Friday, May 8, 2015

Between the Lines in CSR Reports

I consider it a great privilege to do the work that I do, helping companies develop a strategic approach to corporate responsibility and account for their impacts on society through reporting. While, in general, I am guided by a business approach to corporate responsibility and sustainability, with lots of formal frameworks and disclosures and numbers and charts and value accounting in different forms, some things just make you sit up and stand back and realize again that, ultimately, it's all about people, relationships and solidarity. My work exposes me to the so many ways that companies touch people's lives that even the longest Sustainability Report in the world could never even begin to capture the positive ripple effects on individuals and communities. There are some things so inspiring and so moving that they truly change your awareness and appreciation of the real meaning of community at work. The workplace does not have to be only somewhere you go to earn a paycheck or learn new skills. It can be a place where people thrive and help others to thrive, and this is something you just can't adequately reflect in a Report. I am often deeply moved by the dedication and selflessness of individuals as I talk to so many people in the course of gathering information for the reports that I work on with different companies. I have many stories, but this one, this week, was exceptional. 

I am working on helping to prepare the Caesars Entertainment Corporation Citizenship Report for 2014-2015, the third G4 report that Caesars will publish later this year. We have a lot of numbers to crunch and narrative to edit before then! But in meantime, I have had the privilege to connect directly with some of the Caesars HEROs. HEROs is Caesars long standing corporate volunteering initiative that engages thousands of employees, collectively clocking up almost 200,000 hours each year to engage with causes they are passionate about, including initiatives funded by the Caesars Foundation. The opportunities that Caesars Entertainment creates for employees to get active in their communities help employees enrich their own lives and the lives of others in incredible ways. There are so many HEROs throughout the Caesars organization and each one is deserving of recognition. I have had the good fortune to connect with several during the work on this and prior Citizenship Reports and all are equally inspiring. The one that prompted this post is the story of Joan Bish, Boat Operations Supervisor at Horseshoe Hammond Casino

Joan is a dedicated volunteer, donating hundreds of hours of her time each year to several causes. One is the Employee Garden where employees come together to nurture vegetables and sell the resulting produce, directing funds to a local food bank to help in the  fight against hunger. Another is the St.Baldrick's Foundation's event, where employees shave their heads or donate their locks to raise money for childhood cancer research. And at the American Cancer Society's Relay for Life, Joan completed a walk of more than 50 miles. However, what really caught my eye and captured my emotions was the initiative Joan undertook to recognize, support and pay tribute to fellow workers who are fighting their battle with cancer. In a personal mission, covering hours of travel across two U.S. states and visiting with 7 families, Joan created a video that is... well.. I have no more words. Watch it for yourself. 





Watching this video brought home to me the many ways that workplaces become communities of people, good people who want to be good to others, who want to leave a legacy of good and who actually do. The opportunities that companies create that enable employees to step up and get involved are probably one of the most important  aspects of corporate citizenship, and so often, we report that as a number or a result in a chart. There is no chart than can express the profound meaning of this kind of activity and no spreadsheet that can express the way this activity truly enriches lives. That's why I had to stop and share my reflections with you. Perhaps there may be some inspiration you can gain from this in your workplace. 

Perhaps this story touched me so specifically because, just a couple of years ago, my dearest sister-in law heartbreakingly lost her battle with ovarian cancer at the young age of 63 after a three year heroic fight with the support of our family and community. Ovarian cancer is the one that, by the time it's diagnosed, it's usually too late, as it creeps up on women, almost symptomless, until it's so deeply embedded in your body that you can never cut it out. Early detection is the only way to beat ovarian cancer, and new research proves that. I am incredibly proud of my two nieces who, as they continue to suffer the pain of losing their mother, maintain the fight to raise awareness for ovarian cancer, support cancer research and help women be proactive about demanding tests for early detection. My niece, Sarah, who runs her own consultancy, The Athena Programme, that supports safeguarding of children in our communities and workplaces, was interviewed this week for the local news in the UK.



As, during this period, I am deeply embedded in "reporting season",  which consumes pretty much all my time and energy for several months, I have to put my other true passion, blogging about reporting (you know I am a geek) on a back-burner until I resurface in another few weeks. But I couldn't help stopping everything and writing this post to recognize Caesars, all the hundreds of Caesars HEROs including Joan, Sarah and Susan (my nieces) and all the unsung heroes who are making the world a better place. It's worth remembering that, as you look at numbers and charts in Sustainability Reports, there's a another dimension that's only visible between the lines, but it's no less relevant and probably, in the long run, more important.



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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Sunday, April 5, 2015

Ajinomoto: Courageous reporting practice

I have always admired the Ajinomoto company of Japan, and back in 2010, I published a review of Ajinomoto's 2009 report. This time, five years later, I returned to Ajinomoto, at the company's request, to review the most recent 2014 Sustainability Report covering fiscal 2013 activities and prepare a commentary for publication. And it was a great pleasure to do so. (I have fond memories of visiting the Ajinomoto offices and factories in Tokyo back in the 1990s at a time when I had never even heard the terms Corporate Social Responsibility and Sustainability. The strong positive impressions of the way Ajinomoto works and warm hospitality of the totally wonderful people I met there remain with me today).  

