Human Capital Reporting and Disclosure

Why Human Capital Reporting and Disclosure

While some leading global companies voluntarily disclose extensive human capital information as part of their Environment, Social and Governance (ESG) reporting, most organizations report very limited information.

This will now change with the new U.S. Securities & Exchange Commission (SEC) Human Capital Disclosure requirements for all companies listed on the US exchanges. Since the SEC did not specify an exact set of measurements many companies are scrambling to identify what and how to measure to accurately reflect Human Capital’s impact on the business.

One approach is to adopt the ISO 30414 Human Capital Reporting and Disclosure Guidelines. ISO 30414 provides a set of recommended human capital metrics and shows how to calculate them. We believe it can serve as a “safe harbor” approach absent further SEC direction.

Benefits of Human Capital Reporting and Disclosure

Which Human Capital Metrics to Report And Disclose

SEC's 2020 Requirements

Under the new SEC rules, companies listed on U.S. exchanges will have to disclose information about their human capital including “human capital measures or objectives that the registrant focuses on in managing the business.”

The SEC didn't specify which metrics to report, instead individual companies need to decide what to disclose regarding the impact of human capital impact on their business results for areas such as talent attraction, talent retention and talent development among other areas talent impacts business results.

ISO 30414

The ISO 30414 recommends 58 metrics divided into the following 11 categories:

Compliance and ethics;
Costs;
Diversity;
Leadership;
Organizational Culture;
Organizational Health, Safety and Well-Being;
Productivity;
Recruitment, Mobility and Turnover;
Skills and Capabilities;
Succession Planning;
Workforce Availability

5 Steps to Human Capital Reporting Compliance

How We Can Help

HCMI’s Human Capital Reporting and Disclosure services help organizations move rapidly from Assessment to Compliance.
Deliverables include:

Rapid Readiness Assessment: A comprehensive gap assessment of current human capital reporting capabilities vs. SEC requirements and ISO 30414 standards
ISO 30414 Adoption: Deliver ISO 30414 human capital reporting standards on a project basis or via subscription with SOLVE™️ Workforce Intelligence Software
ISO 30414 Certification: Certify your internally- generated ISO 30414 reporting standards
Link Disclosures to Business Strategy: Analyze data to develop the storylines that link disclosures to business intent