CLOROX: G4: good to go?

In the run-up to G4 (to be launched in May at the GRI conference), I decided to examine some recent reports (at random, but GRI-based and broadly same sector) to see if they would be good-to-go if the Exposure Draft is approved as published (albeit the likelihood of this appears low - the grapevine is indicating that significant stakeholder pushback is likely to dilute G4, though quite to what extent is not clear).

Below is a reminder of  what reports must include in order to qualify as "In Accordance" with the potential G4 Framework as we know it today from the Exposure Draft:

1. All of the Profile Disclosure Items. (There are 73 (!) Profile Disclosures)

2. Disclosures on Management Approach and Core Indicators related to all of the material Aspects identified by applying the Technical Protocol: Defining Report Content and Boundaries.

3. All disclosures identified in any applicable GRI Sector Supplement(s).

4. A GRI Content Index as specified in the GRI Guidelines.

5. A statement, signed by the highest governance body or Chief Executive Officer (CEO), that the report has been prepared in accordance with the GRI Guidelines and that it is a balanced and reasonable presentation of the organization’s economic, environmental and social impacts.

Regarding Profile disclosures, there are four substantive disclosures in G4 which make a difference to the entire reporting content. These are:

DI 12: Describe the organization's supply chain (number, type, location of suppliers, value of materials purchased etc)

DI 17: List the identified material Aspects (and other material topics).

DI 18: Describe the organization’s value chain.

DI 19: Place material Aspects (or other material topics) in the value chain.

Not reporting on these Profile Disclosures invalidates the "In Accordance" adherence. I will focus on these in my review of reports.

I ignore the 38 (!) Profile Disclosure items relating to governance and remuneration (up from 10 disclosure Items in G3), as, in my view, many of them are irrelevant, unnecessary and a waste of hours that the Working Group invested in devising every data point that they could possibly imagine. I expect this justified the cost of bringing the group to Amsterdam, but, in my view, it makes sustainability reporting look like Amazon.com's inventory of items shipped in the last five years.  I suspect that in almost every case, these 38 disclosures alone will disqualify all existing reports from claiming "In Accordance". However, let's not get bogged down in the negatives before we even started....

 

Regarding Disclosures on Management Approach, there are now three specific disclosures (replacing rather general guidance in G3) which require the company to report for each material issue (aspect), what the issue is and its key impacts, why it is material and what it's doing about it.      

First guinea pig:

The Clorox Company

Enduring Value 2012 Annual Report (integrated report)

GRI B+ GRI-checked online report with download (78 pages) Household Cleaning Products

Quick Overview of the Report

Clorox is a $5.5billion household products business with markets in over 100 countries and a workforce of 8,400 people. At Clorox, sustainability is paying off. Clorox people write in their annual report: "Sustainability investments in our Burt’s Bees®, Glad®, Brita® and Green Works® brands have accounted for about 40 percent of our sales growth in the last five years. Additionally, we’ve saved about $15 million annually by making sustainability improvements to our operations." A nice touch in this report is a description of some megatrends that are influencing Clorox's thinking. Clorox's Ingredients Inside is an interesting initiative, which lists all raw materials used in Clorox's cleaning products, with their chemical names and function. Of course, you would have to have a PhD in chemistry to make sense of all of that, but it's a good step for transparency.

The report receives a "+" from the GRI for being assured, although only GHG emissions from electricity consumption in U.S. facilities were verified. Frankly, you couldn't find a smaller sample of disclosure to assure, even if you tried really really  really hard. This report, to me, does not stand the test of assurance. I fail to see how the GRI can reasonably award a certificate for assurance here.

The well-respected Leon Kaye's concludes in his review of this report that "Clorox stands out as a corporate citizen that more companies within and outside of its space would be wise to emulate". Certainly the company demonstrates strong performance in waste reduction, GHG emissions, and water consumption. I note some positive employee practices including a new health and wellness program and also good community support.

 

However, I feel the Clorox report lacks some reporting depth and breadth, and is focused on activities rather than the change that Clorox is effecting in society as a result of its sustainable business focus. For example, 21% of products (since 2010) have been reformulated to reduce materials and waste, but Clorox does not disclose the extent of these improvements and the reduction in impact. There is a commitment to "responsible sourcing" but zero detail on what this actually means, beyond the existence of a Supplier Code of Conduct. More importantly, there is little about how Clorox is changing consumer behaviors with the exception of one or two small examples. With key business growth coming from "green"-ish products, I would have appreciated Clorox telling this story more fully.      