Ajinomoto is no stranger to Sustainability Reporting. Ajinomoto started publishing an annual Environmental Report in 2001 and then in 2004, published a first CSR Report, demonstrating a commitment to a broader concept of CSR, beyond the scope of environmental stewardship alone. Through 2004 - 2011, Ajinomoto published two reports in tandem, until in 2012, the group made the transition to publishing one Sustainability Report encompassing the full spectrum of disclosures. The 2014 Sustainability Report is the third full Sustainability Report. 


This current report tells a strong story of Ajinomoto's contribution to healthy eating and healthy living. Ajinomoto has a well-defined approach to sustainability that has two broad elements: sustainable contribution and responsible behavior.


My commentary is on page 141:


Here it is in full:

"
In today’s world, it is not enough to simply be a food or food-ingredient producer. Leading companies view their contribution to society more holistically by identifying and managing the impacts they generate throughout their entire value chain. Such companies, for example, strive to educate consumers and help them adopt healthier and more sustainable lifestyles. In addition, leading companies aspire to conduct their business in an ethical and responsible way. Ajinomoto’s 2014 Sustainability Report addresses both of these aspects of sustainable business. The first part of the report represents Ajinomoto’s three broad areas of contribution: promoting healthy living, conserving food resources and advancing global sustainability. The second part of the report describes Ajinomoto’s responsible practices using the ISO26000 as a framework approach. 

Overall, this is a comprehensive report that covers all the issues we might expect a food company to address, including nutrition and lifestyle, the use of technology and science to improve resource efficiency, sustainable agriculture and land-use, governance, compliance, human rights and employee engagement, health and safety. In all areas, Ajinomoto demonstrates a strong understanding of what’s at stake and what, as a food company, it can and should contribute. Evidence of stakeholder dialogue adds credibility to Ajinomoto’s selection of areas where the company can add value. 

Some of Ajinomoto’s activities are particularly impressive. The company’s investment in externally assured lifecycle carbon footprinting across seven key seasoning ingredients demonstrates advanced commitment to understanding and improving resource efficiency throughout the value chain. Ajinomoto’s approach to circular resource use – using by-products of amino-acid production as fertilizer for crop sources for amino-acids - is an example of sustainable practice. Demonstrating the environmental benefits of amino-acids in feed for livestock supports sustainable agriculture. Innovations in sustainable packaging, including the use of biomass plastic, are leading edge. The extensive engagements in a range of countries to improve nutrition in the Ajinomoto International Cooperation Network for Nutrition and Health (AIN) program show a real commitment to adding value to society. 

One of the challenges of sustainable business is measuring the impacts of company activities and their effects on people, society and the environment. It is not enough to focus on, and report, what you are doing. The real measure of progress is what changes as a result of what you do. In this context, I believe Ajinomoto could go further in identifying and measuring the outcomes of its activities and reporting these outcomes to stakeholders. For example, Ajinomoto relates stories of how the company provides new food alternatives for consumers in Brazil and Pakistan and advances material and infant nutrition in Ghana. These initiatives are commendable but the real question is: how are they actually improving lives and to what extent? Reporting evidence of change as a result of these initiatives would help us appreciate Ajinomoto’s efforts and understand the true value of the company’s contribution to improving healthy lifestyles. 

Similarly, Ajinomoto’s work in sustainable sourcing of skipjack tuna, palm oil, paper and coffee beans is described in the report and Ajinomoto’s initiatives here are impressive. However, reporting actual consumption of these resources and the percentage of each that is sourced sustainably would help clarify the extent of Ajinomoto’s progress. 

While Ajinomoto provides a comprehensive report, it is long. This is partly due to the inclusion of extensive background narrative for the issues Ajinomoto addresses in the report. An understanding of relevant context is important, but it is performance and outcomes that stakeholders need to understand. In future reporting, I believe this narrative could be significantly reduced in a much shorter report that focuses on what matters. Similarly, the report describes policies and approaches in detail, sometimes excessively, without following through on performance. For example, Ajinomoto notes an intention to "promote more women to management positions". Women employees account for just 27% of Ajinomoto’s global workforce and 15% of managers. For a company whose products are largely targeted at women, there is an opportunity to reinforce Ajinomoto’s commitment to women (and therefore society as a whole) by outlining clear plans of action with goals and targets. Another example relates to employee safety. Ajinomoto’s safety data shows that safety of workers outside Japan is far less positive than in Japan. With 65% of Ajinomoto’s permanent workforce outside Japan, reporting a specific plan to address safety at a global level would seem imperative. I would recommend Ajinomoto to consider this in its next report. 

Alongside this, few truly long-term aspirations are presented. Sustainable business goes beyond a three year management plan, and sustainable change takes longer to achieve, especially in a company as dynamic and complex as Ajinomoto. I recommend Ajinomoto to develop a core set of targets to 2020 that can be used to drive, measure and report future progress. Ajinomoto has been around for 105 years. Ajinomoto’s commitment to sustainable business and transparency gives me confidence that the company will be around for at least another 105 years. Therefore, a longer planning and target-setting horizon would be welcome.
"

The practice of asking independent experts from around the world to review and comment on a Sustainability Report is quite widespread among Asian reporters. While an external commentary is not exactly "engagement" in the fullest sense of the word (and does not replace ongoing stakeholder engagement), there is something rather courageous about asking independent experts to review and comment on a Sustainability Report, and then publishing their independent commentaries in full. I can confirm that Ajinomoto published my comments with no editing, and did not try to influence me in any way about what to write or what to focus on. The only limitation I was given was a word-count. 

