Oil and gas firms are among the worst offenders for unnecessarily long annual reports, according to PwC.
The global professional services giant said yesterday businesses of all kinds risked putting off investors by burying gems of information in lengthy reports.
Documents from oil and gas companies weigh in at a hefty 172 pages on average, the fifth longest out of 18 sectors covered by a PwC’s Searching for Buried Treasure study.
But energy firms are by no means the biggest culprits. Banks’ annual reports average out at a whopping 339 pages, said PwC, which will publish its full report next month.
Insurance companies’ reports were the second most long-winded, at 203 pages, while financial services – specifically asset management – were the most concise at 104.
The average length of reports from FTSE 250 companies was 136 pages, 18 fewer than those of FTSE 350 firms.
Bruce Collins, assurance partner in PwC’s Aberdeen Oil and Gas centre of excellence, said reports seemed to be getting longer, and picking out key information was increasingly like trying to find a needle in a haystack.
PwC’s study has also found that many reports contain a mass of data that is often “backward looking” and gives very little insight into a company’s future prospects.
The firm said investors wanted to see a greater focus on the reporting of risk and strategy, in order to give them a longer-term view of a business.
Mr Collins said: “Many companies set out their strategy and business model, but they do this without explaining how the two connect – how risks affect strategic plans, what resources and relationships really drive the business and how these are being managed and progress measured through KPIs (key performance indicators).
“The annual report – and specifically the strategic report, offers companies an important opportunity to tell their story in a way that is credible and consistent.”
A spokeswoman for BP, whose last annual report stretched to more than 250 pages, said: “We work to make sure it presents information as clearly as possible about BP and our performance and strategy, while of course making all the disclosures required.
“We review our reporting continually and it continues to evolve, as do the rules that govern it.”
Shell, whose latest report was 200 pages long, declined to comment.
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