Should the 1,300 or so listed companies that were preparing an OFR heave a sigh of relief that the Red Queen has chopped off its head? And what are the implications for HR departments?
In his speech to the CBI on 28 November, Gordon Brown announced that the government would abolish the operating and financial review (OFR) because of “concerns about the extra administrative costs of the gold plated regulatory requirement.” The DTI provides further justification for replacing the OFR with a simpler annual ‘business review’ because that could lead to overall savings for business of £154 million over the next five years .
Most companies were well into the process of producing an OFR. That requires them to come up with a forward-looking narrative taking into account any social or environmental risks that could affect the business.
By contrast, the business review that will replace the OFR does not demand a prospective view.