports through one central online platform. In fact, strategic plans, annual plans and annual reports are all increasingly made available through central online platforms. This creates greater insight into the extent to which results match set targets.
Transparent, up-to-date and target group-oriented communications about strategy and performance will boost stakeholder trust. Organisations that have ventured down this path are the ones that achieve the greatest impact with their annual reports.
Another good example of an organisation that is moving in the direction of continuous reporting is the Dutch energy network company Alliander. On the online reporting platform http://2016.jaarverslag.alliander.com/ Alliander publishes not only all annual reports and annual plans of recent years, but also an interactive monthly update of KPI’s that that are connected with Alliander’s strategy.