The National Association of Pension Funds (NAPF) today (Thursday) published a new discussion paper, Where’s the workforce in corporate reporting?, highlighting the lack of reporting by companies on how they manage their workforces.
Despite the familiar corporate mantra of “our people are our greatest asset”, and the widely accepted view that human capital is one of the four pillars of capital which underpin corporate and economic growth (the others being physical, social and intellectual capital), most companies still fail to report on it in any meaningful way.
The report underlines the role of pension funds in the UK economy as long-term investors with a clear interest in promoting the long-term success of the companies in which they invest; but points out that NAPF members still often struggle to find any clear or consistent reporting with respect to an investee company’s workforce. While there has been significant evolution in recent years of corporate reporting on governance and environmental matters, the workforce remains notable by absence in company reports.
Joanne Segars, Chief Executive, NAPF, said:
“We often hear much talk of the ‘productivity puzzle’ and how this can be solved to bolster the economic recovery, yet one of the key factors in driving growth – both corporate and economic - does not appear to be deemed sufficiently material for companies to measure or report. That factor is the people who constitute a company’s workforce, sometimes called its human capital.
“Companies often tell us they would report on this if investors asked them to – and too few investors make that request. But on the other hand, investors say they would place greater emphasis on this issue if more meaningful information were available. The NAPF wants to kick start a discussion to resolve this conundrum. In the spirit of what gets measured gets managed and what gets reported gets done, we have identified four areas where there should be better disclosure and we will be encouraging investors, analysts, companies and policy makers to explore this agenda further.
A full copy of the NAPF paper, Where is the workforce in corporate reporting?, can be found on the NAPF website. The four areas the NAPF suggests as areas to be developed in corporate reporting, are:
- The composition of the workforce;
- The stability of the workforce;
- The skills and capability of the workforce; and,
- The motivation and engagement of the workforce.
The NAPF will host a series of roundtables in the second half of this year to bring together investors, analysts, companies, standard setters and policy makers to develop expectations further. The conclusions of these discussions will also be incorporated into the NAPF’s Corporate Governance Policy & Voting Guidelines. The NAPF will also provide an assessment of the progress made in this area in its 2016 Annual AGM Report.
Notes to editors:
The NAPF is the voice of workplace pensions in the UK. We speak for over 1,300 pension schemes that provide pensions for over 17 million people and have more than £900 billion of assets. We also have 400 members from businesses supporting the pensions sector.
We aim to help everyone get more out of their retirement savings. To do this we spread best practice among our members, challenge regulation where it adds more cost than benefit and promote policies that add value for savers.
Lucy Grubb, Head of Media and PR, NAPF, 020 7601 1726 or 07713 073023, [email protected]
Eleanor Bennett, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]