Thursday, April 28, 2016

7 challenging questions on CSR

I am looking forward to my first trip to Bratislava on May17th to take part in the annual CEE CSR Summit as the guest of the Pontis Foundation - the leading organization in Slovakia promoting CSR, philanthropy and capacity development. The annual CEE CSR Summit is the oldest and largest event on corporate responsibility in Central and Eastern Europe, and is attended by almost two hundred experts on CSR, sustainability, the environment, and human resources.

One of the great things about speaking in different countries is that you are able to spread the word in so many different languages. In preparation for the conference, I was happy to be interrogated by the conference team and by local press. This interview was published recently.....

To spare you the pains of Google Translate, here is the interview in full .. in English. Thank you to journalist Veronika Sokolová for challenging me with these questions:

You are leader of a consulting agency, which focuses on issue of corporate social responsibility. Can you describe your working day? 
If I had a job where I could describe my working day, I would probably look for another job! My days are never the same. One the one hand, I am very hands-on in strategy and reporting projects for clients, on the other hand I try to stay ahead of the curve on the developments in the sustainability world. I do a lot of talking with people to hear about their activities in the sustainability area, and I do a lot (a lot!) of writing. My work includes a host of different activities with clients around sustainability reporting – ranging from interviewing anyone from a CEO to a maintenance manager in a company, taking part in conference calls or client meetings, analyzing spreadsheets, developing concepts, creating narratives, proofing, helping align design to content and supporting PR and comms. A not insignificant amount of time is taken up with preparing offers for client projects or bids for reporting contracts – some of which are successful! 

At a more general level, I spend a lot of time scanning new sustainability reports that come across my radar and reviewing several in detail for publication of expert reviews, for articles for my blog or as part of a benchmarking exercise. Several times a year I find myself preparing for speaking engagements at conferences or running workshops while several times a day I scan CSR news from a range of sources. I always try to make time to check what's happening in my social media channels and try to stay involved as much as time permits. I guide the work of my small team and spend time reviewing the status of their work and planning next steps. Many times a month I speak to people who want to find work in the CSR field or with companies that haven't quite decided how they want to move forward in sustainability and seek general advice. So every day is varied, all days are very full and almost(!) all days are really fun.

Which standard should company follow, to work in accordance to CSR? What are the main criteria or measurements, on the basis of which you report? 
The leading global standard for sustainability reporting is the Global Reporting Initiative G4 Standard. While this presents some challenges, it is a good framework and structures the reporting process well. It is possible to report without using any standard in particular, but the use of a widely known standard such as G4 makes it far easier for users of the report to navigate the content and understand the scope of what's reported. One of the big improvements that the G4 standard introduced over its predecessor versions is the focus on what is called in sustainability jargon – materiality – meaning the most important sustainability impacts of the business. A report should not be what I call a "shopping list" of activities. It should focus on the most important impacts of the company and their relevance to stakeholders. I think we are seeing shorter and more focused reporting today, replacing the very very long (and boring) reports of the past.

The European Parliament imposed a directive which obliges thousands of companies to disclose information about their social responsibility. Is it right to make reporting on CSR a duty for company? Don't you think that this will cause companies, not interested in CSR, to start faking the data for reports? 
Yes, I believe it is absolutely right to legislate for companies to be transparent. I believe the impacts of business on our lives are so broad and so profound that we have a right to know how companies do business. I do not believe that the way to report needs to be prescribed in detail, although some minimum expectations should be set. In this way, companies who want to do more because they genuinely believe this can realize benefits for them can do so, while companies who wish to disclose the minimum can also do that. The experience of the Danish framework of "report or explain" for the 1,100 largest companies that was established several years ago has shown that most companies, once they get on the train, find that they enjoy the ride. There will always be companies who break the law.. for example, the big story of Volkswagen cheating on greenhouse gas emission measurements from their vehicles that was exposed last year. Generally, I do not believe that it is the nature of most companies to deliberately falsify data in order to report positive performance. But I might be naïve. The idea is for us all, as stakeholders of companies, to be vigilant and examine what we are hearing from companies. I always think that sooner or later, the bad guys get caught.

When an entrepreneur sells services and goods and customers voluntarily buy them, logically both of them are better off- it is a win-win situation. Many companies also offer various discounts for disadvantaged groups because it is an advertisement for them. Customers know about it. At the same time, companies use an arbitrator like your agency to prove or certify that the firm brings benefit for society. Why do they do that? Is it kind of PR for them? 
There is a branch of CSR that is called cause-related marketing and it is exactly this. Everyone wins. The business sells, the consumer feels good about having bought a product with added social value and the community or social cause benefits. At the same time, companies have something to put in their CR Report. There is nothing wrong with this – provided everyone actually does win. The social contribution should be something that's meaningful and the way of engaging consumers should be appropriate in relation to the social cause that's being promoted. When Kentucky Fried Chicken made a promotion to support Breast Cancer Awareness, for example, it didn’t go down too well and they were attacked for contributing to the problem by producing food which has carcinogenic byproducts rather than supporting a worthy cause. 

CR is a way of doing business, it shouldn’t be a separate charitable project, so using marketing and gaining some good PR from CR is fine.. as long as it's appropriate, balanced and transparent. 

