Sustainability vs. Financial Reporting

At the beginning of October I wrote a blog entry on how DAX 30 companies are reporting about their CSR activities in the web. One thing I mentioned were the differences in how the activities are presented online. Quite a few DAX companies are offering a sustainability portal, which is updated regularly by editing the content. The consequence is that afterwards the previous content is not longer available on the website.

Besides regulations and legal requirements it would be unimaginable that companies overwrite their online annual reports on a regular base. It is useful that the numbers are saved and archived every year to show transparency, openess and to establish a kind of a comprehensive corporate history over several years. If an investor or shareholder is interested in the company he gets broad information about the background of the company. He can also learn more about the strategy of a company at a specific cutoff date and its reaction to external influences, like financial crises.

Different thinking about printed reporting and online reporting

So why are sustainability reports often not archived but rather edited. Different departments have different needs, that’s for sure, but what are the reasons for not establishing a long-term online sustainability reporting history, as it is done with the printed ones? It seems that there is still a different thinking about printed reporting and online reporting, but this doesn’t have to. Print and online are no competitive media in case of reporting – they are satisfying different needs and expectations, they are complementary. The internet has its strenghts with interactivity, comfortable search capabilities and cross linking. The printed version with tangibility, offline usage and perhaps for taking notes. In my opinion it would be best to report consistently over both media, in order to reach as much of your target audience as possible.

In case of eco-efficiency, I would like to draw your attention once again to the Beiersdorf approach, which I think is most sophisticated: Make online first and make a print version out of the online report. This satisfies both, the offline and the online needs, although they are also not providing an online sustainability history.

What do you think? Why are most companies not building up an online sustainability reporting history?

Annual reports for iPhones & iPads: hype or good idea?

The following post is a 1:1 duplicate that I originally wrote for IR Web Report:

THERE is currently a lot of discussion in the corporate reporting community – some might call it hype – about companies creating iPhone and iPad apps for their annual reports and other documents.
In this post, I am going to try to frame the debate in terms of the pros and cons from an investor or analyst’s perspective because that’s ultimately who is supposed to use the apps. By doing so, I hope to bring some rational discussion to a topic that is often charged with all the emotion that Apple tends to evoke with its technologies.

But let’s start at the beginning. When companies and corporate reporting professionals talk about creating “an app” for their annual reports, they typically mean creating content that will be available via Apple’s App Store, which currently offers more than 300,000 apps across a wide range of categories.

It’s interesting to me that most people don’t seem to draw distinctions between apps created for the iPhone or the iPad. They talk about creating “an app,” as if to suggest that one app will be able to meet the requirements of both devices.

While it’s true that a single app can work on both devices, my view is that the two devices are very different and require separate approaches.

Annual report apps for iPhone

Bulky annual reports don't lend themselves to small iPhone screens, so they end up being little more than marketing pitches.

Let me cut to the chase right away: annual reports are horrible on the iPhone and there’s not much anyone can do to make them better.

 

Think about it for a moment. Annual Reports are content rich publications. Depending on the jurisdiction, they can vary from a “slim” 100-page report in the US to a typical 250-page document in Germany and the UK. This goes up to a range of around 500 pages, which is common among Italian companies.

Is this the kind of thing you would want to download and squint at on your iPhone?

The user experience of the iPhone annual reporting apps I’ve looked so far is poor. It takes an awful lot of clicks to end up, far too often, with a useless dead end of information or a PDF download.

And, if I’m being honest, I don’t think this is a result of bad design by the developers. I doubt there is much scope to improve the user experience with clever navigation and content preparation.

No, the real problem is that the large, text-heavy annual report itself is simply not suited to the small iPhone screen size, especially for not for large tables, which are common in annual reports.

This brings me to what I think makes more sense for the iPhone: a slimmed-down, fast-read mobile version that gives you a summary of the essential information, but which directs you to view the full version on another, more appropriate device — which may be an iPad.

Annual report apps for iPad

iPads have a much better screen size to view annual reporting content. In addition, there are several advantages an iPad app could offer users:

1. Offline use.

Users can download the report from the App Store and use it even if they don’t have an Internet connection, such as while they are traveling. This is potentially a very attractive application for number crunching analysts. Together with a good toolset, this could potentially combine the strengths of an online report with the advantages of the portable document format (PDF).

Making notes on the digitized report itself, something that has been tried with little success on the web, would finally start to make sense. Users can attach their personal comments to their personal version of the app and not worry about the information being lost or seen by others on a publicly available online report.

Of course, if you step back, you’ll recognize that these advantages are not new. They’re pretty much what you can do with any printed document!

