Letter from the Chairman:

Blah, blah, blah. New economy. Blah, blah, blah. Exciting initiatives. Blah, blah, blah. Proactive approach. Blah, blah, blah. Poised for the future.

Financial Reports:

Blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah = Blah.

Your annual report shouldn't be “blah”.

Your annual report is the single most important document your company produces – and it’s most powerful public relations and marketing tool. A thoughtfully designed annual communicates corporate culture and values, recruits new talent, builds brand recognition, boosts corporate image and offers people a glimpse at the organization behind the numbers.

Dollars and Sense

Financial reporting has been around as long as there have been investors demanding to know how their assets are being managed. But, it was the catastrophic stock market crash of 1929 that prompted the U.S. Securities Exchange Act of 1934 mandating that all publicly traded companies make yearly financial disclosures to shareholders. Ever since then annual reports have been a sovereign source of information for securities analysts, portfolio managers and individual investors alike. The fact that annual reports are strictly regulated by the Securities and Exchange Commission (SEC) imbues them with a veraciousness investors have literally come to bank on.

Savvy investors look at more than numbers, however. In studies conducted by the Ernst & Young Center for Business Innovation diverse investors consistently placed a premium on non-financial criteria. Attributes such as strategy execution, management credibility, innovation, ability to attract and retain talented people, R&D and branding ranked high among those polled. The study determined that fully one third of a company’s stock share price is attributable to such non-financial factors. Clearly these types of assets are crucial to success, and communicating them effectively in your annual can have tremendous impact on shareholder confidence, investor perception and your bottom line.

Maximize the Message

Your annual report will leave a lasting impression. Everything must be perfect. The problem is that perfection is hard to achieve when dealing with committee reviews, budget constraints, and production hassles. Navigating these obstacles and emerging with a compelling annual requires finesse. Minimize the headaches and maximize your message by keeping these tips in mind:

1. Communicate excellence through design. The quality of concept, layout, printing and bindery, paper, graphics, photography, illustration and copywriting are all reflections of your organization. Skimping or cutting corners in these areas could convey cheapness, inefficiency and an overall inferiority that reflects poorly on you and your products and services. Collaborate with experienced designers who know how to produce high caliber work and who are sensitive to the nuance of layout and design spanning a 100+ page document.

2. Eschew pedantry and esoteric vocational patois. That is to say, don’t use a lot of technical mumbo jumbo that people outside your industry won’t understand. Be clear and concise – speak to your audience not at them. Your annual is an opportunity to educate people about what you do, how you do it, who you do it for, and why. Straightforward, engaging copy will get the message across and create momentum that carries readers from page to page.

3. Flaunt your assets. Financial statements tell people how you did last year, but investors also want to know that you’re prepared for tomorrow. Non-financial performance information lets them know if you’re poised for growth and capable of weathering financial storms. Emphasizing advantages such as comprehensive branding, or skilled management and labor retention rates reassures investors you have what it takes to keep moving forward.

4. Look to the future. Discuss your intent for the coming year – even the next five, 10,or 20 years. Outline your objectives and your plan to meet them. If, for example, acquisition is required to boost revenue, explain the risks associated with such a move – expense of integration and timeframe for return.

5. Go digital. Making your annual report available via the company web site is cost- effective and eco-friendly. A digital version of your report is an excellent supplement to the printed book, but not a replacement – printed reports are still a must.

6. Provide enough time to get the job done right. Timeframes vary between SEC rules the NYSE, etc. The last thing you want is to be scrambling to get it done. It’s never too early to start thinking about next year’s report.

©Nocturnal Graphic Design Studio, LLC

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