06
Non-Financial Indicators Handbook -
2013
-
VIVENDI
2
Integrated Reporting
Pilot Project
Intangible cultural capital: the impact of the Group's investment in diversity
of content on value creation
As Vivendi plans to focus on its media and content activities, and considering the growing demand from the
Group’s different stakeholders to better understand its overall performance, the General Management has launched
an integrated reporting pilot project to illustrate how promoting cultural diversity, one of the strategic issues of
Vivendi’s CSR policy, creates societal and financial value while preventing risks and opening up opportunities to
win markets.
■
The Challenge
Vivendi exerts a human, cultural and intellectual influence on the lives of millions
of customers and citizens worldwide due to the activities of the Universal
Music Group, the world leader in music; the Canal+ Group, the leading French
media company also active in French-speaking Africa as well as Poland and
Vietnam, and its subsidiary Studiocanal, which is aleading European player in
the production, acquisition, and international distribution and sales of films and
TV series. Vivendi has a societal responsibility to satisfy the curiosity and varied
tastes of its audiences on all continents, to help these audiences achieve their
full potential, and to provide the necessary conditions for them to become open
to the world andexercise their critical judgment.
In addition, cultural diversity is at the heart of Vivendi’s businesses: music,
television and film. Providing rich, original content; signing new artists in all
categories; avoiding creative talent drain; meeting the expectations of our
subscribers; making our platform attractive in a digital environment that disrupts
the well-established practices – these are the goals being pursued by our
businesses as they strive to preserve their leading position in their respective
markets (please refer to diagram below).
■
The Approach
Vivendi decided to take a pragmatic approach to this pilot project and to
implement it initially on a limited basis at Universal Music France, Canal+ in
France, and Studiocanal. Led by Vivendi’s Corporate Social Responsibility (CSR)
Department, this initiative brought together the managers in charge of Finance
and Strategy of these three entities of the Group and analysts representing
investors (Amundi, Groupama AM, and Oddo Securities). Indicators establishing
the link between investments in diversity of content and returns were chosen
(please refer below). The materiality of these indicators was then submitted to
analysts for review.
The chief financial officers of Vivendi’s businesses have welcomed and given
their full support to this approach and the analysts whose views were sought
believe it to be innovative, scalable and fully integrated into the strategy of a key
player in the media sector.
The aim is to enhance the value of the pilot project by 2015 through monitoring
indicators and widening the scope of the project to include other CSR issues,
after consultation with the Group’s main stakeholders.
Contribution to value creation of investment in diversity of content
(2013 figures)
CSR ISSUE
FINANCIAL VALUE
UNIVERSAL MUSIC FRANCE
(excluding Publishing)
CANAL + GROUP
CANAL+ AND CANALSAT
Survey results of Canal+ subscribers:
–
"Canal+ is a truly original network, different from the others": 77% agree
–
"Canal+ is a network that discovers and showcases new talent": 70% agree
–
"The films aired by the network are of varied genres": 90% agree
Survey results of Canalsat subscribers:
–
"Canalsat opens me up to the world and benefits me": 74% agree
STUDIOCANAL
Investment in European cinematographic works as an absolute value
and as a percentage: €129 million out of €181 million, or 71%.
SOCIETAL VALUE
To promote cultural diversity in the content offering
To invest in new talent and sign new artists
To promote cultural heritage by exploiting an exceptional catalog of content
To promote our audience’s participation in cultural
life, a source of personal fulfillment
To enable increased access to knowledge
and entertainment
To enhance mutual understanding and social ties
Growth in revenues
Improved profitability
Greater exposure of the brands
Value creation
Investment devoted to marketing new talent as a percentage
of total investment: 21%
Percentage of revenue earned by new talent: 10%
Percentage of digital revenue and physical revenue earned by the catalog
(works marketed for more than two years)
–
Weight of physical catalog: 20.3%
–
Weight of digital catalog: 44.7%
Number of new artists signed: 49
Portion of revenue earned by each musical genre (local, international, classical
and jazz, and compilations)
–
Local revenue: 53%
–
International revenue: 26%
–
Classical and jazz revenue: 8%
–
Compilation revenue: 13%
For Universal Music France, investing in diverse musical genres increases the market shares of its
different labels; promoting the catalog stimulates digital and physical sales; and attracting new
signatures of confirmed artists or of new talent provides a rich pool of artistic talent able to contribute
to the Company’s sustainable performance.
The figures for Canal+ and Canalsat show the direct link between a diversified original program offering
and subscriber satisfaction. The investments by Studiocanal in European cinematographic works make
it possible to develop an offering able to complement the offerings of the US major film studios on the
international market and to achieve an above-average return compared to its competitors.
Source: Studiocanal
Source: UMF
Source: Canal+ and Canalsat subscriber poll, 2013
