CR 2011 reflections & 2012 issues


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Presentation given on November 17 to Canadian Business for Responsibility Members in Webinar. Focusing on highlights of 2011 and what to consider in 2012 in the field of corporate responsibility.

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CR 2011 reflections & 2012 issues

  1. 1. Corporateresponsibility: 2011 reflections and 2012predictionsToby Webb, Founder/Chairman, EthicalCorporation,CEO/Co-Founder, StakeholderIntelligence Ltd17 November 2011. Canadian Business for SocialResponsibilityWebinar
  2. 2. Background • Founded Ethical Corporation 2001 • Directed/Chaired 80+ CR management conferences world-wide • Published 8000 articles & 12 reports • Interview 800+ executives per year: Reports, articles, conferences • 3000 Corp customers globally, expert analysts around globe • Lecturer, Corporate Responsibility, Birkbeck College (London) • Co-chaired independent working group on CSR for UK Government 2006-8 for David Cameron • Co-Founder of Stakeholder Intelligence: Bespoke company training, intelligence & research. 30 experts round the world: China, SA, Brazil, US etc
  3. 3. Sustainability 2011/12 issues Durban: Low expectations but a hope that Kyoto expiration may provide some impetus for a deal before 2015-20 Eurozone crisis: Current severe economic/political troubles an important context considering EU’s traditional role as global environmental standard-setter and proposed shift to a low carbon economy. May hinge on German election. UK Government step back: Policy confusion on business and carbon. E.G. FiTs, green tariffs, green deal, CRC, Renewable Heat Incentive, all faltered Business/Government steps forward: Davos 2011 provided CEOs with space to discuss SD and helps create interface between government and business
  4. 4. Sustainability: Macro issues: 2011 events and 2012 significance 7th billion person arriving on earth: UN shift from 9 to 10 billion max estimate Rio Earth Summit + 20: Unlikely major Govt action, but v significant for business announcements and commitments China’s Five Year Plan: Shift towards res. Efficiency: game changer? China’s middle class: People vs. Govt more than People vs. Biz AND What can 400mn ‘soccer mom’ types mean? Fukushima: Nail in the coffin of nuclear as a transition technology? Given German ‘political’ decision it’s a distinct possibility.
  5. 5. Sustainability: Macro issues: 2011 events and 2012 significance What the Frack?Gasland and association publicity around shale gas – good and bad – firmly on the CR agenda. Is it climate realpolitik or stopgap solution? Companies may need to take a position Occupy Wall Street: Not what it was, but what it represented…sense that the current system of liberal democracy and capitalism isn’t working, and the public sympathy for that 2012 question: Clearly change in context for business in society. Could it lead to a change in definition of the social contract, or a passing fad not even on the scale of anti- globalisation protests of late 1990s?
  6. 6. Sustainability: Macro issues: 2011 events and 2012 significance Occupy debate given new fillip to discussions about solutions: Notably the ‘Tobin tax’ idea which continues to gather political support but appears no closer to reality India’s corruption debate: Lone campaigner, Anna Hazare’s work and mobile licenses scandal = official corruption on mainstream political agenda. Govt& business now under much greater spotlight & pressure Closure of News of the World: Comeuppance for Murdoch. Ongoing, ever-growing journalism and corporate ethics scandal in UK, slowly spreading to North America (shareholder action)
  7. 7. Business and sustainability/corporate responsibility/ethics Coca-Cola Enterprises Sustainability Plan, Sainsbury’s 20/20 plan: September 2011: Impressive milestones. May help other large companies see beyond Unilever, Marks & Spencer as ‘out on their own’ High-tech brands and web businesses: Apple, Google, Facebook, Amazon under scrutiny on both operations AND consumer influence China’s reporting push: 600+ companies now reporting in China. What will Five Year Plan implementation mean for sustainability disclosure 2012 and beyond? Porter’s Shared Vale proposition: Despite obvious bandwagon-jumping and latenessm, re-badging a version of CR unrecognized in Europe as a proprietary concept
  8. 8. Business and sustainability Porter is a ‘name’ in business that counts. Despite lack of focus on minimizing negative impacts ‘Shared Value’ gives other celebrity academics confidence Reports indicate Shared Value apopular concept in US as many uncomfortable with word ‘responsibility’ for legal and cultural reasons Integrated reporting pilot: Despite commercial conflicts/rush by accountancy companies to cash in, major step forward in organizational change process – perhaps. May give CR movement some ‘much needed’ momentum Final Ruggie report: Serious, solutions-oriented step towards a framework for business and human rights. Companies will need to respond positively and in a lot more detail on the topic in 2012
  9. 9. Business and sustainability ISO 26,000& understanding: National body certification may create both markets and confusion Globally-relevant human rights-related rules: Frank-Dodd elements + California’s slave labour disclosure rules help continue to create momentum for business and human rights debate in 2012 Carbon Disclosure Project’s Carbon Action and Water Disclosure initiatives: Will they signal a real change in responsible investment? 2012 may tell us Barclay’s Bob Diamond admitting banks have serious reputation problem alongside financial, but lack solutions or path BP’s problems: Ongoing fallout from Macondo, and their admissions around business practices in Russia
  10. 10. Business case and sector improvements Bigger companies twice as likely to report as those with revenues under $1 billion 48% of Top 100 companies claim cost savings through CR initiatives 47% say increased revenues and/or their position in the current market through CR measures Best performing sectors for CR reporting: Forestry, pulp and paper (84%), mining (84% and automotive (78%) Greatest improvement since 08: Construction (65% in 2011 from 32% 08) and Pharmaceuticals (64% from 25% in 08)
  11. 11. Issues coming up the agenda Water and Carbon high on reporting agenda: CDP to report corporate survey results on water December 2011 Ethical Corporation research shows large companies pushing transparency and data requirements into Tier One suppliers: Energy, Carbon, Water top areas of interest Microsoft (‘11) and Wal-Mart (‘09) notable cases. SEDEX and the Fair Factories Clearinghouse seeing rise in data flowing in from both suppliers and brands 2011: World Resources Institute and World Business Council on Sustainable Development released biz standards to measure, report & manage carbon emissions in supply chains and throughout product life cycles through Greenhouse Gas Protocol
  12. 12. Issues coming up the agenda Integrated reporting on the rise. Some say its investor driven International Integrated Reporting Committee framework for integrated reporting: Aims to unite standards for financial reporting (IFRS and US GAAP) with SD frameworks 40 company pilot scheme for 12 months to apply draft principles: Coca-Cola Co, Microsoft Corp, Volvo, Deloitte & HSBC (IIRC Discussion Paper draft framework pub. 2011) Is there a danger that integrated reporting will water down sustainability reporting?...Sources: KPMG surveys, BNA Daily Environment Report, Ethical Corporation
  13. 13. Further reading and contact (forthcoming)