 

Profile Disclosures: 

Clorox lists four issues of material focus, based on insights gained from stakeholder engagement processes:

• Sustainable Product Innovation to include solutions for public health and more natural or plant-based products.
• Product responsibility  to improve human and environmental safety and ingredient transparency.
• Environmental sustainability for reducing Clorox's eco footprint.
• Public health in the area of disinfecting products.  

Looking at G4's matrix of Categories and Aspects, these appear to be just two aspects: Environment (emissions, effluent and waste aspect) and Product Responsibility (customer health and safety aspect). This is quite convenient for Clorox, as the performance indicator content of G4 is required only for Material Aspects. An opportunity to move from 78 pages to 20 :)

Clorox does not describe its Supply Chain, nor its Value Chain and does not place material aspects in the Value Chain. These are required G4 disclosures. G4 good-to-go? NO

As an aside, another interesting Clorox issue which invited the wrath of leading commentator Marc Gunther  and several others was their Greenworks campaign, which was too late for this report but may (or may not) be mentioned in the next report. Perhaps it's something for the Material Aspect: Marketing Communications! 

Disclosures on Management Approach

This is easy for Clorox as there are only two Aspects to report. I think this report meets the requirements for this section.G4 good-to-go? YES

Performance Indicators

There are 10 indicators which are in the Emissions, effluent and waste Aspect (EN16 - EN25), of which seven are core. Clorox currently reports on three of these seven core indicators in full, providing no data relating to, for example, water discharge (EN21) or significant spills (EN23), and avoiding non-core indicators such as hazardous waste (EN24) and biodiversity affected by water runoff (EN25). G4 good-to-go? NO

There are just two Performance Indicators in the Customer Health and Safety Aspect (PR1, PR2) and Clorox currently reports on one of them, providing a good description of safety assessments and procedures (PR1). Clorox does not report on incidents of non-compliance with regulations concerning the health and safety impacts of products during their life cycle (PR2), but this is non-core, so not required for "In Accordance". G4 good-to-go? YES

Despite producing a lengthy and generally comprehensive report using G3, and recording some good sustainability achievements, it looks like Clorox has quite some work to do in order to prepare future reports "In Accordance" with the G4 Exposure Draft. And this is based on an analysis which barely grazes the surface of the total new scope of G4. I believe this shows that G4 as proposed is not a small evolution for reporting, but a major overhaul, and will require significant reconsideration of what and how to report. The upside is that Clorox G4 will not be required to report on anything not defined as material. But is that really an upside? Are there not some disclosures which should be reported by all companies whether or not they are company-specifically-material? I suspect there are several.

At least Clorox will not be alone in having to make significant change if the company decides to adopt G4... watch this space for an example from Henkel's report in my next post.

 

elaine cohen, CSR consultant, winning (CRRA'12) Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices Contact me via www.twitter.com/elainecohen or via my business website www.b-yond.biz (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

A Sweet Year of Apples and Honey

Photo: jewishpub.org

This Sunday evening (16th September), Jewish New Year celebrations will be held around the world and in the best of tradition, everyone will consume quite a lot of apples and honey, the symbolic expression of a wish for a Sweet Year ahead. As global consumption of apples and honey will probably triple during the two days of the New Year festivities, I thought I would take a look at the sustainability of these two special foods.

Apples

Carl Sagan said: "If you want to make an apple pie from scratch, you must first create the universe." which is a very sustainability-ish type of comment. Of course, don't confuse apples with Apple, whose sustainability commitment is not so clear, as Fabian Pattberg, our sustainability conscience, explains, following the flamboyant iPhone5 launch. But in this post I want to refer to real apples - the kind that grow on supermarket shelves that you eat after scrubbing them with disinfectant to remove all the pesticides.

Sustainable apples may be TRU EARTH certified, such as those at the family-owned Ecker's Apple Farm, and others are the product of scientific agri-innovation such as that practiced by Bayer Crop Science. Actually, the science of apple growing is called pomology. There are 7,500 varieties of apple grown through the world, which makes for a lot of pomologists. Apples are fat, sodium and cholesterol free, which makes them ideal for a healthy (but not so much fun) diet, in fact, they say that an apple a day keeps the doctor away, which is a good thing, unless the doctor happens to be your wife, husband or best friend. You can find loads of amazing facts about apples here. I even found on the web what looks like a very interesting Spiced Apple Ice Cream recipe, which seems to be the perfect way to start the Jewish New Year.

