Integrated value management and reporting that drives better performance, reputation and valuation.
Systems Thinking Using a Multi-Capital Model
Smithfield is the world's largest pork processor and hog producer. The company is based in the U.S. but also has operations in Europe and Mexico. It is a wholly-owned subsidiary (since 2013) of Hong Kong-based, privately-held WH Corp, although speculation at the time of the buyout was that the Chinese government was behind the acquisition.
As readers of this blog know, I've been reviewing the basic characteristics of integrated reports published by U.S.-based companies in recent weeks. Smithfield Foods has a long history of publishing reports (their web report library goes back to 2000) even though they were and still are privately held--and they have a record of bad behavior in the past.
Practices in U.S. meat industry have come under much-deserved fire in recent years. Smithfield is far from perfect but appears to be making a concerted effort to improve its practices. All this background makes it even more interesting in my eyes to look at the company's report. The 2015 report is being published in stages. So this review is going to focus on the compahy's 2014 report.
Integrated reporting is just getting started in the U.S. As a long-time practitioner of the multi-capital model, I have seen the benefits of this model. To date, most of my clients have been using this approach for internal purposes (like growth, performance and value creation) but not for external reporting. So I am glad to have examples in the public sphere. And I decided that it would help advance U.S. practice to create a directory of companies that are using principles of integrated reporting here.
It's happened to me twice this week. I found myself explaining what intellectual capital is and is not. It's nothing new. But I decided to go on the record. So here goes....