CRRA 10 How will you vote? You WILL vote, right?

 It's that time of the year again when we try to pick the winning reports from a pool of 130 entries in the Corporate Register Reporting Awards 2010 (CRRA 10) . If you pick the top ten, you get a BIG PRIZE. But, if that's not enough motivation, you also get the chance to influence which of the reports in the pack will get highlighted for great glory and recognition.I have voted. Strongly suggest you do too. Passivity was never terribly gratifying, so go vote. You have until January 29th 2010. Here is the voting site.

This is year number three of these popular awards. In the first year CRRA 2008 there was, I think, an unlimited number of reports, but last year, my friends at CorporateRegister.com accepted a limited number of entries - that improved format works again this year.

What do you look for in a report?
Actually, the award categories pretty much answer that question:

• Best Carbon Disclosure
• Best Creativity in Communications
• Best Relevance and Materiality
• Best Openess and Honesty
• Best Credibility through Assurance

Other categories relate to reporter characteristics:

• Best First Time Report
• Best Integrated Report
• Best SME report

And to round off, there is a catch-all category of Best Report for the reports that do an overall best in some of all of the above categories.

Let's take a look at who is competing for what. And what what is.

Best Carbon Disclosure.
Previous Winners:
CRRA 08 (39 entrants) BMW AG
CRRA 09 (17 entrants) Royal Dutch Shell
20 reports in this category this year, including both previous winners.
What does a best carbon disclosure look like ?
To answer this question i went to the Shell winning report of 2007. The report contains a detailed discussion of climate change and carbon impacts, and future scenarios that will affect our great-great  grandchildren. The actual Shell carbon footprint data is on their website, and shows a year on year reduction since 2005, from 93 million tonnes to 75 million tonnes in 2008. (82 million in 2007, the date of the winning report). Not bad.
The Bayer AG report was the runner up in this category in 2009, and their carbon disclosure (7.6 million tonnes) is short and to the point, total emissions, GHG Protocol, indirect and direct emissions with breakdown of component parts and commentary. Also not bad.

For me, a best carbon disclosure includes:

• actual total carbon emissions for the entire business
• some context, if possible, industry benchmarks, where available
• data presented over at least 5 years, if available
• details of the methodology used to make the calculation, whats in there and what's not
• verification of the carbon numbers
• explanations for the increase or decrease in emissions
• details of whether carbon targets have been met in the reporting period
• future targets
• clear, accessible presentation which a 15 year old can understand

Of the 20 entrants, I was surprised to see quite a few names that have not competed in this category before - 13 to be precise, including Dell, Amcor, Hess, Novo Nordisk, Panasonic, Veolia, and even Compañía Minera Doña Inés de Collahuasi SCM which gets a bonus for having the longest and most unpronouncable Company name in the entire competition. Is the number of new entrants an indication that carbon disclosure has become more imperative?

Best Creativity in Communications
Previous Winners:
CRRA 2008 (100 entrants) : Coca Cola Enterprises
CRRA 2009 (36 entrants):  Coca Cola Enterprises (yes, that's twice!)
There are some that might say that CSR reporting is too creative, so much so that it often departs from reality. (Joke!) The 2010 awards has 29 entrants, and the big question here is can Coca Cola make it a hat-trick? Whats so special about Coca Cola creativity? The CRRA guide to the categories talks about creativity in the following terms:
Which report is a real pleasure to read, because the authors have given thought to both the content and the reader? Do you find the report engaging and informative, or boring and unimaginative? This award is for the report which best succeeds in getting its message across, using creativity as a defining factor.
I have to admit that, without reading every word of the Coca Cola 2007 report, I wasnt struck by its mindblowing creativity in communications. It is clearly written, well paced, neatly designed and flows well. Perhaps the most creative thing about it is, if you look carefully, Coca Cola don't refer to CSR but to CRS! Or maybe they are just dylexic.

For me, creativity would go a little further than this. It would use analogies and stories to make the data and context come alive, case studies and perepectives of people in the business. It would make connections in my mind that I hadn't considered before, that help me appreciate the true challenges and efforts involved in driving CSR, or CRS, forward.
The 2010 competition has 15 entrants that are new to this category including Bunge, Walt Disney, Export Development Canada to name just a few (well, 3). 

Best Relevance and Materiality
Previous Winners:
CRRA 08 : (167 entrants) BP
CRRA 09 (40 entrants)  Vodafone
This year, 45 reports are vying for first place, including the two pevious winners.And what do we look for in a best materiality report ?  A materiality matrix. Evidence that there has been a process of stakeholder engagement, and considered evaluation of stakeholder and business strategy input, prioritized, and effectively reported. Reporting of material issues should go into greater depth than the shopping list rest-of-the-report.  Vodafone has a history of doing this well, and their 2007 Report, the famous 398 page report, is true to form with a very colourful matrix and a list of key issues. Well, with 398 pages to play with, they could have included 15 materiality matrices.

Best Openness and Honesty
Previous Winners:
CRRA 08: (167 entrants) Bayer AG
CRRA 09: (32 entrants) The Cooperative Group
36 Reports in the running this year in a category which many would say is counter-culture to CSR reporting. Does this report come clean, tell the bad news as well as the good? the Awards organizers ask. And let's face it, that's what honesty is. It's not the absence of lies, it's the creation of a balanced representation of the CSR affairs of the Company. The Cooperative Group Report for 2007/08 , entitled Altogether Different and Making a Difference, declares early on that the report is intended to provide a "warts and all" account of the Coop Group's CSR performance. Hmm, I'm not sure i want ALL the warts. It's a 141 page report, and a the style is just a bit too chatty to make for easy reading, and I would have preferred them to highlight the warts in yellow or something, because, in the sample i reviewed, I couldn't find any at all.  

