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A N N U A L R E P O RT S , V O L U M E 3 I N TH E A M E R I C A N D E S I G N C E N T U R Y S E RI ES , IS P R I N T E D O N P O T L A T C H
K A R M A , A FAV O R IT E O F C O R P O R AT E C O M M U N I C A T O R S F O R M O R E T H A N A Q U A RT E R C E N T U RY. T H I S
P R E M I U M M AT T E - C O AT E D S H E E T C O M E S I N T W O V ER S ATI LE S H A D ES - B R I G H T W H I T E A N D W A R M
N AT U R A L . A s Y O U T U R N T H E S E PA G E S, N O T I C E H O WK A R M A ' S H I G H LY O PA Q U E , N O N - G L A R E S U R FA CE
C A P T U R E S I M A G E S I N V I B R A N T D E TA I L Y E T I S E A SY O N T H E E Y ES E V E N W H E N R E A D I N G F I N E P R I N T.
L I T T L E W O N D E R T H AT K A R M A I S O N E O F T H E M O S T S P E C I F I E D PA P E RS F O R A N N U A L R E P O R T S .
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inancial annual reports have been around
in one form or another for hundreds of
years pre tty m u c h for as lo n g as th ere
have been investors interested in how
thei r money was be ing managed. But in
20th century America , two events shaped annual repor ts
as w e t hi n k of th e m today. T h e first was th e U .S. Secu rities
E xc ha n ge A ct o f 1934 , passed after th ecatastrophic stock
market crash of 1929. It mandated that all publicly traded
companies had to make yearly financial disclosures to
their shareholders. T h e seco nd defining event oc cu rre d
at the da w n of the '60s, w h e n let ter press p rin t in g gave
way to photo offset l i thography and hot metal type gave
way to photo composit ion. Flexible and fast , these newtechnologies made it affordable and possible to introduce
color photography and graphic e lements in to corpora te
brochures . Co m panies se ized the o pp or tu ni ty to "p igg y
ba ck " a m arket in g message on to the ann ual repor ts that
they were required to send to key consti tuents anyway.
From the '60s forward, annual reports exploded with
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colorful photographs, graphic images and visual themes,
and these once-dry documents took on the personal i ty of
the individual company Graphic design drew readers in to
the repor t , co m m un ica ted corpo ra te cu lture and exp la ined
management strategy in a l ively, compelling way It sti l l
does . In fact , the term "shareholders report" is kind of a
misnomer, since most companies print at least two to
three t imes m or e copies than they have s tock holders . T h at
suggests a distribution and use that goes far beyond finan
cial rep ort in g. E ach year thou sand s of ann ual repo rts -
13,577 in 1998 alone - are fi led with the U.S. Securities
and Exchange Commiss ion , and tha t doesn ' t inc lude the
thousands more produced by nonprof i ts and other ent i t ies
that do not have to file w ith th e SE C . For designers ,photographers, i l lustrators and printers , an entire industry
has gro w n u p a rou nd annual repor ts . In V olum e 3 of the
American Design Century, we look at a smal l sampling
of some of the best annual repor ts produced in the 20th
centu ry. T h e emp hasis und erstand ably is o n th e past 40
years w h e n annual repor t s bec am e a v isual m ed iu m .
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An Interview with B. Martin Pedersen
Publisher and CEO of Graphis P ress, B. Martin Pedersen has headed this international
publishing firm since 1985. In addition to publishing one of the world's foremost visual
arts magazines and a wide range of art/design books, G r a p h i s produces a prestigious
biannual annual report competition. Prior to Pedersen's acquisition
of G r a p h i s , he was a principal at fonson Pedersen H inrichs &
Shakery, where he designed many awa rd-winning annual reports,
magazines and corporate promotions. He is a mem ber of the A rt
Directors Hall of Fam e and the Alliance Graphique Internationale.
Q. Graphis has sponsored an annual report competition and produced a bookon annual reports for many years. When did this start and why were these financial
documents of interest to a design publisher?
A. M y predecessor, Walter Herd eg, wh o foundedGraphis, started that in 19 71, no t too long
after the m od er n annual rep ort came in to bein g. W ha t interested Walter, and still interests
Graphis today, is that annual reports involve a broad cross-section of the best talent in the visual
arts industry designers, pho togra phe rs, illustrators and typograp hers w he n they w ere still a
distinct profession. As a category, annuals are also of prime aesthetic interest to our readers.
