The Emerging Stars of Sustainability - Are Nordic Companies the New Stars of Sustainability

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A snapshot of what appears to be the emerging strength and confidence in the approaches to sustainability being adopted by Scandinavian companies.

A snapshot of what appears to be the emerging strength and confidence in the approaches to sustainability being adopted by Scandinavian companies.

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  • 1. DIRECTIONS SUPPLEMENT AUGUST / SEPTEMbER 09 TRENDS AND ISSUES IN THE WORLD OF CORPORATE RESPONSIBILITY The emerging stars of sustainability Are Nordic companies the new stars of sustainability?
  • 2. Directions Supplement August / September 09 Welcome to the August / September special edition of the Directions Supplement series. In this issue we provide a snapshot of what appears to be an emerging strength and confidence in the approaches to sustainability being adopted by Scandinavian companies – and they also appear to be more willing than in the past to communicate on the subject. By highlighting the stars from around the region we have collated trends and areas of best practice that we feel are worth mentioning. And with COP-15 just round the corner we invited our ‘best friend’ agency in Denmark, RelationsPeople, to reflect on the strong social welfare traditions that underpin the region and take a look at the energy sector’s experience of communications around climate change. Sustainability is obviously not a new concept But above all others we think there is one in Scandinavia. Indeed in many of the regions particular factor that is driving this subtle shift companies have long been at the vanguard in mindset – it’s the market opportunity. There of sustainability thinking and the Nordic seems to be a growing realisation that the sustainability model resurfaces time and again substance-based approach, that has been used as the style of capitalism that must be imitated up until now, means that Scandinavian companies to help build a more sustainable future. are well placed to reap the benefits of this long- termism. They’re realising that this substance, But in our experience of working with the when allied to good communications, can now leading companies in the region, the approach provide competitive advantage. to communications on sustainability has often lagged behind the reality and not really done And those companies that aren’t spotting this justice to the strength of the thinking and the opportunity are increasingly at risk of losing out. actual activity. Scandinavian companies are globally There are lots of very good reasons for this: competitive businesses often working in high Government regulation has never really pushed impact sectors or innovation-based industries. the subject; society’s relationship with business They must now be at least as adept as their has tended to be fairly positive and trust peers at engaging stakeholders around the relatively high; stakeholder groups (where they difficult issues they face – taking an understated exist) have not tended to demand too much approach will no longer do but so many are radical action; there also seems to be a very still doing this. consistent view that sustainability should be about substance first and communications So it is this gap and this emerging trend that second (we would share this view); and then we want to explore. As with their much-admired there is what several of our clients have referred model of capitalism, Nordic companies have to as the cultural trait of under-statement and a unique opportunity to rightly stake their modesty – it seems Scandinavian companies claim to being responsible leaders. Effective prefer not to blow their own trumpets. sustainability communications in a multidimensional, interconnected world is a But in our view a lot of this is changing. New critical element to realising this advantage. regulations in Denmark and Norway. Increased stakeholder activism. The transparency needed So we have put some of the biggest companies around global supply chains. The increased in Scandinavia under the spotlight and, looking global access to company information afforded at what we think is great about what they by the internet. Several corruption scandals. are doing to communicate their sustainability Increasing consumer awareness of issues and initiatives, we pick out a few of the stars. It decreasing consumer trust of business. Climate could be a one-off campaign, a new strategy, change science. The financial crisis. All of these an issue-focused microsite, an interactive case factors appear to be leading Scandinavian study map, a unique take on grappling with the companies to re-think their approach to big challenges, or a great approach to dialogue communications and this is being reflected with key stakeholders. Whatever it is that strikes in more visibility, more transparency and us as demonstrating this new-found voice and generally more communications noise. confidence in communications. Nigel Salter Director salterbaxter