You have a lot of experience, how does the process work? First, customers start to look for, let's say, ecologic goods and then companies adapt their corporate values or rather companies bring new trends and educate their customers? 
I am not sure I buy that argument that mass consumers are driving the change in demanding sustainable products from companies and I certainly don't think we have anywhere near a critical mass of consumers that are prepared to buy "sustainably" sourced products at a price premium. I think the dynamic comes more from company innovations which impact the entire competitive landscape, and governments, NGO's, academics, investors, sustainability experts and entrepreneurs who keep the conversation going about what's good for consumers and create new pressures to support collective efforts to meet sustainability standards. Did Toyota produce the first hybrid car because consumers asked for it, or because they could, and take a reputationally-positive leadership position at the same time, increasing awareness and expansion of consumer demand rather than being driven by it? Did General Electric form Ecomagination, now a multi-billion dollar business, because consumers asked for it or because it was the right business opportunity "with benefits"? 

I think it is the professional movement that creates innovation targeted to address a social or environmental challenge or opportunity that moves the needle, and this in turn creates the demand. Having said that, there are examples of where consumer influence has changed the behaviour of corporations or led to innovation such as the new sharing economy of AirBNB and Uber that show how consumers can change markets in different ways. 

How many agencies like yours are currently operating in this sector? Is demand for such reports more in Western society, where companies may afford to invest more to CSR? 
I couldn’t guess how many Sustainability Reporting consulting firms there are … there are different types of firms that specialize in different aspects of sustainability consulting, with or without reporting, and there are other branding, communications and PR firms that compete for a slice of the reporting business. Our business is not PR or comms-driven, we are expert in the way companies can progress the sustainability agenda and report their impacts and performance professionally and transparently. Sometimes reports that have too much of a PR spin without enough sustainability substance do not succeed in building trust, which is the objective of every report. The idea is not to gloss the language and embellish the stories but to present a balanced picture in an engaging way. 

Reporting has steadily increased over the past 20 years and is continuing to do so. The cost of producing a report can be modest or highly invested. I don't think it's always about what companies can afford, it's about what they want to achieve. 

U.S. universities tend to refuse money from tobacco companies which want to contribute to various research. Are there any ways for tobacco and alcohol companies to make a better reputation, according to CSR standards? 
This is a tricky one. CSR today has evolved to refer to the positive impact a company has on society through its core business and not just through initiatives to save energy or volunteer in the community. If you subscribe to this view, the core impact of a tobacco company on people's health and even on the cost of healthcare as result of tobacco-related diseases is not so positive, whichever way you look at it. Therefore, many would say that a company in this sector has no business talking about corporate responsibility as its core product causes undisputable damage. 

However, a different view of CSR relates to how you do business – irrespective of the product you sell (provided it's legal), the focus is on doing your business in an ethical and responsible way – responsible marketing, energy management, treating employees with respect and more. In this case, tobacco, alcohol and all companies in controversial industries can do business in a positive manner and often go to great lengths to prove that they are doing so. 

The problem with the first argument is where you draw the line – tobacco damages people's health but so do the products of many other industries – foods that can lead to obesity, addictive drugs, toxic chemicals used to make toys or clothes… not to mention energy intensive industries that contribute to climate change and are the indirect cause of many health problems. San Francisco became the first state in the U.S. to ban the sale of plastic bottles – but I don't recall seeing that it banned the sale of cigarettes….There are laws banning many harmful products – but I am not aware of a country that bans cigarette sales. (Update: It seems that Turkmenistan has actually banned sales of all tobacco products) I believe tobacco companies have long since realized that they can never have a positive reputation – in my view, their efforts will always be about having a less-bad reputation. By behaving as responsible citizens in every other way and achieving high scores in many sustainability rankings and indices that measure sustainable companies, and by reporting as transparently as they can on everything but the harm that smoking causes, they manage to mitigate some reputational damage.

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Thursday, April 14, 2016

Take time to code

Today, when you talk about coding, the younger among us immediately click to coding: "the process of designing, writing, testing, debugging, troubleshooting and maintaining the source code of computer programs". But in the context of CSR and sustainability, we have a type of coding that is just a little different.

If you work for a large company, the chances are you have a Code of Conduct, a Code of Ethics, a Code of Commitment, a Code of Behavior or some sort of Code that frames the way the company behaves and expects its employees to align with. In addition, your company probably subscribes to one or more external codes or standards or frameworks that provide structure and even external validation of your company's activities in the field of corporate responsibility and sustainability. 

Did you ever stop to think just how many codes, standards and frameworks are actually out there? (Don't get me started, that's another conversation.) But yes, there are LOADS. And even more that. This was the case more than ten years ago and it's still the case at present. That's why, when Deborah Leipziger came along in 2003 and provided a comprehensive guide to the most relevant and useful codes, standards and frameworks in The Corporate Responsibility Code Book, it was an iconic piece of work that would be invaluable as companies started the process of navigating where to hang their hat as they develop a responsible business strategy, or understand what it is that makes one code or another more or less helpful or relevant. Recently the Corporate Responsibility Code Book celebrated the publication of its third edition.

Why does a competitor align with SA8000, for example, where another competitor prefers to use the ETI Base Code? What might we learn from the Extractives Industry Transparency Initiative, even if we are operating in a different sector? What are framework agreements and what role do they play in changing the way business gets done? Do the Guiding Principles on Business and Human Rights actually have any relevance for our company and why? Today, the third edition of The Corporate Responsibility Code Book is updated to include new initiatives such as the Guiding Principles on Business and Human Rights and the Gender Equality Principles and updates to the Global Reporting Initiative guidelines, the OECD Guidelines for MNEs, Social Accountability 8000 and many others. Similarly, some initiatives which that have been overtaken by new frameworks and are therefore no longer relevant have been removed.