Best Credibility through Assurance
Previous Winners:
CRRA 08 (59 entrants) BP
CRRA 09 (22 entrants) Vodafone. Again.
This award is for the Assurance Statement that adds the most credibility to the overall report. Sometimes, I think it would be a step in the right direction to have a statement which adds ANY credibility to the report. 24 reports in this category this year. You know I like talking about Assurance. The BP 2006 report that won in the 08 awards does contain a fairly detailed Assurance statement. But, I regret, all it assures is what they haven't noticed ... the Assurers didn't notice any material misstatements, they didn't notice any exclusions, they didn't notice any improper collection of data etc. What DID they notice ? The Vodafone-398 is marginally more assuring, and includes a long list of recommendations and detailed activity performed by the assurers, to whose attention also nothing came that caused them to believe that.. well, you know the rest of the mantra.

Anyway. I am going to round off here, I might come back to Best Integrated, Best First Timers and Best SME's as these reporter categories hold their own uniqueness and are worthy of spending a little more time on. Although there is one report  that I worked on in the Best First Timers category - 888 Holdings -  online gaming Company. You can vote for that one now if you like, no need to wait.:))  But dont worry, there's enough time for you to vote in all the above categories before i get around to writing my next post.

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Santa's CSR report

Jingle Bells, Jingle Bells, Jingle all the way… yes, Christmas is coming .. and time for Santa to write his CSR report. This year, Santa’s report is mainly about climate change and environmental issues, and yes, you’ve guessed it, it’s going to be a GREEN CHRISTMAS.

I thought I would give you a preview of how Santa introduces his report this year.

Santa Claus 

Elves, Reindeers and Responsibility Report 2009

A message from the CEO:

Dear Stakeholders,
It is my great pleasure to bring you this, my 1745th Responsibility Report which I hope you will read with joy in your hearts, happiness in your soul, and a glass of quality brandy in your hand. Oh my, the world has changed somewhat since I was born in 245 AD. They called me Saint Nicholas back then, and to this day, I try to live up to my saintliness by adopting the principles of responsibility, transparency and accountability. 2009 has been another Greening Santa year, with many environmental achievements which you can read about in the following pages, and an intensive year of improved governance, elf diversity, reindeer rights, equitable toy distribution to the world peripheries, and stronger ethical auditing of all my outsourced production factories. Furthermore, I am introducing for the first time this year a toy-recycling program – instead of delivering new toys this year, I will simply pick up all last year’s toys and deliver them to other children. This is likely to save 5,000,000 tons of carbon emissions, 95,000 tons of plastic, 4,973 rainforest trees, and close down 293 toy factories in China and Taiwan. In this way, I will keep children happy, reduce global warming, and save myself endless headaches wondering what to get for everybody. Should there be a discrepancy between the toys collected and the toys required, I plan to offer a virtual platform for ordering gifts via Santa.net to further save on transportation costs and to advance my ambition to become the first carbon neutral Santa ever. I will offset all outstanding emissions by funding the production of eco-socks using 100% organic cotton recycled from elf undergarments for hanging on the mantelpiece. The socks, not the undergarments.

In preparation for this report, I conducted a Stakeholder Panel and received some useful feedback relating to elf exploitation, gender mainstreaming amongst elf communities, and the life-cycle of reindeer reins. I analysed all these issues in a materiality matrix, but I have not included this in the report, because none of these issues were actually found to be material.

The report is written in accordance with the highest global standards, the GRI framework, at Application Level A. The report is not assured, because I ran out of money to pay the Assurance fees. Apart from which, let’s face it, I am Santa. Who’s not gonna believe ME?

 During 2009, I have significantly improved the working conditions for my 583,000 elves in permanent, full time positions, by providing them with in-dorm TV’s, iPhones (one per couple, elves are half the size of regular people. I have had some complaints from those who have got half an iPhone, but I expect this will be rectified when wePhone is launched). I also formed a Professional Elf Education (PEE) program, to assist in developing elf talent and accelerating the rate of in-house promotion. We still have a problem with gender, and cannot seem to locate enough elfees to come to PEE. However, I have realized that if I have a sex-change operation, the entire Board of my Company will become female, so I have set this as a target for 2010.

Finally I wanted to draw your attention to the vast improvements in my environmental impacts, beyond those mentioned above. I have reduced electricity consumption by turning off all the lights on the sleigh. Last week, in rehearsals, 7 reindeer fell asleep, as they thought it was daytime. All elf uniforms are now produced under the watchful eye of the Ethical Trading Initiative and made from natural materials such as coconut-shell fibers and bamboo. Two elves were hospitalized because someone left the coconuts in the trouser pockets, and one got a bamboo splinter in his bum. But all problems should be ironed out by next year ( must remember to fix that old iron). My red Santa suit is now a kind of nondescript beige, reflecting the natural hemp used in its production. I will review this in the coming year and revert back to red if no-one recognizes me. All elves and elfees have been trained in office greening, and we now use disposable cups several times over, except for those who object to rapid proliferation of H1N1 virus amongst elf populations. Reindeers are fed only organic lichens with no added nutrients. On the ethics front, all elves have been trained in Responsible Practices, and are now able to assist in toy deliveries without insulting cheeky children or taking bribes from celebrity tots.

During 2009 I won several awards:

• Best Santa for Diversity and Inclusivity (we have 34 different Elf Affinity Groups, including an Elvis Presley Elf Lookalike Group)
• Best Workplace for Working Elf Moms (elfees get to do the late deliveries so they can cook Christmas Dinner on time)
• Philanthropist of the Century (who has given out more toys than Santa, hmm?) 
• Green Business Award  (i think this is because the elfves wear green uniforms)
• Reindeer Lifetime Appreciation Award (because i turned the lights out on the sleigh)
• Sleigh Manufacturers Society Honorary President (who has done more for sleighs than me?)
  
