A practical guide to your first annual report (Part 2)
This second article in a two-part series looks at the critical aspects of pre-IPO preparations and post-IPO considerations.your annual report into a valuable communications tool.
Navigating the complexities of your first annual report as a newly listed company can be daunting. The first part of this comprehensive guide covered why it’s essential to get your inaugural annual report right. The second in this two-part series looks at the critical aspects of pre-IPO preparations and post-IPO considerations.your annual report into a valuable communications tool.
Pre-IPO preparations
Start by conducting a gap analysis between your annual report requirements and existing information. This helps implement the right policies and processes to capture necessary data and tell a compelling investment story. Consider these often-overlooked aspects:
– Understand corporate governance obligations for listed companies.
– Determine who will oversee the annual reporting project: the Cosec, Finance/IR, or Corporate Affairs.
– Define your corporate purpose and investor proposition.
– Identify your key audiences and craft targeted messages.
– Plan content for your investor website.
– Develop a sustainability approach with clear commitments and KPIs.
– Consider the platforms and suppliers you will use, project process tools (CtrlPrint, Workiva), and photographers, videographers, and animators
Post-IPO considerations
Your IPO is complete, and you’re now a listed company. You need to start thinking about how you will continue your investor story through your inaugural annual report. This complex document combines mandatory requirements from company law and the FCA’s Listing Rules, non-mandatory guidance from the FRC, and your unique story.
Critical components of an Annual Report:
1. Corporate Purpose: Explain why your business exists and the need it meets.
2. Market Analysis: Discuss critical trends and factors influencing your operating environment.
3. Strategy and KPIs: Outline strategic priorities, including sustainability, and how they deliver your purpose. Define KPIs to measure progress.
4. Business Model: Explain what you do and how you operate, considering sustainability and stakeholders.
5. Sustainability: Discuss any reporting frameworks you follow, such as GRI or SASB, your approach to climate change (TCFD), potential reporting to the CSRD, material issues and priorities, commitments and targets, progress measurement, and integration with your strategy and business model. Also, elucidate how you plan to handle assurance requirements for ESG reporting.
6. Stakeholder Engagement: Identify key stakeholders and engagement methods. Explain how the board considers stakeholder issues.
7. Risk Management: Outline your framework, principal risks, and mitigation strategies.
8. Governance: Include section 172 and non-financial information statements. Report on board diversity, composition, and succession planning.
9. Remuneration: Link executive remuneration to strategic progress and explain success measures.
10. Website: You should consider populating your corporate website with critical content from the annual report, such as strategy, business model, sustainability and governance
11. UK Corporate Governance Code Compliance: Ensure alignment with various areas such as purpose, culture, diversity, stakeholder feedback, succession planning, evaluations, controls and remuneration policies.
Additional considerations
When creating your annual report, it’s important to go beyond the mandatory content and consider your communication objectives.
Think about your corporate brand and how it can be used to tell a compelling story. Consider the look and feel you want for your report and identify the key messages you want to convey. Address any misconceptions that might have arisen and consider if you need to change any of your narratives.
Balancing mandatory requirements with your unique story can be challenging. Focus on conveying key information that investors and stakeholders need to know about your business. Remember, your annual report is a powerful tool for communicating your company’s vision, strategy, and performance. It’s an opportunity to showcase your achievements, address challenges, and demonstrate your commitment to sustainable growth and good governance.
By carefully considering these elements and crafting a comprehensive, engaging report, you can effectively communicate your company’s value proposition and build trust with your stakeholders. Giving you the best foundation for future reports.
If you’d like to discuss this, or any other subject, please get in touch with Tessa Murray, Managing Director, at tessa@gather.london
We’d love to know what you think.