What’s Next: Envisioning the Post-Reporting World

What future do you want?

Suppose for a moment the dust had settled on how, what, and to whom we should all be reporting our non-financial data.

  • How: Cheap, effective technology systems permit continuous data monitoring and sharing.
  • What: Reports consist of pre-defined, industry-specific data points or "Key Performance Indicators" (KPIs) established by governments and industry regulators. Progressive companies make additional bespoke KPIs available at their discretion.
  • Who: Everyone, but primarily stakeholders such as investors, regulators and individual consumers log onto an online clearinghouse to review standardized reports with names like "GRI," "CDP," or "SASB" as well run custom screens inclusive of only the data points about which they care—similar to how we currently screen investment opportunities on personal financial websites like TD Ameritrade or Bloomberg terminals.

Oh what a wonderful world it would be, right? No more static annual or quarterly performance snapshots—just real or near-real time updates on trends and impacts. No more arguments over which KPIs are in and which are out.

What's this all about?

No more twelve month stakeholder consultation periods that lead to shifting goal posts and ever greater complexity. Instead, more resources are spent on doing something about performance instead of merely trying to track and report on it.

Future building

The problem is I'm not sure we (the cadre of talking heads, standards bodies, regulators and reporters) know what our ideal future looks like. And without even a remote sense of how, what and to whom we want to disclose, it's awfully hard to set a path towards our desired outcome.

This cannot continue. The economic, environmental and social cost is far too high. It's time to get a sense of what we want. So let's start with some assumptions:

  1. Transparency is good for both the consumer and provider of data. Consumers make better investment, regulatory, or purchasing decisions while data providers develop integrated, long-term thinking that reduces risk and enhances profit.
  2. Authentic, comparable KPIs exist and they should form the basis of reporting. The rush to define and track ever more numerous and obscure KPIs has done a disservice to those KPIs which have demonstrated solid ROI. Adding KPIs makes the argument for reporting harder to defend, not easier, and it confuses both the data consumer and provider.
  3. Data infrastructure needs investment, not standards or ever glossier marketing-driven reports. It's time to spend money on moving utility data to the cloud and on adding Automated Programming Interfaces (APIs) to proprietary software systems that warehouse financial and non-financial information. The data in these systems is the customer's, not the software provider or utility company's. Service providers should be paid for adding value to raw data, not seek rents for (re)distributing it.

Consensus, please

Before we even worry about agreement on our collective reporting future—the one I describe above, or something wholly different—we must first find agreement on some supporting assumptions. Unfortunately, we're not there yet. While transparency is generally considered good, we're not at a point where there is wholesale buy-in that this information should be shared. We're certainly not at a point of consensus on which KPIs should be included in our reports nor the data systems and infrastructure development needed to lower the financial and intellectual burden of reporting, slowed by the ongoing debates about what and to whom this information should be shared.

Don't be discouraged! We're certainly on the right path towards consensus on these issues. After all, non-financial reporting is becoming the norm, not the exception. Its adoption adds critical mass to "what" and "how" information is shared. As the non-financial marketplace matures, public initiatives and private investments are securing greater funding. This will ensure the marketplace is adequately plumbed for when the taps truly gets turned on. For now, though, I encourage you all to keep aiming for a world in which the conversation is about action, not disclosure itself, because when we've started talking about what we're actually doing, we're in the post-reporting world.

Measurabl empowers any company, regardless of size or type, to achieve sustainability using software to measure, manage, and act upon data. Our online software that lets you quickly and accurately file sustainability reports such as GRESB, CDP and GRI. Learn more, or get started with a free trial.