Narrative reporting forms a key part of the relationship between a reporting entity and its stakeholders.
As a consequence of this, considerable guidance has been issued over the last few years by regulatory bodies looking to meet the ever-growing demand from stakeholders for more useful, pertinent and insightful information from annual reports.
Co-operatives have generally been followers in this regard, but this is an area where co-operatives should be leading the field, according to a narrative reporting guide produced on behalf of Co-operatives UK by the Co-operative Performance Committee.
The below framework emphasises the uniqueness of the co-operative model, the closeness of the relationship between members and their co-operatives and the overall articulation of the ‘co-op difference’.
This framework consists of three pillars covering the three specific areas of content which underpin the concept of ‘co-operative difference’. The pillars themselves are set within the wider context of best practice ‘co-operative reporting’ which consists of a foundation of the ‘co-operative principles’ and an over-arching roof of ‘communication quality’.
Related: What is the best way to report your community impact?
The model reflects a ‘principles’ based approach rather than being prescriptive in nature and each co-operative should choose those areas of the framework that will particularly resonate with their members using the model as an ‘options menu’ for developing best-practice narrative reporting.
What is narrative reporting?
Narrative Reporting forms a key part of the relationship and communication channel between a co-operative and its members while providing each co-operative with a unique opportunity to engage, inform and inspire their membership. It can be defined as any content (written or pictorial) that sits at the front of the annual report before the financial accounts. It is designed to give a reader a better understanding of and relevant insight into a reporting entities purpose, strategy, performance, position and future prospects. In general Narrative Reporting is usually split into sub-sections in the front half of the annual report under the headings of the strategic report and the governance report.
Communication quality
A foundation of the framework is the concept of ‘communication quality’ which refers to the way information is conveyed to the members. In this regard, the guidance looks to articulate the best practice characteristics that could be demonstrated by a co-operative in its narrative report. The guidance puts an emphasis on the characteristic of ‘accessibility’ which is deemed to be particularly relevant to member-owned organisations whilst also dovetailing with existing direction from the FRC in terms of narrative reporting.
- Communication quality
- Accessible
- Fair, balanced & understandable
- Comprehensive & concise
- Forward looking
Co-operative principles
There are seven fundamental ‘co-operative principles’ that underpin the movement as a whole and give the sector its unique identity. It is only natural then that these principles should be referenced to and drawn out under a co-operative framework for narrative reporting.
Co-operative difference
The three pillars represent broad areas of potential content for narrative reporting and as such can be used to frame and organise the reporting. It is through these areas of content (the pillars) that the ‘Co-operative Difference’ can be demonstrated and brought to life.
Pillars
The three pillars represent broad areas of potential content for narrative reporting and as such can be used to frame and organise the reporting. It is through these areas of content (the pillars) that the ‘Co-operative Difference’ can be demonstrated and brought to life.
- Member Value
- Member Voice
- Co-op Values
Member value
Member Value can take many forms and reflects the essence of the relationship between a Co-operative and its members. Different members will value different things and this will vary between members and between Co-operatives. What is important is that each Co-operative looks to define and express that value in relation to its members.
- Strategy & Business Model
- Business Performance
- Risk & uncertainties
- Member Benefits
- Community & Co-op Benefits
- Wider Stakeholders
- Colleagues
Member voice
Member voice is a vital component of any healthy
Co-operative and demonstrating and articulating how this is being achieved is paramount to generating further member engagement.
- Membership
- Member Trade
- Democratic Participation
How engaged are the members with their co-ops?
How well is the co-operative doing at listening to, understanding and responding to what their Members really want from their co-operative?
Co-op values
These underpin the sector as a whole and each
co-op can look to demonstrate and articulate them throughout any Narrative Reporting.
Co-operative Principles:
- Voluntary & open membership
- Democratic control
- Member economic participation
- Autonomy and independence
- Education, training & information
- Co-operation among co-operatives
- Concern for community