Apples, of course, being a popular food, are often stars of Sustainability Reports. Using the PDF search facility at CorporateRegister.com, I can find almost 2,000 Sustainability Reports that refer to apples (although some of them are the Apple kind of apple, some are components of pineapples, and one or two show up because they are mentioned in the word grapple (you'd be surprised how many times the word "grapple" comes up in Sustainability Reports. Wonder why that is?). However, this leaves the vast majority of reports with real apples, and while I won't mention the bad ones (bad apples, get it?), I will highlight just a few ways in which apples flavor Sustainability Reporting.

 

The Yummy Fruit Company in New Zealand supports the AppleQuest program by donating free apples to remote schools such as those in the Chatham and Pitt Islands - noted in the Giumarra Companies 2012 CSR Report.

The 2011 Annual Report of Club Mediteranee mentions a sustainable development partnership in Morocco which supports the professional development of fruit growers and the Village at Marrakech and made seasonal purchases of different varieties of apples and quinces.

  

Worcester College at Oxford University incorporated wildlife habitat into its garden design. They have an allotment and apple orchard (the apples are used to make apple juice that is sold at Waterperry Garden Centre in Oxfordshire). This is in the University of Oxford Environmental Sustainability Report for 2010/2011. So if you are ever incredibly thirsty and passing through Waterperry Gardens....

We even have a little blip about apples. Arla Foods 2011 Social Responsibility Report mentions that Rynkeby Foods added new details to the labelling on a blackcurrant fruit drink so that it states that the drink also contains apples. This change was made after a Danish newspaper drew public attention to the labelling error. The Power of the Press strikes again.

 

And General Mills Global Responsibility 2012 report recalls a little disappointment relating to apples: "In 2006, we launched Nature Valley Fruit Crisps. But the dried and baked slices of apple, with just 50 calories per pouch, didn’t meet consumers’ demanding taste requirements and were discontinued." Too bad. But maybe consumer taste has changed since 2006.

Enough about apples. Let's turn to honey.

Honey

Honey is a sweet food made by bees using nectar from flowers. Aha, but did you know that honey bees transform nectar into honey by a process of regurgitation, and store it as a primary food source in wax honeycombs inside the beehive. But don't let that put you off. The value of honey was recognized in ancient times when honey was known as a wonder-drug for curing almost everything and even embalming corpses. But don't let that put you off. Honey tastes great and there are several hundred unique honey varieties from all over the world. The good thing about honey is that,  in the honeybee world, females do all the work. That way, you know it's gotta be good.

 

Honey-bee raising can be a great activity to encourage Green Employees and help them become aware of their natural surroundings. This is the case with Novus International (disclosure: my client), who started a Honey Bee Project which remains very popular, as reported in their last Sustainability Report.  Another Sustainability Report (2011), this time from Greif Inc., talks about Greif’s Pollinator Habitat Improvement project. "Timberland offers the potential to provide clean forage for the bees that are vital to agricultural productivity and economic viability, while bees offer improved landscape health on timber holdings. Greif is working with Pollinator Partnership to learn how pollinators impact wildlife food availability on timber landscapes. We are also studying the added values of hosting honey bees and beekeepers on the landscape and the best management practice for ecosystem services on forest landscapes."

 

Burt's Bees, however, published a Sustainability Update in 2009 in which someone stole the bees, or at least that how it seemed, as they reported about everything but bees. Bees are one of the species affected by changing patterns of human behavior and consumption and climate change, linked to early pollination. Colony Collapse Disorder has become responsible for massive bee attrition, brought on by use of pesticides and other factors. The UK website HelpSaveBees makes an impassioned plea to do more to save the gradual extinction of our natural honeymakers. But the real reason we should all save bees is ... yes, you guessed it .... more icecream !!!!!!!! See what Haagen Dasz are doing to save bees. That Buy a Carton-Save a Bee campaign is totally compelling. Wonder how many bees I can manage to save in one day ? Enough said.

 

All that remains is for me to wish all the CSR Reporting Blog followers, all Twitter, Facebook and other Social Media friends, all current and future (!) clients of Beyond Business, and just about everyone that is celebrating the Jewish New Year (number 5773) :

 

A HEALTHY, HAPPY, PROSPEROUS, SUSTAINABLE and SWEET YEAR !