• Chinese Toy Manufacturers Ethical Hero (yes, I beat Mattel)
• Lapland Cartographers Award (modestly speaking, it was me who put Lapland on the map, any map)

I hope you will gain immense pleasure from reading this report and will provide your feedback via Santa.net in the section entitled “Santa wants your Feedback.” Nice, eh?

Merry Green Christmas, everybody !!

Santa Claus
Chairman, President, CEO and COO
Santa Claus Universal Magnanimity (SCUM) 275 AD Ltd

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en  

Unassured and fed up

I read many sustainability reports, and  many assurance statements. Today, i lost my rag. (I was cleaning the kitchen) The quality of sustainability report assurance is abysmal, on the whole. So many Companies taking good money to provide what should be a seal of quality on  sustainability reports offering not much more than a page of printed hot-air seems to me to be highly irresponsible. Maybe assurance assignments are easy money. Maybe they are not as sexy as reporting assignments. Maybe the providers just dont have the skills, or are not willing to guarantee the quality of their auditing work for fear of liability. Maybe someone might actually make a decision based on the quality of the assurance? What a disaster! Whatever the reason, assurance is just not making the grade. And worse, the Global Reporting Initiative, in awarding a "+" at each Application Level, without checking the quality, for so-called  assured reports, unwittingly perhaps, is complicit in this devaluation of the assurance process. So I took pen to paper (fingers to keyboard) and sent a letter to the CEO of the GRI. Here it is: 

Sunday ,6th December 2009

For the Attention of:
Mr Ernst Ligteringen
CEO
The Global Reporting Initiative
 
Dear Ernst, 
Quality of Sustainability Report Assurance Practices and Allocation of “+” in the GRI Report Check
As you may know, my business in Israel, BeyondBusiness Ltd, is a strong supporter of the GRI, and we are Organizational Stakeholders. We provide sustainability reporting services to a range of clients, who we always encourage to report against the GRI framework. My business partner, Liad Ortar, was the one who took the initiative to translate the GRI Framework into Hebrew back in 2006, creating greater accessibility for local Companies and paving the way for GRI reporting in Israel. In fact, we wrote the first GRI (Application Level B) report in Israel for Bank Leumi together with their team, the first GRI report at application level A for comme il faut, a private fashion Company, and now we are working on the first GRI report for a non-profit in Israel. In between, we have written several other GRI reports. We like the GRI framework and apply it for all types of organizations in all sectors. Of course, there are elements which could be improved in the future, but overall, we are strong advocates. In addition, we always encourage our clients to have their report checked by the GRI, to ensure confirmation of proper adherence to the guidelines.

There is one area, however, where I feel the GRI does not do justice to the reporting process, and this relates to Assurance. The role of Assurance is to enhance credibility and trust in the report, as a promise to stakeholders that the report has been independently, externally verified by a qualified expert, or group of experts, both in terms of the accuracy of content and the relevance of material issues, and in terms of the fair and balanced representation of the overall content. In checking reports, for the award of a “+” Application Level, the GRI checks only the presence of an Assurance Statement, not the quality of the content or the appropriateness of the assurer. The "+" award provides a benefit for Companies, as the “+” tends to promote the assumption that the GRI confirms that the Assurance Statement achieves the appropriate quality of verification, as per the GRI guidelines. Companies who publish an A+, B+ or C+ report indicate by definition that their report has adhered to these standards.

I read, write and regularly review reports. My reviews are published on www.CorporateRegister.com/reviews for all to view. In performing such reviews, I try to assess whether the report presents a credible and trustworthy picture of the organization’s Corporate Responsibility activities. Of course, I always read the Assurance Statement, if there is one.

And now to the crux of my message.
In many cases, the Assurance Statement seriously lacks the ability to assure.

• Often the statement is a partial assurance of only a very small sample of the report – for example – the carbon emissions.
• Often the statement fails to give reasonable evidence that the Assurance Provider has done the rigorous work required to draw a conclusion about the quality and material relevance of the report.
• In many cases, the Assurance Statement is signed off by a Company and it is not known who actually did the Assurance work. In one currently “featured” report, the name of the Assurer is not legible.  
• In other cases, the Assurance statement is largely a reprint of the prior year’s statement.
• I have seen one report where the Assurer was the very same consultant who supported the entire development and writing of the report, which is a serious breach of the assurance “quality standards” that require the Assurer to be a party “not unduly limited by their relationship with the organization or its stakeholders.”
• One report, which is a currently GRI “featured report” is an integrated report and contains only an audit of the financial statements, and no verification of the sustainability content, as far as I can see.
• And it is almost never clear what changes have been made to the report content prior to publishing as a result of the Assurer’s intervention.

And yet, the GRI automatically awards a “+” for all Assurance Statements, just because the Reporter shows they exist. This, in my view, undermines the contribution of the assurance process and devalues the GRI check.

I suggest the GRI should take a stronger stand on the subject of assurance, and that the GRI should check that:

1. The Assurer is external to the reporting organization and not  engaged in any other form of service provision with the Reporting Company for at least 12 months prior to providing assurance.
2. The Assurer has relevant experience of corporate responsibility practices qualifies him or her to do the work, and signs the Statement in his or her name.
3. The Assurance Statement relates to the entire content of the report, disclosing the detailed methodology used.
4. The Assurance Statement makes reference to specific core material issues and whether the reporting Company has addressed these in the report
5. The Assurance Statement gives positive confirmation, and not a statement of several negatives that confirm only that the Assurer has not noticed inconsistencies or errors, but has positively done the work to conclude that the content is accurate and relevant.

Anything less, should not deserve a "+".

