Thursday, September 11, 2014

G4 goes MAD with Netafim

Why do we love our work? Because we get to help companies like Netafim tell their story. In this case, we all went a little MAD. That's not MAD like crazy cuckoo but MAD like Mass Adoption of Drip Irrigation. The more you know about drip, the more MAD you become. It's compelling, it's an imperative, it's the present and it's the future. Drip irrigation is about sustainable agriculture, efficient use of resources, water conservation, improved yields and quality of food crops and improved livelihoods for millions of large growers and smallholder farmers around the world. Drip irrigation is synonymous with Netafim Ltd, a group of thousands of dedicated, passionate individuals who come together with a collective mission to make the entire world MAD. (Nothing new here - Netafim has been the leading world pioneer of drip irrigation since 1965, check out Netafim's legacy website).

We love Netafim and we love MAD. And this is the report that we helped create for Netafim, describing the sustainability impacts of this MAD-oriented company.

Netafim's 2013 Sustainability Report is written in accordance with GRI's G4 guidelines at core level. It presents both Netafim's 2020 sustainability strategy and most material impacts and the stakeholder engagement process that led to defining both. The report also presents many case studies showing how Netafim is driving it's MAD strategy and the impacts that MAD has at individual and community levels. If you want to skip straight to the stories, the report has a hyper-linked highlights page that will whiz you off to India, Croatia, Brazil, Kenya, Cyprus, Australia and the U.S. and more, to meet with growers and farmers that have gained benefits through adopting drip irrigation, becoming just a little bit MAD.

Or you might prefer to navigate straight to Stockholm. Stockholm holds special significance for Netafim as last year, in 2013, Netafim was awarded one of the highest levels of recognition in the industry for its impacts on water sustainability and sustainable water management at Stockholm Water Week, the Stockholm Industry Water Award (SIWA). This year, in 2014, Netafim presented its spanking new strategy and report in Stockholm. 

You can read on the blog of Netafim's Chief Sustainability Officer, Naty Barak, a staunch MAD propounder, as you might expect, about his experiences in Stockholm, and view Netafim's electronic poster presented at Stockholm 2014 Water Week here.  

But let's get back to drip and being MAD about MAD. Many of you might not know much about drip irrigation and why it is so crucial as a contributing solution to many of the worlds feed-energy-water-land scarcity problems. If this applies to you, you can find a brief explanation of how drip drips in Netafim's report. 

Following extensive consultation with stakeholders, both ongoing as part of Netafim's active participation in many of the leading global collaborative platforms that have water security as their prime focus, and as part of a targeted engagement program to support the preparation of the company's strategic approach and materiality definition, Netafim presents this new report under the theme: At the Heart of the Food-Water-Land Nexus

We are hearing more and more about The Nexus these days, especially in the context of the Post-2015 Sustainable Development Agenda. It's not just one nexus. Sometimes it's the Food-Energy Nexus, sometimes, the Water-Energy Nexus. Netafim's MAD solutions have the biggest impacts in advancing food, water and land security and these are the three nexus elements that are predominantly relevant for Netafim. The nexus view considers not only each challenge as an individual challenge, but considers all of them as part of one Big Thing. The points at which these challenges interact are the points which offer the greatest global and local opportunities for leveraging smart solutions that deliver the greatest benefits for us and the planet. That's what drip irrigation does and that's why Netafim is totally all about MAD

In the run-up to the 2013 Sustainability Report, we helped facilitate stakeholder engagement at two levels: a large round-table discussion with a diverse group of stakeholders based in Israel where Netafim is headquartered, and a series of discussions with global experts in the sustainable agriculture and sustainable business fields. Experts such as Carlo Galli, Technical and Strategy Advisor, Water Resources at Nestlé, Gavin Power, Deputy Director, United Nations Global Compact, Alejandro Litovsky, Founder & CEO, Earth Security Initiative and Pasquale Steduto, Deputy Regional Representative for the Near East and North Africa, FAO  provided their expert input and guidance about MAD and other aspects of Netafim's contribution, and you can read some of their comments in the report.

The result of these consultations and management deliberations was a strategic framework for 2020 and a set of most material impacts around which the 2013 Sustainability Report was structured. These topics and themes will guide and support Netafim's ongoing contribution to global sustainability in the coming years.  

One of the things that we love most about our work at Beyond Business is seeing the personal change and transformation that comes through sustainability culture and practices. Most Sustainability Reports describe what a "company" is doing and how managers and employees take action in the course of their roles. This is great, of course, but there is something special about seeing how the concept of sustainability extends beyond the workplace and into the consciousness of people and other facets of their lives. That's why my favorite part of this report is a piece from Netafim's Marketing Manager, Rachel Shaul. Rachel selected a project related to the impact of drip irrigation as part of academic studies at university, and she shares her insights after having interviewed women farmers in the Indian State of Gujarat. Rachel's perspectives are not just about advancing Netafim's irrigation business, they are about the personal change she experienced in engaging with women farmers, and the way their lives have improved. In the report, Rachel shares some of the comments that she recorded in her interviews, reminding us that sustainability is more than a project or a product or a business, it's about people and life in general. 

