Glossary term
Integrated Reporting Framework (IR Framework)
Subject: Sustainability and ESG, ESG Frameworks, Standards and Disclosure
Also known as: <IR>, IIRC framework
The Integrated Reporting Framework is a principles-based approach that helps a company explain in one concise report how its strategy, governance and performance create value over time using several kinds of capital.
Explanation
It was published by the International Integrated Reporting Council, which merged with SASB in 2021 to form the Value Reporting Foundation. That body was consolidated into the IFRS Foundation in 2022, which now maintains the framework. The framework describes six capitals: financial, manufactured, intellectual, human, social and relationship, and natural. A company shows how its business model takes in these capitals, changes them through its activities and produces outcomes. The report is meant to be short, connect financial and non-financial information, and look ahead. It does not prescribe specific metrics, which is why it is paired with other standards. Some preparers publish a full integrated report, while others use its ideas inside the annual report. Boards and finance teams meet it when they want one story rather than separate financial and sustainability documents. Reviewers look for a clear link between the capitals, the business model and the results, rather than a long list of separate achievements.
Example
A telecoms group replaces separate annual and sustainability reports with one integrated report. A diagram shows how network investment (manufactured), engineer training (human), customer trust (relationship) and energy use (natural) feed into revenue and service outcomes. The board uses the same picture in strategy meetings and links executive targets to several of the capitals.
Not to be confused with
- Sustainability Reporting
- Sustainability reporting is the broad practice. The integrated framework is one method that joins it with financial reporting through value creation.