Should we announce our financial results? Some key considerations

Whether or not to discuss your company’s financial performance with the outside world is a question many businesses grapple with.

Most firms, with the exception of publicly listed companies, are not required to disclose their financial results to anyone other than their professional advisors, financial auditors and regulatory agencies like Companies House.

However, there can often be compelling reasons for publicly announcing your financial results, for example to tell a positive story about the growth of your organisation, to attract fresh investment or court potential new clients.

A business that was previously in financial difficulty but has turned things around may also want to communicate this externally to reassure stakeholders about its future.

However, being bullish about a good financial performance is not without risk. Here’s some guidance for businesses considering making announcements about their financial results.

Communicate internally first

Staff should hear news of your financial performance first (whether good or bad), rather than learning it somewhere else, such as from a customer or reading the business news. There should be a clear narrative about what this means for the business and, in turn, how staff may benefit. If you’re celebrating a significant set of financial results, staff will also be keen to know how they might share in that success – either through pay, bonuses, further job creation, or wider benefits.

Consider how clients and service users might react

Headlines announcing “double digit sales growth” or a “sharp increase in profits” might sound impressive to the shareholders of a major business, but how will it sit with the clients or service users of an SME? This is a particular consideration if you operate in a sensitive or emotive sector, for example healthcare, pharmaceuticals, social care or childcare, where celebrating financial success could strike the wrong tone.

Create a supporting narrative and stick to key messages

If you decide to announce your financial results, it needs a strong supporting narrative. Why have sales grown? How will this be maintained? Where will future growth and diversification come from? How is this good news for clients and staff? How do they share in your success? Developing a set of key messages that spokespeople and staff can all stick to is important part of the planning process.

Have a structured comms plan

Consider how you will communicate to a range of stakeholders. Internal audiences should be informed before you communicate externally. Consider what internal communication assets and supporting materials you will need for a range of media, including external media and your owned channels.

Make social value part of your reporting

Of course, it’s not just financial performance that matters. Stakeholders increasingly want to know how financial success translates into social value. Discussing your wider ESG objectives and achievements as part of your results announcement will carry more impact. This might include number of jobs created, number of training hours delivered, money invested into community initiatives and so on.

Be prepared for increased scrutiny (and to explain a dip in the figures)

With increased success comes increased scrutiny. Proactively announcing your financial results puts you on the radar of financial and business journalists, who may come back to you in six or 12-months’ time for a trading update. They may even set up Companies House alerts to monitor your performance. This means you need to be willing to explain the dips in your financial performance, as well as the highs.

Freshfield has been providing strategic communications support to organisations and their leaders for over 20 years. If you want to discuss a project, in confidence, contact our team at hello@freshfield.com.