Accountability comes of age

June 01, 2001

With the latest batch of corporate reports comes not just quantity but increasing quality, much more diversity and a step change in best practice.

Co-operative Bank and Shell top social reporters

The Co-operative Bank and Shell International are the overall winners of the UK’s first Social Reporting Awards, held on May 4. Sponsored by the Association of Chartered Certified Accountants and the Institute for Social and Ethical Accountability, the scheme aims to reward organisations which are measuring and reporting their social impacts as part of their business strategy for sustainable development. United Utilities, winner of the latest UK Environmental Reporting Awards, was the runner-up.

Shell International published its latest social report, The Shell Report 2000, How do we stand? in May, continuing its practice of printing negative comments made about the company’s performance, while The Shell in the UK Report to Society was published the same month. The Partnership Report, The Co-operative Bank’s ‘warts and all’ 1999 social report was released on April 19. At the release, the bank called on the government to make social and environmental reporting compulsory, and to place it on the same footing as financial reporting. The bank believes that the voluntary approach proposed by the government’s Company Law Review team will lead to an inconsistent, ad hoc approach which will make it impossible to compare one company’s performance with another. Contact Bob Reynolds, ACCA, on 020 7396 5751 (http://www.acca.org); Mark Wade, Shell, on 020 7934 3208 (http://www.shell.com/ shellreport); or Paul Monaghan, Co-operative Bank, on 0161 829 5460 (http://www.co-operativebank.co.uk)

Ford’s first report

Motor manufacturer Ford has released its first ever Corporate Citizenship Report. The report is loosely based on the Global Reporting Initiative principles and has won praise from environmental groups for its case study on Sports Utility Vehicles – widely criticised cars which are more environmentally unfriendly than normal vehicles. Ford admits that there are serious issues around the SUV market and commits itself to using profits from their sales to search for new technologies. Ford has also signed-up to the CERES principles, which commit members to make continuous environmental improvements beyond regulatory requirements. Contact Debbie Zemke, Ford, on 00 1 313 845 2586 (http://www.ford.com)

The lottery of social responsibility

National lottery organiser Camelot released its first Social Report on April 11. With the bidding process for the new lottery operating licence underway, and facing competition from The People’s Lottery, Camelot is placing great emphasis on its social responsibility and especially its community investment programmes. The report itself is based on a comprehensive audit of the company’s performance carried out by the New Economics Foundation, supervised by a panel of independent observers including the Consumer Council and the NCVO. According to the report, Camelot spent an impressive 4.5% or £3.13 million of pre-tax profits on its community programmes, as measured by the London Benchmarking Group method. Contact Camelot Newsroom on 01923 425 456 (http://www.camelotplc.com)

Mining for data

Rio Tinto, the leading extraction industry firm, released its latest social and environmental report at the beginning of April. The report is based around seven key commitments outlined in the 1998 report, including goals of zero fatalities, no spills to the environment, a five per cent decrease in greenhouse gas emissions by 2001 and publication of environmental and social reports (including specific targets) for each operating unit. Rio Tinto calculates that, according to London Benchmarking Group methodology, it invested $41.4 million in its community programme last year. Contact Rio Tinto on 020 7930 2399 (http://www.riotinto.com)

Canada takes note

The Conference Board of Canada released a report entitled Social Auditing: Breaking new ground in corporate social responsibility and accountability on May 4. The report is based on an executive best-practice tour of six UK companies – The Body Shop, BP Amoco, The Co-operative Bank, CWS, Shell and United Utilities. The report documents how these companies are responding to calls from society for greater responsibility and transparency, and how they are using their social reporting to gain competitive advantage.

The Conference Board also released a poll on May 3 of over 800 Canadians, revealing that 72% are more likely to buy from a socially responsible company, while 71% would prefer to work for one and 68% to invest in one. Contact Charlene Cummings, Conference Board of Canada, on 00 1 613 526 3280 ext.231 (http://www.conferenceboard.ca)

Communicate your community investment

Companies will benefit if they communicate their community investment better to their key stakeholders, including the rising number of socially responsible investors. A report commissioned by PR company, Communications Management, entitled Getting the Message? analyses the efforts of the top ten UK corporate donors. It also highlights the work of the London Benchmarking Group in developing ways to measure and report the company’s impact on the community. The report’s recommendations include:

• show board level commitment to community investment;

• briefly outline your community policy and give detailed examples of community support;

• give totals for donations as a per cent of pre-tax profit, and for other forms of community contribution, plus a comparison with the previous year’s totals;

• mention any separate social / community report produced and give a company website address -capitalise on the web by encouraging readers to interact and signposting them to related sites.