2. Standardized presentation.

Since all iPads are the same, we know exactly how our content will look for the end user. We can optimize the display and functionality to precisely meet the iPad’s specifications. That means we can optimize the size of pictures and use multi-column layouts, things that we have to refrain from doing when people are accessing our reports with a variety of screen sizes, browsers and operating systems.

Now this might sound like a good thing, but again it’s more or less bringing back strengths we already have in printed reports. Of course, an app will enable us to do things that we can’t do on paper. You can zoom in on a picture, watch a video, hear an audio clip and explore with your finger tips. You can even flip through pages with your fingers, just like a paper report!

The iPad offers a much better viewing experience, especially for multimedia. But it lacks support for key software like Excel spreadsheets.

3. Brand positioning.

Being part of the tech-savvy crowd is probably the main driver behind the current buzz around annual reporting apps. Having an app for your annual report positions your company as being a leader. It could attract media attention and inspire interest from a technology-focused crowd. It can raise awareness of your company among app users, a growing number of whom inhabit the world’s financial districts.

And to be honest, this is not a bad reason to create an iPad app for your annual report information. We all need to differentiate our companies somehow. It’s just important to be honest about our reasons, and not fool ourselves that our annual reporting apps are actually more useful than anything that has come before.

Towards a platform-independent approach

An iPad app of an annual report can combine the advantages of online reports — search, hyperlinks, multimedia and instant worldwide availability — with the well-worn advantages of printed reports. As the iPad is a very interactive device, a key success factor will be engaging users with the app.

But at the end of the day, an iPhone or iPad app is just that, an application for a single device. It’s an additional expense over and above the traditional report. And it doesn’t support file formats that are important to analysts, such as tables in Excel.

The question is, is it wise to put all your eggs in one basket? Perhaps a better approach would be to create a platform-independent application that can work just as easily on Apple’s devices as it can on other tablets and mobile phones. Increasingly, this is the direction we and other web developers are moving in.

Online Annual Reports: Skip converting Notes section into HTML?

This years Nexxar research showed a remarkable development in online corporate reporting in the UK and US: A strong rise of HTML reports that incorporate the Notes section just as PDF. Is this a major shift in the perception of online reporting? Together with an increasing use of mulitmedia, companies seem to focus more on telling stories than reporting their business performance. A fool who thinks bad figures in economic difficult times might be the reason!

Of course companies save a lot of money by skipping conversion for more than half of the annual report. And notes include most of the tables, which are a technical challenging thing to do online. Companies question to take these costs, argueing that nobody reads them.

I don’t agree on this view!
Every 4th user visits the Financial statements. And around half of them go on to the Notes for deeper explanantions! Looking at the search strings of what people are searching for in the online report, more than 1/3 of the top links go into the back section of the financial reporting. If Notes are not converted into HTML the search results do not reflect a true but an incorrect and misleading view of the reporting! For more stats have a look at the video replay of our Webinar.

Another interesting facet is that corporate reporting rankings so far didn’t comment on this development. Hybrid reports have been surprisingly successful in UK rankings. Mostly it is not even mentioned that these reports leave out valuable information not to display in HTML.

UK IR Society guidelines explicitly asks to make the full report available online. But the winner of their last years Best Practice Awards is just an hybrid report.

Hybrid report wins last years UK Best Practice Awards!?

I hope hybrid reports are a temporary fashion due to current budget constraints. IMHO they are a serious threat to overall reputation of online reporting. Bad user experience may also negativly influence usage of good HTML reports. I think it is all vendors own interest to keep up good work and thus enhance usability of online reporting.

Summary of my Webinar on Online Reporting

Is the printed report over and done with? Are social media taking over?
A high-level status update.

It was a great pleasure sharing our thoughts on these and related subjects in our Webinar on October 12. For those who couldn’t make it here are the main messages:

• Market analysis of 508 companies: 41.4% provide Annual Report in HTML
• About 3% use mobile reports, but notes can’t be presented well. iPad may be an answer for the future
• 13% use interactive charting, video is attracting high attention: user prefer people rather than image videos
• HTML Report should be prominent on corporate site, SEO is a must
• A powerful search function is key for effective online reporting
• Online and print do serve different needs: enhancing each other

If you are interested in more detailed information what has been presented at this one hour webinar please see the following options below:

YouTube
 
View a playlist of the Nexxar Webinar on YouTube
 
http://nxr.me/vi_nxr10
 

 

Slideshare
 
Download or look at the Webinar slides on Slideshare
 
http://nxr.me/slides
 

 

delicious
 
See our best practice bookmarks including comments on all tools and features
 
http://www.delicious.com/nexxar/webinar10

Roadshow

We currently touring through major european cities for individual presentations. If we have sparked your interest feel free to make an appointment by mail or phone.