Annual reports are unique because whether they are for a multi-billion dollar conglom
erate or a small public concern, they all must communicate the same basic information
w h o the com pan y is, w hat it does, ho w it is doing financially,
and w he re it's goin g in the future. W hat's fascinating is
the myriad ways that designers address these points and how
they manage to come up with fresh, original, company-
specific solutions each year.
Q. Like many people, you use the term "modern"
annual report. Could you define what you mean by modern
and what the typical annual report was like previously?
A. By modern, we are talking about annual reports that make
strategic use of design as a marketing/public relations tool.
When you look back on annual reports produced prior to the
mid-'50s, they were non-visual financial documents a letter
to shareholders, financial statements and n otes, brief summ ary
;?|fiSvf..ii v>!! K
Before acquiring Graphis Press, MartinPedersen designed a number of award -
winning annual reports. Amon g his long
standing clients was Dow Jones & Co.
for whom heproduced annual reports for
nearly a decade.
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Every two years Graphis hosts an
annual report competition and show
cases the winning designs from around
the world in a hard-cover book.
of ope ration s, and a listing of officers and directo rs, jus t th e facts
that the S EC required th em to disclose. Th at doesn't m ean that
good corporate design wasn't being produced. Look at the com
mercial posters and advertising images being created by designers
like Herbert Bayer, Lester Beall, and others at the time.It's just that
no one saw the annual report as anything but a financial doc um ent.
Q. So when did the annual report start
becoming a corporate communications vehicle?
A. Early signs of what it is today began appearing in the mid-'50s.
Today Paul Rand's 1955 annual report for IBM may look dated,
but back then i t was cutt ing-edge. Rand was brought into IBM
by its president Tom Watson Jr., w ho asked him to head a new graphics progra m . R an d
immediately brought a responsible design sensibility to IBM's annual reports and promotional
literature. H e hired leading photojournalists to take pictures for the reports. H e p ut a color
pho tog rap h on the cover, introdu ced the use of wh ite space and switched over from a cheap
paper to a quality coated stock. For its time, the impact was dramatic.
Another memorable annual from that period is the one that Erik Nitsche did for GeneralDy nam ics in 1 958. Nitsc he illustrated the c ompa ny's business lines by com bin ing beautiful
black-a nd-w hite photograp hs of airplanes, rockets and submarines, with short-sheet color
pho togra phs of abstract industrial designs. Even by today's standards, that re por t is w ond erful
ly sophisticated and fresh.
Q. The reports you mention pre-date th e 1959 Lit ton Industries book designed
by Robert Miles Runyan, who is often called the father of the modern annual report.
Why was Runyan's Litton report considered groundbreaking?
A. W ha t mad e Litton's report uniqu e was that Bo b Ru ny an developed a m ore sophist icated
visual theme to posit ion the companystrategically.You have to remember that Lit ton had
only been founded about five years earlier a startup by today's definition and didn't have
much o f a track record to show for itself. I t needed to develop a corporate presence. Bob
presented readers with Litton's goals and aspiration by combining inspiring symbolic still life
photog raphs w ith m arketing promises. Th e the m e implied technological leadership and
sound financial management without focusing on the present. It was a message intended to
reassure employees and customers as well as shareholders. It wasbrilliant.The Lit ton book
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Although the majority of annual reports produced in the late 1800s and
in the early part of the 20th Century contained little more than finan-
cials, there were a few wonderful exceptions, including this1860 Central
Park annual report featuring a fold-out map of the park.
was a visual eye -open er to the design comm unity. It helped C EO s, com m unica tions
managers and designers see how an annual report could be used to build what we now
call a brand identity.
Q. Were there other reasons why annual reports began to play a larger communications role?
A. The fact that annual reports came out annually and had to be distributed, by law, to
investors, financial analysts and oth er im po rta nt audienc es m ade it practical to add a few
m ore pages for an editorial message. C om par e that to corpo rate broc hures, w hic h often get
bogged down in production for lack ofa fixed deadline and then get used for years until
the inform ation inside becom es em barrassingly ou tdated. W ith annual reports, the SEC
filing de adline forces decisions to be m ade and to p executives to give it priority. As a result,
the con tent is perceived as m ore timely and authoritative. T he fact that annua l reports are
regulated by the SEC also adds to their credibility.Q. What impact did the modern annual report have on the design industry?
