Keep your annual report simple, clear, concise and consistent

Annual reports influence the perception investors have of a company. They are seen by them as the most credible and comprehensive overview of a company in which they wish to invest. They should attract the reader’s attention; educate and inform shareholders (potential as well as current); report on performance; outline the strategy and future direction of the company and fulfil legal and regulatory responsibilities.

Design agencies have an important role to play in adding value and appeal to the reporting process and integrate verbal and visual messages. Design, however, is not just about creating pretty pictures. Good design is an important strategic process in which creative solutions are found to meet the expectations of the company and satisfy the needs of the business. Good design results when the relationship between the client and designer is open and collaborative, and where the designer develops a clear sense of the client’s unique objectives, competitive advantage and day-to-day requirements.

SO WHAT MAKES A GOOD ANNUAL REPORT?

Simplicity: An annual report should be written for someone without specialist industry or financial knowledge and should be aimed at the broader range of shareholders including retail shareholders and prospective investors who may not have any industry or technical knowledge.

Clarity: An annual report should be laid out coherently and be clearly indexed (perhaps with the use of colour), so that it is easy to find key information. Structure and content should be guided by the key messages that reflect the concerns of analysts and shareholders. Jill Howry of Howry Design, a US design company, once said: “If a company cannot articulate why it believes in itself, how is anyone else going to believe in it?”

Concise & Consistent: The content should be precise and to the point while retaining substance. It should contain a clear description of what the company does and articulate progression from the previous years reporting - its ‘hits’ and ‘misses’. This is essential to give shareholders a quick and accessible summary of the business.

With the shift to online reporting in the US, UK, Australia and New Zealand as a result of changing legislation, 80-90% of shareholders now form a new majority who seek an engaging online experience. Are you going to give them one or are you still stuck in the print era?

Finally, the annual report should stand alone in its own right without the need to reference other publications or prior year reports. The annual report is also an important marketing tool that should enhance the brand and help build and manage the brand’s reputation.

Happy reporting!

Matthew White is a Senior Designer at Heywood Innovation.

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