  • 3. Sweden Sweden’s leading companies have, for some the build up to COP15, Vattenfall has an easy time now, been amongst the best and most to understand map of where the business visible in the region when it comes to is going. It also features many interactive sustainability communications. The approaches slideshow presentations around key issues, of the leaders are equal to and in many cases providing useful explanations of the business exceed the effort of global peers making this impacts and processes looking at issues such country stand out on the world stage. as CSS and nuclear. Companies around the world could learn a lot from Vatenfall’s The Volvo online report has many entry approach to sustainability communications. points for different stakeholders, with tiered information where each page leads you to Electrolux engages well on individual issues greater level of detail or external links. All with a standalone water savings site – which the data in one scorecard at the front of the is actually a product site for an efficient 40-page report showing the useful economic, dishwasher! A good example of a company with environmental, and social data. A blog from sustainability well-integrated into its approach. managers and polls on different issues are also great features. The TeliaSonera report site is well laid out and gives a good perspective of business operations. The Ericsson report starts with its most Stakeholder assessment of issues and relevant issues and these then guide the stakeholder engagement are well presented. communications. Features include an interactive case study map and CEO video. H&M takes a transparent ‘no stone unturned’ approach to explaining impacts in the supply Skanska has a great ‘triple bottom line’ chain. The company identifies the top ten interactive video and timeline showcasing non-compliance issues and individuals its sustainability history. accountable for achieving targets are named. The stakeholder feedback Q&A section also SCA’s communications feature an engaging adds credibility. No doubt that this company lifecycle brochure. But most importantly the is a Nordic star of sustainability. company is clear in identifying the controversial issues that are key to the business. SAS has an offset calculator which is a useful, if uninspiring tool. SAS has a good assessment With a Youtube style climate site containing of steps the airline industry can take to information around the different stages of reduce emissions. Finland There’s some original thinking being done The highlight of Stora Enso’s site is the quick in Finland and, for the most part, Finnish and easy reader survey facilitating feedback. companies are comfortable talking about the The company takes an honest approach, for issues that they are facing. With some world example when talking about fatal accidents. leaders based in the country and also with some industries needing to address some of A great sustainable forestry micro-site the most challenging global issues (forestry, and good technical data, but unfortunately nuclear energy, renewables), the approaches communications presented by UPM-Kymmene and the ambition being demonstrated by some are a bit dry. More could also be made of the of the companies show real star quality. ‘UPM stories’ section covering its big impact areas. And how will it start to develop its With an integrated report and separate position on water? environmental brochure, Neste Oil displays that the business is aligned with environmental Fortum has a number of position papers around challenges. It also leads on issues such as key issues, such as a separate report exploring sustainable palm oil, clean diesel and vehicle how it fits into the climate change debate. emissions reductions. There’s also an ambitious new strategy and direction which bodes well for future initiatives Nokia is a great example of a company and leadership. Lots of challenges and lots of completely integrating its sustainability engagement and activity to help address them. principles through the development of an environment-focused product line called The conversational tone adopted by the ‘Power of We’. It uses an interactive CR map SOK Group’s Responsibility Review makes it to outline global initiatives across a number a great read. And the spirit of the cooperative of different areas e.g. disaster relief and youth. movement comes through really well. In partnership with WWF, Nokia has created a The Metsäliitto Cooperative CR review is young online community talking about various incorporated into its annual report. Although environmental issues. information presented in the report is in depth, the company could benefit from consistent communications, making the most of online.