Free Stock-image resources

A few months ago Malte Landwehr posted a linklist presenting where to get free stock-images. His list is a complete and actual resource where you can choose image sources by your needs. Some of them are related to a specific topic, some of them are private.
However, don’t use Direct Linking

Below I would like to give you an overview about the image resources I prefer and use frequently:

1. OpenClipArt Libary
   The OpenClipArt Libary provides 34746 cliparts containing web-icons in vector format svg under Public Domain license. Use them and feel free to leave your own.

Speeding up jQuery ready() on IE

Often you need to manipulate the DOM tree of an HTML page right before the page is presented to the user. Eg.: you may want to replace some HTML texts with a flash movie like sIFR. jQuery.ready() is vital for performing any DOM manipulation tasks as early as possible, to avoid flickering. Most modern browsers – except IE – support the “DOMContentLoaded” event. As soon as the DOM is ready – right before images are loaded – this event is fired, making DOM manipulation happen as early as possible, almost instantly.

Problem with IE

IE does not support a similar event, whereas hacks exist to simulate it. These hacks fire much later than necessary. Additionally the Javascript engines of IE6,IE7,IE8 are soooo slooooow, that page flickering is most commonly experienced when using sIFR on a page. What a pity – the momentarily slowest browser on earth fires the DOM ready event as latest.

Solution

Wait for IE9 replacing all IE6/IE7/IE8 – not really an option

Fortunately here is a way to make jQuery.ready() getting called much earlier on IE, competing with the other browsers. Put the following code right at the end of your HTML page. (You may omit the try{} catch{}, but I prefer to be sure nothing stops IE from executing JavaScript on the page.)


<script type="text/jscript">
<!--
try{jQuery.ready();}catch(e){}
// -->
</script>
</body>


Explanation

IE seems to create the DOM while parsing the HTML file. At the end of the file, the DOM is fully created and already available for manipulation. This small script makes jQuery run the ready() queue at that stage – much earlier than the “simulated” DOM ready event fires up.

With that trick we have been able to avoid any flickering with sIFR on IE.

Please tell me your thoughts about it. You can test the trick on the following pages (use IE to see the difference!).

• Volkswagen Annual Report 2009
• Legal & General Annual Report and Accounts 2009

Compare it with these pages that do not use this trick and see the flickering of the head line:

• Linde AG Annual Report 2009

How sustainable are DAX 30 companies?

Sustainable development seems to be one major key success factor for companies in the (near) future. This is the reason, why sustainability gets more and more attention from all kind of stakeholders, especially customers and investors.

Reasons enough for us to analyze the sustainability reporting within the german DAX 30 index (The findings are presented in the market research section of our website). 27 out of 30 companies do offer a sustainability report – in HTML or as a PDF – or have at least an informative sustainability section on their corporate website. That means that only three companies do not report about their sustainability activities in a proper manner. Fresenius and Fresenius Medical Care do not present any figures or strategies on their websites and Infineon just has a small CSR-section available only in English.

Best practice

We were very pleased to see a lot of sophisticated reports, but Beiersdorf impressed us most. They present a web-only version, not offering a printed report, but a PDF including all HTML pages. This is very eco-efficiency and saves a lot of resources as the report is produced for web-purposes only. All other companies, publishing sustainability reports periodically, are still providing a print version.

In our opinion, sustainability reports would be the perfect opportunity to treat the online media as the leading media. Including (interactive) features, such as GRI tables, world maps, search functions, etc. online reports are adding value and they are even environmentally friendly. This might be no easy step for sure, but it would set an example to do something for your stakeholders and for nature in one go.

In addition I think it is not reasonable, why companies present their financial data completely differently from their sustainability acitivities, but I will probably pick up this question in a separate blog entry.

I am very interested in hearing your thoughts to this topic. Do you think that a print-report is compatible with the sustainability thoughts? Do you know some other best-practice examples?

PS: If you are interested in further CSR reports in UK, Europe or USA, please visit our colleagues from The Group, who published their online reports directory a few weeks ago.

Nexxar now has its own URL shortener: nxr.me

Recently we put up our own URL shortening service using the domain nxr.me. This service is not designed for commercial use as such, but will be part of our own share and bookmarking services that we provide in all our online financial reports.

What is a URL shortener?

URL shortening is a technique in which the used URL may be made substantially shorter in length. A HTTP Redirect at this short URL guides visitors to the target website, with the long URL.  (see: http://en.wikipedia.org/wiki/URL_shortening)

Why is this useful?