I was also happy to read three additional expert commentaries in the same 2014 Ajinomoto report.
  • Deborah Leipziger, Professor at Hult International Business School and a Senior Fellow at the Lewis Institute at Babson College.
  • Mark Feldman, Managing Director of Cause Consulting.
  • Dr. Wong Lai Yong, Founder of First Penguin and social responsibility and human resources development consultant.

All three experts provided a truly interesting and diverse range of insights that are well worth reading. Ajinomoto's openness in requesting and publishing such commentaries is to be admired, though, one hopes, that these will not remain at the level of words on pages. Each expert articulated different pieces of very practical advice to assist Ajinomoto in its ongoing reporting journey. The hope is that this advice and guidance will be carefully analyzed within the Ajinomoto reporting team and company management, and that, where relevant, suggestions may be adopted to help make Ajinomoto's next report even more relevant and useful to stakeholders.

I look forward to seeing the next Ajinomoto Sustainability Report. In the meantime, Ajinomoto's current report provides, in the words of Dr Wong Lai Yong, "a strong example that Ajinomoto is willing to walk the talk." 



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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Wednesday, March 11, 2015

Businesses (still) discriminate against women

So. Another International Women's Day has come and gone. Celebrating the achievements of women. Doesn't do much for me, I have to say. The implication is that it's sort of amazing or even surprising that women achieve anything at all. Unlike men, for whom achievement is apparently quite natural as they don't have a Day all to themselves, international or otherwise. International Women's Day to me is quite unnecessary. As a woman, wife, mother, business-owner and yes, achiever, in my own modest way, I don't really need a Day. I am happy to celebrate my own achievements in my own way whenever I feel I want to.  

On the other hand, none of us can have any doubt that the need to create a society in which fair and equal opportunity for women exists is no less acute than it ever was. And that, apparently, takes longer than a Day. The position of women in society - certain societies - has improved over the years, but women are still discriminated against. This applies to business as much as it applies in other walks of life. No matter how many sets of Women's Empowerment Principles exist, gender equality in business is still somewhat of a distant dream. 

Sustainability. How can business be sustainable when it discriminates against women? Even the most advanced "sustainable" businesses discriminate. Let's be clear. If women do not have balanced representation in business, discrimination is present. It may not be overt, declared or even desired, but it's there. This is not resolved by adding women to Boards of Directors. It's fairly easy to pluck selected distinguished women and place them on (rather impotent) Boards of Directors so that the numbers look better. I would be interested in seeing research that shows what influence women Directors are actually having in influencing the way business does business. Forgive me for being a little skeptical.

I am more interested in how women have equal opportunity to enter and advance in business, especially the large, typically male-dominated companies that do business around the world. Many consumer goods companies actually target women who make most of the purchasing decisions for their products and yet women's representation in their senior management committees is pathetic. 

Corporate Knights makes a big splash every year announcing the Global 100 - most sustainable corporations - at the World Economic Forum. By all accounts, this is one of the better lists (although all rankings serve the rankers more than the ranked). With the Global 100, the methodology is clear, transparent, and covers the spectrum of sustainability performance areas. In 2015, however, the ten companies that headed up the Global 100 list have just 11% of women in their Executive Committees. They have a higher rate of women on the Boards of Directors, but where it really counts, women in senior executive roles, the figures are rubbish. At the same time, most of these companies have workforces that are 40 - 60% composed of women. What happens to women when they join these companies? How come that, in a combined workforce of almost 200,000 women in these ten top companies, only 9 get a key to the executive committee room? Men, on the other hand, have a better chance of getting a seat on the Executive Committee by a factor of almost five. Three of these top ten companies have ZERO women on their executive committees. So you tell me, are these companies discriminating against women or aren't they? (Hint: not no).



Biogen Idec: The world's most sustainable company has 17% women representation on it's executive management team. That's 2 women out of a team of 12. The two women are the Chief Legal Officer and the VP for Technology and Business Solutions. This is what Biogen Idec says about women in its 2013 Sustainability Report:

"To continue to thrive as a company and an industry, we must advance leadership opportunities for women. In 2013, the Women’s Forum of New York formally recognized our commitment as one of the 174 U.S.-based companies honored at the event for having a board of directors that is at least 20 percent women. Women currently make up just over half of our global workforce, and 40 percent of our management team. As we continue to advance in this area, one way we are striving to close this gender gap is through our Women’s Innovation Network (WIN) Employee Resource Group, which provides opportunities for women to network, learn, seek out mentors and develop their careers. Though primarily focused on women’s careers and leadership, WIN proactively recruits and welcomes employees of all gender identities who wish to act as allies. At present, more than 800 women and men from across the enterprise are members of the network."

This is how Biogen Idec represents the numbers visually:
Note how the high numbers stand out... 51.5% total women  and 40% women in management. Wonder why there is no visual presentation of women on the Executive Management Team. That would read:
17%
Aside from a resource group (dubious effectiveness in actually helping get women promoted), I don't see evidence of a plan to improve women at executive team level.

Allergan: The world's second most sustainable corporation has ZERO women on its executive management team. Yes, ZERO. Yet, this is what Allergan says about women in its 2013 Sustainability Report

"In 2013, women comprised 53% of our workforce and 40% of our leadership roles. This includes more than 39% of our manager and director roles, and nearly 27% of our executive positions. We were also fortunate to have one exceptional female member of our Board of Directors who brings truly exceptional credentials to our organization and is committed to its development."