Contact Pam Calvert or Sarah Dennis, Communications Management, on 01727 850 761 (http://www.cm-pr.co.uk)

news in brief

• BT added to debate on how companies can maximise their contribution to economic growth by publishing Adding Values, the fourth in its occasional papers series, on May 24. The report clarifies thinking on the ways companies impact society, and suggests some indicators companies can use to measure and manage their performance. Contact Jan Walsh, BT, on 020 7356 6034 (http://www.bt.com/world/society/reports)

• Norwegian energy group Norsk Hydro has published a collection of essays from leading NGOs such as Amnesty, World Business Council for Sustainable Development and International Alert, plus case studies from Norsk Hydro’s own activities, to highlight and debate the issue of CSR. Contact Stéphanie Isabelle Tamagno, Norsk Hydro, on 00 47 22 43 21 00 (http://www.hydro.com)

• Consumer goods group Unilever published an account of its approach to sustainable agriculture, Growing for the Future, in May. The document outlines the issues surrounding sustainable farming, the company’s own policy, and the practical steps it has taken to fulfil that policy since the company first addressed the issue in the mid-1990s. Contact Sandra Darton, Unilever, on 020 7822 5252 ext.5320 (http://www.unilever.com)

• Provident Financial has published a booklet detailing its 1999 community investment programme, including its Parliamentary secondment initiative. Corporate community investment spend, following the London Benchmarking Group methodology, was £516,000. Contact Brent Shackleton, Provident Financial, on 01274 731 111 (http://www.providentfinancial.co.uk)

Editorial Comment

Every edition we report on another batch of corporate reports. Go back a few years, and it was news when a community report included any numbers at all. Cheers went up when an environment report mentioned human beings. Now, the London Benchmarking Group approach to valuing community contributions is almost becoming routine. Environmental impact has grown into sustainability, with the inclusion of social and economic factors, even if a holistic triple bottom line is still some way off.

We seem to have reached a key milestone in this process of gradual improvement. The third Shell report shows it really is possible to get commitment from a huge global business to do the numbers. Until now, companies listed in London have led the way, but with the Ford report (and Procter & Gamble’s cited in our last edition), we can say the Americans have arrived. Although the Asians (with some notable exceptions) are still largely absent, it won’t be long.

In this spread of practice internationally, the Global Reporting Initiative has been important; as we go to press, the results of its 18 month pilot are eagerly awaited. But looking forward, is going global the right course? In fact, very few stakeholders are global; perhaps only capital, which is already well served by the annual report and accounts, plus elements of the green agenda. Most are essentially local – employees, communities, customers, supply partners, governments. A single global report can never include enough detail for them to know what is really going on in their own backyards. For stakeholders of global businesses, Rio Tinto’s approach of separate local reports may well be the most effective. Real engagement locally is what being a corporate citizen is all about.

<

Corporate Citizenship Briefing, issue no: 52 – June, 2000

COMMENT:

Every edition we report on another batch of corporate reports.

Every edition we report on another batch of corporate reports. Go back a few years, and it was news when a community report included any numbers at all. Cheers went up when an environment report mentioned human beings. Now, the London Benchmarking Group approach to valuing community contributions is almost becoming routine. Environmental impact has grown into sustainability, with the inclusion of social and economic factors, even if a holistic triple bottom line is still some way off.

We seem to have reached a key milestone in this process of gradual improvement. The third Shell report shows it really is possible to get commitment from a huge global business to do the numbers. Until now, companies listed in London have led the way, but with the Ford report (and Procter & Gamble’s cited in our last edition), we can say the Americans have arrived. Although the Asians (with some notable exceptions) are still largely absent, it won’t be long.

In this spread of practice internationally, the Global Reporting Initiative has been important; as we go to press, the results of its 18 month pilot are eagerly awaited. But looking forward, is going global the right course? In fact, very few stakeholders are global; perhaps only capital, which is already well served by the annual report and accounts, plus elements of the green agenda. Most are essentially local – employees, communities, customers, supply partners, governments. A single global report can never include enough detail for them to know what is really going on in their own backyards. For stakeholders of global businesses, Rio Tinto’s approach of separate local reports may well be the most effective. Real engagement locally is what being a corporate citizen is all about.

COMMENTS