 

 

 

elaine cohen, CSR consultant, winning (CRRA'12) Sustainability Reporter, HR Professional, Ice Cream Addict. Author of CSR for HR: A necessary partnership for advancing responsible business practices Contact me via www.twitter.com/elainecohen   on Twitter or via my business website www.b-yond.biz  (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm)

21 ways to make your Sustainability Report stand out from the crowd

Inspired by this post on Geenbiz.com entitled  "I published my CSR Report. Where's my media coverage?", in which  Elin Nosewski offers some tips about how to get noticed by reporters and bloggers - mainly focusing on the report content, I thought I would offer some tips of my own on how to make your Sustainability Report stand out from the crowd. Here they are:

1. Call it iReport 4s. Everyone will queue for one.
2. Write it in Latin or Ancient Greek. You will easily capture all the very very very old people who read Sustainability Reports.
3. Include pornographic pictures. Porno is the most viewed content on the internet. Every second, 28,528 internet users are viewing pornography.
4. Have your CEO present it to Financial Analysts and Investors over breakfast in a London Hotel. They won't understand but they will enjoy the croissants.
5. Have your VP for Human Resources write the introduction. Now, that's original. That's how Lloyd's Bank did it in 2009.
6. Have the CSR Reporting Blog mention it in The Top Ten Reports of the year. (No-one one has been able to afford this, yet, but you could be the first.)
7. Print your report on virgin paper, destroying 347 Amazon Forest trees, and send it using the postal service to thousands of stakeholders. Greenpeace will make such a campaign about this that no-one will fail to notice your report.
8. Win a CSR Reporting award. That's how Vodafone does it.
9. Gamify it. That's how BT does it.
10. Write it in Braille. 39 million blind people will love you.
11. Turn it into multiple-choice test. It will be used in school syllabuses all around the world.
12. Offer an iPad to those who provide feedback. That's how OneSteel does it.
13. Offer a luxury weekend in Hawaii to all those who are prepared to use the weekend to read your report. Don't worry, only 4 people will respond. Your mom, your dad and your 2 kids.
14. Send out a Presss Release saying you have published a Sustainability Report. (OK, this is not a serious entry.)
15. Add disposal instructions on the back cover. Something like: Please dispose of this report in an environmentally responsible manner before you read it.
16. Fit it all into one webpage. This is how AHA! does it.
17. Use a sexy waitress to deliver it to male executives. See how Heinz does it with Ketchup.
18. Publish it on the web, then Digg it, Stumble Upon it, Slideshare it, Facebook it, Google+ it and Tweet it. Again. Once more. And again.
19. Employ a blogger relations specialist and create a bloggers corner blog. This is how SAP does it.
20. Make it all in videos. This is how Burt's Bees does it.
21. Accidentally on-purpose, call it your Annual Report. The entire financial world will love it! And financial journalists will rush to scrutinize it.

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of CSR for HR: A necessary partnership for advancing responsible business practices  Contact me via www.twitter.com/elainecohen  on Twitter or via my business website www.b-yond.biz/en  (Beyond Business, an inspired CSR consulting and Sustainability Reporting firm)

5 recommendations for online CSR comms

This week saw the release of two multimedia digital online technicolour walking and talking sustainability communications - one is a CSR report and the other, a website which is the basis for reporting. These communications are clearly designed with the masses in mind. All those billions of people around the globe who have time to sit and watch scores of  videos about company sustainability activities will be delighted at the flurry of box-office offerings now available on corporate sustainability websites.  I will take a quick look at these two different online deliveries, and then share five recommendations for online reporters to mull over. 

****

"Burt's Bees open doors to greater sustainability with a multimedia social and environmental report" is the title of the press release on CSWwire.com announcing the arrival of the Burt's Bees movie. You can access the report here. Burt's Bees aspire to becoming "the greenest personal care company on earth". That's a big ambition, as is, indeed, their new sustainability report. The multimedia production is split into 10 chapters (welcome, this report, governance, culture, products, sourcing, packaging, community, environment, buzz)  with around 75 minutes of video footage, supplemented by some data charts (make sure you enable pop-ups!). The videos are professionally produced and very slick, showing many of Burt's Bees real people who talk openly about how they do their jobs, what's important to them and the company, society and the environment. Most vids last between 6 and 14 minutes each.  The two video clips I watched in full were Chapter 1 - the CEO's introduction - and Chapter 2 - with the delightful Yola Carlough, Burt's Bees Director of Sustainability who describes in 6 minutes what the company has tried to do with this multimedia report. Yola is worth watching for any number of minutes! However, I didn't manage to watch all the videos in full, though I scanned most of them briefly.

The storytelling approach to this report describes the Burt's Bees processes and impacts, as far as I could tell, and it does give the impression that this company takes sustainability culture seriously. As far as embedding culture is concerned, Burt's Bees seems to have got it right. I assume this report was designed for consumers, the employees themselves (what a wonderful  way to celebrate so many employees  - turning them into movie stars - something to show their kids and friends and families - and potential Hollywood agents) and perhaps also for the army of Clorox people who own Burt's Bees and who themselves are advancing their own sustainability culture.