A. It enabled graphic design to grow into the profession as we k no w it today. T he m arketin g
potential of annual reports encouraged companies to allocate sizeable budgets for top pro
fessionals and for the best pro du ctio n value available. W h e n yo u loo k at the tho usan ds of
annual reports prin ted every year, you can see how they have spawned an entire industry,
supp orting designers, pho togra phe rs, illustrators, printers an d paper co mp anies. Before m od
ern annual reports, the graphic design profession was called commercial art. In fact,Graphis
started out as a commercial arts magazine. Its contents were about displaying graphic art,
and what that meant wasfine graph ic art prints by t he likes of Vasarely, M u n c h and Picasso.
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Q. Have annual reports set any design trends?
A. Absolutely! Some of the most innovative design produced over the past several decades
appe ared in a nnu al repo rts. Th is started wit h early design giants like Paul R an d , Saul Bass,
Dick Hess, Arnold Saks,Robert Vogele, George Tscherny and Chermayeff & Geismar, who,
in turn , hired som e of the leading pho togra phe rs and illustrators of the tim e. Tog ether they
established a model for what annual reports are today
Q. Could you name some of the major influences on annual report design over the years?
A. O f course, B ob R un ya n and Erik N itsche showed us the visual possibilities of annual
reports. Con sistently good annua l repo rt designers like Jim B erte and G ary He nc he cam e
ou t of Runyan s Los Angeles studio and are still doing goo d w ork today In the '70s and
'80s, Jim Cross did a nu m be r of elegant annual reports for No rth ro p, featuring som e am azing black -an d-w hite p ho tog rap hy In the '70s, illustrator and designer Dic k Hess was respo n
sible for giving a family look to C ha m pio n Interna tional ann ual reports. W h e n yo u stacked
them on the shelf, they looke d like a bo ok series, but each had a uniqu e m essage in her ent
to the company's performance that year. Co rpor ate Graphics Inc. and C orpo rate A nnual
R ep or ts also had strong influence du ring the '70s and '80s, and built their com panies and
reputations creating un iqu e annual reports for Fo rtun e 500 c om panies. Kit Hinr ichs has also
had an enorm ous influence on annual reports , with his wo rk for W arner Co m mu nication s,
Immunex and his brilliant encyclopedic series for Potlatch. Over the past 20 years, Greg and
Pat Samata have also contributed enormously to the annual report field.
Q. How has annual report design changed inth e '90s?
A. In the '60s, '70s, and '80s, ther e we re established looks tha t we re
maintained, refined and developed. In the '90s, design is all over
the p lace. T he re is no lon ger a single design m od el. A lot of
younger designers have gone beyond being influenced by each
othe r and are doing the ir ow n things. W h e n they are brilliant at it ,
they are amazing. I particularly admire the imaginative reports
produced by Cahan & Associates. I'm awed by and supportive of
the young generation of designers who are taking risks andc o m -
The stock market crash ofnig up with original concepts that merge tine art and the new
1929 instigated a demand for
techn ologies . To do that w ithin a pe rio d w he n there is no specific mandatory annual financialreports to stockholders and led
loo k and fashion is t ruly crea tivi ty at a highly de m an din g level . t0 the creation ofthe Securitiesand Exchange Commission.
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Q. Are annual reports always a reflection of the CEO?
A. Annual reports have been called the CEO's report card, and certainly, they always contain
the C EO 's letter to stockholders. In most cases, the a nnual rep ort m essage is driven from the
top, even though the production process is supervised bya corpora te communicator.
Sophisticated C EO s kno w that their ideas, achievemen ts and vision can't be com m unic ated
strictly thr ou gh h ard num be rs. Th ese messages are conveyed m or e effectively a nd persua sive
ly thro ugh design, image ry and well-w ritten narrative tex t.
Q. Designers frequently express frustration that corporations are inherently conservative
and less willing to embrace groundbreaking ideas. From reviewing annual reports, do you
have any thoughts on how to develop a strong annual report?
A. Let's look at it another way. I believe that two-thirds of the design solution is likelytocom e from the clients themselves, but to o m any designers go into the first mee ting w ith
their own design solutions in place. O n e of the most impo rtan t ingredients of co m m un ica
tions is an ability to listen. A se cure desig ner listensto the client and the client, in many
instances, drives the brilliance of an original idea. This is especially tru e o f CE O s w h o have
to be creative and innovativein solving business problems. W h e n designers showa will ing
ness to listen, I believe that CEOs look to them to articulate their vision and expressit in a
way that is visually c om pellin g. Afterall, design
can give form, energy and emotionto corpora te
strategies. As Runyan's Lit ton report showed us,
design can gain attention and help readers appre
ciate corporate goals and aspirations, even before
a company has realized its full potential.
