"Complacent" US firms slip down must-read list of annual reports

Canadian firm TELUS, Swedish companies SAS and SCA, and Finnish business Stora Enso have been named as the authors of 2005's best four annual reports.

The yearly global rankings have been compiled for the past decade by Report Watch, which gave the four firms A+ ratings based on criteria covering

While Report Watch notes that the overall quality of reporting has improved over the past few years, its research highlights concerns about the increasing standardisation and blandness of US annual statements, which it blames partly on the effects of the Enron scandal and subsequent regulations including the SarbanesOxley Act. As a consequence, the number of US companies in the top 300 has decreased, while the number of non-US firms moving up into the top 50 has increased by 50 per cent in two years.

"We are now down to three Cs: (excessive) complacency, compliance and conformism have become the main characteristics of US reports," said Mike Guillaume, editor of Report Watch's research report. "Thousands of them are as interchangeable as country songs. Differentiating through reports seems to be a secondary concern."

The research also notes other trends. Most statements are still printed, but many firms also produce online versions that allow different stakeholders to access tailor-made appendices. Non-financials and CSR are becoming increasingly important elements, too.

"Non-financials are the overheads of the 21st century. The major challenge facing corporate managers is how to grasp their importance, define their parameters and report on them," said Kaevan Gazdar, who is responsible for reporting at German bank HVB.

The other organisations in the reporting top ten are: Wienerberger (Austria); Trelleborg (Sweden); Philips (the Netherlands); Volvo (Sweden); WPP (UK); and CLP (Hong Kong).

Report Watch's full research report can be obtained from e.com@reportwatch.net. CIMA has joined a multi-stakeholder group called "Report leadership - tomorrow's reporting today", which aims to challenge established thinking and make corporate reporting more accessible and effective. It will issue a report on November 21.