Building trust by communicating transparently

Posted
30 April, 2015

I was reading an article featured in the ACCA’s Accounting Futures magazine recently, which highlighted the importance of the Board and in particular, the CEO, in building trust. This has been evidenced through the Edelman’s Trust Barometer, which examines trust on a global scale, and I have to say it is a really interesting read, arguing clearly that “CEOs can build trust by communicating clearly and transparently, telling the truth regardless of how unpopular it is.”

For us at Black Sun this is a truly exciting breakthrough. We have long been passionate believers that communicating with your stakeholders clearly and transparently, is critical to building and maintaining trust. In our own experience we have found that those companies who communicate in this way are purely reflecting the positives which already exist within the business – namely good management, thinking which is strategic and forward-looking, and all-in-all reflects a well-run business.

Interestingly, the article supports the idea that integrated thinking and Integrated Reporting can help companies down this route towards transparency. For many people in the reporting world, building trust sounds like a great idea, however the concept of having to produce ANOTHER document can be a deterrent. In actual fact, we believe Integrated Reporting is just ‘good’ reporting and that the trusty Annual Report already forms the basis of an Integrated Report. This is particularly true for UK reporters, as the Strategic Report, which was introduced in 2013 combined with the FRC’s guidance on the Strategic Report, is consistent with the International Integrated Reporting Framework.

Not convinced? Well the benefits do not stop there. Our latest research with the IIRC demonstrates that there are many benefits of using Integrated Reporting to not only communicate more transparently but as a tool to better understand the connections between key resources and relationships that contribute to a company’s success. Key highlights from our ‘Realizing the benefits: the impact of Integrated Reporting’, research include:

  • Important breakthroughs in organisations’ understanding and articulation of how they create (and destroy) value
  • Better ways of assessing performance and changes in the provisions of information
  • Important developments in integrated thinking with strategic benefits such as: better decision making, better understanding of risks and opportunities, and last but certainly not least, better collaborative thinking by the board about goals and targets

So maybe when you are thinking about how to build trust and drive change for your organisation – you might consider the enormous opportunity that your reporting presents. As I always say, you have to report so you might as well get some value out of it. And while it is difficult, try to see it as an ‘opportunity not an obligation’ and hopefully you too will begin to see the benefits.

 

This blog was originally posted on the Black Sun website.