Know thyself…and thy audience - 3 core audiences of impact reporting
No matter how we feel about Impact Reports, there are many reasons why we (our organization or company) do it– because we value trust, accountability and transparency, or for compliance with government, funder and regulatory agencies. Sometimes it’s because we want to demonstrate we are good citizens, or we want to build awareness or bring in funders, investors and customers. Sometimes we are simply proud of what we have accomplished and want to celebrate. And not only do we have different reasons for reporting, we have different audiences as well - customers, communities, grantees, funders and investors, just to name a few.
But we can’t write a report for all audiences or all goals - it would become an odyssey of mixed metaphors, overburdened by charts and information. To be successful, an impact report should be written with its audience and outcome in mind. We must ask ourselves “what does my audience need? And what do I want them to do?”
Before we dig in, a note on what I’m including this discussion: I am taking a very broad view of Impact Reporting, which can include nonprofit annual reports (for funders, donors and government agencies), corporate impact reports which can include sustainability, ESG and corporate social responsibility. In my experience, there are more similarities than differences when it comes to how the various sectors communicate impact.
I find there are 3 broad categories of impact report audience. They may overlap to varying degrees, but these categories provide guide rails for what we report and how we report it.
#1 - Stakeholders who have a financial interest in your company or organization - They donate, fund, invest or serve on the board of directors
Ben & Jerry's has the only Impact Report that will make you hungry, but it's also a great example of a blended audience. They provide in depth information about programs, strategy, decision-making for audiences with a financial interest in the company, and for the rest of us (because, who doesn’t love ice cream?) they do so with fun graphics that are rooted in their core product.
What do they need? This audience typically has financial interest in your organization or company, as a donor, funder, investor, or board member. They need to feel confident that they are making a sound choice and know where their funds are going. If they hold fiduciary responsibilities, they need to feel secure about the organization. They may also need detailed information about programs, initiatives and strategies in order to make decisions about future funding and recommendations.
What do you want them to do?
Feel confident
Continue or increase their investments/funding
Advocate for your organization and help you connect to additional sources of funding
Possibly weigh in on strategic decision-making, identify risks and opportunities for your company or organization
What role can the Impact Report play? The Impact Report for this audience is likely to focus on how the organization is strategizing its work and allocating resources. It is also going to need to equip the audience with the words and the numbers to have informed conversations about your organization.
#2 - Stakeholders who have an interest in your cause or product - They are customers & community members who purchase product, or join the cause through volunteering or other activities
TOMS Shoes brings their Impact Report to a customer audience with a video that showcases how the company's values are aligned with their business model. They help the audience feel inspired and part of a movement by showcasing community involvement.
What do they need? They want to feel good about themselves, and how they are spending their money and their time. They want to see their priorities reflected in the organization’s values, goals and purpose, and to feel like they are supporting a cause and part of something bigger than themselves. This can also include community partners who want to trust that they are collaborating with a company or organization that is transparent and accountable and has aligned values and goals.
What do you want them to do?
Feel inspired and proud
Trust you
Continue or increase their purchasing of your products or engagement with your cause
Donate their time (volunteering) and treasure (money)
What role can the Impact Report play? The ideal impact report for this audience will elevate the organization’s “why”, their mission, vision, values and purpose and align it to their stakeholder’s priorities and values. It will tell the story of collaboration & community contribution towards impact.
#3 - Stakeholders who have an interest in oversight and regulation - They are agencies that provide oversight, regulatory functions and sometimes funding
What do they need? They need the numbers. Short and sweet, they need to know what’s happening at the organization and if there are any red flags. Often they come to the table with existing standards or reporting requirements.
Etsy's Integrated Annual Report combines Financials, ESG and Social Impact Reporting into one financial-style document. This format is great for agencies providing oversight, regulatory functions and for investors who need specific information pertaining to the business.
What do you want them to do?
Feel satisfied, that they have what they need, that standards are met and they no have additional questions.
If the oversight body is also a funding organization, then you want them to continue their funding.
What role can the Impact Report play? At its minimum, this report fulfills compliance requirements, but is also an opportunity to showcase commitment to strategy, innovation, change over time, as well as to build audience confidence and trust.
Once we’ve named it, it seems so obvious. But Impact Reports of various shapes and sizes are often created without naming the target audience and business value. By going through this exercise at the outset, organizations can make decisions about about the cadence, scope and scale of reporting that makes sense for their organization, and allocate appropriate resources. Some organizations have split up their ESG and Impact Reporting by topic or strategy area, while others integrate them with their financial statements. Some embed the report on their websites, feature videos or host downloadable PDFs. Having a clear picture of what you are trying to achieve via your impact report turns the report into a strategy itself, because you are delivering the correct message to the intended audience in the best way for them.
In my next segment, I’ll talk about the 3 broad categories of Impact Reports- The Brand Boosting Report, The Standards Report and The Proof of Work Report. Each of these report styles lends itself to different audiences and needs, so we will examine their strengths and limitations, and check out some examples.
