Setting the new agenda for CFOs: WICI’s latest report into understanding the role of intangibles in value creation

“We welcome this report and the insights it provides about the current state of reporting on intangibles. Intangibles account for an increasing share of value creation and it is therefore critical that they are properly understood, measured, integrated into decision-making and reported upon. It is also important that capital providers understand how businesses are managing their intangible assets for sustainable value creation. In our view, not enough attention is currently given to the role of intangibles in contributing to, or eroding, value.

This guide will be an important step in prompting that discussion.

The Value Reporting Foundation, to be formed from the intended merger between the IIRC and SASB, commends WICI for producing this overview of current practice as well as its recommendations for how reporting on intangibles can be improved to provide decision useful information for both preparers and users. We are clearly at the innovation stage in terms of best practice and we encourage more work to increase both awareness and quality for the future.

The examples included in the report illustrate the many relevant dimensions of intangible value, from how banks can use information on intangibles to support lending decisions to new management control perspectives and investors’ analyses and decision-making.

We plan to work with WICI to continue developing the basis for meaningful reporting of intangibles to assist corporate measurement, valuation and improved transparency through appropriate narrative and quantitative disclosures. This work is essential to achieving high
quality and comprehensive corporate reporting which promotes more efficient and productive capital allocation and sustainable business performance.”

– Charles Tilley, CEO, International Integrated Reporting Council

– Janine Guillot, CEO, Sustainability Accounting Standards Board