With microblogging plattforms like Twitter short URL services became popular, but somehow they are not as reliable and secure as they should be. So we decided to host the shortened URLs for our reports on our own. Having full control over your URLs is very important and just feels better. Besides that, having your own short URLs is pretty cool

What it is not

Unfortunately this is not a public service. It will only be used for reports created by Nexxar. If you visit one of our customers report and share a page via Twitter, a short URL is generated automatically. Currently we are using AddThis, which will be replaced by nxr.me in future reports. We see this as an effective way to increase security as well as brand awareness as part of our long-term marketing strategy.

How did we do it?

We are using the open source system yourls (http://yourls.org/). It provides a set of functions to create your own URL shortener. With yourls as a base to start and some tweaking and tuning we had nxr.me up and running pretty fast.

Online reporting: how is technology shaping the future of corporate communications?

Invitation to an inspiration session on Wednesday September 29th 17.00 to 19.00 at Dart, Amsterdam!

Is the printed report over and done with? Are social media taking over? A high-level status update.

High-quality corporate reporting provides investors and key stakeholders with essential information and insights to enable them to make effective decisions. As a strategic asset, a corporate report can boost confidence, increase knowledge and provide reassurance. And these are exactly the elements that drive the success of every organization, especially now that we are on a path to recovery from a global financial crisis with investor trust at an all-time low.

In the past few years, we have seen an explosion of online annual and CSR reports and the emergence of social media as a channel for shareholder communications. For many companies, the online channel rather than print now leads the reporting process. Audiences’ appetite for the digital medium and the expectation of cost savings paves the way. But how significantly is technology changing the corporate communications landscape? Do the web users statistics really stack up? Do stakeholders really use or trust online communications? Do companies really save money?

If you are looking for answers to these or similar questions, I invite you to join me on Wednesday 29 September 2010 in Amsterdam. I will tackle this together with an overall overview on major developments and trends in online corporate reporting worldwide at a GreenSpot Seminar hosted by Dutch branding & design experts Dart Group. Please click here to register.

ps. Dart and Nexxar teamed up to enable our clients to excel by offering them the best of both worlds. Together we are setting the pace on first-class corporate reporting, both print and online, from the same resource. Please read more on our joined website: www.yourcorporatereporting.com.

Do you like #socialmedia and #ir? If yes, RT that to your friends and followers!

 Social media has been one of the most dynamic trends in recent years, whereas the use of social media in IR is just at the beginning of its development. The main question is: how essential is it to share your IR relevant news via social media?

In the last reporting cycle the inclusion of social media buttons within online reports became common practice. On the one hand you can easily share interesting content of the report with friends using share buttons, on the other hand it can also provide a link to social media profiles of a company. Sharing simply makes use of the fact that nothing is more effective and reliable than recommendations from your friends, while social media profiles offer the user/friend/follower the latest news or simply thoughts of the account owner.

Social media helps to gain more attention to your financial reports! It’s already common use to announce financial results including a link to your reports on Twitter & co. Looking at the number of visits after announcing a report via social media tools it’s obvious that good social media work is definitely worthwhile! The more people visiting your report, the better!

In my opinion the benefits of using social media for IR are convincing and true just as for general corporate communication.
I bet you know it from yourself: most of the users start their day with looking at social media networks like Facebook or Twitter to get the latest news. These information channels are getting more and more popular and have overtaken established sources of information like online newspapers, portals or corporate websites.

Twitter and Facebook are the news portals of the future, as it seems that they present the most current news! It goes without saying that these information channels are valuable for investor relations as well. Shareholders feel well informed and always up-to-date about what happens around the companies’ investor relations when following your company on their preferred social media channel. It provides proper service to these sensitive stakeholders.
In comparison to newsletters you can reach a much wider audience. Not only registered stakeholders, but also prospective ones who decide to look up your social media presence, can retrieve historic and present information.

An important facet of social media is interactivity. Every company has the chance to get in closer dialogue with its shareholders and vice versa! It’s an easy way to get to know what shareholders think. Of course this also means that your shareholders expect a timely answer. If you take social media serious it can be a great multiplier, if not it can harm your reputation. Never before you were so close to your audience and got direct and prompt feedback – not only once a year at the general meeting.
Worried about negative feedback? Well, that’s life and what is more motivating than disprove it?

BASF Investor Relations (@BASF_IR) is doing an excellent job at Twitter by e.g. informing about current corporate events, updates about the BASF share and sharing IR relevant articles or blogs. Even current analyst consensus estimates are referred to.
TVI (www.facebook.com/tvipacific) involves their stakeholders very much on Facebook. Friends get up-to-date information and their posts or updates always get a swift reply which results in lot of positive feedback for that.
These two are good examples how IR can perform very well on social platforms.

If you think about starting to involve your investors on social media, keep two things in mind:
1. Scan and listen carefully what is being said about you constantly.
2. Be responsive and interact with your audience otherwise you will do more harm than good.

What’s on your mind?
What’s happening?
How social are you?