Transnet has won the 2014 Nkonki State-Owned Company (SOC) Integrated Reporting Award for the best performer.

Assurance and advisory firm Nkonki on Wednesday released the findings of its 2015 review of integrated reporting by South African SOCs. The report, titled ‘Integrated Reporting: A New Era for Public Sector Entities in South Africa’, assessed how local parastatals measured up in terms of applying the guiding principles of and global best practice relating to integrated reporting.

The 2015 report provided insights into the extent to which SOCs have applied the International Integrated Reporting Council’s (IIRC’s) International Integrated Reporting Framework, released in December 2013, to their 2014 reports.

As part of the report, 20 of the country’s SOCs were assessed in terms of their integrated reporting performance. Air Traffic and Navigation Services ranked second and Eskom third.

Receiving the award on behalf of Transnet, commercial group executive Khomotso Phihlela said the award was an affirmation of the “tireless effort” the group put into “the succinct dissemination of information that tied in with its Market Demand Strategy”.

Overall, 55% of the SOCs reviewed scored above 50% of the expected minimum requirement for 70% of the expected requirements, which included strategic focus, connectivity of information, materiality in terms of stakeholder dealings, nature of dealings with stakeholders, conciseness, reliability and completeness, consistency and comparability, capitals and business model concepts, content elements, the wow factor, layout, linkages and the organisation of information.

This was an improvement on the 50% achieved in 2013.

However, Nkonki pointed out that there was still a clear indication that many SOCs needed to improve their integrated reporting efforts, highlighting that many of the reports were still too long, at an average 296 pages – albeit an improvement on the previous year’s average of 418 pages.

“Despite many of the country’s SOCs coming under fire for a variety of reasons, our report indicates that they are, in fact, doing admirably in terms of their reporting standards and that their integrated reporting continues to improve,” Nkonki partner Thuto Masasa said.

The strategic focus component scored an average of 71.7%, with only one company scoring below a D rating, while the connectivity of information component scored an average of 56.3%, which indicated that it should receive more attention in future. Seven companies could not obtain a D rating or higher.

Further, the materiality in terms of dealings with stakeholders scored an average of 66.9%, which the firm considered a good rating, noting, however, that it could improve. Five companies scored below a D rating.

The nature of dealings with stakeholders was described adequately in many instances, but this also scored an average of 66.9%. Five companies scored below a D rating.

Reliability and completeness scored an average of 68.5%, with only three reports rated lower than D, while consistency and comparability scored an average of 100%. It did not account for many marks, so a full score was fairly easy to obtain.

Nkonki found that the content elements, such as organisational overview, governance, business model, risks and opportunities, strategy and resource allocation, performance, outlook, basis of preparation, and presentation, were not yet fully adopted, with an average score of 55%. Fifteen SOCs scored a D or higher.

“The ‘wow’ factor fared the worst, only being present to some extent in four company reports, which is why the average is only 11.7%,” the company said, adding that proper layout scored an average of 61%, leaving room for companies to reconsider the way in which their information was presented in the integrated report, as well as how the information linked to other reports and other information on a company’s Web pages.