  • 4. Norway Even though several world leading businesses chain issues found in Bangladesh with a with some difficult industrial issues (Statoil detailed, frank explanation of problems and Yara) can be said to also be world class and terminated partnerships. in sustainability, the communications of the companies away from the main spotlight has Pages on issues and impacts from Norsk been generally uninspired and uninspiring. New Hydro are a good example of how impact government thinking on company disclosure areas are addressed separately with single in 2009, recent initiatives on the use of sources of information. government pension funds to incentivise green Orkla has an online report site that has the energy and technology, plus a new approach look and feel of a printed document. This is to taxation on food and drink items which will disappointing as there is great evidence of favour ‘products with health benefits’ all mean lots of dialogue channels for stakeholder that the ground seems to be shifting – fast. groups. The content is there – but Orkla would Yara international clearly demonstrates benefit from making much more of its online how sustainability solutions are built into communications and demonstrating a the business model. ‘Addressing the food more coherent overall group approach to challenge’ is a great example of a company’s sustainability – admittedly difficult for a true use of video content. conglomerate, but this is the challenge it now faces. Statoil has an engaging online report tackling energy reality issues. With its interactive site, Unfortunately AKER has taken a simple ‘solutions of tomorrow’, it looks at future efforts ‘nuts and bolts’ approach with only a PDF of to reduce impacts and the ‘Hywind’ floating its CR report online. The strength is in its wind turbine is well explained with rich content. year-on-year table assessing progress on targets. Also worth mentioning is the Looking at content, Telenor provides a really transparent explanation of fatalities. strong response to the challenging supply Denmark Long associated with innovation in the field Arla provides a wordy PDF Report, but this of sustainability and the environment Danish is supported by videos on impact areas and companies appear to have an appetite for food blogs. leadership on these issues. Communications beyond a few leaders had, until recently been Although Danish Crown does have an limited but the government’s recent requirement environment and climate strategy the for all companies to report on social and sustainability communications is limited to environmental issues appears to have raised the its annual report. It does however have a bar. Most companies had one or two excellent virtual slaughterhouse tour that is very communications ideas and initiatives – well on informative, and actually fun! the road to obtaining a full suite of tools to Novo Nordisk also integrates its sustainability communicate their approach to sustainability. communications into its Annual report. One Despite not producing a report Maersk focuses of the first companies to use tools such as on a range of key issues, such as carbon capture games and scenarios to explore sustainability and storage. Some good legwork with content issues, this company embodies worldwide – we look forward to a report that presents this best practice. information in an exciting and innovative way. Every retail unit in the Danske Bank Group Unfortunately little more from ISS than launched a local CR site. The Group also a functional explanation of what they do, produces a CR fact book which is heavy partnerships and commitments. So much with performance data. more could be done here. Carlsberg has a strong proposition and Novozymes has a well-integrated approach strategy built around the idea of ‘growing as products are positioned as solutions to big responsibly’. A case study map outlines global challenges. Key best practice features initiatives across the 3 focus areas of the are a ‘most-read tag cloud’ and a ‘second life environment, responsible consumption and island’ where solutions for the future are responsible supplier management. There showcased. Making full use of 3-D virtual reality appears to be a lot going on and a sense environment to communicate, a genuinely of lots more to come. innovative example of original thinking Vestas promotes modern energy as its theme although possibly not all entirely effective. with many films which, despite a low level of DONG has the shortest report for the detail, do a good job of engaging the audience. sector (only 50 pages!). The introduction of But given Vestas’ position as a world leader in an exchange between the WWF Secretary wind energy, we’d have to say that we’d expect General and Dong CEO makes a great read. more in terms of communication – this seems to be an opportunity missed.
  • 5. Branding climate change – a Scandinavian approach Kristian Eiberg Scandinavian countries, characterised by leaders are at the forefront of corporate Partner strong social welfare systems, have long branding in theory and practice. We term RelationsPeople been used to their governments taking the this ‘third wave’ corporate branding. lead on sustainability issues. Acting through the legislature, governments have tackled Behind creative and skillful communication themes from corporate governance to, most is serious business. These companies actively recently in Denmark and Sweden, demanding seek to influence the markets within which that a large group of companies report on they operate. Carlsberg addresses water corporate responsibility (CR). supply issues not only because it is a scarce resource, but it’s also a prerequisite for beer Maybe because of this strong emphasis on production. Novo Nordisk stands shoulder public consensus and the ability of government to shoulder with health authorities in to effectively regulate, Scandinavian companies tackling diabetes. By