When it comes to the timing of reporting, I have few observations to share.

In Fanda, there is a popular joke that the annual report is called “annual” because the process to prepare it truly spans the entire year. The irony is, there’s a hint of truth in this joke.

When speaking on the introduction to annual reports to students, I often reference a scene from the movie “In Time” (2011), where time means everything for the characters, and deadlines are matters of literal life and death.

If we think about the sport that best resembles the publication of annual reports, it has to be Formula 1: split-second timing, breakneck speeds, high technology, big budgets, numerous observers, strict rules, and schedules. It requires the effort of an entire professional team to cross the finish line, plus skill and a bit of luck to reach the podium.

According to personal and corporate experience (based on over 1000 reports), as well as discussions with thousands of project participants from both companies and agencies, I have never once encountered credible evidence that interim and final deadlines were met consistently. The harsh truth is that interim deadlines are fluid, and the report eventually gets released through a mix of experience, technology, overtime, dedication, and sometimes a touch of magic. If you happen to have a different experience, please share it with us, and I will extend a fantastic job offer in our company to help replicate such a miracle!

When discussing reporting timelines, it is essential to separately consider strictly regulated annual reports of public companies (also known as annual financial reports) and more flexibly regulated sustainability reports. For simplicity, I will exclude the specifics of integrated reporting and the emerging (and, in some countries, active) practice of mandatory disclosure of sustainability reports or data.

Determining Annual Report Timelines

Information has time-specific value, while regularly disclosed corporate data being particularly valuable. Therefore, releasing a report within a reasonable minimum timeframe has become standard practice, with regulators in most countries mandating reports to be disclosed within 3 to 4 months after the end of the reporting period. This fact forms the basis of corporate calendars, creating a chain of events with both soft and hard deadlines, from data collection to the approval of the annual report at the board meeting, and subsequent presentations to annual shareholders’ meetings.

Moreover, professional stakeholders, especially financial analysts, anticipate the publication of company reports at specific times. For instance, in our practice, attempts to check online reports at expected addresses (e.g., ar2023.companydomain.com) days before the anticipated publication date are common. Hence, access to reports in the final stages of testing needs to be restricted until the official disclosure to avoid data leaks.

In other words, the practice of report publication is established, and changing the timelines is quite challenging.

However, companies strive to minimize timelines and publish reports during February. This is often driven by several factors, including:

Shaping expectations of financial analysts to support current stock quotes. The first report from an industry leader sets the tone for others, which is especially relevant for large-cap companies.

Adjusting according to a part or the entire corporate calendar, e.g., for earlier dividend payments.

Addressing other challenges within the area of corporate transformations.

Therefore, an earlier publication of an annual report is necessary for a company to:

A) meet the expectations of professional stakeholders;

B) set benchmarks among industry peers;

C) address internal corporate goals.

Timing Nuances in Sustainability Reporting

Rules and procedures for publishing Sustainability Reports are somewhat similar to annual reports, but companies often anticipate a delay in releasing Sustainability Reports compared to Annual Reports. Why is this the case?

Key reasons include:

Lack of internal resources: in many companies, especially across mid and small caps, the same individuals may be responsible for preparing both the annual report and the sustainability report, making it challenging to manage both projects simultaneously. Additionally, managing the approval of two reports simultaneously can be burdensome for management, any committees, and the board of directors.

Constantly changing practices and standards: unlike annual reports with well-established practices, sustainability reporting is often new for many companies, and standards and regulations in non-financial disclosure change rapidly. This results in numerous changes necessary in each year’s sustainability report project, complicating efforts to shorten timelines.

More complex preparation processes: when publishing Sustainability Reports according to prevalent standards and frameworks, specific stages, distinct from traditional annual reports, are often required. These include materiality assessment procedures, stakeholder engagement on non-financial topics, and third-party assurance.

Lack of regulation (or softer regulation) regarding timelines: in many countries, the fact of mandatory disclosure of Sustainability Reports is not well-regulated, or it is described quite loosely, with few specific publication dates.

As a result, influenced by one or more of these reasons, companies often publish Sustainability Reports significantly later than their annual reports.

By the way, this phenomenon has a very interesting consequence: in some companies, by the time the Sustainability Report is published, certain indicators for the reporting period may have already been updated and recalculated compared to those disclosed in the annual report. This can, at times, result in reports featuring significantly different metrics from each other.

Now, what will happen to the timelines of publishing Sustainability Reports?

I see at least two powerful factors, which may bring the timelines of Sustainability Report issuance closer to annual reports:

Best Practices: this involves simultaneous information disclosure, helping avoid discrepancies between reports.

Implementation of IFRS S1/S2 Standards: these standards necessitate the disclosure of non-financial information within the framework of the annual report.

How to Change the Timing of Report Releases

A significant shift in the publication timelines of reports is a formidable challenge that requires advanced preparation. In my experience, there was a case where, over two years, we moved the publication of a large-cap company’s annual report to a date seven weeks earlier, while concurrently enhancing the report’s quality. It was a significant achievement, but the project’s workload on both sides was exponentially increased.

I’ll share some tips that might work:

Set realistic deadline reduction targets: in our case, achieving the target in two years, not one, was more feasible.

Ensure clear communication of goals: make sure both internal and external teams share and understand the targets equally, and the target isn’t merely an individual manager’s ambition, even if they are at the C-level. This applies generally, and not only to changing timelines.

Gain management and Board support: as their schedules will also change, securing support from top management and the Board of Directors is crucial.

Remember the quality triangle (Time-Price-Quality): if timelines take priority, be prepared to sacrifice either “quality” or be ready for a budget adjustment. Miracles won’t happen.

Link every deadline shift to another: regardless of the type of visualization of your timeline (Gantt chart, for example), your task is to move everything at once, ensuring that the next stages will start earlier if you finish the previous ones ahead of schedule. Make sure that external contractors’ schedules also allow you to shift timelines.

Create a pessimistic schedule and have time buffers: Murphy’s Law still applies today.

In the next article, I’ll explain why it is crucial to publish reports simultaneously in all formats.

Share your challenges and know-how.

Reporting as a sport: racing against time