I recommend (of course !) that you take a look at the Netafim report and (of course!) give feedback. Maybe you also might become a little MAD.

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

Tuesday, September 9, 2014

Dr. Sustainability is BACK!

Dr. Sustainability is back in town, and as always, she is delighted to answer CSR Reporting Blog reader questions.

Dear Dr. Sustainability: How can you tell if a materiality analysis is genuine or if it was written on the back of an envelope over a beer in the pub?
Dear Alcoholic: If it was written on the back of an envelope over a beer in the pub, it's probably more genuine than most of the ones that weren't.

Dear Dr. Sustainability: What sustainability conferences have you attended recently and what conferences do you recommend?
Dear Curious: I have almost been attending loads of fantastic conferences. A couple of months ago, I was at the Climate Change Deniers Annual Conference. I denied that you can deny climate change and they kicked me out. Then I was at the We Love Reporting Annual Conference. The attendees were all wackos and weirdos so I left early. I mean, you have to be a wacko or a weirdo to love reporting. Last month I was at the Sustainability is an Imperative or We Will Perish Annual Conference. That was so depressing I am still taking valium. The best conference I almost attended was the Sustainable Ice Cream Conference in Vermont, where I was hoping that Ben and Jerry's would be distributing free fair-trade organic ice cream. When I realized that ice cream was not on the menu, I decided to stay home.

Dear Dr. Sustainability: A funny thing happened to me last month. I was finishing up our sustainability report and just as I was about to complete the GRI Content Index, I got an incredible pain that started in my head and traveled all the way down to my feet. Do you think there is any connection between the pain and the GRI Index?
Dear Painful: Yes, I have recommended for years now that GRI Reporting should come with a health-warning. You are apparently one of the lucky ones. Many of my friends and colleagues are now gazing mournfully out of a sanatorium window, unable to recognize their mothers and throwing objects at passing nurses. When you say hello to them, all they can respond is "DMA.... DMA... DMA... page... DMA... G4-21... Page...." and they carry on like that for hours. I think it has gotten a little worse with G4. Now they are mumbling "material Aspects ...... material Aspects ...... material Aspects ...... material Aspects...... material Aspects...."

Dear Dr. Sustainability: I have been reporting for years and now my company has decided to do G4 and wants a materiality matrix. Where on earth can I get a matrix?
Dear Experienced Reporter: The best matrix I have found is The Matrix. You can get it on iTunes. Called "The Most Eye-Popping and Imaginative Movie of the Year", the Matrix will be much more fun than the boring squares and arches of most of the materiality matrices you find in regular reports.

Dear Dr. Sustainability: Can you please advise how I should deal with our chief legal officer who insists on reading our Sustainability Report before it is published. That's never happened before. What should I do?
Dear Backache: The fact that your chief legal officer wants to read the report before it is published is a real disaster. Typically, legal folks see a court case in anything. They can't read a sustainability report without a big pair of scissors and an extra-extra-large delete button. After your chief legal officer has done his thing, you will be left with a cover page, a back-cover, a few nice photos and about two pages of narrative describing improvements in your environmental performance and increases in community donations. Hmmm. I guess that will make your report look quite consistent with most of the reports that have been published in the last ten years. Maybe it's not such a disaster after all.   

Dear Dr. Sustainability: We have heard that stakeholder engagement is all the rage these days and at our company we have decided to get some, although we don't really want to. What's the best way to engage hundreds of stakeholders at lowest cost without them really having an influence on what we do? We want to be able to say we have engaged without really engaging.
Dear Engagement: That's such an easy question. I have the perfect solution. SurveyMonkey. Just send out your questionnaire to thousands of anonymous people (you can call them stakeholders if you like, most people don't know the difference). Even better, you can send out your survey to loads of consultants and ask them for their professional opinion for free. If you really want people to engage, promise them that you will donate $0.05 to a charity of their choice for every completed questionnaire. While the quality of feedback you will receive from 437 completed questionnaires will be totally irrelevant to your sustainability strategy and will not be useful in defining material issues, you will be able to tick the stakeholder engagement box with a REALLY BIG TICK. 

