WICI and IIRC Formalise Agreement to Work Towards <IR>
(Italy, London, Tokyo June 12, 2013) - The International Integrated Reporting Council (IIRC) and the World Intellectual Capital Initiative (WICI) have signed a Memorandum of Understanding (MoU) to promote cooperation, ensuring that "intellectual capital" is reflected as a crucial and essential source of an organization's value creation within Integrated Reporting <IR>.
<IR> is the language of resilient business. It is a process that results in communication by an organization, most visibly a periodic integrated report, about value creation over time. Intellectual capital is organizational, knowledge-based intangibles, including intellectual property, tacit knowledge, systems, procedures, and intangibles associated with the brand and reputation. In today's knowledge-based economy, intellectual capital is becoming a major part of that value creation. WICI is globally recognised for the work it does in the area of intellectual capital, improving the reporting of intellectual assets and capital and key performance indicators that are of interest to providers of financial capital and other stakeholders.
Commenting on the MoU, Paul Druckman, IIRC’s CEO says, “Communicating how an organization develops and exploits intellectual capital and deploys innovation is key to understanding value creation. We look forward to deepening our collaboration with WICI in this important area.
“Standard & Poor’s, a US ratings firm, published research which demonstrates that in the 1970′s 80% of a company’s market value could be traced through to its financial statements. Today, only around 20% of a company’s market value can be accounted for by its financial and physical assets. Corporate reporting needs to evolve in order to reflect this change – <IR> provides the framework to do so, and our collaboration with WICI gives the whole initiative further energy.”
Takayuki Sumita, Chairman of WICI Global, said “The essence of a business is to create value over the long, as well as the short and medium term, by utilizing its strengths supported by the range of capitals available to it. Therefore, the most important part of corporate reporting is for a business to tell its individual value creation story, providing evidence of how the organisation has created value in the past and its plans for creating value in the future.
“The collaboration between WICI and IIRC will help further the evolution of corporate reporting. Creating a new corporate reporting language will enable organizations to communicate their own value creation story more effectively with investors which will facilitate better decision making and, in turn, contribute to a more sustainable global economy.”
Source: IIRC website