In a review of several of the current featured reports on the GRI Website, I find that adherence to the above criteria is low. Few of the statements I reviewed suggest a professional and quality approach to assurance, and the GRI approach seems to condone this.

I would like to recommend, that the GRI adopts a new policy to read and check Assurance Statements, and award “+” only if the Assurance Statement and the Assurer meet the above criteria.

This does not preclude a Company including a consultant’s statement, or opinions of experts relating to part or all of the report. This is often a nice touch, and adds value, but it does not carry the validity of a formal Assurance Statement which earns the Company the highest level of adherence to the GRI Framework with a “+” designation.

I would be grateful if the GRI would consider this recommendation and a possible change to its practice with regard to the checking of assured reports in the future. I send you this letter as an open letter, which I plan to publish simultaneously on my Reporting Blog , in the hope that it will generate some discussion from other reporting professionals as you consider this recommendation.

Thank you for reading this letter, and for all the GRI does to promote sustainability.
I look forward to hearing from you 

Warm regards,

Chunky Monkey Me Elaine 

 *********************

That was the letter. I don't expect that the GRI response will be an ethusiastic YES OF COURSE, though i do believe the GRI, as a multi-stakeholder organization, will be receptive to feedback, and hope this will be taken in good spirit. Whatever the response, I could not remain passive on this issue, which irks me time and time again every day as I dip in to some report or other.
By the way, the report mentioned above which has an assurance statement signed illegibly - well, see what you can make of this

Maybe it was written by an alien ?

CorporateRegister.com produced a good report about  Assurance approaches in July 2008 called AssureView.This report discusses quite well the difficultues of assurance including the fact that there is no "common currency" or accepted methodology of performing assurance of non-financial data. The conclusion hits the nail on the head:

So what do you think ? Am i unassured and fed up all alone ? Should the GRI change its policy? Do you read and believe Assurance Statements ? And how important is all of this?

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Why we do what we do

Yesterday was a good day for the CSR-Reporting blog. Permit me to tell you why:

First, we received a great compliment in the form of a recommendation from Sustainability Expert Fabian Pattberg who runs the Sustainability Forum, one of the best CSR resouurces around. Fabian recommended the reporting blog in his new category of Recommended Websites.  (Fabian on Twitter: @FabianPattberg)

Second, Chris Jarvis posted as follows:

Chris Jarvis is the author of Realizing your Worth blog, and one of the world's authorities on CSR and employee volunteering programs. His blog is always packed with insight and good practical advice based on years of experience. (Chris on Twitter:  @realizedworth) 

There is something about getting credit from your peers which is truly gratifying. In a business world which is competitive and sometimes rather brutal, despite our csr efforts, praise and recognition from professionals who understand is always a boost. This is a tribute to our community of CSR professionals on Twitter and other social networking sites. THANK YOU to Fabian and Chris, and all other members of our great community. I salute you all! 

Third, yes, there's more...

Yesterday i received a reply from Indranil who wrote to me on 30th November - unedited email as received:

Elaine,
I am a full-time MBA student at University of Oxford. I have been reading your blog for quite a while now and drawn very valuable learning which helped me in my academic work.
I take special interest in how large organisations are building sustainable practices around the core of their business, and also how they are communicating that to the wider stakeholders. I am currently undertaking a comparative study of Nestle, Danone and Unilever in terms of their CSR reporting methods and whether the reporting methods are effective in building “trust” among the wider stakeholders.
I have taken the approach mentioned in one of your blog posts about starting from the CEO’s message and then drilling down into the specifics of each of the areas of emphasis. While that provided me a perfect ground to compare the quality of the reports, it is not providing me with a qualitative basis of comparing the “effectiveness of building trust”. I am not being able to build a framework around which I may be able to structure the comparisons.
It would be great if you could please provide me with some pointers. What would you look for in a CSR report to see whether it has the right elements to build trust?Thanks a lot for reading. It would be a privilege to hear from you.
Warm Regards,
Indranil.

This is Indranil:

This is the essence of what i wrote back to Indranil:

CSR reporting should contribute to building credibility, trust flows from that.

The things i look for:
** Has the organization reported "difficult" data as well as positive data?. A "good news" only report is not credible.
**Has the organisation really been transparent about its intentions – are there clear measurable targets which represent a future commitment?
**Has the organisation included external commentaries from a range of experts, not only those predisposed to saying nice things, and are the commentaries fair and balanced?
**The overall level of transparency - reporting on total levels of women in the business, for instance, but not how many women in senior management.
**Explanation of inconsistencies – e.g. changes in calculation methods for carbon footprint
**The organizational infrastructure for CSR/sustainability. If there is no clear accountability within the organisation, it is difficult to believe the company is serious about sustainability.
**Consistency of reporting over time – I often look at two or three prior reports to see how actions, themes and targets are reported consistently
**The content of the assurance statement, if available. If it is a very limited gushingly favourable statement, it decreases credibility rather than adding to credibility.
**You might wish to take a look at www.CorporateRegister.com/reviews - the "credibility" section of my report reviews often picks up on all these points.

Indranil explained in his reply:

You might be wondering by now that why students of a business school are suddenly so concerned about CSR, but here in Oxford, our business school is dedicated towards building responsible corporate citizens who can lead the businesses of tomorrow. So much so that even our accountancy course has a strong element of how “morality” and “intentions” impact accounting practices and how, we, as business drivers of the future should try and shape such business practices towards an honest, ethical and sustainable future.

This is the proof that the time and energy that myself and so many other CSR professionals spend writing, informing, sharing, offering tips and guidance, thoughts, insights and recommendations is actually getting through. The future leaders of industry and business are reading this stuff. This is the most gratifying thing of all. Forward-thinking, level-headed, positive-minded business students are using our output to shape the way they think and I am confident, the way they will work and impact. I expect Indranil and his peers will be transparent and accountable business leaders.
And this, folks, is why we do what we do.

