Businesses not reporting key people data
FTSE 100 firms are failing to share important workforce data in their annual reports, according to the CIPD
Hidden Figures: How workforce data is missing from corporate reports found that workforce reporting in FTSE 100 organisations’ annual reports increased by 9% between 2015 and 2017, a much smaller increase compared to the 19% rise seen between 2013 and 2016 (when the CIPD first analysed FTSE 100 workforce reporting).
The most commonly-reported workforce issues were talent management, succession planning and employee turnover.
However, levels of reporting around skills were found to be low. Only 12% of FTSE 100 firms reported their perspectives on skills shortages, and only 21% reported on skills gaps, despite many businesses expressing concern about access to skills after the UK leaves the European Union in 2019.
Meanwhile, apprenticeships (64% more reporting), employee wellbeing (+76%), entrepreneurship (+28%) and talent management (+26%), all saw increased levels of reporting between 2015 and 2017.
Internships (32% less reporting), commitment (-31%), flexibility (-30%) and employee engagement (-21%) all saw decreased levels of reporting.
In response the CIPD is calling for improved reporting and transparency from Britain’s biggest businesses. The body has warned that failure to capture and disclose workforce data is keeping investors, employees and other parties in the dark on key business indicators.
Edward Houghton, senior research adviser for human capital and governance at the CIPD, welcomed increased transparency in businesses, but said that higher quality and more consistency in reporting is needed.
“It’s positive to see that the quantity of workforce reporting is increasing, but there’s still a considerable challenge regarding the quality, consistency and transparency of data being reported," he said. "Organisations seem to focus their efforts on complying with legislation and governance codes and report on very little else voluntarily.
"Reporting is also often subject to trends or pressure from government rather than ongoing strategic imperatives. We need to see much more consistency in what is being reported, the language used to report it, and the measurements being applied, so all stakeholders get a complete picture of workforce opportunities and risks."
Businesses have come under pressure to provide data following several high-profile corporate governance failures and equal pay issues over the past year. These have led to gender pay reporting and calls for organisations to publish details of executive pay.
Houghton said business leaders need to become comfortable with sharing data.
“Without full transparency there’s a danger that businesses are painting an overly-positive picture of how they manage their people and people risk," he said. "Gender pay gap reporting regulations have shown us that a framework and a common language can improve disclosure and prompt healthy debate on important issues among key stakeholders.
"It’s also rightly awakened an appetite among investors for even more workforce data. Businesses need to be ready to respond to this demand. We need senior leaders to get comfortable with being more transparent about their workforce practices and we need investors and government to be demanding far more of these insights.”
To support a better understanding of workforce issues and risks the CIPD has created a new reporting framework that, alongside improved use of workforce analytics, aims to improve transparency and help with the identification and management of workforce and cultural risks.
Its People Risk Reporting Framework explores seven dimensions of workforce risk that employers should look to report against: talent management, health and safety, employee ethics, diversity and equality, employee relations, business continuity and reputational risk.
The research explored how workforce reporting has changed over the last five years, and how transparent organisations are about risks and opportunities relating to the workforce.