Q. Are annual report designs
evolving in this age of mass media?r Certainly, annual reports are reflecting the fact
that we have become a technology and informa
tion-based culture. In America today, the entire
working populat ion, including CEOs, has grown
up under the influence of television, some wereIn the late '50s, the General Dynamics and Litton
industries annual reports introduced conceptual even weaned on MTV. The media-sawy public istheme sections with rich color photography and
demonstrated to American business the marketing attuned tO quicker methods of communicationsvalue of these financial documents.
^ w
f.
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As with m ost annual reports of
the time, IBM produced a minimal
docum ent in the 1920s. Just 6x8 inches in
size and only 8 pages long, the IBM annual report
included just a title page, letter to shareholder, directors
listing, balance sheet, incom e statement and auditor's report.
and to dealing with sophist icated concep
tual ideas. It is used to rec eiving info rm a
tion in sound bites and graphic form, and
impatient with long-winded stories and
disconnected words and images. Am erican
consumers have learned that it is possible
to be informed and entertained at the
same t ime - and they have come to
dem and i t. T he way annual reports are
being designed and information is being
presented is a reflection of that shift.
Ano the r in t e res t ing change i s tha t
some of the most daring annual reports
today are be ing created for startup co mp anies, wh ereas 25 years ago the most dyn am ic
reports were generated by Fo rtun e 100 corpo rations. A startup back then wo uld have
m ost likely put out a plain 10-K to conserv e cash. Today's startups un de rstan d the im po r
tance of bran d posit ioning and ho w m arketing can help them grow and at tract investors.Th ey are willing to risk mo re and allocate a significant p or tio n of their funds towa rd
creating a bran d identi ty throu gh their annual reports .
Q. With the rise of the Internet, many people are predicting the imminent demise
of printed annual reports. Any thoughts?
A, M aybe someday, but n ot in the nea r future. W ha t I do see hap pen ing is that com panies
will likely place an even greate r em phasis on th e so-called "front of the b oo k." Tha t's a
complete reversal of the original intent of annual reports a financial document with a sec
ond ary th em e m essage. Today anyone can go o nline and look at a comp any's earnings the
day they are anno unc ed . W hy wait weeks wh en you can access this informa tion instantly?
However, a printed piece is a tangibleobject.You can tou ch it, brow se th ro ug h it, read it at
yo ur leisure, toss it on yo ur coffee table and c om e back to it at a later time . A no th er adv an
tage for co mp anies is that they can actually pu t a pr int ed pie ce in front of readers, wh erea s
the W eb requires that peop le take the initiative and deliberately choose to visit a co rpo ra
tion's website. So just like T V hasn't replaced book s, I don't th ink W eb com m unic ation s will
replace the printed annual report. Most likely they will support and augment each other.
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Most companies begin introducing themselves
to annual report recipients right from the cover. Strong
visuals entice readers to open the book and provide
an opportunity to focus attention on the theme message for the
year. In 1 9 7 6 , H.J.Heinz proudly joined in the celebrationof America's Bicentennial by paying tribute to people across the
nation. The photographic essay by Art Kane begins on
the cover with a picture of a high school graduating class of
7 6 . The report was designed by Harrison Associates.
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Cahan & Associates used
bright solid colors, clean
geometric shapes and
simple sans serif typography
to reinforce the meaning
of the company name and
turn the cover of Rational's1996 report into a bold
piece of modern art.
T H E L. J . S K A G G S A N D M A RY C . S K A G G S F O U N D A T I O N A N N U A L R E P O RT
K
Nonprofit organizations as
well as publicly traded
companies produce annual
reports. In the 1987 report
for the Skaggs Foundation,
Vanderbyl Design featured folk
art objects to draw attention
to the Folkart/Folklife Program
funded by the Foundation.
12
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F
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Chase Manhattan Bank 1968
Micom Systems Inc. 1983
Hupp Motor Car Corp. 193 8 Puget Sound Power & Light Co. 194 4 General Foods 1949 Transamerica Corporation 1950
The Ansul Company 1961 Westinghouse Electric 1978
"ENT OVER 1971. THEOR PART OF THIS IM
PROVEMENT CAME FROMG A I N SI N O U R C O N S U M E R
TED PRODUCT LINESW H I C H A C C O U N T E D F O R
..:- p-; .--.- ;-..: -. ::CENT OF 1972 EARNINGSC O M PA R E D W I T HONLY.20PER CENT TEN YEARS AGO.
Scovill Manufacturing Company 1972
iircwo
cs
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known for presenting
conceptual ideas with a
humorous twist as shown in
the 1992 report for Herman
Miller Inc., which featured
a theme on Perspectives.