And now, i think we all deserve a b-i-g helping of Chunky Monkey....

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en 

Even Embassies do it

I was in the British Embassy in Tel Aviv last week. (No, they arent trying to deport me or anything.. as far as i know . Yet.). As I waited for my meeting to start (stripped of my cellphone and laptop, so feeling completely at a loss), I looked around for something to do and noticed the FCO Internal Employee Magazine. The Magazine for Foreign and Commonwealth Office People around the world. Issue 76. Sept/Oct 08. A little out of date, I admit, but interesting all the same with a big headline "Greener Outlook".  The FCO is the branch of the British Government with is reponsible for promoting British interests overseas, and is staffed by Ambassadors, Diplomats, Attaches, and a host of other people, stationed in all corners of the globe. 14,900 people working in 160 countries at present, with a 2 billion pound budget. . (Guess us Brits must have a lot of interests to promote, right?). You can find the FCO on Twitter at @foreignoffice. And i found it interesting that the theme of this edition of the employee mag was about what the Embassy people over the world were/are doing to improve their environmental impacts.  A few examples:

• Carbon Neutral Birthday parties for the Queen in Rome, Milan, Naples and Bari
• New energy efficient solar-heated Embassy building in Manila
• Vegetable and herb garden at the Governor's residence in Gibraltar
• Composted waste in Port Louis
• Cycling to work in the UK and in Mexico City
• Carbon neutral printing of the Employee Magazine

Commendable, old chap, no ? 
I tried to find some additional information on Greening the FCO on their website,  but couldn't . The FCO  produces an Annual Report, and though it does mention the importance of Britain developing a low-carbon economy, the closest it comes to CSR is the Comprehensive Spending Review, which i think is FCO-speak for budget.

What does all this have to do with CSR reporting ? This. Two Annual Environmental Reports published by the British Embassy in Sofia, Bulgaria, the later of which you can download here. As far as i can tell, this is the only British Embassy post which publishes this type of report. I couldnt find any other Embassy of any country that produces a CSR or an Environmental report.  Big big round of applause for this initiative to the Brits in Sofia.

It's a nice report, 16 pages, covering everything from the Embassy 7-member Green Team, the modern glass Embassy building with heated sub-floors, the Embassy Environmental Policy and external Environmental Audit, Key Performance Indicators and targets, including medium term up to 2012, Carbon Footprint, and an Environmental Pledge by all the Embassy members. A short report, but a significant one which demonstrates a strong commitment. Though I would hope to see them expand the scope a little to include social impacts in future. Embassies can be very influential in addressing social and human rights issues, as well as, via the Trade sections, help encourage awareness for responsible business practices. UK Companies are in leadership positions on this, and foreign Embassies could do much to help leverage this abroad.

I hope that more Embassies will take the lead from the Sofia Brits. This is largely uncharted territory for this type of organization, so more pioneers will be welcome.

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Does size really matter ?

Should small Companies report ? Do you agree with the statement that "CR reporting is for companies with large footprints" ? Does the size of the Company, and its footprint dictate whether a Company should be transparent and accountable to its stakeholders? Is it true that "that large companies have many more resources than small firms" and therefore, large Companies can afford to report and small Companies cannot ? Should a small Company content itself with "more written policies and statements about our impacts"?

The quotes (in red) above are from Toby Webb, the founder and manager of Ethical Corporation.(The questions are mine!)  I have met Toby briefly a couple of times, when I have attended Ethical Corp's conferences, which are very good. I regularly follow his blog Reflections on Ethical Business which I genuinely find to be one of the best blogs around on CSR, full of sharp insight and commentary. Recently Toby posted "Twelve reasons why I won't read your corporate responsibility report", and my response, which was basically that the twelve reasons Toby mentions for not reading CSR reports, are precisely the reasons he should read reports (call me argumentative if you like, but check it out), led to a ping-pong of why reporting is for all organizations, irrespective of size (me) versus why a small business doesnt need, or have the resources, to report (Toby). This prompted me to bring  the ping-pong on to my territory, a blog about reporting, for all organizations (ALL organizations) and elaborate on why I believe this to be so.

What is reporting ? It's a process by which a business, after reasonable dialogue with stakeholders, considers the most material issues for them, the stakeholders, and for its business sustainability, and is transparent about how it performs on matters of stakeholder interest. Reporting is part of the loop of dialogue - we listen, we act, we respond, we listen again. The report is the periodical output of this cyclical process. The process itself builds relationships, trust, management discipline, identifies risk and oportunity, contributes to positive reputation and enhances investor interest, to name but a few benefits. The resources required to produce a report are do not need to be overwhelming - more often than not, the design, printing and dispatch of reports can cost more than the investment in wirting them, or the consultant fee. Most of these cost elements can be avoided by a producing a PDF download or an online report, with modest graphics. The content is what counts. In a small business, personnel resources may be more limited, but the issues are far less complex than in a big global business, and require less personnel.  So i think this  we-ain't-got-the-resources line is a cop-out for not applying rigorous thinking to sustainability, or accepting accountability. Oh, and let's face it, no-one reads reports, anyway, right ?

Let's take a look at some stuff relating to SME reporting:

In Spain, 822 SME's  now produce CSR reports. Why ? It enables them "to increase their competitiveness in a setting where transparency and distinguishing features play an important role. ...... the preparation of the reports initiates the enterprise in the main aspects of CSR while encouraging it to develop its skills of self-diagnosis." This is reported on the Instituto de Crédito Oficial website, an organziation which assists SMEs to report.

