Inspiring trust through insight: Integrated Reporting in Malaysia

Highlights from the event

Date
8 September 2015

Opening remarks
Dato’ Mohammad Faiz Azmi, Executive Chairman, PwC Malaysia

Moderator
Pauline Ho, Assurance Leader, PwC Malaysia

Panellists

  • Raymond Tan (Chief Investment Officer, Astro Malaysia Holdings Berhad)
  • Khoo Hsu Chuang (Chuang) (Producer, BFM)
  • Chris Hill (CEO, Black Sun Corporate Communications, South East Asia)

 

PwC Malaysia recently embarked on a benchmarking exercise, analysing the annual reports of Bursa Malaysia’s Top 50 companies against the International Integrated Reporting Council’s Integrated Reporting Framework.

This was a follow-up study to our pilot benchmarking exercise last year on Bursa Malaysia’s Top 30 companies’ annual reports.

The report titled ‘Inspiring trust through insight – Integrated Reporting in Malaysia’ was launched to a diverse crowd comprising business leaders of the companies surveyed, board members, and finance as well as investor relations professionals.

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‘Inspiring trust through insight’ was also the event theme, reflecting the need for better insight as a means to build stakeholder value and greater trust amidst an increasingly disruptive marketplace.

The theme was discussed in relation to the following reporting practices in the local landscape, as revealed in our benchmarking exercise:

  • Siloed reporting is evident
  • Historical reporting remains the focus
  • ‘Copy and paste’ content is the norm

Dato’ Mohammad Faiz Azmi, Executive Chairman, PwC Malaysia, in his welcome address, highlighted that most businesses in Malaysia still treat reporting as a compliance exercise. 

He emphasised that the annual report can be a compelling stakeholder engagement tool and a competitive differentiator in the eyes of an increasingly discerning investor community.

He provided two examples of how changing market demands will influence the way Integrated Reporting evolves locally:

  • To improve shareholder value, the integrated report can be used to provide information that will assist a Shariah assessment of the company, a priority high on the agenda of stakeholders
  • Disclosure of the company’s Environmental, Social and Governance (ESG) activities can also help promote shareholder value creation

Dato' Mohammad Faiz Azmi delivering his welcome address

The panel discussion addressed some key developments in the local reporting landscape including how companies have progressed in their Integrated Reporting journey and the practical issues surrounding its implementation.

The moderator, Pauline Ho, Assurance Leader, PwC Malaysia, raised some interesting questions to the panellists. This included the factors that drove Astro to improve in their reporting, whether companies ran the risk of giving away their competitive advantage by communicating about their risks, and whether reporting had adequately responded to the need for increased transparency/trust building among investors.

With a corporate reporter (Raymond Tan from Astro), a radio anchor/financial journalist (Chuang from BFM) and a corporate communications advisor (Chris Hill from Black Sun) on the panel, the dialogue brought out many thought-provoking insights and observations that both supported and challenged the audience’s views of corporate reporting.

Raymond emphasised that Integrated Reporting forces companies to move away from siloed thinking to integrated thinking, which may not be easy but certainly necessary in these challenging times.

Chuang highlighted the need for clear communications in reporting. He made an interesting observation on statements such as ‘cautious optimism’, and ‘barring unforeseen circumstances’. These statements, often used in reporting documents, may appear meaningless, closely mirroring boilerplate statements, which would not help to demonstrate authenticity to stakeholders.

Pauline Ho, PwC Malaysia Assurance Leader moderating the panel discussion

 

Chris urged businesses to put their corporate story at the forefront of their reporting, pointing out that there was a clear need to connect the dots between the company’s business model, its strategy and risks among other content elements in order to craft a cohesive storyline on the business.

From left: Raymond, Pauline, Chuang and Chris at the launch

In her summary of the key takeaways, Pauline reinforced the concept of Integrated Reporting as a continuous improvement process in corporate reporting, beyond just quick wins.

Essentially, corporate reporting is only one part of the business value creation process. More importantly, companies should build integrated thinking into their culture; one of the ways to achieve this is by crafting a meaningful corporate story which can be used consistently across multiple communication platforms.

This, she shared, will be key in improving shareholder value and enhancing public trust.

Interesting quotes from the panellists: 

“One of the biggest benefits of Integrated Reporting is how much more engaged the employees are. It provides a holistic picture of the company.”

Chris Hill, CEO, Black Sun Corporate Communications, South East Asia

“Integrated Reporting helps us to crystallise our thinking and link up our report. A lot of blood, sweat and tears to get it done.”

Raymond Tan, Chief Investment Officer, Astro Malaysia Holdings Berhad

“My wish list is that more PLCs will adopt Integrated Reporting, not just the top few. It’s interesting that a small market like Malaysia is leading the charge.”

Khoo Hsu Chuang, Producer, BFM

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