Research

The State of Annual Reports in the Netherlands

A leading solution in investor relations (IR), Tangelo conducts detailed research on annual reporting trends across the world. Today, as part of our continuing series on digital IR communications and online annual reports, we’re releasing our latest findings.

What did we look at this time around? The 2018 annual reports of all 74 companies listed in The Netherlands in the AEX, AMX and AScX indices. (And no, you’re not mistaken—the AScX index really does only have 24 constituents…)

After digging through 74 documents, we uncovered a few surprising trends. Read on to learn about the best—and worst—in show!

“Hallo, investeerders”

How are Dutch companies presenting information to investors?

Let’s talk language. Of the 21 Dutch AEX companies, only two published their investor relations websites in Dutch (in addition to English)—that’s a paltry 10%. The remaining 90% of AEX companies have English-only websites.

Among the comparatively small AScX companies, the percentage of English-only websites is much lower—41%—with 59% of companies choosing to present their website in both English and Dutch. This makes sense, considering that almost 60% of the AScX companies are more “local companies,” headquartered outside of the four major cities in the Netherlands.

Investor relations websites, by language (Dutch companies only)

Index

English only

English and Dutch

AEX

19 / 21

90%

2 / 21

10%

AMX

17 / 21

81%

4 / 21

19%

AScX

9* / 22

41%

13 / 22

59%

Total

45 / 64

70%

19 / 64

30%

* The Netherlands-incorporated company Kendrion has its investor relations website available in both English and German.

An investor relations website that really stood out to us was ASML. They have a modern, clean and crisp design—with just the right amount of engaging dynamic effects.

How are annual reports made available online?

Our research focused on two different options.

The first—and arguably, the best—option is as an online annual report, made available either within a corporate website or as a separate microsite. The second option is as a PDF, which can either be downloaded (our suggestion) or presented as a flipbook for “on-screen reading” (we’ll return to why we think this is a bad idea).

% of companies in the Netherlands publishing online annual reports

Index

Has online annual report

Available as a microsite

AEX

13 / 25

52%

9 / 25

36%

AMX

7 / 25

28%

6 / 25

24%

AScX

6 / 24

25%

6 / 24

25%

Total

26 / 74

35%

21 / 74

28%


How do the above trends compare to those observed in other countries? 35% of the Dutch companies we researched had published online annual reports in 2018. That’s more than twice the number of Australian (15%) and New Zealand (10%) companies that published online annual reports. But fewer companies listed in the Netherlands published online annual reports than did the “DACH” (Germany, Austria, and Switzerland) and Scandinavia—which have historically high adoption rates of up to 40%.

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A responsive, website-style online annual report is the best way to reach the tech-savvy generation of new investors accustomed to accessing information on laptops, tablets, and smartphones.

For more on this, read our recent article ‘How the digital transformation in finance is reinventing annual reporting – for good.’

It’s especially helpful for annual reports to present information that is complete, visually engaging, and offers investor “tools” like custom PDF downloads, interactive charts, and the option to download data as an Excel spreadsheet.

Of the 26 online annual reports, only 10—or 40%—are complete. The others either summarize/provide highlights of the annual report or present a so-called “annual review.”

When it comes to language, seven of the 22 online annual reports of Dutch companies are published in English and Dutch (32%)—which is similar to the investor relations websites that offer content in both Dutch and English.

Online annual reports – “investor tools”

Investor tool

% of companies offering

PDF download

25 / 25

100%

  • Full PDF only

12 / 25

48%

  • plus fixed / pre-selected parts

11 / 25

44%

  • custom (user can create PDF)

2 / 25

8%

Excel download (of tables in report)

7 / 25

28%

  • All tables only

1 / 7

14%

  • plus fixed / pre-selected sets

5 / 7

72%

  • custom (page or user selection)

1 / 7

14%

Interactive charts

4 (3 AEX, 1 AScX) / 25

16%

Switch to last year / other years

5 (all AEX) / 25

20%


All 10 complete annual report websites have search functionality. But these websites also integrate a relatively low percentage of investor tools—only 8% of the websites offer custom PDF downloads, 16% offer interactive charts, and 28% offer Excel downloads.

A secret weapon for upping stakeholder engagement

In order to produce a successful online annual report, companies must follow these four guidelines:

  1. Have an engaging landing page.
  2. Make clear what information is available in your online annual report/microsite.
  3. Offer intuitive navigation.
  4. Be responsive—it’s as simple as that.

Content is king—and in the world of online annual reports, video can be a powerful tool for upping investor and stakeholder engagement. Of the 25 companies offering an online annual report, five companies (all AEX) include a video message from their CEO—with one including an “annual review/highlights” video.