The Global Reporting Initiative website has a  section dedicated to support for SME's , and  lists a whole string of SME's who report. In an interview with  Scott McAusland on the GRI website, he says that SME's " account for about 90% of businesses worldwide and 50 - 60% of employment."  Often SME's are part of MNE (multinational enterprise) supply chains, and therefore may have a need to demonstrate ethical, accountable and transparent behaviour in order to stay competitive.

CorporateRegister.com's 2010 CR Reporting Awards has a special category for SME's , as in previous years. You can find many SME reports in the CorporateRegister.com database. The European Commission produced an excellent guide for SME's for communicating CSR.  Whilst the focus of this guide is communications, of which reporting is only one element, it lists many compelling reasons for SME's to communicate abobut their CSR activities, with a CSR report included in the different channels reletvant to different stakeholder groups.

In a post back in July 2009, called You don't have to be BIG to do CSR, I gave an example of an SME from Moldova who reported many positive impacts which almost certainly no-one would ever know about had they not reported themselves. Local competitiveness and reputation are just as crucial here as for bigger businesses.

Many of the reporting SME's confirm that both the process and the report deliver significant benefits as mentioned above. It is important to note that the process cannot succeed without the product of that process - the report itself - a periodical health-check of strategy and metrics, and renewed commitment. A report is the most appropriate vehicle for this - as part of a total csr and communications strategy. I dont see this as a privilege reserved  for only the big blockbuster corps.

What might a Company like Ethical Corporation have to gain by a reporting process and publication of a report? 

• Stakeholder engagement and materiality analysis could throw up new insights about ways to serve stakeholders and do more, better, business. At worst, it will provide an external reality check of how the Company is percieved by those who can influence its sucess.
• An environmental risk and impact assessment, followed by an Environmental Policy and Action Plan could deliver several benefits - cost savings through improved internal environmental practices, travel habits, printing and sustainability in events management.
• A statement of mission, values and perhaps even a Code of Ethics could serve to align employees and all contributing writers to the Company's "what we stand for" and support the building of alignment, trust and reputation. Marketing practices for example are an important element of this too.
• A review of Human Resources practices - even with a small team - could assist the business in improving employee engagement and beoming more attractive to potential employees.
• A review of how the Company contributes to the public good through its business activities, and involves its employees in community activities or supporting social causes could contribute to positive reputation, improved egagement and skill development.
• And more than anything else,  scoping of Ethical Corporation's indirect influence on its many readers and conference attendees could provide the business with a platform to measure and increase its influence and potential readership. Through a "Green Conference Facilities", for example, the Company could provide attendees with an opportunity to make their own contribution to environmental sustainability.
• And finally, the compiling of all of this into a periodical, coherent report would provide a basis to maintain this cycle of planning and improvement, track performance and maintain a leading edge.  

Would this sell more mags or bring more people to summits ? Maybe not in the short term. But we all know that sustainability is a long haul and not a quick-buck thing. And it really doesn't matter how many people the Company employs or how many $ it earns. It's all about impacts. As Dolly Parton said, as far as i recall, "If you think you are too small to influence, you have never been in bed with a mosquito".

Note that i haven't even touched on the sense of duty we might assume of a Company whose core business is communicating about business ethics and "encouraging debate on responsible business" . The GRI produces a report, BSR produces a report, The Guardian produces a report.

Enough said.  I don't hope to convince Toby or Ethical Corporation, and i understand that every business must choose its own ways of doing things. My comments could apply to any small business, not just Ethical Corp. I just felt the need to share my perspective in good spirit on something i have, as you may have noticed, strong views about. And by way of disclosure, I am a CSR report-writing consultant so i am not totally objective.  Thanks to Toby for allowing this debate on his blog  - I expect i am getting on his nerves a bit. Oops!  Next time i see him at a conference I will buy him a Chunky Monkey!

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

HR behind the times on CSR

The Human Resources function is a critical partner in the development of a responsible and accountable corporate culture. Corporate Responsibility is often referred to as improving impacts on stakeholders. Nothing new here. Employees are stakeholders. Nothing new here either. The better you treat, or impact on, your employees, the better the business will perform. Numerous statistics and surveys prove this correlation. The engagement of every employee in the business is really the only way to ensure flawless corporate responsibility.  I am reading Adam Werbach's book at the moment, Strategies for Sustainability, and quite by chance, or not, he makes the same point - more eloquently than I do, I must admit. However, it's nice to be in such illustrious Company. Adam says: ... "to execute a strategy for sustainability, you must engage individuals personally" (page 132).

Ultimately, corporate reponsibility is not just about treating employees well, or investing in their development, or providing a ramp if they are in a wheelchair. It's not only about how satisfied they are on the job. Corporate responsibility is transforming every employee into an ambassador of the corporate responsibility message of the business. Ensuring that they understand, are involved, are inspired and know where they can play a role. This means moving from impacts ON employees to impacts OF employes. Each employee in the business interacts with any number of stakeholders every day, maybe thousands of daily connections. This potential, to turn every single stakeholder interaction into one which moves the CSR agenda forward, is more powerful than almost any other single business activity.

CSR reporting is often seen as something which primarily benefits employees. Through the report, they get a comprehensive view of the way their Company interprets and progresses sustainability themes. Often, the CSR report contains news and information which had not cascaded through to them via regular internal communication channels.  In some cases, Corporate Reponsibility reports even state the names of individuals in the Company who are responsible for progressing different action items - an example of this is Vancouver City Savings Union (Vancity) (page 35). But when I recently tried to ascertain how many Companies actually track how many employees read all or part of their reports, I couldnt get an answer.

I found one example of something coming close to this on the Adidas website where readers of their online report are asked to own up and identify themselves. The results are displayed in a neat graph.