Dear Dr. Sustainability: I have been reading loads of G4 reports and before I go totally cross-eyed, I was wondering if i am missing something. They all look like G3 reports.
Dear Puzzled: I can recommend you start with Elaine Cohen's G4 Game Changer Series. In this series, expert GRI report-writer and commentator, Elaine Cohen, analyses the differences between G3 and G4 reports of different companies. This cutting-edge analysis will lead you to the same conclusion. G4 reports, so far, are looking pretty much the same as G3 reports. Now you don't need to go totally cross-eyed. Unless you want to.

Dear Dr. Sustainability: How can I make more people read our Sustainability Report?
Dear PeoplePerson: Give your report a new title. Call it: The ALS Ice Bucket Challenge.

Dear Dr. Sustainability: We are having a real problem with gender balance in our company. As much as we try to recruit and promote women, it never works.They all have children that get sick, and they can never work overtime. They decorate their offices with pretty pictures of their kids and family pets, instead of our company values posters, and they are so OTT about multi-tasking that everything gets done without anyone noticing. Our CEO wants to show at least 30% women in management in our Sustainability Report (currently the actual is 0.43%). What can we do? 
Dear GenderBender: Look, there appears to be no hope in your company. There are two options. Kick out all the women and make it a male-only company. While this is illegal and immoral, your company will soon go down the tubes before you have a chance to face the court cases and pay the fines. The second option is to make your workplace more women-friendly. Offer all males over the age of 27 free sex-change operations and fire those who don't take up the offer.  

Dear Dr. Sustainability: I hear that there is a new trend in sustainability reporting called unsustainability unreporting. What do you think about that?
Dear PeoplePerson:   I have always been in favor of telling it like it is.

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

Saturday, September 6, 2014

Telekom Austria : G4 game-changer?

Did Telekom Austria change the game with its first G4 report? This post continues my analysis of what changed with G4, this time using Telekom Austria  reports over three years.

For an overview of what all this means, see this post.
For a G4 game-changer analysis of Fiat Group, see this post.
For a G4 game-changer analysis of Ahlstrom, see this post.
For a G4 game-changer analysis of Johnson&Johnson, see this post.

For a game-changer analysis of Telekom Austria, read on......

Telekom Austria 2013/2014 Sustainability Report: GRI G4 Comprehensive, 92 pages
Telekom Austria 2012/2013 Sustainability Report. GRI 3.1 A+, 86 pages
Telekom Austria 2011/2012 sustainability Report, GRI 3.1 A+, 58 pages

The first thing that may strike you about Telekom Austria reports, G4 or otherwise, just by looking at the covers, is that they are super-creative. I can't understand how I missed the 2012 report - The Sustainables! - brilliant. Disclosing your sustainability impacts in the form of a Marvell-style SuperHero comic book is a fantastic way to get people interested in your report. It certainly captured my attention.

I was dazzled by Telekom Austria's 2012 report and had to look back at previous years' reports as well. There is definitely a creative flair to sustainability reporting at Telekom Austria that is one of the best I have seen and is consistent over the years. But it's more than just a creative design or infographic. It seems to stem from deep thought about what sustainability means to Telekom Austria. Each report tells a real story of sustainability practice using an imaginative and innovative approach that, each year, is slightly different and reflects the current report theme well. I like it!

The report is hyper-linked throughout - and all GRI G4 disclosures and indicators are annotated in the narrative and linked to the GRI Content Index, making it easy to find what's where. Telekom Austria refers to its report as a "magazine", and, although the framework is GRI and G4, it really does read like a magazine with very interesting articles and background information to add perspective and context.

Materiality - drives the report or just for show 
Telekom Austria uses its 2012 materiality assessment for its 2013 report. There was no materiality process in 2011.

The 23 material issues are grouped into four sustainability priorities that govern the structure of the 2013 report, just as they did the 2012 Sustainables comic book report. 
  • Providing responsible products
  • Living Green
  • Empowering People
  • Creating Equal Opportunities
In this report, in general, the four priority themes include the stated material issues. Data protection is the number one issue. In G4, this would be material Aspect "Customer Privacy" with an indicator relating to privacy breaches (G4-PR8). This is covered well in the report narrative and the indicator is reported. Network infrastructure is the second issue and this is mainly correlated to a material Aspect from the draft telecommunications sector supplement. This is reported in the company's annual report, not the sustainability report. Customer satisfaction is the third most important issue, and the response to G4-PR5 (customer survey results) is that there are no results yet as a new survey has just been completed. However, these three top issues appear to be addressed appropriately in the report. 