While it's probably only geeks like me who actually like to read a book like The Corporate Responsibility Code Book, it's usefulness for anyone working in this space cannot be underestimated. And because, as a geek, I find this so fascinating, I couldn't resist talking to Deborah Leipziger, the code guru, to hear a little more from behind the code scenes.

Deborah Leipziger advises companies, governments and UN agencies on corporate responsibility and sustainability. She has advised leading multinational companies on strategic and supply chain issues, as well as a wide range of CR initiatives, including the UN's Global Compact, the Global Reporting Initiative, the UN Environment Programme, the Human Rights Impact Assessment, and Social Accountability International. Ms Leipziger is a Senior Fellow in Social Innovation at the Lewis Institute at Babson, and has taught at the Bard MBA in Sustainability, at the Simmons School of Management, and at Hult International Business School. She is a co-author several books and has served as a member of several boards including the Advisory Committee on Socially Responsible Investment for Aviva (UK), the Center for Ethics at Manhattanville College (USA) and the International Board of Ethos (Brazil). check out her website: here    

The Code Book is somewhat of an icon in sustainability and the general body of knowledge available. Who actually uses the Code Book and what's its value to them?
Deborah: The Code Book is used in many classrooms to teach about sustainability and CSR. I use it to teach my MBA students at Bard. I have heard from many professors that it makes for a very good syllabus and complete course materials. Many college libraries also purchase The Code Book. In addition, companies and law firms also purchase The Code Book for their libraries.

What makes for a good Code of Conduct? 
Deborah: The best standards and codes build upon the knowledge and value of normative and foundation standards, such as those developed by multilateral organizations like the International Labor Organization. A good code of conduct should be dynamic and flexible, while at the same time having staying power. Over the past 25 years, I have worked with many codes and standards. The best codes and guidelines are clear and concise and written with implementation in mind. Strong support from stakeholders is also essential.

In your introduction, you refer to a new emerging vocabulary as an essential part of fostering corporate responsibility. What are the key changes in vocabulary and why is it essential for us to adapt?
Deborah: A wonderful question! One of the most lasting contributions of codes and standards is their ability to create clear definitions in a complex field. Guidelines and codes have shaped a lexicon of terms around CSR and sustainability. For example, SA8000 lays out definitions of child labor and trafficking which are helpful for stakeholders and companies. These definitions provide companies with concrete parameters. The UN Guiding Principles on Business and Human Rights uses the terms “irremediable” to define human rights abuses for which there is no remedy, such as a lost childhood spent in hard labor. There are abuses for which there is a remedy, such as providing back pay for wages which were withheld. A few years ago, I was asked to advise Aviva plc on a project they were working on with Forum for the Future to create scenarios for what a sustainable economy might look like in 2050. My reaction was that we do not yet have the vocabulary to imagine and create a sustainable economy in the coming decades. I tackle this in a book I co-wrote with a team at Babson: Creating Social Value: A Guide for Leaders and Change Makers, which came out in 2013. One of the paradigm shifts that I see is companies working to promote social value creation, which includes solving social problems while also creating financial value. Companies need to think beyond being compliant with laws and standards, and towards creating social value through social innovation.

Your last chapter talks about pathways to convergence with ISEAL as an example which brings NGOs together under a broad framework of shared principles. However, what's the evidence that any sort of convergence in the private sector is actually happening? It seems that the world of codes, frameworks, and standards is only becoming more complex.
Deborah: The ISEAL Alliance has brought coherence to a wide range of social and environmental certification systems, creating common frameworks. This has helped to bring credibility and efficiency to certification and labeling standards from organics to fair trade. At the same time, there are many new systems emerging many of which are complex. I think complexity and convergence can coexist.

Did you consider the standard of standards, the emerging GISR? Do you expect GISR to influence the way Codes are used? 
Deborah: I have been following the progress of the Global Initiative for Sustainability Ratings (GISR) for many years. Allen White and I worked together when we were both in the Netherlands and he has been a speaker in my classes for many years, which has allowed me to follow the progress of the GISR first hand. I think the GISR will indeed have an impact on how codes and standards evolve. Perhaps it will be included in a future version of The Code Book.

What's your position on the frameworks used for inclusion in major stock exchange sustainability rankings for example DJSI?
Deborah: Many companies use DJSI as a framework to drive strategy and disclosure. I think the Dow Jones Sustainability Index is an excellent tool for companies. It helps drive performance and serves as a driver for companies to excel. I consider stock exchanges to be pivotal in driving change in the corporate sector. I hope to see more rankings like the DJSI emerge.

What was your personal biggest insight as you were preparing the third edition?
Deborah: I was struck by how much membership has grown for the guidelines and codes covered in Code Book III. When I first began tracking codes and standards, many of the initiatives had a dozen or so members. Now initiatives encompass broad networks of companies. I am also struck by how the field has evolved from aspirational initiatives to complex and brilliant initiatives like the UN Guiding Principles on Business and Human Rights. The Guiding Principles constitute a significant contribution to the field of corporate responsibility, defining the role of the state and of companies in addressing human rights and the need to provide access to remedy when human rights have been abused. The Guiding Principles provide a useful tool for companies working to complete due diligence and to assess where their operations, products, or services might have a potential adverse impact.

Will there be a Code Book IV? 
Deborah: It’s not in the works right now, but it is a possibility. There is a great deal of interest from emerging economies and Code Book III was launched in New Delhi.  


