About five years ago, American Electric Power (AEP) made a surprising discovery: Its investors were seeking insight on non- financial business matters beyond what was included in the annual financial report. In response, the company integrated its financial and sustainability reporting, producing a single annual report that presents a view of how the company creates financial and non- financial value now and how that will evolve in the future. The company has now produced four such reports.
And during that time, AEP has made another discovery: integrated reporting combined with proactive stakeholder engagement has changed how the company operates. For example, as the company considered carbon capture and storage projects, stakeholders asked questions such as how the approach might raise prices for customers if it were commercialized. Explains Sandy Nessing, AEP’s managing director of sustainability, “When you’re reporting it and you’re thinking about all of the different aspects of something it starts to pull it all together.”
Is your company prepared for a similar change—both to meet investor and other stakeholder needs and reap the benefits of being a more cohesive organization?