International Paper Annual Report Communication Analysis

Introduction and Scope

This analysis evaluates International Paper's 2003 annual company report against twelve principles of effective managerial communication, as outlined in Managerial Communication: Strategies and Application (Smeltzer, Leonard, & Hynes, 2002). Each principle is examined in turn, with direct quotations from the report used as evidence and, where appropriate, suggested revisions offered. The goal is to assess how well the report communicates financial and operational information to its intended audience of investors and other interested parties.

Word Choice: Precision, Length, and Concreteness

International Paper's company report does not appear to contain any word used inappropriately. The significance of terms is precise and almost always denotative. However, some word choices carry negative connotations. For instance, when referring to legal claims, the report states: "In connection with the products involved in the lawsuits described above, where there is damage, the process of degradation, once begun, continues until repairs are made." A more positive framing would have noted, for example, that the process of degradation stops once repairs are made. The writers do not appear to have given much thought to how investors and other interested parties would perceive this phrasing.

Although a company report should maintain an official register, it is important to remember that such documents are typically addressed to all kinds of investors, not all of whom may be as fluent in business language as the writers. Since the primary purpose of an annual report is to communicate clarity about the previous year's financial data, more precise and accessible word choices are advisable.

International Paper's report opens with a statement from CEO John Faraci. The following passage illustrates his word choices: "Each of these accomplishments greatly improved our operations and our relationships with customers, and gives us a very strong foundation for the future… In terms of continuity, we remain absolutely committed to our target of achieving a 9 percent return on investment." Many of these words could have been replaced with shorter, clearer alternatives. The apparent intention may have been to underscore the importance of the document, but the effect is one of unnecessary complexity.

International Paper's report is filled with abstract language. It appears that a significant portion of the hundred-page document could have conveyed the same information in half the space. The following passage illustrates the level of abstraction present throughout: "During 2003, International Paper continued to focus on managing the factors it can control, and further strengthened its core businesses through a rationalization and realignment program." Words such as "factors," "strengthened," "rationalization," and "realignment" create confusion at best and frustration at worst.

Economy of Language and Avoidance of Clichés

A more concrete approach would have served readers better. For instance, the following sentence accomplishes more with less abstraction: "In July 2003, we announced a program targeting significant additional reductions in overhead costs by late 2004, including the elimination of approximately 3,000 salaried positions in the United States." This kind of specific, grounded language is far more informative than abstract corporate phrasing, and reflects the principles of clear business writing widely recommended in professional communication.

This principle is closely connected to the one above. While many unnecessary words are scattered throughout the report, there are also passages where the writers present problems concisely. For instance, Chairman Faraci addresses his intentions using short, precise language: "We will also continue our intense focus on improving the performance of each of our three core businesses and our company in total. We've made progress in this area, but it's clear we've got to improve what we do every day, every place in the company."

Although there are instances of verbal economy, the overall size of the report speaks for itself. The report's hundred pages suggest that the writers did not prioritize conciseness as a guiding principle. Significant improvement could be achieved in this area.

With respect to clichés and jargon, the writers have made some effort to avoid making the report unnecessarily difficult to read. For example, the phrase "we remain absolutely committed to our target of achieving a 9 percent return on investment (ROI)" helpfully informs the reader how this financial ratio is abbreviated. The general tendency throughout the report is to explain the significance of technical terms, at least upon first use.