Thanks to Deborah for these insights. Happy coding!

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Friday, April 1, 2016

Common principles of materiality: April Fool!!!!

So, apologies for a few weeks of radio silence on the CSR Reporting Blog... sometimes that little thing called life just takes over .... but this April Fool's Day joke was too good to miss. It's the publication of the Statement of Common Principles of Materiality of the Corporate Reporting Dialogue in March 2016 which I just noticed yesterday via a Facebook post from eRevalue

The Corporate Reporting Dialogue is the consortium of the biggies or wannabe biggies in corporate disclosure:
  • CDP
  • Climate Disclosure Standards Board
  • Global Reporting Initiative
  • International Accounting Standards Board
  • International Integrated Reporting Council
  • International Organization for Standardization
  • Sustainability Accounting Standards Board 
It was established in June 2014 as "an initiative designed to respond to market calls for greater coherence, consistency and comparability between corporate reporting frameworks, standards and related requirements".

So, after almost two years of dialogue, where, we might be inclined to ask, is the greater coherence, consistency and comparability? Aside from more and more connections and linkages and principles and frameworks and standards and indicators and pseudo-dialogue... there is little evidence of coherence, consistency and comparability.. on the contrary, there is more evidence of three different c's: confusion, complexity and conflict. And just to make life fun, yet another document on materiality that looks like more of an April Fool's Day joke than an intelligent response to the needs of reporters and their stakeholder communities appears proudly on our screens. 

The document is billed as responding to "market demand" in "clarifying reporting concepts". It starts with a full page introduction to Materiality... which, when boiled down into a couple of sentences, essentially tells us what we already know: what's material is different depending on who you are talking to, and, what is only a bit material now maybe a lot material in the future. Therefore, no-one has a "one-size fits-all" (sic.) definition of materiality but there is a "foundational principle" which is: "material information is any information which is reasonably capable of making a difference to the conclusions reasonable stakeholders may draw when reviewing the related information."

Note here that the reference is to "reasonable" stakeholders. Later this is explained as excluding from the reporting focus a "single or atypical stakeholder or one who is behaving unreasonably or irrationally". I wonder what this means? I know all stakeholders weren't created equal, but surely there is some element of stakeholder inclusion that suggests that by definition, a stakeholder (group or individual)  is affected by and affects the business of a corporation and therefore has the right to hear and be heard? Who judges what behavior is unreasonable or irrational enough to merit exclusion from the playing ground? GRI's definition of stakeholders does not exclude unreasonable or irrational stakeholders:

So, apart from the fact that companies are encouraged to play nice with nice stakeholders, there's nothing new in this introduction and it kinda reinforces what most of us have already known for a long time - that materiality without due process is subjective, self-serving and manipulable and no-one really wants the inconvenience of proving otherwise.  This document makes no reference to the process by which materiality is determined... only what materiality is or should be. As fundamental as materiality is to all things sustainable and reporting, we might have expected that the most invested minds in reporting thought-leadership today might have been able to come up with something more substantive.

Moving quickly onto the document's presentation of the principles. Oops. No principles... just (another) Introduction, Concepts and Application.

Six concepts are presented. I can distill five of them down to the following from the mumbo-jumbo technobabble of this coherent, consistent and comparable (not) document:
  • Report materiality to your most important stakeholders (only) and assume they understand
  • Leave out stuff which is not material
  • Every company will have to decide how much detail to add in or leave out
  • It's OK to include stuff which is not material, as long as it doesn't hide what's material
  • Materiality is relative - depends on the context
  • Even if a new standard defines something as material, if the reporting company's stakeholders don't think its material, it's OK to ignore it 
I challenge you to read the six concepts in full original technobabble and see if you can distill them down to even fewer words, or even, identify anything ANYTHING that is remotely different, new, enlightening or helpful in all of this.

Then there's the application. There are five points of guidance which I have distilled down into English:
  • Materiality requires qualitative judgment, but if it's law, the law prevails
  • Managers decide what's material but should take primary stakeholder (investor) input into account  
  • Relevance of materiality changes over time, so if you've said it once, you can probably ease off in the future
  • If you are making estimates when reporting material impacts, take into account the views of your reasonable stakeholders
  • When disclosing material information, if you can't measure it, it doesn't count 
Then there are 4 pages of comparison of materiality definitions and approaches by Corporate Reporting Dialogue participants - a sort of copy-paste-plus of what's already out there.

So, I am wondering, apart from wanting us to have a laugh on April Fool's Day, what earthly purpose does this document fulfil and what are corporate reporters supposed to do with it? More importantly, if it takes two years of meetings, lunches and open dialogue to deliver this, frankly I think everyone should go back to their own corner and campaign for fragmentation, differentiation and splendid isolation. Unless the lunches are unbeatable.

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Tuesday, February 9, 2016

Humanizing sustainability

We often position sustainability so far above the radar of our day-to-day reach that it fails to inspire, energize and motivate. By using corporate-speak, legaleeze and PR-approved jargon  for getting the sustainability communications message across, we have to realize that we are missing an opportunity to create an engaging conversation about sustainability. That's what Emma Ward calls humanizing sustainability. Making sustainability about real life, about people and how we relate to each other, and about the things that matter to us can only happen if it's a great conversation, and not a stuffy old report. You have to agree that this is a compelling sort of idea.

