Trendmonitor 2024: the reporting trends of the DAX 40 companies

Digital change in the media portfolio

With the desire for more interactivity and accessibility, the media portfolio of DAX 40 reports is also changing - high time for us to remove analogue criteria from the catalogue and add digital categories. The number of full HTML reports has remained the same compared to the previous year, while the number of partial HTML reports has increased only slightly. More than a third of companies continue to rely purely on PDF, 52 per cent of which use portrait format. However, PDF reports are reaching their limits as the volume of reports increases.

Image content finds other ways

In the content area, a first glance reveals that The length of the reports is increasing. The average report now comprises 314 pages, compared to 307 in the previous year, ranging from 146 pages at Siemens Healthineers to 571 pages at Deutsche Bank.

While the figures on the interactive functions of PDFs or service and download options on HTML pages do not indicate a significant trend reversal, a clear development can be recognised in image communication. Ten years ago, two thirds of annual reports contained an image section; today it is just under 20 per cent. So is image communication just "nice to have"? Not at all! It has simply shifted to other channels. Some companies only place image-building content in the online report or only in the PDF. In addition, a lot of image content can be found in social media in the context of accompanying communication.

Separate image and highlight publications are also gaining in importance. Companies are designing their image communication independently of the detailed annual reports and are thus emphasising specific topics:

• Beiersdorf: Beiersdorf publishes sustainability highlights on the topic of "CARE BEYOND SKIN" under the "Sustainability" tab on the corporate website.
• Brenntag: In the sustainability section of the corporate website, the company offers a separate highlight publication on the topic of sustainability:
  "Sustainability Insights".
• Henkel: While the annual report and sustainability report deal with the main topics and key figures, the company also publishes a magazine with exciting projects, facts and figures relating to CSR.

CSRD on the threshold

With the new CSRD directive, a major upheaval is imminent. But what does sustainability reporting already look like today? All 40 DAX companies provide information on their sustainability endeavours, although the formats are varied and sometimes difficult to differentiate. 22 companies rely on separate sustainability or corporate responsibility (CR) reports. Five integrate their sustainability data directly into the annual report, while six combine this information with the annual report. In addition, 23 companies offer an online sustainability report.

The shift towards ESRS-compliant management reports is unmistakable. While 20 companies still included their non-financial statement in the management report in 2022, this figure has already risen to 25 in 2023, making it all the more surprising that only two companies (DHL Group and Vonovia) are already indexing the ESRS standards. In view of the mandatory application of ESRS from 1 January 2024, it is high time for the remaining DAX 40 companies to follow suit. The transition to new standards is a major challenge, but also offers companies the opportunity to increase the transparency and credibility of their reporting.

Outlook for the future

Although the number of full HTML reports has remained constant compared to the previous year, HTML reports are showing overall growth. The direction is clear: "digital". However, many companies are hesitant due to the higher costs involved or doubt that their target groups will use them. The CSRD could bring a breath of fresh air to digital reporting. The integration of ESRS will further increase the scope of reports, meaning that the PDF format may reach its limits. HTML reports offer the solution by presenting content non-linearly through links and interactive functions.

In the area of sustainability reporting, only a few companies will still produce complete separate reports. Project examples and stories will not make it into ESRS reports due to the audit requirement. Instead, companies will make greater use of their websites and develop new, innovative formats to communicate sustainability issues effectively.

The high level of complexity resulting from regulatory requirements such as the CSRD will lead to a stronger focus on the preparation processes for annual reports. Disclosure management systems are gaining in importance and the depth of integration is increasing. The use of artificial intelligence (AI) offers great potential, particularly in the areas of tagging, text creation and layout. In the future, AI could automatically generate code, carry out security and performance tests and optimise quality assurance. The previously time-consuming coding phases would thus give way to quality control, which would take up more space in the reporting process.