Up until Q4 of this year, the SEC’s regulations on disclosure related to HCM was limited to Board members and very generalized metrics across the employee base.
With the final amendments to Item 101(c) the SEC has expanded the past requirement to disclose the number of employees with an additional new requirement to provide information regarding the public company’s “human capital resources,” including in such description any human capital measures or objectives that management focuses on in managing its business, to the extent such disclosures would be material to an understanding of the company’s business as a whole. The rule provides a non-exclusive list of examples of human capital measures and objectives that may be material, depending on the nature of the company’s business and workforce, including measures or objectives that address the attraction, development, and retention of personnel. Consistent with other disclosure obligations, materiality of any individual factors will still be determined by the disclosing company.
We have partnered with David Simmonds, Chairman of HCM Metrics and the HR Analytics Group.
HCM Metrics is recognized as the leading global expert on HCM reporting regulations and standards.
David is the first accredited Lead Auditor for ISO 30414:2018 Human Capital Reporting in the world. It is the first International Standard that allows an organization to get a clear view of the ROI of its human capital.
Read more about David and HCM Metrics here.
It is anticipated that, over the long-term, the SEC will require the ISO standard, or very similar metrics for Human Capital reporting based on how similar regulatory mandates have evolved in other countries such as the UK and EU. The companies that adopt these first will set the leading standards for the US.
The Guiding Principles of ISO 30414:2018 support the delivery of evidence-based measures. This means an organization has insights that lead to better decision making. Having standard measures across the same sectors means it is easier to compare organizations and provide valuable insights for stakeholders. The important aspects of an organization are identified and provide consistency and ease of understanding. Board members and stakeholders have clarity and transparency in order to govern the business correctly.
An organization must bring focus to Human Capital Management metrics as part of its strategy. The alignment to the ISO standard needs to be pragmatic It must implemented within the organization's operation model. The organization should undertake a cost/benefit analysis. The ISO standard are relevant to all businesses of all sizes across multiple industries.
CRI has developed and are making available to our Clients, a detailed report to provide metrics on external relocations as part of talent recruitment and internal relocations of talent (by policy group).
To facilitate a common understanding of reporting requirements, the standard clearly delineates 11 Core Areas of Reporting.
As Q4, 2020 started, many firms found themselves scrambling to define a strategy and reporting structure for this year’s requirement. It is anticipated that firms will report on a variety of metrics until standardization is finalized in the coming reporting periods. The 11 Core Areas can provide a solid foundation to get ahead of the curve for many companies.
Watch CRI’s exclusive interview with David on What Comes Next:
We believe that mobility is a critical element of HCM Reporting.
Slow-moving or ineffective recruitment can be a bottleneck to growth. Cumbersome processes and overstretched teams or unrealistic expectations can make the job of filling vacancies longer and more costly. Poor candidate experience leads to a negative effect on employer brand. Timely and successful recruitment delivers many benefits to your company’s performance. Effective recruitment leaves you well-placed to take advantage of new organizational opportunities. Streamlined, efficient recruitment processes deliver higher-quality, more engaged people, providing a competitive advantage that directly impacts on the bottom line. Poor or slow recruitment can increase attrition rates, with the risk of stress and disengagement within the workforce. It can lead to high turnover resulting in lower productivity and poor morale.
As a result, we have developed and are making available to our Clients, a detailed report to provide metrics on external relocations as part of talent recruitment and internal relocations of talent (by policy group).
The bottom-line is, mobility and relocation impact recruitment and retention dramatically. Poor mobility results in stagnation and poor performance.
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