Emma Ward is the Group Sustainability Manager for McNicholas, a family business in the UK, established in the 1940s and currently employing around 1,400 people in the construction and engineering sector. McNicholas provides engineering services to the multi--utility sector, telecommunications, gas, power, water and renewable energy sectors and more.  

Emma will be joining me and a fabulous line-up of speakers and a distinguished group of delegates at the edie Sustainability Reporting conference on February 23rd in London, where she will engage in a discussion all about innovative ways of engaging stakeholders.

As I do before every conference, I like to get to know some of our speakers and get a general sense of what's going on. I had a chat with Emma and here are some of the insights she shared with me.

How long have you been with McNicholas and what's your favorite part of the job?
Emma: I have been with McNicholas for 14 years. I joined as an environmental advisor and have grown our approach at McNicholas from an environmental focus to the point where sustainability is now a major part of our business strategy. It’s sort of my baby! I think it’s the variety that makes it so exciting - the role covers some many different facets. Another thing I enjoy is the sense of changing the face of the construction industry… generally people think of construction as a sort of “mucky” industry. With sustainability, we present a clean and professional face of the industry as one that cares about people and the environment.

What’s driven the increased focus on sustainability at McNicholas?
Emma: Although we have been pushed to align with regulation and increasing expectations from our Clients and from the communities we work in, we as a corporate are seeing genuine business benefits from applying sustainability as a risk management tool. I think it is this that keeps up the momentum rather than it just being a passing fad. In this day and age, a business plan can’t just focus on the financial and commercial risks, the environmental and social ones need to be just as high on the list. By using this new strategic approach, we are more involved at the planning stages enabling us to build better relationships with communities, respect what is important to them and help to improve things. But a sustainable and ethical approach to business has always been our culture. We are a family-owned company… sustainability has gone hand in hand with growing the business. At the same time, we stay true to our values as a people company. We have always tried to make sustainability about people as much as about any other aspect. It’s a way of humanizing everything.

How do you define what’s most important from a sustainability standpoint?
Emma:  We have recently reviewed our approach and tried to go back to basics on what makes us good, what is our way and why our clients want to work with us. In doing so, we have completed a materiality assessment, using input from our internal stakeholders and some of our key clients – large companies who are themselves leaders in sustainability practice – to understand their expectations of McNicholas. Our new strategy, entitled ‘Our World’, has nine activity streams covering the environment, people and culture.

What’s going to change with the new strategy?
Emma: I believe ’Our World’ will help us engage even better with the people that make McNicholas great and ensure we are meeting the expectations of our clients and communities. One of the things we decided to do differently is give each of our Board members responsibility for leading one of our strategy streams BUT in an area different to their main area of expertise. For example, the CEO will lead our community stream, our Human Resources Director will lead the natural environment stream and so forth. We wanted them to be involved from the perspective of a sustainability leader rather than from the perspective of a subject matter expert. That way, they will ask new questions and perhaps even learn something new.

What makes a good sustainability report?
Emma: It needs to be light enough to dip in and out of. A report shouldn’t be too intense – it should be short, concise, snappy and has to engage me straight away. The look and tone must be fresh and navigation should be easy so that the reader is in control of how to read the report. So many reports make that decision for the reader. They define a route through the report whereas I think we should be in control, not the report. Our own report process at McNicholas is changing to reflect this. We have always written fairly light reading reports in the past, but now we plan to use the website more to communicate our sustainability strategy and achievements. This will help to keep the report less about just a year-end wrap-up, and more about a conversation about what’s going on more regularly. Less structure, more control for the reader. We want to keep sustainability conversational and personal. It should be fresh and engaging. Hopefully, our new website will be ready in a few weeks.


Fresh and engaging. Those are not words we usually associate with sustainability. Interesting how sustainability came to be so stuffy. Well, it doesn't have to be and Emma is a living example of that. She talks with a lively passion about what she's doing and she's very clear about how to make sustainability work in her organization. It's called humanizing sustainability. If you haven't tried it yet, I am sure Emma will be handing out free tips in February. Hope to see you there!

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Tuesday, January 26, 2016

Know what CSV really means? Think again.

I had a quick phone call with Janet Voûte last week. I caught her just as she was going into the launch of the 2016 Access to Nutrition Index session at Davos. I guess that's the closest I'll probably get to a WEF session at Davos like ever.

OK, so I wasn't in Davos, I stayed warm.
I was super-grateful that Janet spared me some time as she is one of the most passionate and inspiring speakers around on the making-the-world-better circuit today. She is also really REALLY busy.  Janet shared some insights with me that truly helped me understand the essence of better-world-through-business. Janet Voûte is Nestlé's VP of Global Public Affairs. Want to know what that means? Read on....

But first, a quick reminder of Nestlé's claim to fame: Creating Shared Value (CSV). No, I'm not going to give you the lecture. You probably know what Shared Value is all about by now. But if you don't, stop, grab a cup of Nescafé (see that? PC), and read all about it in Nestlé's last report.

Oops, the full report is 284 pages short. You night need more than one cup. The Summary Report is only ONLY 53 pages and that works well too. The report is entitled "Nestlé in Society: Creating Shared Value and meeting our commitments". That bit about commitments is no less important than the CSV bit. Nestlé has 38 commitments to 2020 that support the CSV direction. Check them out here on Nestlé's CSV website. Against each commitment is a statement of progress and a link to dive deeper. The scale, scope and breadth of these commitments is formidable, especially as they are not only about reducing GHG emissions, water use and salt, fat and sugar in products  ... they are mainly about changing the way consumers consume or the way farmers farm or the way young people get a foot on the career ladder. What's striking about Nestlé's commitments is that most of them really go to the heart of the role of business in society. Which, in a nutshell, is what CSV is all about. It's better-world-through-business .. where business addresses specific societal / social needs in a way that creates value both for the business and for society. Darn. I wasn't going to lecture.