Note how the high numbers stand out. 53% of the workforce at Allergan means more than 6,100 women. Not a single one worthy of helping to run the company. And the "exceptional" female director doesn't seem to be able to do anything about it. Allergan says nothing about any plans to address this gender imbalance in its organization. 

Allergan website - gender balance in action. Not.
Instead of talking about 27% of executive positions, Allergan should highlight the percentage of women executive team members, i.e.  
0%
And perhaps in its reporting, the company might like to explain how it is that zero women are worthy of senior leadership, and what if anything, the company plans to do about it. 

adidas: The third most sustainable corporation in the world has ZERO women on the Executive Team. The Adidas 2013 Sustainability Report includes a 2014 milestone to "Systematically increase the percentage of women in leadership positions." The website expands a little, stating: "The adidas Group has set itself concrete goals in line with its corporate culture and employee structure to increase the number of women in leadership positions in the coming years. The proportion of women in management is to be increased to at least 32% by 2015 (currently, the proportion is 26% in Germany and 28% worldwide). To achieve this goal, we have increased the proportion of women participating in our leadership development programmes to 35%. This is to help more women take up leadership positions in all areas of the company. We had already achieved this corporate goal at the end of 2012."

Note how adidas quotes the big numbers relating to women in leadership. But, if Adidas were to highlight the number of women on the Executive Management team, the result would look like this
0%
adidas employs more than 50,000 people. Not one single woman worthy of an executive team position. 

Keppel Land: This is the fourth most sustainable company in the world, according to Corporate Knights. And Keppel Land has the highest ratio of women on the senior management team, 2 out of a team of 6, which is 33%. Keppel Land is a real estate company, employing less than 4,00 people in total. And yet, even with such a small total workforce compared to other companies in the top ten sustainables, Keppel Land managed to identify two worthy women leaders, both of them in significant business P&L roles. 
33%

Kesko: The fifth most sustainable corporation has 1 woman out of a team of 8 on the senior executive team (Group Management Board). This is with a workforce of 45,000 employees of whom more than 50% are women. The one woman is the General Legal Counsel.  Rate of women in executive management? 
13%

BMW: The sixth most sustainable company with more than 100,000 employees can manage just 1 woman on the Board of Management out of a team of 8. The woman is the Human Resources Manager. Despite this, BMW has by far the lowest rate of women out of these top ten companies in the total workforce at 17%. Don't women buy cars? I hope they don't buy BMWs.


BMW women in Management:
13%

Reckitt Benckiser Group: The seventh most sustainable company has 1 woman on an executive team of 8.

13%

Centrica: Centrica has one woman in a team of seven top execs. Centrica's website displays some interactive charts that show different performance indicators, including this one for women. Lots of room on this chart for improvement.....



14%

Schneider Electric: This ninth most sustainable company has the largest senior management team of all the top ten. A whopping 15 members. You might think this would give opportunity to find a few women from the 153,000 people in the Schneider workforce to help lead the company. As it stands, just one makes the grade.


Overall women in the Executive Team?
6%

Danske Bank: Perhaps it's fitting that the tenth most sustainable company in the world rounds off this sorry state of women's affairs with a big ZERO women in the management Executive Board.


However, Danske Bank does make a commitment - one of the few that does:

This is not entirely out of the blue. This is what prompted Danske Bank to get more women-action-oriented: 

"In 2012, the Danish Parliament adopted legislation to ensure equal rights for men and women in private organisations. The law requires Danish companies to set specific targets for the number of women on the Board of Directors and to develop policies to increase the number of women in leadership positions. In their annual reporting, companies must also report on the progress made towards these targets and on the implementation of a diversity policy. We have already come a long way in developing a diversified and inclusive workforce, but we recognise that we still have some work ahead of us.

12.5% women on the Executive Board  of six members adds up to 0.75 women. I wonder which 0.25 part they are planning to leave out? Nonetheless, appointing three quarters of a woman executive by 2017 (four years from the 2013 report publication) is some sort of commitment, but forgive me if I am not falling off my seat. Today the score is:
0%


Well, all that was rather disappointing. I confess to being a little surprised that companies that are named as "most sustainable" are so unwilling to promote women. I am sure none of them will admit to discrimination among their ranks. But look at the numbers. Draw your own conclusions. It will take more than an International Women's Day to fix this. In fact, several Days haven't. Let's move on from a Day to Every Day.  




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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Friday, March 6, 2015

Will I take the G4 Exam?

Nooooooooooooooooooooooooo !

GRI has introduced a G4 Exam. With bold billing as the Next Step for Sustainability Professionals, the G4 Exam is a 60 question multiple choice exam covering the GRI reporting phases. GRI says: "The G4 Exam will give candidates an opportunity to demonstrate to the market their ability to use the G4 Guidelines. "

I beg to differ. 

Pay lots of money. Attend a GRI Training Course (typically around Euro 1,500 or more). Pay more money (Euro 315-500 per exam). Take the exam. And WOW. Collect all the certificates and get your name on the GRI website so that people will think you can write a G4 Sustainability Report. Answering questions about the framework does not equate to ability to use the framework. Something doesn't work here for me. 

