Value-Added Statements as a Communication Tool for Stakeholders: The Case of Industrias Peñoles in Mexico

Abstract

This chapter illustrates the use of a value-added statement (VAS) reporting model by Industrias Penoles, a large mining, industrial, and chemical firm based in Mexico. The firm is quoted in the Mexican Stock Exchange, while one of its subsidiaries is quoted in London. This case study describes the use of a VAS reporting model in the context of stakeholder engagement, which is a particularly relevant issue for a company that operates in a highly sensitive industrial sector. Industrias Penoles uses a VAS model called the Fourth Financial Statement (FFS). The FFS supports dialogue between Industrias Penoles and its stakeholders by providing extensive information about the economic contribution of the company to each category of stakeholders. This chapter presents a longitudinal analysis of Industrias Penoles’ use of the FFS over 9 years (2005–2013), showing how stakeholder participation has evolved over time. Two different sets of stakeholders were identified: one group that enjoys a more stable distribution and another group that receives a more volatile share. This pattern suggests that the company has maintained a consistent policy for value distribution throughout the period. This chapter contributes to the discussion of stakeholder engagement by explaining how the FFS can help to shape and support discussions among stakeholders. This case has managerial and public policy implications as an illustration of a specific corporate policy for value distribution to stakeholders and of how the FFS tool can provide valuable information for public policy decision-making.