21st Century Executive Reporting in Ag Requires the Right Data and Fintech

Oct 6, 2021 | Blog, Data Acclimation

Decision Support Fintech Can Save Ag Lenders Time and Money

Executive reporting has evolved in recent years, with CEOs “taking on a broader array of responsibilities,” according to the Harvard Business Review. In part, that’s due to a combination of new technologies and new reporting requirements that are expanding the ways that companies are collecting data and reporting to their stakeholders.

As the status quo for reporting ramps up, executive reporting in agriculture must be bold but realistic in terms of the actual agricultural risk situations on the ground. By ensuring that stakeholders don’t stretch the capabilities of the agricultural system, executive reporting can play a key role in mitigating overall financial risk.

This post will take a look at how executive reporting is changing in the 21st century, as well as how the right data and fintech tools can streamline that transition.

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Why Executive Reporting Matters

Executive reporting is, in the most basic sense, how executives stay informed about the strategic operations of a business or organization. As the HBR explains, the broadening purview of CEOs and COOs means that “greater detail is visible all the way up the chain of command, so functional leaders had better know what they’re talking about.”

In agriculture finance, that means decision-makers such as chief risk officers, loan officers, and appraisers need to be familiar with a wide range of issues, from wildfire risk to water rights

Additionally, increased reporting requirements mean that ag professionals have to be more transparent about how they address these factors across their portfolios, from parcel-specific risk mitigation strategies to macro-level portfolio risk management.

 

Understanding risk at both the granular, parcel level as well as overall portfolio level is essential in ag finance risk management. Through this understanding, highly-informed loan decisions and parcel valuations can be made.

 

Fintech in executive reporting can help ag finance organizations monitor and meet targets, while also contributing to the sustainability of the agricultural system as a whole.

 

 

The Role of Fintech in Executive Reporting

Farm Credits and ag lenders have to report to their boards on the risks in their portfolios – this is what executive reporting means in agriculture. But without the right data, executive reporting can be difficult. This is where risk management fintech comes into play.

Climate risk aside, a financial institution’s core objective is to manage and mitigate risk, and risk in a portfolio is best understood geospatially. From loan decisioning to asset valuation, GIS tools can help ag professionals better identify and understand risks before reporting on them to their boards and governing bodies.

While the SEC has taken steps to mandate climate risk disclosure, government oversight and even investor expectations are changing rapidly. As Yahoo! Finance puts it:

“While many of us may want a single standard for corporate reporting to emerge, the different audiences and differences in what is measured for financial reports versus sustainability reports could make that impossible.”

Likewise, Nasdaq points out that “every organization must prioritize what it will focus on based on its own strategy, company, culture, and appetite to enhance its reporting.” This is an important sentiment. 

 

Farm Credits and ag lenders are very well aware of their own reporting strategies and requirements. It is their data, their portfolios, and their executive reporting. Risk management fintech is the catalyst to make this process smoother, faster, and easier. 

 

By focusing on data and risk management, rather than a specific reporting framework, ag finance institutions can be prepared to adapt to changes in the reporting landscape.

 

 

How GIS Connect Can Help

AQUAOSO’s GIS Connect is a fintech platform that can help with the E and S aspects of executive reporting by tracking environmental and social impacts across an ag lending portfolio. In particular, it can pull reports on a lending or investment portfolio’s overall risk level or present parcel-specific risk data in an easy-to-understand format.

GIS Connect un-silos risk data, allowing ag professionals to securely acclimate their own financial data with third-party data sets of their choosing. Each Farm Credit institution or commercial lender may have climate analytics or other third-party risk metrics that they use. This could include AQUAOSO’s top-of-the-line water risk data, as well as customer financial data, wildfire and smoke data, hurricane and storm data, frost data, and more.

 

Whatever it may be, it is encouraged. The magic component for the right risk management fintech solution is data acclimation: securely integrating it all together.

 

AQUAOSO’s secure APIs integrate third-party risk datasets. Bringing data together to see risk on a map from the parcel level to the portfolio level is everything.

 

 

Executive Reporting for the 21st Century

Not only does fintech help lenders and investors make better decisions, but they also give ag professionals a voice to make known what is currently possible so reporting requirements can align with where the agricultural industry is at today, in an effort to progress to tomorrow.

 

Rather than recommending a specific reporting framework, AQUAOSO’s GIS Connect fintech solution meets Farm Credits and ag lenders where they are, allowing for realistic reporting requirements to be implemented so that action can start as soon as possible.

 

By un-siloing relevant risk data and displaying it in a map-based format, GIS Connect helps Farm Credits and ag lenders achieve their core goal: managing risk. With GIS Connect, ag professionals are equipped with what they need to report purposefully and effectively to their boards and their governing bodies.

 

 

The Bottom Line

Executive reporting has a key role to play in getting decision-makers, regulators, and other stakeholders on the same page about financial risk in agriculture. As the industry adapts to a new status quo of reporting, having the right data matters more than ever. 

By using the right fintech tools and geospatial platforms, ag finance institutions can put their existing financial data into context and create reports that support their own reporting strategies.

AQUAOSO’s GIS Connect is specifically designed to help ag professionals geospatially see their portfolios in the context of risk. By acclimating third-party risk datasets, including AQUAOSO’s top-of-the-line water risk data, into their own loan and portfolio data, Farm Credits and commercial lenders can create accurate reports that identify risk factors on a parcel-by-parcel and portfolio-level basis.

Plus, since all of these once-disparate datasets are collected in a central, cloud-based platform, it’s easy for users to adapt their data management strategies to meet new reporting frameworks.

Contact the team at AQUAOSO to learn more, or visit the Resources page to download free reports and white papers on water risk.

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