Short answer

Incorporate the principles of Integrated Reporting (<IR>) into the design of corporate sustainability communications to better demonstrate long-term value creation by linking financial and non-financial performance.

Field: Innovation & Design
Source: Aviation (2023)
Method: Content analysis of corporate reports.
Evidence: Moderate effect

The Integrated Reporting (<IR>) framework offers a more robust method for communicating sustainability performance by connecting financial data with non-financial capital disclosures, thereby demonstrating long-term value creation. This innovation & design research insight is drawn from a 2023 study published in Aviation. Using Content analysis of corporate reports., researchers explored how this design variable affects real-world outcomes. The key design takeaway: Incorporate the principles of Integrated Reporting (<IR>) into the design of corporate sustainability communications to better demonstrate long-term value creation by linking financial and non-financial performance.

Study

Innovation & DesignRecentModerate effect

Integrated Reporting Framework Enhances Sustainability Communication by Linking Financial and Non-Financial Value Creation

Aviation · 2023

Key Findings

01Northeastern European airports are not widely adopting the Integrated Reporting (<IR>) framework in their current annual sustainability communications.
02However, there is evidence of some <IR> features being included in their reports, suggesting a potential transition towards this framework.

Application

Design takeaway

How to apply

When designing reporting tools or communication strategies for organizations, consider how to integrate financial metrics with disclosures on natural, human, social, and relationship capitals to align with the <IR> framework.

Project actions

01When researching a company's sustainability efforts, look for reports that combine financial data with information about their impact on people and the environment.
02Consider how the design of a report can make it easier for stakeholders to understand the links between different types of value a company creates.

Method & Evidence

AimTo investigate the adoption and application of the Integrated Reporting (<IR>) framework in the sustainability communications of Northeastern European airports.

MethodContent analysis of corporate reports.

ProcedureThe research analyzed annual sustainability reports from Northeastern European airports to identify the extent to which they incorporate elements of the Integrated Reporting (<IR>) framework, specifically looking for the integration of financial and non-financial information across six capital types.

ContextCorporate sustainability reporting, airport management, financial and non-financial disclosure.

Variables

IVAdoption of the Integrated Reporting (<IR>) framework.

DVSustainability communication practices of airports.

CVIndustry (airports), geographical region (Northeastern Europe), reporting period (annual reports).

Strengths & Limitations

Strengths

+Focuses on a specific, under-researched area (airports in Northeastern Europe).
+Applies a recognized framework (<IR>) for analysis.

Limitations

It can be challenging to find publicly available reports that fully adhere to the <IR> framework, and interpreting the level of integration requires careful analysis.

Reliability & validity

Reliability could be enhanced through clear coding schemes for content analysis. Validity might be challenged by subjective interpretation of 'integrated features' and the specific focus on airports.

Think critically

To what extent does the adoption of the Integrated Reporting framework truly reflect a company's commitment to sustainability, versus being a sophisticated communication strategy?

Design Principles

"Integrate financial and non-financial information to provide a holistic view of organizational performance and value creation."

For designers and researchers, understanding how organizations communicate their sustainability efforts is crucial. The <IR> framework provides a structured approach that can lead to more credible and transparent reporting, influencing stakeholder trust and investment decisions. This can inform the design of reporting systems and communication strategies.

What This Means for Your Design

Companies are starting to connect their financial success with their environmental and social efforts, using a special reporting style called Integrated Reporting to show how they create value over time.

How to use in your project

1.Use the findings to justify the design of a reporting system that integrates financial and non-financial data for a client.
2.Reference the <IR> framework as a best practice for communicating the value created by a design solution beyond its immediate functional benefits.

Add to My Project

Quick Cite

Paragraph starter

The research highlights the growing importance of Integrated Reporting (<IR>) as a model for sustainability management, emphasizing its ability to connect financial performance with non-financial capitals to demonstrate long-term value creation. This framework offers a more comprehensive approach than traditional sustainability reports by encouraging the integrated analysis of financial and non-financial information, thereby providing a clearer picture of an organization's sustainability achievements and future projections.

Source

Aviation

INTEGRATED REPORTING AS A MODEL FOR SUSTAINABILITY MANAGEMENT REPORTING: THE CASE OF NORTHEASTERN EUROPEAN AIRPORTS

journal · 2023

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Questions About This Research

What does the research say about integrated reporting framework enhances sustainability communication by linking financial and non-financial value creation?: Incorporate the principles of Integrated Reporting (<IR>) into the design of corporate sustainability communications to better demonstrate long-term value creation by linking financial and non-financial performance. Evidence: Aviation (2023).
Why does "Integrated Reporting Framework Enhances Sustainability Communication by Linking Financial and Non-Financial Value Creation" matter for design?: For designers and researchers, understanding how organizations communicate their sustainability efforts is crucial. The <IR> framework provides a structured approach that can lead to more credible and transparent reporting, influencing stakeholder trust and investment decisions. This can inform the design of reporting systems and communication strategies.
How can designers apply this research?: Incorporate the principles of Integrated Reporting (<IR>) into the design of corporate sustainability communications to better demonstrate long-term value creation by linking financial and non-financial performance.
What were the main findings?: Northeastern European airports are not widely adopting the Integrated Reporting (<IR>) framework in their current annual sustainability communications.. However, there is evidence of some <IR> features being included in their reports, suggesting a potential transition towards this framework.
What research method was used?: Content analysis of corporate reports..
How strong is the evidence?: Evidence strength is rated Moderate effect, based on a 2023 journal from Aviation.
What should I do differently in my next project?: When designing reporting tools or communication strategies for organizations, consider how to integrate financial metrics with disclosures on natural, human, social, and relationship capitals to align with the <IR> framework.
What are the limitations?: The study focused on a specific region (Northeastern Europe) and industry (airports), limiting the generalizability of findings to other sectors or geographical areas.