While I have long advocated that GRI use its force for good to improve quality use of G3/G4, my reaction to the G4 Exam is like.. err.... super cringe. In my view, it implies that quality reporting is equal to knowledge of a reporting framework, and this is simply not the case. Answering 60 multiple choice questions about G4 does not make you a good reporter and does not even demonstrate that you fully understand the intricacies of G4 reporting. The pass mark is 75%. So you can get 15 questions wrong.

And OMG. I hope this does not indicate a new trend in sustainability disclosure. Will we see a CDP Exam? An IIRC Exam? A SASB exam? A GHG Protocol Exam? A UNGC COP Exam? An ISO 26000 Exam? Maybe it's back to school for everyone..

The implication is that reporting is only about understanding the technicalities of the G4 framework. Reporting is at least as much about the process and the content and navigating the endless organizational hurdles that need to be overcome before a Sustainability Report is birthed. A useful G4 report is more than the sum of the boxes you tick and the disclosure labels you add.

Of course, if a company decides to use the framework, it should use it correctly, so some form of quality control is a good thing, as I have (very) often said in the past. But the quality control should cover the report, not the theoretical knowledge of the framework. Anyone who has sat through a training program and memorized the framework can sit the exam and get a certificate. They may have never worked on a report.

On the other hand, perhaps the G4 Exam is a good measure of an individual's commitment to fully understanding the framework before taking up the practice of reporting. Perhaps the G4 Exam is good for internal reporters who want an additional qualification or proof of competence within their own organization. Perhaps the G4 Exam will actually help prevent consultants and reporters becoming confused with the finer points of the guidelines and misrepresenting them in reports, as so often happens. Perhaps it will help people actually notice when they do.

Wondering if my views about the G4 Exam are overly critical, I did a little asking around. I won't mention any names, but these are the reactions I received when I asked a group of sustainability professionals I respect from around the world whether the G4 exam is a good thing or a bad thing:

"It smacks of opportunism. I also have concerns about how it extends the GRI brand."
"My initial thought was, that's weird, and possibly a waste of time, but on reflection it seems OK - though it would be much more meaningful if they developed a proper credential from this. The test alone is too obscure to create a qualification mark for practitioners."
"It can be a way to shift "enthusiastic" to "book smart".
"I think it's an interesting initiative, however, I believe that many organizations will do it do just for marketing I think reporting ability is shown more by experience, since that gives richness to the learning and continuous improvement. It seems difficult that GRI accepts only a methodological framework."
"This attracts relatively unqualified people that then can use the GRI name to promote themselves. The exam will “certify” as “experts” people that have merely read the guidelines. They capitalize on the brand name to lure naive people into their courses and now exam. Irresponsible, crassly commercial."
"I think it is better than nothing (i.e., anyone can be an expert) but it is misleading that good test score = expert."

The real question is will reporting quality improve as a result of people passing the G4 Exam?

GRI has always sat on the sidelines with regard to report quality. The Application Level checks of old often led to misrepresentation, enabling reporters to use GRI officialdom to claim "highest accolades" and "certification" by GRI when the checks only covered a small random selection of indicators. Now, GRI has developed a suite of report checks at higher prices than in the past, and even, a higher than higher priced "fast track". So now, if you are a non-Organizational Stakeholder corporation, you can use the Content Index Service (Euro 4,500 for a comprehensive report), the Materiality Disclosures Service (Euro 2,400), or the Application Level Service (Euro 1,750). For an additional Euro 750-850, GRI promises a turnaround of half the regular time.

The thing is, that none of these "services" actually provide a thorough and reliable check on the quality of the report adherence to the G3 or G4 frameworks. They are all designed to confirm the presence of disclosures in the place that the reporters say they should be and/or the quantity of disclosures included in the report. In the Content Index and Materiality Matters checks, for example, if you have said you have reported EN1, GRI will check that your disclosure is on the page you said it was. But GRI will not check that the disclosure is complete or if it actually discloses everything that the framework requires. In other words, GRI will check that you have a train ticket and that you got on the right train, but GRI won't check that you actually stayed on the train until you got to your destination.

The Materiality Disclosures Check is less useful. It confirms that you included the material disclosures on the pages you said they should be - including, specifically, a list of material topics (G4-19). But it does not check that, in the rest of the report, you have actually disclosed anything material (i.e. performance indicators that demonstrate performance relating to material issues). What's the point of that?

All of this is GRI side-stepping reporting quality and increasing reporting "we are great" hype. The G4 exam, in my view, amplifies the hype. Have GRI publicly confirm to everyone you can do something without you ever having done it.  I think it's rather disappointing that GRI lends its highly-regarded brand to this sort of individual promotion.

If GRI were committed to improving reporting quality, it would make more of an effort to think deeply and strategically about what quality application of the GRI reporting frameworks actually means and then go back to the drawing board and develop a methodology to provide a reliable, comprehensive, thorough and meaningful check of report adherence. Skimming the surface with almost-quality checks may be convenient (and encourage uptake because it's easy) but the result it delivers does not advance sustainability or sustainability reporting. I have ceased recommending the use of these services to my clients. I just hope none of them ask me to take the G4 Exam.    


