Human capital reporting in the US remains early stage at best, according to an analysis of studies released recently by the Human Capital Investment and Reporting Council, a network of human capital practitioners and investors interested in the “S” or Social of Environmental, Social, Governance management.
for the report.
Here are key highlights:
• Over 70% of companies have either disclosed human capital information last year or intend to report in 2021. (Source: IR Magazine)
• Over 94% of surveyed companies included the metric of the number of employees. (Source: Willis Towers Watson)
• 38 out of 50 top companies by revenue in the Fortune 100 (or 76%) included disclosure on employee health and safety in first-quarter 10-Q filings. (Source: White & Case)
• 41 out of 80 surveyed SMB (small-to medium-size) companies provided some form of voluntary sustainability disclosure on their web sites. (Source: White & Case)
• Of the above 41, over 13 companies did not disclose any ESG related information the previous year. (Source: White & Case)
• Human capital disclosures are mostly made in Sustainability reports, followed by annual reports and on company web sites. (Source: IR Magazine)
• Between 2016 and 2019, the number of companies that either produce a report on ESG or speak to ESG during investor interactions has increased from 78% to 92%. (Source: Corporate Secretary)
• More than 75% of investor relation teams have received questions about human capital management from investors in the past two years. (Source: IR Magazine)
• Over six in 10 investors view human capital within the company when looking to invest. (Source: IR Magazine)
• Nearly 80% of directors say their board spends more time discussing talent strategy than it did just five years ago. (Source: Ernst & Young)
• Nearly double the number of institutional investors reported placing greater emphasis on the Social component when making investment decisions - 45% in 2020 vs. 28% in 2018. (Source: Financial Executives)
• The most important human capital issues for investors are pay and compensation, followed by staff retention and hiring, diversity and senior management. (Source: IR Magazine)
• Word length of human capital reports in SEC disclosures varied dramatically, ranging from nine words to 1,582 words.
• The median disclosure was 369 words long. (Source: FW Cook)
For More Information
Founder, Human Capital Investment and Reporting Council
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