This is not the case with the lesser issues. The least important material issue is noted as  "sponsorship of arts, culture and sports". This is not correlated to any G4 material Aspect in the Telekom Austria report. We might consider a correlation to G4-SO1 (programs with local community engagement) but this indicator is not reported. We might consider it to correlate to G4-EC8 - indirect economic impacts. But responses to G4-EC8 in the Telekom Austria report relate to developments in communication technology and products that "make life easier", which have nothing to do with sponsorship. The second least important material issue is "open discussion in the digital world", whatever that means. This is not correlated to any material Aspect and I have no idea whether it's reported or not or how it is measured as I really don't know what it relates to. Therefore, while I think Telekom Austria does a good job of reflecting the material focus in this G4 report (just as it did in the 2012 G3.1 report), covering the main themes and most important issues, there seems to be a lack of rigor in correlating all the material issues to actual performance and impacts within the G4 framework.  

Focus - focused and relevant or ticking the boxes
This is a comprehensive level report so there are more boxes to tick than a core report. It's certainly no shorter than the previous two reports and almost double the length of the 2011 report. However, Telekom Austria has not reported on Aspects that were not defined as material. occupational health and safety (social), biodiversity, use of materials, supplier assessments for labor, environmental and social practices, and many aspects of human rights (although it's noted that this is because the data is not available, not because certain human rights indicators are not material). All the indicators in the draft telecommunications sector supplement are reported. Generally, then, it seems that Telekom Austria has made a focused selection, even if the focus is rather broad - 23 material issues is quite a lot. 

Engagement - process or lip-service
Telekom Austria doesn't go overboard in describing it's stakeholder engagement process in 2013. It was an online survey of 300 internal and external stakeholders. The results are not disclosed. It's not clear what was asked, who responded, or who said what. It's not clear to what extent the survey results influenced the selection of the issues. It's not clear who made this selection. All of this was described in the 2012 G3 report, and again, almost word for word in the 2013 report. Does an online survey constitute stakeholder engagement? Well, there are surveys and surveys. However, my personal view is that there is no substitute for a good 'ole conversation. I believe there is room for more robust activity in this area. 

Integrity - shapes up or misleads
I think this report does a good job of reporting the indicators that the company has selected to report. In each section, there is a hyper-linked disclosure or performance indicator that shows you where the commentary fits in the G4 Content Index. And for people like me, there's a treat. They say flattery will get you everywhere, and Telekom Austria knows how to make us GRI geeks feel special. In each section there is a catch-all for indicators not reported in the narrative, specially created for "GRI Experts". Thank you, Telekom Austria, for your consideration.

Impact - what we did or what difference we made
It's a little hard to distill actual impact in Telekom Austria's report. The amount of context and interesting background information enables you to understand why they are doing what they are doing. That gives great perspective on what's needed in society. Telekom Austria's "Creating equal opportunities" focus area has the potential to impact society in the broadest way, reflecting a sort of social mission, which is of course hard to quantify. In this section, Telekom Austria refers to programs to promote media literacy, inform about internet safety, support social entrepreneurs etc. In general, this is about Telekom Austria supporting, initiating, expanding, publishing, implementing, developing, increasing and simply doing more. It's all good stuff, but, beyond a couple of areas where the number of beneficiaries or participants is noted, I didn't get a sense of how all of this is making a difference. 

Telekom Austria publishes a separate status of performance against targets for all its subsidiary companies called the "Measures Programme". Here too, although this is fabulous from a transparency standpoint, I was not able to discern any direct measurement of impact (as opposed to reach).  

It would be nice to see Telekom Austria use its amazingly innovative and creative capabilities to develop some measures that go beyond participation. Although Woody Allen is noted for saying "80% of success is showing up",  I wonder if providing 100,000 people with media skills training actually means that 100,000 people actually become more media literate. Maybe I am just a skeptic. 

Game-changer - does or doesn't?  
This report isn't really a G4 game-changer for Telekom Austria, interesting though it is. The company moved to materiality-oriented reporting in 2012. In the conversion to G4, aside from changing the numbers of the disclosures and performance indicators, there is nothing too new. In fact, there is not enough new, and the specific requirements of disclosure of stakeholder feedback and engagement process, alignment of material priorities to G4 material Aspects, identification of material Aspect boundaries and performance indicators in line with material issues - none of this is truly present in 2013. Despite such an engaging approach to telling the story, I feel the 2013 report adapts the mechanics of reporting to G4 rather than truly providing a step-up in Telekom Austria's reporting approach. But, as with my analysis of Johnson and Johnson's G4 reporting, the path to G4 was already paved a year in advance with a more strategic approach including a materiality process and report face-lift in 2012. 

I give this report a 67% rating, the best so far, but not good enough to really change the game at G4 level. 

Material issues -80%
Focus  - 70%
Stakeholder Engagement -  45%
Integrity -  75%
Doing or impacting -  65%

This completes four game-changer analyses. Watch  this space soon for a summary-so-far of trends and insights. And then, maybe some more analyses. 

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

Tuesday, September 2, 2014

Strauss Group: a special 7th report

I am always delighted to showcase reports we have worked on for our clients, and this month, Strauss Group published its seventh annual Sustainability Report.