For an example of a Dutch company whose 2018 AR scores particularly high on engagement, completeness, use of video, and the integration of investor tools, look at AkzoNobel.

For an example of a company with a particularly bad online annual report, turn to Silgro Food Group. This AR landed on our “worst in show” list for its bad URL, old-school design, and unresponsive nature (something you simply can’t get away with in 2019).

A duel for the ages: PDF download vs. the dreaded flipbook

So, how did the remaining 49 companies make their annual reports available online? Most chose the obvious option—a plain, straightforward PDF download. But 11 companies added tools such as flipbooks, pop-outs, so-called navigation elements, A3-size PDFs with A4 pages in spreads, and PDFs that open in full-screen mode.

The above formats often hinder an enjoyable on-screen reading experience. To see this in action, just look at:

This flipbook by Royal BAM Group. What’s wrong here? To start, the flipbook has a bad URL and its pages are far too small to provide a pleasurable on-screen reading experience. If those missteps weren’t enough, it also features obnoxious user interaction—yes, even with the “turning the page of a brochure” animation (which might have been exciting in the early days of the Internet)...

This annual report from TKH Group. We have no idea what this is (and that’s putting things nicely). The PDF pages are presented as unreadable images, and there are no options whatsoever for the reader—no “zoom in” feature (so the report remains unreadable), nothing clickable, no download option. Needless to say, this AR is definitely a frontrunner for “worst in show.”

Annual reports by format: Online annual report, PDF, or flipbook?

Format

% companies using

Online annual report (see above)

25 / 74

34%

PDF download only

38 / 74

51%

Flipbook

11 / 72

15%


Companies with extra navigation elements

Index

Extra navigation elements like “Next page,” “Previous page,” and “Back to Table of Contents”

AEX

10 / 25

40%

AMX

5 / 25

20%

AScX

3 / 24

12%

Total

18 / 74

24%


Rather than turning to flipbooks, we suggest that companies ensure their PDFs check all of the following boxes:

  • Can be opened in the user’s standard PDF viewer (most likely Adobe Acrobat Reader)
  • Has proper bookmarks to aid in navigation
  • Has a clickable Table of Contents and note references—and all references to other sections are clickable, as well

Oddly enough, companies rarely succeed in checking the above boxes. Of the 74 annual reports researched, only 18 have proper bookmarks (24%), while 16 have clickable note references (22%).

For an example of a PDF that checks all the right boxes, take a look at Randstad’s annual report.

And please, remember to steer clear of those pesky flipbooks…

Last but not least: the annual report itself

As self-proclaimed number nerds, we couldn’t resist ending Part I of this newsletter with some more statistics.

Language

Index

IR website in English and Dutch

Annual report in English and Dutch

AEX

2 / 21

10%

Full: 1 / 21

5%

Shortened: 1 / 21

5%

AMX

4 / 21

19%

Full: 1 / 21

5%

Shortened: 2 / 21

10%

AScX

13 / 22

59%

8 / 22

36%


Interestingly enough, companies whose investors relations websites are in both Dutch and English don’t always publish annual reports in both languages.

Orientation

Orientation

Portrait

54 / 74

73%

Landscape

20 / 74

27%

Non-standard size (“portrait” or “landscape”)

5 / 74

7%


ING Group
presents an interesting example of a non-standard size PDF with their (440 page!) annual report. The large landscape-oriented format seems to be designed for on-screen reading.

Number of pages

Index

Average number of pages

250+ pages

AEX

245

7 / 25

24%

AMX

200

5 / 25

20%

AScX

163

3 / 24

12%


The average number of pages per annual report varies quite remarkably throughout the three indices. Companies in the AEX index have the highest average number of pages (245), while companies in the AScX index have the lowest average number of pages (163). This makes sense, considering AEX index companies are much larger than AScX companies, and— not-so-surprisingly—the majority of 250+ page reports are published by financial services companies, almost all of which belong to the AEX index.

With a whopping 464 pages, Unibail-Rodamco-Westfield claims the title of longest annual report (“Registration Document 2018”). But they also offer a great online annual review—phew!

What’s next?

In Part II of this research article, we’ll dive deeper into the topics companies cover in their annual report—including storytelling, strategy, risk, remuneration, financials (and other statutory elements), integrated reporting, the United Nations’ Sustainable Development Goals (SDGs), and Environmental, Social & Governance (ESG) reporting.

Contact us to be notified when Part II becomes available, or if you want to receive a detailed report including hyperlinks and all numbers by index and company.