HR Magazine has reported that following the inaugural IR framework, released in December, experts in the field of Integrated Reporting (IR) have expressed the need for HR to become more involved in the whole reporting framework.
The current thinking from expert Paul Druckman, International Integrated Reporting Council CEO is that HR should be playing a pivotal role in the development of Integrated Reporting and demonstrating the significant added valued the function can bring to strategic thinking. Paul Druckman has said “without HR involved in the strategy and value chain of a business, IR will show a weakness in the organisation.”
By HR working closely with other functions such as Finance rather than both in isolation, the organisation can work together in order to improve their knowledge of how human capital is valued and how to increase that value.
CIPD Chief Executive, Peter Cheese, supports this view by commenting that “HR needs to be more articulate in its measuring human capital value and collaborating with other functions such as the Finance Department”. “People increasingly recognise these are important things to have more consistency on, but the fact we haven’t got them also indicates the difficulty in defining”.
Criticism of HR is often that the function is not strategic enough in its operation and in many organisations provides a ‘behind the scenes’ service that has no representation at Board level. Consequently IR does not appear on the HR agenda and collaborative working with other functions is lacking. Druckman told HR magazine that “a consistent approach and methodology in the way firms value human capital is an important goal, provided there is flexibility. He said that industry-specific metrics and best practices could be referenced in future versions of the framework”.
In order to move forward and take advantage of this opportunity, HR will need to ensure that the function has the seniority and expertise necessary to provide HR reports and metrics that place it at the heart of the Integrated Reporting debate.