Strauss Group is an international corporation with a portfolio of five companies in the food and beverage sector, headquartered in Israel, active in 24 countries and generating $2.35 billion in consolidated sales in 2013. The Group directly employs over 13,500 people.  

7 is a very special number in many ways. It's the lowest natural number that cannot be represented as the sum of the squares of three integers. is the aliquot sum of one number, the cubic number 8 and is the base of the 7-aliquot tree. 7 is the only dimension, besides the familiar 3, in which a vector cross product can be defined. 7 is the lowest dimension of a known exotic sphere. Of course, if you understood all of that, you are way more intelligent than I am. Or probably than anyone I know. I copy-pasted these 7-facts from Wikipedia. Impressive, right? In the Jewish religion, 7 is special in different ways. More copy-paste - here we come: 7 is one of the greatest power numbers in Judaism, representing Creation, good fortune, and blessing. The Bible is replete with things grouped in 7. Besides the Sabbath, the 7th day, there are 7 laws of Noah and 7 Patriarchs and Matriarchs. Several Jewish holidays are 7 days long, and priestly ordination takes 7 days. The Land of Israel was allowed to lie fallow one year in 7. The menorah in the Temple has 7 branches. There's more from the Rabbi ... check it out here. In numerology, the number 7 is the seeker, the thinker, the searcher of Truth. The 7 doesn't take anything at face value - it is always trying to understand the underlying, hidden truths. The 7 knows that nothing is exactly as it seems and that reality is often hidden behind illusions. More for numerologists here. In gambling, number 7 is really lucky. According to the Psychic Library website, on July 7, 2007, the casinos were full up as hopefuls tried to beat the lucky date 07/07/07 (maybe they also went at 07:07 in the morning!) Someone even wrote a book about the magical, amazing and popular number 7. 

So, having established that 7 is special, we might then expect something special from Strauss Group's 7th Sustainability Report. Here are 7 special things about Strauss Group's 7th Sustainability Report.

First, it's prepared in accordance with GRI G4 (core), a first for Strauss. So far, worldwide, just a few hundred companies have ventured into G4 territory. Actually, the stretch was not overly significant for Strauss, as a deep materiality review had been conducted in 2012 and presented in Strauss's 2012 report. In 2013, in preparation for this report, further consultation with stakeholders was conducted and resulted in a revised focus on six core material issues. The main narrative of the report is aligned with these six material themes. 

Second, each materiality-based chapter presents the core issues, aligned strategic goals, GRI G4 material Aspects and reported Performance Indicators. As you will know if you have read my G4-Game-changer series, this is a critical element of a G4 report. There must be an audit trail from strategy to materiality to performance. The Strauss Group report ensures this is as clear as you can get. 

Third, this report presents Strauss Groups's 2020 Sustainability Strategy. Strauss Group has been assimilating sustainability practices into its operations for many years. This is the first time the Group has worked across company-boundaries and created a global corporate multi-year strategy with measurable targets. The strategy has two elements: impact and performance. Each has three dimensions.

In the Impact element, the three dimensions relate to the direct connection of stakeholders to the company. Colleagues (employees) are the first degree of impact. They are the first to experience the way the company behaves toward them, and they are also the ambassadors of the company and define the way the company impacts other stakeholders. Consumers are a much larger group, of course, and they are directly impacted by the product quality, choice, availability, access and messaging of Strauss Group. The way Strauss impacts consumers has a direct result on the quality of their lives and the way they connect to the company's products. Finally, the Citizenship dimension represents Strauss Group's impacts on society, the environment and all relevant stakeholders. By improving impacts in a spirit of citizenship, ethical behavior, efficient resource management and transparency, Strauss Group continues to make a positive impact as a good corporate citizen. 

In each dimension, the 2020 Sustainability Strategy defines 3 levels of performance - meet, exceed and lead. Meet refers to meeting the basic performance expectations of society and all stakeholders in relation to commonly accepted standards of responsible behavior including governance, compliance and ethics. Exceed represents continuous improvement, exceeding prior performance in certain strategically defined performance areas. Lead refers to a smaller number of performance areas where Strauss aspires to make significant progress and achieve levels of impact that can be considered leading performance at a global level. In this way, the Sustainability Strategy defines the scope and scale and degree of impact improvement that Strauss Group plans to achieve in the next few years. 

Fourth, Aron Cramer, CEO of BSR and one of the leading thinkers and opinion-leaders in sustainability today, reviewed Strauss's material issues and strategic direction and provided guidance. "Strauss should be focused on real issues that are driven by core products. These could include enhancing consumer choice, helping consumers understand the health implications of consumption habits, through product labeling and other means, and sustainable sourcing." His full commentary can be found in the report.  