Nestlé's CSV focus is very well defined......
 .... and Nestlé has been very consistent over the years in driving its prime agendas forward. But I promised to tell you what VP Global Public Affairs means. Perhaps it's better to let Janet explain:

What does Global Public Affairs mean on a day-to-day basis?
Janet: What I spend my days on is our CSV agenda and all the many aspects of that. I have the privilege to sit on the Nestlé In Society board – that’s an internal management board of our entire societal agenda, chaired by our CEO, which meets three or four times a year. I also spend time as Chair of the Nestlé CSV Council which is an external advisory group made up of 12 thought-leaders from around the world in strategy and sustainability matters such as nutrition, water, agriculture and rural development. I also organize our CSV Forum and stakeholder convenings. Obviously, around this time of year, I am also involved in the development of our report suite and effective communications of CSV. I have a particular background in the health field so I also work on our Nutrition Health and Wellness strategy.

Yes, you did read that right. Stakeholder convenings. Somehow that sounds much more considered than stakeholder meetings or stakeholder dialogue, though I suppose it's pretty much that. However, Nestlé does this quite spectacularly. But before we convene about convenings, you first need to know about the CSV Global Forum. This is an annual public debate held in different places around the globe, bringing together around 200 experts for a full day to discuss the role of business in society and key topical themes. It's live-streamed and prolifically tweeted. You can read the summary of the 2014 event here.  (Don't worry, no more than one cup). The CSV Global Forum provides inspiration and direction for the stakeholder convenings.

Please tell me about stakeholder convenings.
Janet: Twice a year, in addition to our public engagement processes, we hold private stakeholder convenings covering the same topics that we discussed in our public stakeholder dialogue events under the CSV Forum. These private convening events for around 60 - 70 people including academics, NGO's and members of the investor community enable an open discussion about what we are doing and what they like and what they don't like. The convenings are held under Chatham House Rules (we just completed one in Washington D.C.) and the conversations are enriching for our business leaders. The last time, our CEO spent nine hours listening and responding. This platform provides authentic insight into what’s expected of us as a company. It also helps our stakeholders gain new insight so I hope it's mutually beneficial. The think-tank SustainAbility helps us structure the process. The output of these discussions feed our materiality assessment. We also publish the recommendations in our CSV report.

The investment in truly understanding what stakeholders are saying in so many different meetings, convenings, gatherings and panels (Nestlé also has a Nestlé Nutrition Council - an independent advisory panel made up of international nutrition scientists) is a far cry from the online questionnaires or consultant-led interviews with anonymous stakeholders which seems to satisfy many companies. This is real face-time. It's meaningful, impactful and robust as a source of guidance for Nestlé's evolving role in society. One of the tangible outcomes is Nestlé's materiality matrix.

Does all this chatter really have an impact on the way Nestlé does things?
Janet:  Oh yes! It really does. For example, our use of the term zero in our water program may well have come from our interaction with John Elkington on the Nestlé CSV Council who made that term synonymous with the sustainable development agenda in his book The Zeronauts. We have zero water dairy factories. While we might have gotten to this ourselves, it’s not a given that we would have developed our ambition to reach this far. Similarly, for example, Sasha Zehnder, the Scientific Director of the Alberta Water Research Institute in Edmonton, guides us in the fact that water is both an emotional and a rational discussion, and all of our nutrition experts on the CSV Council encourage us to engage more with stakeholders and review our commitments. Our CEO listens, we listen, and this changes how we evolve. We are now planning our seventh CSV Forum to take place in Abidjan in the Ivory Coast in June this year. This Forum will continue to look at the changing role of business in society especially in the light of the new Sustainable Development Goals.

Cero means Zero in Mexico. Just sayin'....

What’s hot on the CSV agenda today?
Janet: The CSV agenda is always dynamic. Nutrition is always on the agenda with both the overweight and underweight double burden of malnutrition. That will always be part of Nestlé corporate strategy. Also, clearly the water and environmental sustainability agendas will continue to be central. And all the work with farmers and rural development. Our Chairman is here at Davos with a new 2030 Water Resources Group which he helped establish. This area will require focus for years to come. What’s new is perhaps the increasing interest of investors beyond SRI and ESG investors. I am seeing new frontiers as the conversation starts to penetrate into the mainstream. Mainstream investors are starting to understand that it’s about why the business does well – CSV as essential to business success through improved access to capital, access to labor, license to operate and brand building. The other topic area that's hot right now is the consumer/millennial side of the equation.

Over and under nutrition is Nestlé’s top material issue. Where do you believe you have made the most significant progress in these areas in the past few years?
Janet: In terms of the double burden of malnutrition, we are all massively concerned with increasing rates of obesity, and recognize that national health systems cannot manage this. That’s a joint, mutual concern while at the same time you still have populations that are undernourished, malnourished and micro-nutrient deficient. Nestlé has done many things in this area. We have done some of the classic things like reducing salt, fat and sugar and added whole grains and vegetables, but we have also innovated in a series of areas like portion guidance. We are starting to tell consumers in simpler terms how much is the right amount to eat to help them make better decisions. For example, in the U.S., we have a frozen pizza business and we have portion guidance that shows that a big guy can have two pieces and a kid can have one and you should eat it with salad! 

