1. The Role of Integrated
Reporting in Value Creation
.
Chair: Karin Ireton, Director, Group Sustainability Management,
Standard Bank Group, South Africa
Nelmara Arbex, Deputy Chief Executive, Global Reporting Initiative
Michael Bray, Chair, Better Business Reporting Group, KPMG
Nathan Fabian, Chief Executive, Investor Group on Climate Change
Dr. Jeanne Ng, Group Environmental Affairs, CLP Holdings Limited
John Stanhope, Chairman, Financial Reporting Council’s Integrated Reporting
Taskforce; Former Chief Financial Officer, Telstra

2. The role of Integrated
Reporting in value creation
Is Integrated Reporting
going to change the world?
March 2012
Michael Bray

3. The Australian Business Reporting Leaders Forum is moving from ‘facilitating’ to
‘influencing’
“We are very supportive of the great work done by the
BRLF in Australia to generate interest and discussion
around <IR>. They have done a superb job in
harnessing input and presenting that back to the IIRC.”
Banarra Submission on IIRC Discussion Paper
■ Project of Society for Knowledge Economics (SKE) - president is Steve Vamos
■ Participants include CFOs, directors, sustainability officers, investor relations officers, „big
4‟ accounting firms, academia and regulators
■ Regular face to face meetings commenced in April 2011
2010 2011 2012 2013 2014 and beyond
Drive/influence
Developed business case implementation of IR
IIRC Move towards Integrated Report
established Reviewed early draft of IIRC in Australia implementation becomes flagship
discussion paper
GRI Conference
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative 2
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation.

4. Key themes – Australian
Submissions on <IR>
Framework
Key Themes Role of WICI
■ Submissions from a broad range of ■ Facilitate the development of a global
stakeholders business reporting framework for
■ Strong support for the IIRC and developing a measuring and reporting overall
globally <IR> consistent framework corporate performance to shareholders
■ Calls for a fully worked conceptual framework and other stakeholders
– „what does it look like‟?
■ Working towards development of
■ Strong support for business model focus – common idea on key performance
operational guidance needed indicators (KPIs)
3-Way
■ Demonstrate that it is not just adding more
KPI
reports – front end of annual reports? Concept
■ How does it sit with financial reporting?
■ Does <IR> really lead to integrated thinking or
can <IR> give the impression that integrated XBRL
thinking exists when it does not? Taxonomy
■ Need to deal more authoritatively with the
„commercially sensitive information‟ and
„director liability objections‟ Industry KPI Libraries - Automotive,
Pharmaceuticals, Mining, Electronic Devices,
■ Strong support for investor focus Telecommunications, Fashion & Luxury
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative 3
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation.

5. IIRC Pilot Organisations – business is taking notice
Europe Europe Asia Pacific Americas
 ACCA - Accounting  ENI – Oil & Gas  China Light & Power - Energy  Cliffs Natural Resources –
Mining
 AEGON – Insurance / Funds  Flughafen Munchen –  Diesel & Motor Engineering
Industrial Markets  Coca Cola – Consumer
 AkzoNobel - Chemicals  MECU – Banking
Markets
 Leaseplan – Finance
 ARM Holdings - Hi-Tech  National Australia Bank –
 Microsoft – Hi-Tech
 HSBC - Banking Banking
 Atlantia – Industrial Markets
 Natura Cosmeticos –
 KPMG - Accounting  Showa Denkai – Consumer
 BBVA - Banking Consumer Markets
Markets
 Marks & Spencer – Retail
 Bwise – Industrial Markets  pwc – Accounting
 Stockland - Property
 N.V. Luchthaven Schiphol
 Chartered Institute of Building  Prudential Financial – Funds
 Takeda - Pharmaceuticals
 Novo Nordisk
 CNDCEC - Accounting  Vancity – Banking
 Randstad – Industrial Markets
 Danone - Consumer Markets
 State Nuclear Energy Co
 Deloitte NL – Accounting
(Rosatom) – Energy Largest 400 companies in
 Diesel & Motor Engineering – Africa
 Vestas Wind Systems – South Africa are now building
Industrial Markets  Eskom - Energy
Energy Integrated Reports for year
 Edelman – Media  Gold Fields – Mining
 Via Gutenberg – Industrial ending 31 March 2012
 EnBW Energie Baden- Markets
Wurttemberg – Energy
■ 60 globally significant
 Volvo – Motor Vehicle
 Enegas - Energy ■ 20% in financial services
 ENEL – Energy ■ 20% in energy and
natural resources
■ 20% in Asia Pacific
■ 3 in Australia
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative 4
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation.

6. South Africa – leading the way?
Mandate Framework
■ Clearing up some confusion about the nature ■ Global and South African frameworks are
of the JSE „mandate‟ aligned and will be brought into line
■ May no longer produce an <IR> Exposure
Draft in South Africa – fall in line behind IIRC
Integrated reports in practice
■ Many reports labelled „Integrated Reports‟ pre-date IIRC ■ There is no requirement for an annual report – most
framework and in some instances pre-date South African incorporating <IR> at front end of annual report
IR framework
■ Organisational buy-in, top leadership, balanced steering
■ Mining, energy and banking industries are making the group are critical success factors
most progress
■ Business model/value creation-centric and materiality
■ „Underlying profit‟ debate changed in South Africa – driven – „golden thread‟
replaced by a more rewarding discussion about what is
relevant enough to the business model to be included in
the <IR> – financial and non-financial
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative 5
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation.

7. Integrated Reporting will assist with the Australian energy financing challenge
Will Australia’s energy financing challenge be a gap or an opportunity?
KPMG recommendations
include
■ An Integrated Report be
prepared by the
government on a timely
basis in relation to each
four yearly review.
■ Encourage legislation or
regulation to accelerate the
adoption of Integrated
Reporting by energy
businesses to provide
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
financiers with a better 6
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation. basis for capital allocation.

8. Will Integrated Reporting change the world?
The KPMG Better Business Reporting Journey
Results
■ The integrated report <IR>
becomes the flagship
■ Meaningful reports that
clearly articulate business
model/value creation
■ Capital markets able to
make informed decisions
■ Improved basis for capital
allocation
■ Big implications for the
accounting profession
© 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative 7
(“KPMG International”), a Swiss entity. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of
KPMG International. Liability limited by a scheme approved under Professional Standards Legislation.

9. © 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
The KPMG name, logo and "cutting through complexity" are registered trademarks or trademarks of KPMG International).
Liability limited by a scheme approved under Professional Standards Legislation.