Fifth, the people. Strauss people appear on many pages of this report and they are the ones that make it all happen. Working with Strauss Group, we are privileged to meet many employees in the course of our varied interactions with Strauss around the world, and we can testify to the Strauss spirit and values that motivate and inspire employees to do great things. Employee engagement at Strauss reaches 92% in parts of the Group, based on employee surveys, and that's what makes this 7th report (and all previous ones) special. 

Sixth, the infographic. It's always good to get the report highlights all in one place. If you are a numbers person, this is the page for you.

7th, is the fact that it's the 7th. Delivering a sustainability report year after year is no easy task. Strauss Group is the only Israel-based company to date that has published  7 reports, year after year, since 2008, demonstrating not only a commitment to transparency and continuous improvement, but also a commitment to local leadership and best practice. 

For us at Beyond Business, supporting clients such as Strauss, as we do around the world, is a privilege and we are delighted to have been able to help create this 7th report. 

Oh and by the way, I should also mention that the number 7 is very relevant to the world of ice cream too. I happened to come across, in my search for all things 7, this announcement by Perry's Ice Cream of 7 new flavors for 2014.  They all sound delicious. As 2014 is nearly over, I had better start tasting.....

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

Friday, August 29, 2014

Johnson & Johnson: G4 game-changer?

Did Johnson & Jonson, a veteran sustainability reporter with 17 years of reporting experience, change the game with its first G4 report? This post continues my analysis of what changed with G4, this time using Johnson & Johnson  reports over three years.

For an overview of what all this means, see this post.
For a G4 game-changer analysis of Fiat Group, see this post.
For a G4 game-changer analysis of Ahlstrom, see this post.


2013 Citizenship and Sustainability Report: G4 Core, 118 pages
2012 Citizenship and Sustainability Report:  GRI G3, Level A, 88 pages
2011 Responsibility Report: GRI G3, Level B, 82 pages

Materiality - drives the report or just for show 
J&J has delivered a very detailed G4 report, 20+ pages longer than prior reports, and with more Performance Indicators than prior reports (80 in 2013, 65 in 2012). This is perhaps not surprising when you consider that J&J identified 41 material issues for its 2013 report, narrowed down from a master list of 220 issues that the company developed. In 2012 and 2011, the list of issues reported was based on a 2010 materiality analysis in 2010 that identified 12 broad issues.

2013 material issues
 J&J prioritized these 41 issues based on an analysis of internal and external feedback.

The very high priority issues are in the left-hand column and reporting covers these in some detail, usually several pages. The lower priority issues are covered in less detail in the report. Biodiversity, for example, ranks among the lesser important material topics, is covered in less than a page in the report.  Product Quality and Safety, the most important issue, gets several pages. However, this is not entirely consistent. Three of the least important issues - philanthropy, community investment and volunteerism have around 5 pages of content. But then, everyone likes to brag about donating to the community. 

The structure of the 2013 report follows the material issues grouped into 3 categories: advancing health, doing business responsibly and safeguarding the planet. All 41 issues are included in separate sections in one of these three groupings. That makes for a rather fragmented report and it is hard for the reader to focus on whats most important - the left hand column. This is not too dissimilar from prior J&J reports where the main section was entitled "Our Material Issues" and contained several chapters and sub-chapters. 

Johnson & Johnson has delivered a report in 2013 that is definitely materiality-oriented and built around the identified material issues. However, the report also includes the not-most important issues. This is similar to the reports of the past two years. Therefore, G4 doesn't appear to have been a significant game changer for J&J. J&J changed the game ahead of the game by reporting with a materiality focus well before G4 publication, something which many companies did not do. But in moving to G4, the focus has been diluted a little and the urge to report more than G4 requires is in evidence.  

Focus - focused and relevant or ticking the boxes
The content lists for each chapter are long and do not differentiate between the most important issues and the least important issues. There are 14 issues that are noted as "extremely high" priority. In the chapter on Advancing Human Health, there are 7 sections, Leading Business Responsibly, 23 sections, and Safeguarding the Planet, 9 sections. The 14 extremely high important issues are all included as the first sections in each chapter. But so are all the rest. 

There is some G4 logic in this presentation, but I had to spend quite a lot of time working this out.It took me a while to realize that the most important issues were the first chapters in each section. I feel that these issues could/should have been more effectively differentiated in a G4 report. In a sense, we cannot fault J&J for being attentive to a broad range of stakeholder needs. However, a bolder focus on the really important issues would give bigger impact and make this report more appealing and digestible. Reconsideration of the structure of this report might enable the reader to get to the critical parts more quickly, and use of the GRI Index, or an Appendix, or the company website could be options for disclosure of the less important issues for those stakeholders who require this additional information. 