openly and actively have not been active in communicating communicating around these issues, these corporate responsibility. There has been no leaders build engagement and corporate demand from stakeholders to do so. legitimacy in areas of potential conflict. In Denmark, the regional bank Sparekassen The energy sector Nordjylland took its first step into corporate Leading Scandinavian energy companies have sustainability when in 1987/88 it launched engaged in ‘third wave’ corporate branding on the world’s first ethical accounting statement. climate change and energy policy. Scandinavia This approach inspired not only other Danish has strong, state-owned players that work companies to follow suit, but also gained across the Scandinavian borders. In 2006 traction outside Scandinavia. The Danish Statoil launched a biofuel product supported government played a leading role in deepening by heavy consumer advertising. But both their CR across Europe as Danish companies were defense of first generation bioethanol and the directly approached to contribute and advise mismanagement of NGO protests around their on government-backed projects. Ms. Karen misleading marketing were highly criticised. Jespersen, then Minister for Social Affairs, took Prior to the UN Climate Summit in Poznań in the initiative to establish a National Network of 2008, Vattenfall launched a global campaign Company Leaders to act as an advisory board to engage people to sign a declaration that, to government. Representatives were selected among other things, called for a global price from corporations such as Novo Nordisk, on CO2 emissions. Vattenfall was met with Carlsberg, Grundfos and Oticon as well as sharp criticisms of greenwashing. Elsewhere, from Danish SMEs. DONG Energy, has recently run a highly visible campaign focusing on investments in However, CR from a government perspective renewable energy sources such as wind power. has largely been focused around creating and maintaining an inclusive labour market – Public criticism and accusations of mobilising various parties to address problems greenwashing are part of the game when of unemployment and social exclusion of commercial companies enter the political scene marginalized groups. and engage with these issues and ‘third wave’ corporate branding. If a company wants to More recently Scandinavian companies have engage with stakeholders and take a stand faced increasing demands to demonstrate on an issue it must have something to offer. commitments to CR and accountability In order to be efficient, climate change from global markets. This shift towards communications should by their very nature be using sustainability to enhance global controversial to some and appealing to others. competitiveness of Scandinavian firms has been accompanied by legislation. The most In sum, a tricky dilemma needs resolving. recent requires the 1,100 largest companies On the one hand, Scandinavian populations to report on CR from 2009. have a high regard for those companies associated with corporate responsibility, but ‘Third wave’ corporate branding at the same time the majority of citizens Today, leading Scandinavian companies are skeptical when companies communicate have realised that stakeholders’ concerns corporate responsibility. Mission impossible? are their concerns. And that active listening No, but in order to successfully manage to stakeholders enhances product innovation, the scepticism, companies must make sure stakeholder relations and corporate reputation. that their corporate behaviour in this field Many Scandinavian companies have put is matched by tangible actions, measurable climate change at the centre of their targets and a business-driven approach. The sustainability branding. Making firm publication of thousands of annual reports in commitments and engaging meaningfully with 2010 that will report on responsibility issues stakeholders as well as exploring potential will give an interesting insight into the current solutions through communications, these state of affairs.
  • 6. About us Contact: Louise Dudley-Williams Salterbaxter advise companies ldudley-williams@salterbaxter.com Tel: +44 (0)20 7229 5720 on strategy, branding, corporate Emily Measor communications and design – emeasor@salterbaxter.com Tel: +44 (0)20 7229 5720 providing creative communications The Directions Supplements for big business issues. support our main Directions report. The main report is published each year and is We have worked on over 170 corporate responsibility and now regarded as the UK’s sustainability projects for more than 50 companies since most comprehensive analysis of the trends and issues in we started in 1998. CR communications. If you want a copy, call us on the number below or email We offer a full range of corporate responsibility and directions@salterbaxter.com sustainability communications services – from strategy consulting to the design, writing and delivery of printed and online communications. And everything in between. – Strategy/consultancy – Design for print and web – Programme advice – Online issues/social media – Stakeholder engagement – Writing – Reporting – Workshops and training – Single issue campaigns – Research – Internal communications – Events Our latest corporate responsibility clients include: Adidas Group Friends Provident 202 Kensington Church Street ArcelorMittal H&M (Hennes & Mauritz) London W8 4DP AXA UK Land Securities Tel +44 (0)20 7229 5720 Fax +44 (0)20 7229 5721 Bacardi LEGO www.salterbaxter.com BAE Systems Millicom Camelot Nokia Carlsberg Group 02 UK Coca-Cola Rolls-Royce E.ON Telefónica 02 Europe Ericsson Vodafone This supplement is printed on Think Bright and is supplied by Howard Smith. It is an FSC (Forest Stewardship Council) certified material and is 100% recyclable. www.hspg.com Printed by CTD, an ISO 14001 certified and FSC accredited company. TT-COC-2142 ©1996 Forest Stewardship Council A.C www.ctdprinters.com