Janet: We are also doing a great deal of research for the future of nutrition to make step changes such as addressing sodium levels to retain taste but dramatically lower sodium content. To further our research, we have two relatively new business areas in the past 5 years: Nestle Health Science and Nestle Skin Health. Going beyond the food and beverage business and investing in the future of nutrition and health is how we are evolving our corporate strategy while staying true to our CSV core. Science looks for nutritional solutions to specific conditions – targeted nutrition and personalized nutrition are the next level - food, health, skin care - it's all linked by the science of nutrition. It’s a big agenda and I am proud of the company for the progress we have made - it’s not over! I am  also happy we improved our score to become number 2 in the  2016 Access to Nutrition Index which is a very rigorous benchmark of food and nutrition companies. 

Nestle 2016 ATN rank

It will be a great honor for me personally to host Janet Voûte at our upcoming Sustainability Reporting Conference in February. Janet is a wealth of experience, knowledge and insight, and has a tangible passion that will energize our audience. Of course, if you haven't booked your place yet, better hurry! You wouldn't want us to run out of space, now, would you? Check with me for a discount (yay!).

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Monday, January 25, 2016

Trust - it's no accident

One of the things that Barbara Brooks Kimmel, CEO and CoFounder of Trust Across America-Trust Around the World™ (TAA-TAW), has succeeded in driving home in her intensive work over the past two decades, is that trust in business is no accident. Trustworthy business is underpinned by trustworthy people. Trustworthy people advance trust in business through their words and actions, and the compatibility of the former with the latter. Doing business without trust is like running a marathon with a blindfold. You might keep running but who knows where you will end up. You could also fall and break your leg.
Trust is at the root of any successful business. But while that may sound obvious, we all know the consequences of lack of trustworthiness. Martin Winterkorn might want to weigh in here, alongside a thousand others I could mention. I don't believe that trustworthy characteristics are the product of a carefully conceived strategy. I believe that trustworthy business leaders were trustworthy before they were business leaders. I believe it's part of who they are. So why should we celebrate people for doing business in a trustworthy way, just because that's the way they are? Shouldn't trustworthiness be a minimum acceptable baseline? Does it deserve recognition?
Yes it does. Because no matter how deeply entrenched your personal trust characteristics are, there are many temptations along the way. So many conflicting interests to appease, so many challenging targets to achieve, so much competitive and regulatory noise, so many demands, so many corners available to cut, so many new challenges that emerge from new market dynamics. Even the most trustworthy of us might be tempted to ease off around the edges in order to protect assets developed and reputation hard-earned. Corporate leaders that rise above the noise and stay true to a backbone of trustworthy character in all their undertakings are an inspiration for us all. A little celebration of trustworthiness can only serve to reinforce it.
Similarly, capturing and embedding trustworthiness throughout a large organization takes more than  one trustworthy leader at the top. The leadership-halo ripple-effect reaches only so far in large, complex organizations. A structured approach of walk, talk, training, recognition and discipline is required to ensure that every single employee in an organization knows that trustworthiness is more than a value, it's a non-negotiable. Every single employee needs to know the behavioral expectations that support trustworthy business in each daily action in each role. The influence and work of many individuals who support business leaders in embedding trustworthiness in their organizations should also be celebrated. They are an essential part of the trustworthiness chain of custody.  
Enter TAA-TAW. Now in its 6th year, TAA-TAW celebrates professionals who are transforming the way organizations do business and honors 2016  Top Thought Leaders as well as Lifetime Achievement Awards to seven individuals who have maintained Top Thought Leader status for five years. 
According to Barbara Kimmel: "The release of this year’s list coincides with the beginning of the 4th year of the formation of our Trust Alliance, a growing group of global professionals committed to learning about and advancing the cause of organizational trust. Many of this year's honorees are well-known CEOs, authors and leadership advisors, while others are quietly working behind the scenes as teachers and researchers. We acknowledge and reward all their efforts in elevating societal trust. We congratulate all of our honorees whose work is shining a spotlight on the importance of trust and providing a roadmap for others to follow. They inspire organizations to look more closely at their higher create greater value for, and trust from all of their stakeholders, and understand trust is a "hard currency" with real returns."
Check out the 2016 Lifetime Honorees here.
Check out the full list of 2016 Honorees in the Winter 2016 issue of TRUST! Magazine

And here I will also mention that I am personally honored and delighted to be included once again in 2016 in this carefully selected group of illustrious and inspiring group of individuals. I am humbled to be on this list with so many truly world-changing individuals. 
I hope you will join me in thanking Trust Across America and Barbara Brooks Kimmel for the hard work that goes into the nomination, judging and award process for the annual selection of Top Thought Leaders, and also in congratulating the 2016 Honorees and Lifetime Honorees.

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  

Monday, January 18, 2016

How will you simplify your supply chain this year?

Here's a little one-question one-answer quiz.

What's the second best thing you can do to mitigate supply chain risk in 2016? 

Answer: (please select one)
a) Attend the Sedex 2016 conference
b) Attend the Sedex 2016 conference
c) Attend the Sedex 2016 conference
d) Attend the Sedex 2016 conference

Whether you selected answer a) b) c) or d), read on. Learn more about why the Sedex Conference in March in London in 2016 should be part of your schedule.  