Engagement - process or lip-service
I feel the stakeholder engagement process described in the J&J report was rather corner-cutting. It's hard to tell whether the process was a little under-cooked or whether the reporting of it was modest. J&J describes a new materiality process, the first since 2010. The mechanics are clear. Develop a broad range of issues, narrow them down and prioritize them using internal and external feedback. For external stakeholders, Johnson&Johnson "identified a group of external stakeholders primarily focused on corporate responsibility and asked them to rank the topics for overall importance of the topic and importance for Johnson &Johnson to address." It's not clear who this group is, how large it is, nor what kind of feedback the group gave. G4-27 specifically requires companies to state which stakeholders raised which topics.

J&J did not do this, listing issues in their final prioritized form. This is an area where I believe J&J hasn't changed the game in G4 - or at least - if it has, reporting of stakeholder engagement is weak. 

Integrity - shapes up or misleads
This report is in accordance at core level but reports on far more general disclosures and Performance Indicators than are required at core level. J&J indicates Performance Indicators with labels throughout the report, making it very easy to find disclosures. (In fact, the J&J report PDF is super-navigable, totally hyper-linked and very easy to work through). In general, I found J&J's reporting to be quite meticulous, and several awkward disclosures which many companies never get right are carefully presented in this report. However, something fell through the cracks. Take for example G4-LA3. G4-LA3 is pretty prescriptive.

J&J  confirm having reported G4-LA3, saying the disclosure is both in the report and online.

I couldn't find any relevant information online, and in the report, this is the G4-LA3 disclosure.

As you may have realized, the disclosure bears no resemblance to the disclosure requirement. It is difficult to report with integrity and many times, inconsistencies are often inevitable. It's better to publish a great report like this one from J&J with a little blip here and there than not to report at all. However, there is something about robust quality checking in reporting by people that truly understand reporting frameworks that should not be underestimated. Getting everything in sync is no easy task.

Impact - what we did or what difference we made
J&J has an impressive range of Healthy Future 2015 goals and reports progress against each. Many of these are outcome oriented in one way or another. For example, "approximately 75 percent of strategic suppliers have two or more publicly reported sustainability goals" is an outcome of having embedded sustainability processes in the extended supply chain. While a deeper outcome might be to calculate the benefits that suppliers gained through reported sustainability goals, this interim outcome is, for me, a good indicator of impact. It's not "we trained our suppliers" and it's not "our suppliers signed our Code of Conduct". It's a behavioral change by suppliers. I think that's great. Another example: "46 percent [of employees] have completed a health risk assessment and know their key health indicators". Again, this is evidence of a positive impact on employee behavior. There are many more examples. This is good G4 practice, but for J&J, it's not so much of a game-changer because it's what J&J has been doing for some years. But it's still good to see. 

Game-changer - does or doesn't?  
I give this report a 65% game-changer rating, the highest of the three so far (Fiat 58%, Ahlstrom 54%). This rating is more about meeting expectations of a G4 report than about a total transformation of the reporting approach, because J&J was already reporting though a materiality lens in the past. However, as a report to emulate in our G4 landscape, it's the best of those I have analyzed so far. But, it could be better :)

Material issues -85%
Focus  - 65%
Stakeholder Engagement -  40%
Integrity -  65%
Doing or impacting -  70%

This completes the first three G4 game-changer analyses. Stay tuned for more perspectives on how G4 is changing the game. Or not.  

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

Thursday, August 28, 2014

Ahlstrom: G4 game-changer?

Did Ahlstrom, a Finnish fiber-based materials company with 3,500 employees, change the game with its first G4 report? This post continues my analysis of what changed with G4, this time using Ahlstrom reports over three years.

For an overview of what all this means, see this post.
For a G4 game-changer analysis of Fiat Group, see this post.


Ahlstrom Sustainability 2013: G4 core, 40 pages
Ahlstrom Sustainability 2012: G3, B+, 60 pages
Ahlstrom Sustainability 2011: G3.1, B, 54 pages

Materiality - drives the report or just for show 
Just by looking at the cover of the 2013 Ahlstrom Report, versus the 2012 and 2011 reports, you can already notice the change in approach. This is also reflected in the change in the structure of the reports. 2011 and 2012 had a four part structure: Company, products, performance culture and supply chain. The 2013 report has a series of chapters, each dealing with a separate issue correlating more or less to the material issues identified. 

Ahlstrom's 2013 report includes 35 G4 core General Disclosures and 31 fully reported Performance Indicators, versus 25 fully reported Performance Indicators in 2012. Once again, more indicators, fewer pages. In addition to the GRI content index, Ahlstrom includes a correlation of material issues identified to G4 Performance Indicators which certainly helps understanding the report. However, only a few of the indicators are correlated to G4 Performance Indicators and some are not even reported. For example, employee-well-being is a material issue but it is not correlated with any G4 Aspect and is is not mentioned anywhere in the report - no disclosure and no indicator. Eco-design approach is a top ranking material issue - but it is not correlated to a G4 Aspect or Performance Indicator and the two-page review of progress in this area does not indicate how Ahlstrom will measure ongoing performance. 

