BT leads the way in a recent global reporting survey; the Companies Bill will mean need for improvement in data collection; and the KPMG Report suggests mandatory regulation improves reporting.
Global reporters
BT leads the field in the latest biannual benchmarking survey of leading practice in corporate sustainability reporting, published by consultancy and think-tank SustainAbility on November 9. Published in partnership with the UN Environment Programme and Standard & Poor’s, Tomorrow’s Value ranks the world’s leaders in corporate sustainability reporting, transparency and disclosure.
BT was head-and-shoulders in front of the main pack of leading reporters, coming in seven percentage points ahead of the second group — Co-operative Financial Services (CFS), BP, Rabobank and Anglo Platinum. Among the findings:
Leading companies are shifting the focus of their sustainability strategy away from risk management, towards an approach that seeks to identify the opportunities for strategic innovation and market building
Financial markets are beginning to influence disclosure: sustainability reports are framed as part of a portfolio of information available to both socially responsible investment funds and, increasingly, mainstream investors
Many company reports still lack the hard targets and forward-looking information needed to become essential reading for mainstream analysts
The proportion of companies reporting the integration of sustainable development into core decision-making has leapt. At least 80% of companies were rated as integrated on at least one aspect of their reporting
Under half of reporters still fail to link their sustainability commitments to the wider influence they exercise, either directly or through lobbying and trade organisations. Only 28% of the top 50 reporters covered this area meaningfully.
The report encourages an emerging effort by some businesses to link their individual sustainability targets with broader macro-frameworks, to provide a sense of scale and to help measure individual contributions. The Millennium Development Goals are used in this way by over 20% of the 50 top reporters. Contact; Kelly Cruickshank, SustainAbility 020 7269 6900 www.sustainability.com
Carrot & Stick
The harmonisation of voluntary standards and mandatory regulation will lead to higher quality and more useful corporate sustainability reporting, according to a report by the UN Environment Programme and KPMG‘s Global Sustainability Services.
Carrots and Sticks for Starters gives an overview and analysis of current trends and approaches in mandatory and voluntary standards for sustainability reporting and corporate responsibility.
Presented at the Global Reporting Initiative’s Amsterdam conference at the beginning of October, the report stressed the need for independent verification, stakeholder engagement, and the role of government in enforcing a level playing field.
“It is clear that regulation by itself cannot provide all the answers. It needs to be balanced by appropriate market measures and voluntary action,” said Achim Steiner, UN under-secretary-general and UNEP executive director.
The GRI released its new reporting guidelines at the conference (see Briefing 89, Aug/Sept). The new framework makes reporting simpler and includes requirements to describe management approaches and progress in areas such as environmental protection, labour standards, human rights and anti-corruption, areas addressed under the UN Global Compact. Its new online format is also aimed to make reporting and reported information more easily comparable for investors and financial analysts.
Contact; Robert Bisset, UNEP 001 33 1 4437 7613
Sustainability shortcomings
Significant improvements in sustainability reporting and data collection are likely to be needed to meet the requirements of the UK Companies Bill according to a report published on October 9.
Accounting for Ethical, Social, Environmental and Economic Issues: Towards an Integrated Approach looked at the annual and standalone sustainability reports of 100 UK companies and 100 Australian companies.
75% of UK companies provided at least one instance of reporting on the performance of social and environmental data, while 71% of Australian companies provided no data.
Similarly, 83% of Australian and 41% of UK companies failed to identify specific targets. 32% of UK companies acknowledged that performance measures were incorporated within their management systems. These included Cadbury Schweppes and Astra Zeneca. BAE Systems identified how the performance information was used.
Research into seven best practice organisations found that even leading companies are using an ad hoc approach when assembling sustainability information and then integrating it into their decision making processes. Carol Adams, a report author, noted: “Under the proposed law directors will be required to act in a way which benefits employees and local communities, customers and suppliers yet many of them do not have the means to assess their impacts on these groups.”
Contact; Carol Adams, report author, La Trobe University 00 61 2 9351 3778; Geoff Frost, report author, The University of Sydney 001 61 9351 3778 www.cima.org
Tool Up
The UN Global Compact has launched a comprehensive, web-based tool – OneReport Communication on Progress (COP) Publisher – to help Global Compact participants prepare and publish progress reports on integrating the ten principles into day-to-day business operations and practices.
Toyota has published its latest sustainability report focused on its European operations. Included in the report are details of a major drive to reduce carbon dioxide emissions, targets for a five year environmental action plan up to 2010, social contributions and investment and education programmes. www.toyota.com
McDonald’s has released its third corporate responsibility report, Open Doors. “The report is a transparent look at the company’s social responsibility progress,” the company said. A new element to the report includes candid opinions of students, who were given open access to McDonald’s and its supplier facilities to examine the sustainability of the company’s US beef supply. www.csr.mcdonalds.com
Nationwide Building Society published its fourth Better Society report, setting out the society’s vision for the future. www.nationwide.co.uk/bettersociety
Severn Trent published its Corporate Responsibility Report 2006. Acona independently verified the report. www.severntrent.com
Boots published its second Corporate Social Responsibility Report, following Global Reporting Initiative principles. www.boots-csrreport2006.com
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