Something I would add to this report is a document download with a list of the key impacts and performance data. A bird's eye view,or should I say a bee's eye view, of this report would make it more accessible to those who don't have 75 minutes to watch movies (or prefer to spend movie time with Angelina Jolie or George Clooney). Key content transcripts of the videos would be helpful.

The other thing I would add to this report is  interactivity. There is no room for comment or insight. Instead, Burt's Bees direct us to their Facebook page where they maintain they are "encouraging dialogue with readers".   However, a brief look at the Burt's Bees facebook page shows only announcements of  product promotions and consumer comments which appear to go unanswered. I didn't notice a "dialogue" about sustainability.

It's a nice production, which may well appeal to a broader audience than the standard style of report we have come to know and love hate tolerate expect.

****

The other digital extravaganza announced this week on Report Alert was Virgin Media Inc's new sustainability website with the line "announcing a new approach to sustainability reporting" , the "new" being "exclusively digital." You can view this website here. 

This is not really a report, but the preparation for a report. Virgin Media promises to be updating sustainability data regularly on this website. As it stands, whilst this is a good piece of sustainability communications, little current data is presented beyond a download of carbon emissions.

The first video clip - "Getting it straight from the top man - CEO Niel Berkett " is a 2 minute intro and holds a suprising fun twist which gets you smiling as you start out exploring the report. Well worth taking a look. In fact, all the vids have a touch of humour which makes you want to watch the rest of them.

The website has five sections: our approach, our digital future, the environment, diversity, the supply chain. It includes a "Browse content" tab which lists download documents (policies and video files). I downloaded the carbon data file, for example, and immediately noticed a hike in the Virgin Media's carbon footprint between 2007 and 2009. There is no explanation in the narrative for this growing carbon footprint. The narrative references only the good things that Virgin Media are doing to reduce energy use.

Virgin Media's CEO says that "he believes this is the future of sustainability reporting", referring to harnessing the power of digital media. Virgin's website/report site contains about 5 vids which are quite short and easy to digest. A nice feature is that they show Virgin people, which makes for a more authentic experience. However, the sustainability website is low on data so far.  I looked at the section called Diversity. This is a general statement about Virgin Media's  approach  and an interview with the Chief People Officer , but there is no disclosure about  how many employees are in the business, or any evidence that diversity is taking root, aside from a few mentions. Unless Virgin Media are going to beef this site up a whole lot with material and relevant performance data, then it will remain a sustainability website and definitely not anything that resembles reporting.  

Virgin Media tries to generate some action from readers with a "What do you think?" textbox on each page. I sent in one comment and a query - not sure where they went - hope they didn't end up in one of Virgin's fun-style recycling bins. It was only later that I noticed on the "Contact Us" page that they require contact details in order to reply to feedback. Oops. The feedback box doesn't ask for contact details. You just assume they will know.

The Virgin Media website shows awareness and progress in sustainability activities. A clear set of targets was presented in 2010, which this website/report should follow through on in due course. The digital presentation is a good approach, but clearly needs to be filled out with relevant sustainability reporting disclosures.   

*****

Two very different sustainability communication digital offerings from two very different companies. There is no doubt that writing reports first and foremost for online presentation requires a different approach to the written report, which can, once written,  be presented online in different formats. Well done to Burt's Bees and Virgin Media for entering this relatively new and challenging territory, which I hope will serve as part of a learning process for them and others regarding the most effective communications and reporting formats for these companies and their stakeholders.

My recommendations for online reporters :

Include a downloadable executive summary rather than just a series of videos or online pages. Some degree of choice for the reader between a written document and online content would increase appeal and useability of the information.

Make individual videos short - 3 minutes is about my limit.

Include the data in the body of the reporting narrative - not as an unrelated isolated download - and explain inconsistencies.

Leverage the digital platform more effectively to generate feedback and create conversations.

Ensure the enormous creativity and inspiration (not to mention adrenalin) required to produce  fabulous digital design and videos and online content does not overshadow the fact that a report should also contain material disclosures and performance data.

I just hope that no-one decides to make Chunky Monkey in digital format only. Now that would be a real disaster....

elaine cohen, CSR consultant, Sustainabilty Reporter, HR Professional, Ice Cream Addict. Author of CSR for HR: A necessary partnership for advancing responsible business practices  Contact me via www.twitter.com/elainecohen  on Twitter or via my business website www.b-yond.biz/en  (BeyondBusiness,  CSR consulting and Sustainability Reporting firm)