We dont know how many people took this survey, and I am not quite sure what the difference is between an employee and a worker, but this is a great way to see what kind of people are taking interest in the report. And a very brave move on the part of Adidas to have an open survey such as this on their reporting site . In a recent dialogue with Symantec,  i understood  they progress many activities in the framework of internal communications to ensure employees are aware and engaged. But, bottom line is, overall, we DON'T KNOW if employees take any sort of interest in one of the most important documents the Company publishes to stakeholders, and if they are capable of being the ambassadors for that document, and the Company.

 

Who is repsonsible for this ? After the CEO, it has to be the HR Function. The HR function must ensure proceses are developed within the busnesss to raise employee awareness of key strategies and processes, especially those which are in the public domain. Why doesnt HR do this ? Because, I submit, most HR Managers just don't see how they link to Sustainability strategy, beyond matters relating to ethics and values, and sometimes, community volunteering (because no-one else does it). Most HR Managers really don't see the relevance of ensuring high quality communications and dialogue about sustainability programs. When was the last time you had a progressive conversation with an HR Manager about sustainability in the supply chain and the HR role which supports that ? How do HR Managers recruit people into sustainability jobs ? In what ways does HR adopt sustainable practices  as a function ? Most HR Managers cannot tell you. The HR function has still not grasped the principles of a stakeholder society and stakeholder-driven business.

 

This is a pretty damming picture of HR people. This is why i am writing a book as a guide for HR Managers on all things sustainability and corporate reponsibility, due for publication next year. In order to test my theory, I produced a short survey for HR Managers. Of the lowish number of responses I have had to date, this is some of the initial data:

• 100% of HR Manager responders say that HR Managers need to have some understanding of Corporate Social Responsibility
• 54% of HR Managers say CSR  is something they are involved with as part of their ongoing role
• 80% and 70% respectively say this involvements relates to ethics and community involvement, with zero being involved in supply chain practices and external stakeholder engagement.
• 45% said that HR Managers need additional skills (and knowledge) to support CSR
• 30% said they had targets related to CSR

and one HR Manager, in responding to the question "What does the concept of Corporate Social Responsibility mean to you ?"  wrote : "Sustainability" . Well, at least that's something.

So, they all think it's important, half of them are responsible for it (in a limited way), and a third are measured on it. Less than half think they need to learn new ways of doing things in order to do it. Frankly, I think this is a saddish picture of the HR function. And i am keen to get a wider sample of opinions from a broader range of HR Managers so PLEASE pass this on to any HR Manager you know and request they complete the survey HERE: http://bit.ly/3HpxnS
I promise to update you all with the results. Thank you !

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Prostitution, fashion and communicating CSR

Embed. Once more. Interweave CSR into the fabric of your business. This is my fifth and final post on this subject, (for now!) inspired by Ethical Corporation's 2009 research report called How to Embed Corporate Responsibility across different parts of your Company.We already covered how people do it (embedding CSR in Human Resources ), how buyers buy it (Procurement function ), how accountants count it (Finance function ) and how truckers truck it (Operations and Logistics Function). Now, we examine how they all talk it. Embedding CSR in  corporate communications - internal, external, marcom and reporting.

With case studies and insights from the Man Group (don't worry girls, this isn't a gender thing, the Man group was founded by James Man over 225 years ago. Not his fault if he had a gender-biased name), Hewlett Packard, Novo Nordisk, BT, Vodafone, Starbucks, Pepsico and reference to research findings from McKinsey, embeddng communications covers reporting (ahaaaaaaaaaaa, my favourite subject. See ?  I saved the best for the last) and how to make reporting effective, marketing to consumers using CR messages, and communicating with your colleagues internally.

One of the things I liked in the research paper was a quotation from the Global Triple Bottom Line Management at Novo Nordisk who said that the report is a key method for "keeping the Company accountable for performance". This is often underestimated as a prime use for CSR reports. The more internal and external stakeholders that know about corporate goals and objectives, the more pressure there is on the individuals in the business to deliver. Another interviewee goes even further and says that reporting should drive behaviour change.  In my experience, this does happen.

Another thing about CSR communications is that the core message should be spead by every employee in the Company, in a way that is relevant to her or him, and her or his role in the business, and in her or his own words. I will illustrate this with an example  from one of my clients in the local market.

Communications and dialogue has long been at the heart of the comme il faut fashion house in Israel. Every bi-annual fashion collection is supported by a social campaign which involves employees and customers in dialogue.

 from comme il faut Winter 2010 collection

Last season's campaign, a bold move, was centered around customers bringing to the Company an unwanted bra, in return for which they received a discount on new purchases, whilst the Company donated cash to support healthcare for women trapped in prostitution. You can imagine that the subject of prostitution is not one which is easily introduced into the world of  fashion, beauty, positive body image etc, and it was not without a certain trepidation that this company for women, known to be outspoken in promoting women's rights, decided to stand up publicly for women who have been abused by society. Before this campaign launched, many internal dialogues were held with employees of the fashion house, both to help them understand the plight of women trapped in prostitution and protitution survivors, who still need much support, and also to build their skills in engaging customers on this subject.  I facilitated many of these conversations and was fascinated by the range of insights this brought out. Subsequently, during the campaign, each of the several thousand customers who donated a bra engaged in a conversation about prostitution and also benefited  from new insights.

The current campaign  for the Winter 2010 collection is themed Re-fashion, and looks at what endears us to certain items of clothing year after year, and how we can re-fashion and re-fresh them so that they can serve us even longer, inspired by the principles of environmentally preferable "slow-fashion" . Customers bring in an item of clothing, which the comme il faut designers examine in order to understand why  that particular garment is so special that it stands the test of time. The customer gains a discount on new purchases and the opportunity to win a $5,000 new wardrobe. And women trapped in prostitution get a new garment as a gift from comme il faut for every old one that is brought in. This has doubled the conversation effect. Not only is the social content still present, but now the Company can engage customers in conversation about their most intimate reasons for wearing the same pair of trousers, or the same blouse or skirt, year after year, and use the customer experience in the new garment design process.  