I grew up in the supply chain. In my formative years as a young manager with Procter and Gamble, I was responsible for logistics in Scotland and Northern Ireland in my very first management role, and then, over eight years until I decided to move on to pastures new, I took on successively diverse and challenging roles across different aspects of the supply chain in Europe including purchasing, customer service, distribution center management and more. And today, working with clients on strategy and reporting, I always feel at home discussing the opportunities (and risks) relating to ethical and sustainable supply. In that context, Sedex often crops up as one of the most influential players in the field of sustainable sourcing and responsible supply chain practice. I am looking forward to attending the 2016 conference, not only because I'll have the chance to speak (you all know how I love to talk), but mainly because I have the feeling that I am going to learn 
a lot.

Sedex is a not for profit membership organisation dedicated to driving improvements in ethical and responsible business practices in global supply chains. As the largest collaborative platform for sharing ethical supply chain data, Sedex is an innovative and effective supply chain management solution, helping companies to reduce risk, protect their reputation and improve supply chain practices. 

I could write reams about the vital importance of ethical supply chain management and the increasing risk as businesses become more global in scope and more complex in scale. It's also a gobbler-upper of resources. Monitoring, audits, training, communications, evaluations, assessments in a context of increasingly strict regulatory requirements means that both customers and suppliers must invest significant resources to stay not only cost-effective but also low-risk. At the same time, the supply chain, if you treat it right, can be a fabulous source of innovation and creativity, enabling business expansion and growth. And of course, no Sustainability Report is complete without critical supply chain disclosures. It seems that Sedex is in the right place at the right time. And by attending the Sedex 2016 Conference (#Sedex16), you will be too! Check out the agenda here.  

I posed a few questions to the Sedex CEO, Jonathan Ivelaw-Chapman, about supply chain sustainability and the conference. Check out his insights: 

What's the most important aspect of your role at Sedex? What's most challenging and what's most satisfying? 

Jonathan: Since joining Sedex, what has struck me is our people and the passion they bring to the organisation. For me, it’s our values and our people that are the most important aspect at Sedex. The most satisfying part of what I am doing is seeing our employees engage in future-thinking in fresh and innovative ways. They are all here because they care and are passionate, and the talent and energy we have seems endless. This is wonderful to observe and participate in. 

Coming from the technology industry, where for nearly 30 years, hype, language and behaviors were all about self-justification and increased investment, I now sense an exit to the “hype” that we have all experienced. I want to help avoid any similarities to the IT industry, by bringing clarity and affordability into the sustainability industry. The challenge for Sedex is to help our industry and membership navigate in an increasingly complex sustainability world. We will do this by simplifying our language, facilitating opportunities to work collaboratively, and giving our members an industry roadmap, with a vision of the way responsible sourcing can work. 

The Sedex Conference 2016 theme runs under the banner of simplification. Everyone seems to talk about the sustainability landscape becoming increasingly complex! How realistic is simplification?

Jonathan: The business and sustainability landscape is rapidly changing. From natural resource scarcity to human rights, child labour to an evolving regulatory landscape, our industry is facing a range of challenges. With all these new topics coming up, sustainability is becoming a complicated space with new initiatives, frameworks, certifications, and schemes, creating silos in industries, countries, topic areas themselves.

Sedex is already looking at simplifying supply chains and recognising the interconnectivities between different issues such as bribery and health and safety and whether there could be more effective ways for companies and their suppliers to manage these issues as one as opposed to treating them in silos. 

There is no need to re-invent the wheel but rather try to scale up – pick what’s relevant to you and collaborate with other stakeholders. We might not have all the right answers just yet, but we are getting there. The conference will provide a great forum to discuss and address the challenges and hear from the industry leaders on how they are going about simplifying the challenging issues and approach to tackling them. 

What's going to be different about the SEDEX Conference 2016? What highlights should we look out for? 

Jonathan: This will be our largest conference so far, bringing together around 1,000 leaders in responsible sourcing for two days of discussions. The conference will be live-streamed and for the first time, we will also have live interviews with conference speakers straight from the conference hall. The conference agenda will cover the most relevant topics for supply chain sustainability – from modern slavery legislation, how organisations can quantify, value, and improve their impact on society, to best practice in agricultural sustainability measurement and reporting tools and resources and much more. 

We have an exciting line up of speakers – from multinational companies such as Kellogg and Mars, to organisations such as International Trade Centre and Thomson Reuters across plenary sessions, master-classes, workshops and spotlight talks. 

For the first time ever we will also host the VIP Networking Dinner event at the Barbican’s tropical plant conservatory in the heart of the City of London. Our conference delegates often ask for more opportunities to network and this dinner, designed for just 150 guests, will provide an exclusive opportunity to connect with industry experts and discuss hot sustainability topics. We are delighted to have John Morrison, Executive Director of the Institute for Human Rights and Business, speaking during the dinner. As a well-known and influential voice on business and human rights, and a highly engaging and knowledgeable speaker, John's speech will be a real highlight of the evening.


And now another little one-question one-answer quiz:

What's the first best thing you can do to mitigate supply chain risk in 2016? 

Answer: (please select one)
a) Attend the Sedex 2016 conference
b) Attend the Sedex 2016 conference
c) Attend the Sedex 2016 conference
d) Attend the Sedex 2016 conference 

Look forward to seeing you there!
Drop me a note if you'd like a 50% discount on the standard ticket price on registration. Who wouldn't?

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise Guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing your first / next Sustainability Report? Contact elaine:  
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