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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Tuesday, March 3, 2015

15 insights from the Smarter Sustainability Reporting Conference

The fourth annual Smarter Sustainability Reporting Conference last week in London was by all accounts a great success. We heard from a range of experts, raised several challenges and discussed the finer points of what makes reporting smarter. Here is a selection from my opening comments to the conference as everyone braced themselves for an action-packed day:

"G4 has emerged as the leading reporting framework with close to 1,000 reporters now having started their reporting journey with G4 or transitioned to G4. Has G4 made a difference? We do see a new relationship emerging with materiality but many reports are still written with a shopping list mindset – a list of "everything good that we did". The G4 transition is still working itself out, but it's a positive development. GRI has even introduced the G4 EXAM – to prove that people who write reports really can. 

The European Directive for non-financial reporting came into force in December 2014 with around 6,000 organizations expected to get on the train by 2018. Will they just show up or will they use the reporting process to add value? In other countries, such as Taiwan and Singapore, reporting has become mandatory. Sustainability reporting is apparently not going to disappear. But what will make it smarter? 

In 2014, more companies than ever reported to the Carbon Disclosure Project. CDP now reports impacts across a range of topics – climate change, water, sustainable cities, forests, and supply chains on the basis of data submitted by 4,500 of companies representing over a third of the world's invested capital. This is a database too large to ignore. 

The IIRC continued its journey and its search for identity as more companies start to pilot the framework to explain how they create value for investors. The UN Global Compact launched a program for Boards of Directors so that Directors can actually learn what's going on. SASB has published more and more standards, but when you get beyond the hype, you realize that in some cases, you need to be a rocket scientist to understand the actual performance measures. The jury is still out on whether companies will adopt these standards and if they do, and how they will influence materiality processes. 

And talking of materiality, there is still no agreement across the board on what it actually means for sustainability and despite even more declarations of harmonization and collaboration talks, all we are seeing is more and more declarations of harmonization and collaboration talks."


All conference photos in this post are courtesy of edie.net, the conference organizer. Thank you!


Here are some of the things that others said throughout the conference (and a short reaction from me). 

Mardi McBrien, Managing Director, Climate Disclosure Standards Board (CDSB) : "In 2007, at the World Economic Forum, companies were saying there are too many ways to report climate change. Investors were saying, "well, we don't use it anyway"."
Err. What's changed?

Nelmara Arbex, Chief Advisor on Innovation in Reporting, Global Reporting Initiative (GRI): "Personally, I believe that reporting promotes change and innovation. Reports used to talk about the past. Now they should be talking about the future."
I agree. But when exactly does the future start?

Sarah Grey Markets Director, International Integrated Reporting Council (IIRC): "Smarter Sustainability Reporting is a pretty big issue for business. Sustainability is about having a strategic impact in the market. Hopefully some of the integrated reporting thinking will help sustainability reporting having that strategic impact."
Hopefully.

Verity Lawson, Sustainability Reporting Manager, British American Tobacco: "I think especially for an organization like us that is operating in a very controversial sector, it is particularly important that stakeholders can place trust in what we report. So the robust frameworks and processes such as independent assurance and GRI are particularly helpful. But while it is encouraging to see all the developments - G4's focus on materiality, the IR framework, the harmonization talks - frankly it is very overwhelming for reporting companies."
Harmonization is great in theory. The problem is, it's always theory. 

LTR: Shaun Davis, Louise Tyson, Irene Jakobi, Neil Barrett, me

Neil Barrett, Vice-President, Sustainable Development, Sodexo: "It's really about using sustainability reporting to create actions that will be of value to our clients. Increasingly our clients want to understand how we are helping them in their own sustainability journey".
It is great when reports are useful as part of regular business processes. And when clients know what to do with them!

Shaun Davis, Group Director - Safety, Health, Wellbeing & Sustainability, Royal Mail: "Reporting is all about engagement and taking people with you. We shouldn't forget how powerful it is as an engagement tool to talk to people about sustainability environment, safety wellbeing etc."
Tried it lately?

Louise Tyson, Head of Reporting, BP: "A lot of work goes into preparing information for reports and this is wasteful if it's mot material. Less is more. In the last three years we have cut our reporting by 30%. We are hoping that more concise reporting targeted to what our stakeholders want to know will help us answer their questions better." 
100 page reports - a thing of the past? 

Irene Jakobi, Sustainability Manager, Telekom Austria: "Now we have taken a more creative approach. Our first reports were more classic with hands and people and green trees. In 2008, we started to make a shift to more communicative content." If you want creative, look at Telekom Austria's reports!

Telekom Austria - the age of the graphic novel


Megan Mitrevski-Dale, Associate Director, Corporate Responsibility and Sustainability Communications, Coca-Cola Enterprises: "Starting in 2005 we set ourselves a target to reduce our operational carbon footprint by 15% by 2020. OK, we said, operations means our manufacturing facilities and field sales offices. But as we started to go through it, we realized that that's only part of the story. If our product gets to a store and its not in a cooler, no-one will buy it.  Then we realized that our main carbon footprint isn't in our operations. It is actually in our vending and cooling facilities."
How many companies think they are doing fantastically by reporting internal operational footprints when, all the time, their true impact is beyond the factory walls?  


Christoph Wilfert, Chief Executive Officer, PE International: "We think the software side of sustainability management is going to change dramatically. How do you get past email and excel spreadsheet management to support our sustainability reporting efforts? To us, reporting is not a journey of harmonization that frankly will take a very long time to come together to make your lives easier. We think its an app."
Down with harmonization. Up with apps. 

