Value Reporting™ Framework (VRF)
What is the Value Reporting Framework (VRF)?
The Value Reporting™ Framework (VRF) is a PricewaterhouseCoopers (PWC) approach for measuring and managing corporate performance and structuring communications about that performance.
The value reporting framework (VRF) is a framework that companies can use to report on the value that they create for a variety of stakeholders, including shareholders, customers, employees, and the community. The VRF is designed to provide a more holistic view of a company's performance and impact, beyond traditional financial metrics such as profits and revenues.
The VRF typically includes three key components: a value creation model, a value reporting model, and a value assurance model. The value creation model defines how a company creates value for its stakeholders, while the value reporting model outlines how the company communicates that value to stakeholders. The value assurance model is designed to ensure the accuracy and reliability of the value reporting process.
The VRF is based on the idea that companies have a responsibility to create value for all of their stakeholders, not just shareholders. By using the VRF to report on the value that they create, companies can provide a more comprehensive picture of their performance and impact, and demonstrate their commitment to responsible and sustainable business practices.
Overall, the VRF is an important tool for companies looking to communicate the value that they create to a wide range of stakeholders, and to demonstrate their commitment to responsible and sustainable business practices.
The value reporting framework (VRF) consists of three main components:
- Value creation model: This component of the VRF defines how a company creates value for its stakeholders. It typically includes a description of the company's business model and the value drivers that contribute to the creation of value. The value creation model is used to identify the key sources of value for the company, and to understand how those sources of value contribute to the company's overall performance.
- Value reporting model: This component of the VRF outlines how the company communicates the value that it creates to its stakeholders. It includes a description of the information that the company will report on, and the format and frequency of the reports. The value reporting model is used to ensure that the company is transparent and accountable in its reporting, and to provide stakeholders with the information they need to make informed decisions.
- Value assurance model: This component of the VRF is designed to ensure the accuracy and reliability of the value reporting process. It includes processes and procedures for verifying the accuracy and completeness of the value reports, as well as guidelines for resolving any discrepancies or disputes that may arise. The value assurance model is used to build confidence in the value reporting process and to ensure that stakeholders can trust the information they receive.
The concept of value reporting has a long history, with roots dating back to the early 20th century. The value reporting framework (VRF) is a more recent development, however, and has only been in use for a few decades.
The VRF was developed by a group of leading accounting firms, professional associations, and research organizations in the late 1990s, in response to a growing need for a more comprehensive approach to value reporting. The goal of the VRF was to provide a framework that companies could use to report on the value that they create for a variety of stakeholders, beyond traditional financial metrics such as profits and revenues.
The VRF was officially launched in 2002 and has since been adopted by a number of companies around the world. The VRF is designed to be flexible and adaptable and can be customized to fit the specific needs and circumstances of individual companies.
Today, the VRF is used by companies in a variety of industries and sectors and has become an important tool for companies looking to communicate the value that they create to a wide range of stakeholders, and to demonstrate their commitment to responsible and sustainable business practices.
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