Tuesday, June 1, 2010

Brazil rules the world

A Brazilian delegate at the GRI conference told me that she was quite embarrassed at the knockout performance of the Brazilian reporters in the GRI Readers Choice Awards 2010. Actually, it may even have been an embarrassment for the GRI as well, perhaps intimated as such by Hermann Mulder, member of the Awards Integrity Team who said the team met five times and worked to a process which was "as good as it can be". As good as it can be does not necessarily mean good. A process which delivers  four reports, all from Brazil, for six awards, out of a possible 1,100 reports which received votes, of which 105 were shortlisted, from 13 countries, must beg some questions.  Out of a total of 30,546 votes cast, Brazilians voted 22,613 times - 74% of all the votes.   The next highest voting country was the USA with 2,107 votes, then India with 1,981 votes, then Greece with 1,288 votes. All other countries cast less than 1,000 votes, with the Netherlands, home to the GRI, with a mere 57 votes!!, the lowest number of all. Data from CorporateRegister.com shows that Brazil is the 13th reporting country in terms of number of reports issued per year, with about 100 or so reports issued annuallly, way behind European and North American levels.

So how did this happen ? What magic inspired over 22,000 Brazilian votes ? 3,724 individual Brazilians were reponsible for these votes  - that's 72% of voters and an average of 6 votes per person, whereas the rest-of-the-world appear to have an average voting rate of 5 per participant. Not such a big difference, unless there are very wide variations withing the averages.  And even so, mobilizing so many voters to get online and "do it" is certainly an achievement worth recognizing. Notwithstanding, I believe it would be appropriate, in the interests of transparency, for the GRI to disclose the distribution of  average votes per person in each country. Just so that we can pronounce Brazil the reporting rulers of the world with a clear conscience in the knowledge that this was about quality reporting and not exploitation of the system by an enthusiastic few.   

Let's have a look at the winning reports:

Banco do Brasil - Relatorio Annual 2008. This is an annual combined financial and non-financial report hosted in the Investor Relations section of the bank's website. It is an html mini-site which is attractively designed and uses automated people who speak to you (in the local lingo with English subtitles) and provide you with the option of choosing your profile - employee, customer etc -for a tailored reading experience,  or going directly to  the the entire report content. The PDF download of this report is 539 pages! This is not a report, it's a library. It includes everything from a history lesson, "Napoleon sweeps the continent with its armies, dethroning monarchies and installing republics." in 1808, to all the detailed financial statements you would expect in a financial report, macroeconomics, microeconomics as well as sustainability information, with the resepective GRI indicator noted alongside each section of text. The main sustainability section is in a chapter of its own, 38 pages, though some of the Profile Disclosures are threaded throughout the report, plus around 20 pages of GRI Index.  Whilst it seems that this report cannot be faulted for transparency, I must say that it is not one of the most pleasurable reading experiences, though the English translation is unintentionally mildly amusing :) If you like numbers, this is a report for you!

Banco Bradesco Sustainability Report 2008. This report also won in the Best Assurance category in the CRRA 10 Awards. It's a GRI A+ level report of 148 pages in length. It's nicely designed and carefully written. The bank employs over 80,000 people with over 40% of women in management positions. Clearly, an enlightened organization :). In addition to the content in the body of the report, there are around 50 pages of "additional content" which zoom in on different aspects of the bank's activity and performance for those interested in greater detail - a nice touch! The report includes details of the Banco Bradesco "Cycle of Dialogue" with stakeholders and feedback received on their 2007 report. Atfter a brief look through, this seems to me to be an impressive report.

Vale Sustainability Report 2008 : This is a second report at GRI level B+ of 117 pages in length from this mining company with a mission to transform mineral resources into prosperity and sustainable development, employing over 145,000 people. The report is also clear and nicely designed and includes interesting references to indigenous communities and quilombolas and other informative stories.  The Vale report appears to cover key sustainability themes  and  includes an interesting graphic presentation of the material issues.

Natura Cosmeticos Annual Report 2008 : This is a nicely philosopical (life is a chain of relationships) report, (commitment to the truth is the route to perfecting the quality of relationships) for this 40 year old company with 5,500 employees, and is their ninth sustainability report, containing 14 pages of financial statements, out of a total 49 pages. (It is in the heart and in the eye of each one of us that change is built) It is a GRI A+ report with both financial and sustainability content assured by separate assurers. It doesn't shy away from talking about "controversial ingredients" and in general this  report is written in a frank and direct manner, adressing sensivtive issues such as layoffs , accidents and the challenges of diversity. Quite a readable report, actually.

So, all in all, four relevant and serious reports were selected. One cannot say that the awards were made to reports that were not worthy entrants. And you should not mistake my criticsm of the awards process for sour grapes because my predictions weren't entirely correct ... ahem.. even though I did pick two out of the four winning companies though not in the right categories.  Leon Kaye takes this positively in his editorial for Justmeans , saying that Brazil can "provide a teaching moment for companies around the world" . I am sure this is true. I am just not quite sure what the lesson is. Fernando Legrand also says Brasil (e India) se estaban convirtiendo en ejemplos a seguir por las empresas de Estados Unidos. Hmm. I am sure all the American reporters will like that!

Leon Kaye says the  Brazilian showstopper is  evidence of "Brazil's remarkable influence on the world economy and concern for sustainability." Is he right ? They certainly have some clout  - according to Forbes list of the biggest companies in the world, Petrobras (2008 GRI Awards winner)  is #18, Banco Bradesco  #51, Banco do Brasil  #52 and Vale  #80. And I guess I would rather they were leaders in sustainability than not. But Antonio Vives, who takes a "mirada critica" (I think this means  a critical look ?!) at CSR, oops, RSE,  is not convinced, calling the Brazilian victory a "falacia" (guess that one yourself). Let's hope that this win encourages more Brazilian companies to report, and more countries and voters to get into the compeititve spirit and make best use of the two years until the next Awards Gala to boost their sustainability leadership and RATS: Responsibility, Accountability, Transparency and Sustainability.
However, I would recommend changing the system for future awards. Here are some options:
  • Hold one Readers Choice Awards for Brazil and one for the rest of the world, in the interests of diversity - a concept fundamental to sustainability.
  • Announce now the results of the 2012 Awards (Brazil takes all!) and avoid all the hassle of mobilizing votes, in the interests of energy and resources savings.
  • Limit votes to 3 reports per person, where no-one can vote for their own report, in the interests of the abundance mentality.  
  • Make award categories for regions, and allocate a winner for each region, in the interests of  well, regions.
  • Make award categories for company size, or type (for profit vs not-for profit) so that the Awards will be inclusive - another sustainability concept critical to the development of diversity.
  • Invite only Brazilians to vote, but for not Brazilian reports.This could be called the Brazilian Choice Awards.
  • Maintain the Awards in exactly the same format but accidentally on purpose block all Brazilian IP's. This could be the Brazilian No Choice Awards.
  • Maintain the Awards in exactly the same format but call it the "Eurovision Song contest for Corporate Geeks" (name inspired by Mallen Baker's post on the same subject)
Which option do you prefer ? You can vote only if you live in Rio.   

elaine cohen is co-founder and co-CEO of Beyond Business, a leading social and environmental consulting and reporting firm. Visit our website at www.b-yond.biz/en

1 comment:

Unknown said...

Extremely entertaining post! Of course, some overly-enthusiastic souls in Brazil decided to vote more than once. They are so busy saving what's left of the Rain Forest, they forgot they had already voted! And as they say in Brazil, G'd is Brazilian, and I am sure G'd's vote skewed the counting. (Disclaimer: born & raised in Brazil).

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