Simon Howard, Chief Executive Officer, UK Sustainable Investment & Finance Association (UKSIF): "Thirty percent of assets worldwide are run with sustainability as an aim and it's growing very fast. Can a fund manager have too much sustainability information? Overwhelmingly yes. The information they want needs to be material, relevant and timely."
G4 to the rescue. 

Paul Toyne, Group Head of Sustainability, Balfour Beatty: "We have an integrated report that has sustainability sections in it, and we use our website to disclose a lot of information. What's interesting is that when we start to get into disclosure, we spend so much time and effort to get to group level data and aggregating up to global level, but the investment we have taken here doesn't really drive performance. If we invested more time and energy into the source data and dealing with the impacts, then we would actually improve performance."
The old story of the chicken and the egg. Data to drive performance or performance to drive data? 

Crystal Crawford, Corporate Responsibility Manager, Liberty Global:  "If we manage internal reporting requirements well, then it will drive reputation and recognition. We have 45,000 data points in our data collection process." 
Data to drive performance. 



Katie Buchanan, Head of Sustainability and Reporting, Virgin Media: "At a market level its about having a real responsibility to try to bring to life the material issues for our key audiences which are our staff and our customers." 
Materiality in practice and not only in a matrix. 


All in all, a packed conference with a packed agenda and many insights for reporters, future reporters and reporting partners. We addressed the tools used for reporting, the frameworks and the practice. We plan to do the same thing next year. Same but different. In a year's time, the world will have changed and the Smarter Sustainability Reporting goalposts will have moved once again. 



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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Monday, February 2, 2015

Do you trust Sustainability Reports?

This follows my post about trust and the Top 100 Thought Leaders in Trust. Which got me thinking.

There are some questions that are apparently very simple to ask but not so simple to answer. Do you trust Sustainability Reports? Of course, there are reports and reports. Maybe you trust part of what's written in a report, and maybe not other parts. Bottom line, however, if you don't trust it all, you don't trust it.

What makes sustainability reports trustworthy? We often talk about credibility when referring to Sustainability Reports, and this is defined as "the quality of being worthy of trust". So I guess it boils down to the same thing. Do we believe what we read? If yes, trust is the outcome. If not, mistrust is. But it's not quite as simple as that. Reports are not just about what is written. They are about who is writing them. When you pick up a report of a company that you don't trust, the credibility start-point of that company's Sustainability Report is already in the red. The report has to work much harder to be believable. But it's not quite as simple as that. One report doesn't do it. I have often said that what makes sustainability reports credible is the fact that they are one of a series ... one report is a drop in the ocean, a series of annual Sustainability Reports that display consistency over time is what builds trust. Consistency is a big trust differentiator in reporting. But it's not quite as simple as that either. Here are some more factors that influence whether we trust reports.

The CEO: Leslie Gaines Ross, with whom I had the honor to share a stage in Berlin last year, says that the reputation equity of a company is influenced by the reputation of the CEO at a level of 50%. When you get a CEO or a senior leader that makes non-trustworthy statements, this has a direct impact on the Sustainability Report credibility of the company. When a company's Chairman makes a public statement which is anti-gay, as in the case of Barilla, you have a hard time believing anything that is written in the company's Sustainability Report. When a CEO openly discriminates about people who do not match a beauty stereotype, as in the case of Abercrombie and Fitch, you are likely to have a hard time believing the Sustainability Report. Write whatever you want in your Sustainability Report, if no-one trusts your CEO, no-one will trust your report. 

The Bits you Leave Out: Reporting is often as much what you don't report as what you do report. If you have had a major scandal, major restructuring or major crisis, and this is not referenced anywhere in your report, what IS referenced in your report is treated with suspicion. One of the first things I generally ask my reporting clients is: what do you not want to report? Every company has these. Every company wants to minimize the negatives. Yet it's these very issues that create credibility and trust in your report. After the big celeb scandals in the UK, the BBC did not avoid reporting the impact on its organization.


After the horsemeat scandal in Tesco frozen beefburgers, Tesco did not shy away from referring to its actions to increase food trust in the 2013 Tesco and Society Report.

The bits you leave out are the bits everyone wants to read. There is a likelihood that there is even an expectation that you will report  on exactly those things. Not doing so erodes trust in your reporting and in your company.

The Reporting Ecosystem: GRI was devised to create a common platform for reporting so that we would have a measure of comparability that would also make it possible to know which reports are green-washing and which are serious about reporting the issues that matter. While comparability has never truly been achieved, the overarching framework of GRI sets an expectation of the scope of reporting and the basic elements of a report that are considered to meet the needs of a wide range of stakeholders. Reporting whatever suits you, without referring to a broad set of stakeholder expectations can often erode trust, as readers believe that you are reporting what's easy or shiny and not what matters. 

The Buzz Ecosystem: Whether you trust a Sustainability Report can often be influenced by the buzz on the street and not the report itself. When the buzz about your company is negative, your report has to work much harder to generate trust. So, for example, companies such as Walmart, Gazprom, Chevron and a range of other companies that feature in the Public Eye Hall of Shame have to overcome gross mistrust before they can build trust. Reports such as Behind the Brands expose the issues that companies are addressing, or not, in their supply chains, and these can influence the way you read the reports of the companies reviewed. On the positive side, we might argue that rankings and ratings (if they themselves are credible) create a more positive disposition regarding whether you are prepared to trust a company's report. The DJSI rankings are often held to represent a solid guide to sustainable corporate practice and high-rankers tend to gain a head-start in trust.  And lets not forget the Twitter community and other online forums, bloggers and commentators. They all create the reporting buzz ecosystem and influence the way you relate to a report by setting expectations, positive or negative.  Managing your buzz ecosystem is part of managing trust in your Sustainability Report. 

