The Hindu : Designer annual reports

Online edition of India's National Newspaper
Sunday, Oct 19, 2003

Business

Business

Designer annual reports — a communication tool

By Alok Mukherjee

NEW DELHI OCT. 18. In the age of show business, corporate India has stumbled upon a new way to showcase itself to the shareholders — designer annual reports. Gone are the days of dull black and white annual compilation of accounts for presentation to the shareholders at the annual general meetings.

Instead, flysheets, vibrant colours, smooth looking satin, dry-trapped varnishes, foil and embossing on the cover and short-fold gate spreads are the order of the day for company annual reports.

Today, companies see the annual reports as an aggressive tool for external communication, considering the sheer volume of printing and the reach they enjoy.

"Unlike brochures and leaflets, annual reports have a loyal readership and a definite target segment and hence they are an attractive instrument of communication, containing more than the financial data,'' Ashish Kaul, Vice President, Corporate Brand Development of the Essel Group, told The Hindu.

"After all, it is a reflection of the image of the company and the moment someone picks up a copy, he forms an opinion about the company, Mr. Kaul adds.

Corporate sources emphasise that companies such as Godrej, Essel Propack, Reliance, Zee Telefilms and Hindustan Lever have a large number of shareholders and, on an average, they print 1.5 - 5 lakh copies of their annual reports every year. This roughly translates into an expense of Rs. 20 - 60 lakhs per annum.

With such big volume business being involved, printing houses such as Almats Enterprises, Magna and Repro India have dedicated creative cells for annual reports, the sources said.

As the annual report is seen as a CEO's report card, companies are also using it to communicate a success story in a growing year or put forward a plausible explanation in a lean year.

Annual reports are also used as critical tool to share the vision of the company and also familiarise the shareholder with the thought process in a company. "Usually, companies choose a theme for their annual report which is then translated into a design and the design carried forward throughout.

This strongly conveys the company's prime focus area and other principal concerns,'' one corporate communications executive pointed out.

With the Internet revolution, companies have also discovered that the World Wide Web could be a good way to see what is happening in corporate circles globally and then to use the same means to communicate with shareholders and prospective investors. Not surprisingly, IT companies were the first to take advantage of this new communication tool. Intel, for instance, offers three versions of its on-line annual report.

The simplest, designed for 14.4 kbps modem connections, is mostly text while the middle version, for 28.8 kbps, comes with richer graphics.

At the international level, consultants Shelley Taylor and Associates publish every two years the `Full Disclosure Study.'

The 2002 study ranks British Telecom as having the second best annual report, beaten only by the pharmaceutical company Glaxosmithkline. Overall, however, the study was critical of many top companies for having "no road map for the future and failing to provide voluntary disclosure of key operational information that serves as the basis of good corporate governance and accountability.'' Based on interviews with many global money managers, the study said the British companies had the best annual reports.

It also said that only 44 per cent of chairmen mentioned corporate strategy in their letters to shareholders and only 36 per cent of the reports provided any clearly stated objectives — down from 76 per cent in 2000.

With competition taking strong roots here, corporate communicators see such critical appraisal of Indian annual reports becoming a normal feature in India too.

Printer friendly page
Send this article to Friends by E-Mail

Business

News Update

Stories in this Section

Designer annual reports — a communication tool

Post-dotcom lethargy to cost corporates dearly

RBI tightens cap on NRE rates

Forex reserves cross $90 b