While most annual reports
are produced by outside
design firms, Herman Miller's
award-winning reports have
been done by in-house
designer Steve Frykholm
for more than 20 years.
Eli Lilly and Company 1982
Illustrations have long
been a favorite means to
communicate broad
concepts. Robert Guisti's
bull painting highlighted
animal genetics in Eli
Lilly's report, designed
by Corporate Graphics.
Jack Unruh's fanciful
drawings accompanied
children's essays about
the future in the Lomas
& Nettieton Mortgage
Investors report, designed
by Richards, Sullivan,
Brock & Associates. Vin
Guiliani's collage-
assemblage visualized
automotive market share
in Scovill Manufacturing
Co.'s report, by Corporate
Annual Reports, Inc.
- x-
mm
Lomas & Nettieton Mortgage Investors 1977
Scovill Manufacturing Company 1969
3 8
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UALORT
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< During the '90s, Cahan &
Associates has made creative
use of unusual techniques to
drive home their clients'
message in unforgettable ways.
Here, two die-cut holes that
run through the entire 1996Heartport annual report
underscore the point that the
company's system of making
two small incisions between
the ribs is a less invasive
alternative to conventional
open heart surgery.
Group 243 Design
chose a fun and youthful
way to reinforce brand
awareness of the Domino's
Pizza name. It tucked
the company's 1983
financial message inside
in a dominoes game box.
4 1
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Transamerica's Pyramid >
headquarters is not only the
company's corporate symbol, it
is one of San Francisco's most
popular tourist attractions. To
celebrate the Pyramid's 20th
anniversary, Pentagram designeda 33-inch high pull-up cover
that called out interesting facts
about the landmark. The theme
inside called out interesting
facts about the company.
M A I N P L A N T C O M P A N Y D E T R O I -
Prior to the mid-'50s, few
companies took an editorial
stance in their visuals.
Pictures of their facilities
were presented simply, in a
"bricks-and-mortar" style,
with no attempt to interpret
the business. The drawing in
Pfeiffer Brewing Co.'s 1950
report is an exceptionally fine
example of this approach.
4 2
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EH HEW BRANDS, RAISING THE COMPANY'S TOTAL DOMESTIC ANDINTERNATIONAL BRAND:
- ''-
Sometimes the most impressive and understandable
way to present a broad assortment of products is by arranging them
into a pleasing pattern. Using photographs shot by Michael
Deuson, VSA Partners organized Smithfield Foods' packaged meats
into a colorful design of interesting shapes and sizes.
The 1974 Seagram Company report, designed by
Arnold Saks Associates, opened onto a five-page foldout photograph
of Seagram products, with the reverse side showing more of
the same. Photographer Phil Marco shot this impressive display by
arranging the bottles in a staggered pattern on a light box.
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Before Photoshop, complicated photographs required
expensive retouching to assemble. For Castle & Cooke's 1984 report
designed by Jonson Pedersen Hinrichs & Shakery, photographer
Tom Tracy created an elaborate still life display on a soundstage so he
could shoot the company's produce products from 20-feet above.
v
Qua ntity - not just product assortment - w as the visual
message in this photograph in Sunshine's 1945 annual report, which
talked about the nearly 200 million packages of cookie
and cracker products sent to military PXs during World War II.
v
than 190,000,000 packages-X's alone shipped betweenHarbor and Hirohito's surr, A ug. 1 4, 1945in additionr rations. Sunshine has gonevery corner of the world
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H.J. Heinz Co. 1974
Arnold Saks transformed
the look of annual report
photography in the '70s -
first by his use of strong
photographic "icons" of an
industry and then by
partnering with printers to
produce color separations
that would enable higher ink
densities on a sheet. Gary
Gladstone's photograph for
the 1982 Colt Industries
report is representative of
Saks' richly saturated style.
H.J. Heinz Co. 1976
During the '70 s, H J. Heinz
commissioned some of the
best-known editorial
photographers in the world -
from top, Bruce Davidson,
Art Kane and Jay Maisel -
to shoot for its annual
reports. The 1974 and 1976
reports were designed by
Harrison Associates. The
1979 report was done by
Corporate Graphics Inc.
H J . Heinz Co. 1979
4 6
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4 8
For the 1996 and 1997
Swiss Army annual reports,
SamataMason designed
double-cover "form and
function" books. Opened
from one side, the books
showcase product forms
in beautiful photographs.
From the other direction,
the books feature the
functional side, presenting
the letter to shareholders
and financial information.
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