The Quality of the Content: Reporting quality impacts the way we trust reports. If we get past the trust barrier and actually read the report. If the content is poorly written, if the report is poorly constructed, if there are many errors in the report, if the data is not clear, if there are gaps in data presentation... everything influences how you read a report and how you trust it. Also, companies that translate their reports into English are to be commended, but if that translation is just awful, it reduces our trust in the report and the company.  

The Timing: Who trusts a report that is published more than 12 months after the end of the reporting period? Enough said.

The Person Behind the Report: Behind every report is a person who created it. Often there were many people involved in the creation of the report. But there is always one person who has the ultimate responsibility for a report and its contents. If we trust the person, we trust the report. Very few people put themselves on the line and admit to writing and being responsible for a report and very few people who are reporters allow us to get to know them. I say that reporters in companies should make themselves more accessible, identify themselves with the reports they have created and be available to the report-reading public. These days, there are many online opportunities to get to know corporate sustainability reporting leads, with CSRChats, webinars and so on. A couple of examples spring to mind - Kathrin Winkler of EMC puts herself out there - she is often interviewed, writes a great blog, and generally helps us get to know her and what she stands for. Before I even open EMC's sustainability report, I am inclined to start with a bag-load of trust. Dave Stangis of Campbell's is another great Sustainability Officer who lets us get to know him. And Nikki Kelley King, who leads the Campbell's CSR Report compilation, tells her story in the latest report. Getting to know Dave and Nikki through their willingness to talk about themselves and what's important to them is a big plus in the trust scale for Campbell's reporting.  


These are just a few thoughts about Sustainability Reports and trust. It's not an exhaustive list and I am sure there are many other factors that impact the way we trust Sustainability Reports or otherwise. One of the key takeouts is that reporting is just part of your corporate reputation and your corporate communications. Reporting is not everything. It is part of a holistic approach to sustainable and responsible business behavior that must be reflected across all stakeholder touch-points. The downside is that, even if your report is super-trustworthy, people may not trust it. The upside is that when you manage your reporting as part of an integrated approach to sustainability communications and aligned corporate behavior, it can contribute significantly to positive reputation, credibility and yes, trust. 



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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine: info@b-yond.biz   

Friday, January 30, 2015

What does trust mean to you?


This week saw the publication of the 2015 Top 100 Thought Leaders in Trust. You can see who made the list this year, including 15 Lifetime Achievement Award winners, in the free download of the Winter 2015 magazine issue. I was honored once again to be selected as one of the Top 100, and humbled to be in the company of those I feel are much more deserving of this recognition. This is the 5th year that Trust Across America - Trust Around the World - under the visionary leadership of Barbara Brooks Kimmel - has recognized professionals from business, academia, nonprofits and consulting whose work is elevating organizational trust. The leaders were selected by a distinguished panel of judges  - big names in responsible business - and you can read about them too in the Trust! Magazine Winter Issue. 

The theme of trust is so central to everything we do in sustainability and both a driver and an outcome of sustainable behavior. Several of the lifetime honorees took time to reflect on what trust means to them, and much of what they said resonated strongly with me. For example:

Patricia Aburdene: "In the business world, trust literally transmutes into success and profitability."

Steven M.R. Covey: "Trust underlies and affects the quality of every relationship, every communication, every work project, every business venture, and every effort in which we are engaged."

Jed Emerson: "Confidence in our collaborations with others is the foundation of successful organizations, and the best collaborations are always fundamentally a question of creating a trusting relationship."

Leslie Gaines-Ross:  "Trust is the bedrock of relationships."

Mary Gentile: "Trust means integrity – acting in accordance with our words and commitments—and making sure those words and commitments are worthy of this consistency."

Charles H. Green: "Trust-based organizations encourage and enable the art of trusting and the virtues of trustworthiness in all the personal relationships they touch. In so doing, they also increase the social and financial value of the organization."

Jim Kouzes: "Trust rules your brand image."

Linda Locke: "Trust, and reputation are about how you make people feel. We want to conduct business, and have relationships with people and organizations we respect and hold in high esteem. Trust is a central strategy for business growth in a reputation economy."

Edward Marshall: "We yearn for relationships and organizations that operate with integrity, honor, transparency, and grace. It is possible."

There is no sustainability without trust. There is no business success without trust. Often imperceptibly, trust builds stronger organizations. This got me thinking about the role of sustainability reporting in helping to build and enhance trust in a range of ways. Whose Sustainability Report do you trust and why? And what affects the trust we place, or do not place, in sustainability reporting. This is the topic of a future post (coming soon!). 

In the meantime, each of the 100 Top Thought Leaders in Trust offers inspiration that we can create a business environment that has trust at its core. Barbara Kimmel and Trust Across America is committed to helping us do just that, and the annual honoring of thought leaders, the suite of books published in the Trust Inc. series, the frequent blogs on trust and related matters and the F.A.C.T.S. framework for trustworthy business behavior are all making their impact felt.  

Congratulations to all the 2015 honorees and especially the Lifetime Achievement Award winners!



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 www.b-yond.biz   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).    
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