100 companies – score less than 100%. FRC research.

Research from Financial Reporting Council published April 2022, has general applicability.  Not just to compliance gaps in modern slavery – the focus of the report.

While all entities should be fundamentally against any form of slavery, the risk management involved – and reporting – is simply not impressive yet.  This was the finding of FRC research.

That means taking lessons learned and applying it to wider risk management, because there is a lot of read-across.

FRC’s research tells us:

• FTSE firms sampled, included some that were completely non-compliant because 1 in 10 failed to publish any statement against modern slavery,
• 1/3 of firms did had an easy to read statement,
• FRC was disappointed to find over-complicated reports, reports which said nothing coherent and reports lacking narrative or structure,
• FRC made the comment that long reads are not necessarily useful,
• FRC also made the comment that looking back in time is not sufficient – looking ahead counts for a great deal.

A major takeaway from the research, was that key performance indicators were thin on the ground and in failing to use KPI’s this created a particularly poor outcome – because metrics (and sensible use of the same) would have produced tangible benefits like better decisions and informed spending – not just words on a page that fail to find a purpose.  Of those firms who attempted using KPIs, only about 10% used those KPI’s to make informed decisions.

The glaring summary of FRC’s thematic work on anti- slavery reporting, is that the largest firms are not doing enough governance work to think about culture, reduce the risk of inappropriate culture and are not measuring success. Too few firms know how to draft powerful summaries that draw from results.  Fewer are pulling out lessons to learn.

Much as a scientist would draw conclusions from evidence – Board Originator software puts in front of subscribers their key risks. 

Board Originators records impact and probability of risk – and prompts you to take mitigating strategies.  

You run a risk report which sets out your risks and strategies – in an easy, readable report.

With Board Originator you’re running an automated risk tool.  In an excellent position to stand up to scrutiny.

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