Ahlstrom's 2011 report contained a materiality matrix but the 2012 report did not. In fact, the 2012 report did not mention materiality even once. The Ahlstrom 2013 report includes a brand new materiality matrix which is quite different to the one published in 2011, and identifies 16 material issues.

Comparing the content of the report to the material issues - we can see a correlation. 

Examples of correlation of 2013 report contents to stated material issues

Although, as mentioned, there is some dissonance between materiality and content, I believe it is a departure from prior reports and has a hint of game-changing. 

Focus - focused and relevant or ticking the boxes
Ahlstrom has been selective in the content of this report and the indicators reported. The correlation of indicators to material issues is not exact, but in general, the report chapters match the material issues mentioned. I would have preferred to see, however, fewer material issues and greater reporting depth. Ethics, for example, is the number one material issue this time around. It has one page in this 40 page report, and most of the narrative is an exact word for word copy-paste of what was reported in 2012. Amazingly the exact same number of grievances were reported in 2012 as were reporting in 2013. How incredible is that ?! Aside from some additional anti-corruption training in 2013, there is nothing in this report to suggest any additional material focus on ethics. 

Water, on the other hand, gets much more detailed treatment in the 2013 report, with more information about withdrawal sources and water effluent composition. Water as a single material issue was not even mentioned in the Ahlstrom 2011 materiality matrix, demonstrating a shift in thinking and attempt to measure and improve. Ahlstrom advises that a focus area for 2014 will be to determine the best water metrics for measuring and improving performance.

Engagement - process or lip-service
Ahlstrom has an interesting definition of  stakeholders. "A stakeholder is anyone who is interested in what the company is doing." Really? Ahlstrom does not describe stakeholder engagement with anyone who is interested in what the company is doing, but specifically with six stakeholder groups: customers, employees, suppliers, shareholders, academia, society and industry peers. Once again, the examples of dialogue and feedback received were very similar to that reported in 2013, though some additional and different detail was provided. There is no evidence of additional deep-dive stakeholder engagement process, but nonetheless, a comprehensive overview is provided that includes details of a range of stakeholder interactions. Not game-changing, but reasonably good game.

Integrity - shapes up or misleads
As mentioned, in this report, there is a lack of accurate correlation of material issues with G4 material Aspects. However, my random check of indicators enabled me to quickly find disclosures through the GRI Content index. So while this report is not fully in accordance with G4 core level in the strictest sense, reporting integrity seems to be applied.

As an aside, unrelated to G4, this report does something almost no other report does. It publishes right up front a list of areas for improvement. Now, you don't have to look for the bad news. That saves a lot of time :)

Impact - what we did or what difference we made
Ahlstrom makes references to different kinds of impacts. For example, money donated via the company foundation "has been very successfully used in a 3-year UNICEF WASH (Water Sanitation and Hygiene) project in India, where close to 20 million schoolchildren, especially girls, have been helped". One case study shows how 30% of energy savings can be made using a new type of filtration media product (although it doesn't say whether the product has actually been used). Another makes reference to economic impacts:

(Wonder how Ahlstrom knows that people pay their taxes and act as active neighbors ?!)

Ahlstrom presents a full page on the company's impacts on global sustainability "Our sustainability promise is to make products for a clean and healthy environment, minimizing our own impacts, and communicating about the sustainability benefits of our products in a clear way", but actually, there are very few examples of how Ahlstrom realizes this promise in this report. Most of the narrative is about responsible and ethical business behavior and not actual sustainability impacts (with the exception of direct environmental impacts, as is the case with most reports). I believe there is a great story here which G4 could help Ahlstrom tell, but in this report, the great story remains just below the surface. 

Game-changer - does or doesn't?  
Overall, there appears to be a decision at Ahlstrom to apply G4 in the best way possible, and to restructure reporting to meet the new G4 framework. My sense is that Ahlstrom does this in practice, to some extent, and with genuine intent. There are lots of positives in this report. Still, I don't feel that Ahlstrom has really exploited the full potential of G4 to drive clarity, focus and impact. Maybe the report's title "Acting Responsibly" should give us a hint of how the company approaches reporting. Funnily enough, the 2011 and 2012 reports did not have titles other than "Sustainability Report".

I give this report a 54% game-changer rating.

Material issues - 65%
Focus  - 55%
Stakeholder Engagement -  45%
Integrity -  65%
Doing or impacting - 40%

Stay tuned for more game-changer analyses.

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   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)
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