Why is all this important ? Because these campaigns embrace the principles of corporate social responsibility in processes based on communications. They require every employee in the business to understand and engage with the campaign and what the Company is trying to communicate. It makes them think about their own role in supporting the campaign and furthering the commercial and social objectives. And it help them understand the way others think and use this in making business decisions.  And this, in my view, is what embedding CSR is all about.

By the way, you can read comme il faut's CSR report (I led the writing of this report) here.

I have now completed my series of posts on embedding CSR in different functions of the business. Thank you to Ethical Corp for the research report which prompted this series. And now, if you see me walking around in my undies, the reason is probably that i gave all the rest of my clothes to comme il faut ....

elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Paper conservation at Heinz - or not?

Heinz published their fifth #csr report yesterday. It's a GRI B self-declared report. Congratulations!  I didn't read it yet. But something struck a nerve with me, so i decided to use Heinz as a scapegoat in my upcoming rant. Heinz is by no means the only Company who does this, but, well, they just happened to plop only my screen as I have the energy to rant. Here is what they say about the online report:

"Reflecting our commitment to environmental responsibility, Heinz has conserved paper and the energy used to produce it by publishing our 2009 Corporate Responsibility Report exclusively online. This online report provides more in-depth information than previous reports about our corporate social responsibility activities and includes multimedia elements. In addition, we are offering a customizable PDF so readers of this report may print out any sections they wish."

Start rant.
What is it about CSR reports that they are held up as the sole example of a Company saving the planet by not printing it? What about Annual Reports? Heinz makes it really really easy for anyone, not just investors, to order a printed copy of an Annual Report . There is nothing  in the rest of their CSR report about conserving paper. Reduced printing in everyday operations? Percentage of recycled paper consumption ? On-line billing? Zilch. The only example we have of Heinz's commitment to conserving paper is this one single example of a sustainability report.
There are many good reasons to produce on-line reports, beyond the conservation of paper. And Heinz reports many good examples of environmental positives including reducing packaging initiatives and more. But if the CSR non-printed report is the only paper-conservation exercise that is highlighted by a Company, I begin to wonder how balanced their reporting is.
Finish rant.  
 
elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en

Inform, inspire and involve to embed CSR in operations

Embedding, post number 4. We already covered embedding CSR in Human Resources, the Procurement function, and the Finance function. All of this, as you may recall, is based on Ethical Corporation's 2009 research report called How to Embed Corporate Responsibility across different parts of your Company. This time, i will cover the ways Companies embed CSR in the "Facility, Logistics and Operations" bits of the Company. Having managed logistics for many years with Procter and Gamble in Europe, this is an area of the business I am familiar with. The report looks at:

• How to make facility or manufacturing operations more efficient and more  environmentally friendly through consultation with operators and line workers
• Developing low energy or socially innovative solutions for triple bottom line benefit
• Indentifying no-cost innovation solutions
• Developing partnerships to drive suggestions for improvements

Most people will understand quite easily that environmental opportunities are abundant in the Manufacturing and Logistics functions. With examples from Boots, Hewlett Packard, Novo Nordisk and Vodafone, the report cites examples of innovative solutions in different aspects of the supply chain which offer benefits for customers and the business, and which have been developed using insights and suggestions of those involved on the ground. Opportunities such as haulage partnerships with non-competitive companies to optimize truck payloads, recycling and re-use rather than disposal of products, real-time energy monitoring  are some of the solutions highlighted. The key common demoninator of the development of these solutions is : dialogue. Creating a culture where employees of the business, suppliers and customers can contribute to developing triple bottom line solutions is core.

Developing new ways of doing things, and maintaining a constructive dialogue with suppliers, customers and employees does not happen automatically. A company looking for CSR opportunities in the manufacturing and logistics functions needs to define its objectives and create awareness for the concepts of social and environmentally preferred ways of manufacturing or trucking. This means creating  communications processes for all these stakeholders, so that CSR is part of their mindset when they are reviewing operational activities. "Greening employees" for example, reflects the process of educating, informing, involving and inspiring  employees regarding environmentally friendly practices.

What better Company to use for a review of the embedding of CSR in the logistics function than a logistics Company. I took a look at Fedex 2008 CSR report. Here is an example:

"At the FedEx Packaging Lab, our engineers use the latest materials and tools to solve shipping challenges, including environmental ones. FedEx engineer Yongquan Zhou recently helped a customer shipping heavy exercise equipment from China find a more protective and environmentally friendly alternative for a commonly used cushioning material known as expanded polystyrene foam (EPS). His result: a honeycomb-style packaging with corrugated pads and banding, a packaging solution that not only reduces damage at a comparable cost, but is also better for the environment."

I assume Mr Zhou didn't wake up one morning out of the blue and thought to himself over the morning cornfakes: "Hmm, I need to find environmentally friendly packaging solutions today". I bet he didn't say to himself " Wow. Honeycomb-style packaging, gotta do something with that". I bet he didn't think, as he helped himself to a third bowl of cornflakes,   "I can contribute to saving the planet today by developing environmentally-friendly solutions for Fedex clients". Maybe he did, but the chances are that if he did, it was because of a culture that had been developed at Fedex to ensure employees are aware of their possibilities to contribute to environmental efforts, and provide them with the opportunity to do so.

You can't embed CSR if you don't inform, inspire and  involve.
 
elaine cohen is the joint CEO of BeyondBusiness, a leading reporting and social-environmental consulting firm . Visit our website at: www.b-yond.biz/en