Magazine article Marketing

News Analysis: Altered Perspective

Magazine article Marketing

News Analysis: Altered Perspective

Article excerpt

Changes to the way companies must compile their annual reports will be to marketing's benefit, writes Tim Ambler.

Marketers have a professional responsibility to see their organisation through the eyes of their brands' end users. Company directors, on the other hand, may be more concerned with the investor's perspective - hence the use of shareholder value as a decision tool.

Now, new guidelines from the government and the Accounting Standards Board (ASB) require companies to publish annual reports so that investors can see the business 'through the eyes of the directors'. It is, says Sir Paul Judge, chairman of The Panoramic Group, ' a marvellous opportunity for marketing to make common cause with the City'.

These requirements flow, in part, from the EU Modernisation Directive 2003, with similar dictates applying in the US, Canada and other developed countries.

The specifics of the Operating and Financial Review (OFR), now the Business Review, may have been bouncing around, but the principle is clear: the narrative parts of company annual reports are becoming more important than the accounts when it comes to telling investors what is going on.

What has that got to do with marketers? Everything. Marketing is the sourcing and harvesting of cash flow, though most company boards have yet to figure that out. So marketers have much to gain from board directors coming to understand their importance.

Different perspective

The nub is that investors and analysts increasingly want to see the business and its market in the way its marketers see it. So, the people in the middle, company directors, are being prodded by the ASB to provide that information.

This article is based on two years of research sponsored by the Worshipful Company of Marketers. In the first year, two researchers worked with company secretaries, senior experts and the ASB to produce a checklist of the then-new requirements and best-practice suggestions (see panel).

Given the hundreds of pages being produced by the government and others, the list, now also sponsored by The Marketing Society and IPA, has proved a blessing for company secretaries.

Creating it was an important staging post; suddenly the perspectives of investors and marketers seemed to have much in common. …

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