Leigh Roberts presentation at the King IV breakfast held at IQ Business.

1. Integrated Reporting and
Integrated Thinking
November 2016
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2. IR in SA
Integrated reports since 2010 -
recommendation of King III
JSE Listing Requirements
In 2014, IRC of SA endorsed the
International <IR> Framework
King Codes
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3. The Framework’s 18 RequirementsConcepts
Value creation
6 capitals
8 Content Elements
 Organisational overview
& external environment
 Governance
 Business model
 Risks & opportunities
 Strategy & resource
allocation
 Performance
 Outlook
 Basis of preparation &
presentation
7 Guiding Principles
 Strategic focus & future
orientation
 Connectivity of information
 Stakeholder relationships
 Materiality
 Conciseness
 Reliability & completeness
 Consistency & comparability
2 Statements
 Reference <IR> Framework
(Comply with all Requirements unless
impracticable or competitive harm  but
disclosures
 Board responsibility for integrity of
report (2)
Form of the report
 Designated, identifiable
communication 3

4. Source: International <IR> Framework, IIRC, 2013

5. Financial
Capital
• Equity and
debt
funding
• Internal
generation
• Subsidies
Manufact
-ured
Capital
• Owned
physical
assets
• Public
infrastruct
ure
Intellect-
ual Capital
• Knowledge
manage-
ment
• Trademarks,
copyrights,
licenses
Social &
Relation-
ship
Capital
• Stakeholders
• Social
license to
operate
• Brand and
reputation
Natural
Capital
• Water,
land, air,
forests,
bio-
diversity,
eco-
systems
Human
Capital
• Employee
skills and
experience

6. Integrated Thinking
Managing an organisation in accordance with its reality.
An organisation is a network of resources and
relationships. Effective leadership considers them all for
the benefit of the longer term success of the
organisation.
No guidance – in a connected world its common sense
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7. Embedded in the organisation at 3 levels
1. The Board
2. Executives and senior management
3. Staff
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8. 1. The Board
• Duty of care
• Approve holistic strategy and risks
• Approve KPIs and targets
• Make decisions after being given the ‘right’ information
• Mitigating actions for the negative effects on capitals
• Consider stakeholder relationships and outcomes
• Push management to embed Integrated Thinking
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9. An example – Standard Bank
“We believe our strategy represents a consistent
and considered level of integrated thinking, which
we continue to deepen as we implement our
strategy within our organisation.”
(IR 2015)
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10. 2. Executives and senior management
• Implementation of the holistic strategy
• Monitoring the holistic risks
• Systems
• Cascade strategic objectives into departmental and
individual KPIs
• Holistic decision-making
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11. An example - CEO of Gold Fields
“The sustainability of our business is ensured by
understanding the linkages between all of the inputs and
outputs of our operations, enabling us to maximise the
benefits for all stakeholders and reduce the risks to the
business. Integrated thinking underpins this approach . . .
. . . the objective (in 2016) will be to explain in greater
detail how integrated thinking is factored into our
business decisions. Our integrated reporting will be an
output of this thinking.” (IR 2015)
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12. 3. Staff
• Personal responsibility
• Remuneration incentives: performance and bonus
assessments
• Mindset shift to six capitals rather than one
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13. The evidenced advantages
CGMA Survey of 300 C-suite execs globally found those who
applied Integrated Thinking in decision-making:
- Out performed their peers
- More effective execution of decisions
- Less delivery of flawed information to decision-makers
SAICA Survey of execs/ non-exec directors (2015):
- Improved decision-making at board and management
- More cohesive approach to reporting
- Improved understanding of the value drivers of the business
- Improved risk management
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14. How does the Integrated Report fit with
Integrated Thinking?
• The report is the visible tip of the iceberg
• Many companies have said their integrated report has
brought significant internal management benefits by helping
to embed integrated thinking
• Some stakeholders see the quality of the integrated report as
a proxy for quality of management in the organisation
• The report is the voice of the governing body
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15. How do you know when Integrated Thinking is
embedded…
“When there is no longer separation between non-financial and
financial performance on the company-wide acceptance that
each affects the other.
When all functions and divisions share in the company’s
strategy and work together to achieve it.
When decision-making is carried out with a longer-term view
on value creation and how the decisions impact on the
company’s resources and its relationships.”
Integrate: Doing Business in the 21st Century; Mervyn King and Leigh Roberts (Juta)
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