Sustainability Reporting
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This document discusses sustainability reporting and whether companies have to report on sustainability issues. It defines sustainability and outlines different sustainability reporting standards and frameworks. The document notes that while sustainability reporting is not mandatory for all companies, there are external pressures from regulations, advocacy groups, consumers, and investors that are driving more companies to report. It also discusses the benefits companies can realize by reporting, such as minimizing risks, improving reputation and brand, and increasing innovation. The document provides an overview of the major sustainability reporting standards and guidelines.
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Sustainability Reporting
- 1. Sustainability ReportingDO I HAVE TO ?? Jennifer H. Elder CPA, CMA, CIA, CFF The Sustainable CFO jelder@sustainablecfo.com
- 4. DO YOU HAVE TO REPORT ???
- 5. DO YOU HAVE TO ???
- 6. DO YOU HAVE TO ??? 32.1%
- 7. No one ever catches the back of the wave and reaches shore. You’ve got to start paddling before the wave comes in…. Being ahead of the curve always leads to profits. Shai Agassi, CEO, Better Place
- 8. BE AHEAD OF THE CURVE!IT’S GOOD FOR BUSINESS!
- 9. BE AHEAD OF THE CURVE! OR BE LATE!
- 10. WHAT DO WE REPORT NOW?
- 11. WHAT IS SUSTAINABILITY REPORTING?
- 12. WHAT IS SUSTAINABILITY REPORTING? Names Uses Forms Content Standards
- 13. DIFFERENT NAMES Environmental Impact Health & Safety Community Affairs Corporate Citizenship Corporate Social Responsibility (CSR) Environmental, Social, Governance (ESG)
- 14. DIFFERENT USES Public relations Communication Improvement
- 15. DIFFERENT FORMS Separate report Attachment to annual report Combined report Statement Online report
- 16. DIFFERENT CONTENT Environmental impacts Safety Community service Supply chain Policy Results
- 17. DIFFERENT STANDARDS G -3 Protocol UN Global Compact ISO 26000 Account Ability AA1000 Connected Reporting Framework Sarbannes Oxley
- 18. DIFFERENT BUT SIMILAR Communication Connects company to world Address issues around risk Process for measuring, disclosing, and being held accountable
- 19. NIKE
- 20. NIKE
- 21. NIKE
- 22. TOYOTA
- 23. TOYOTA
- 24. TOYOTA
- 25. TOYOTA
- 26. WALMART
- 29. HISTORY 1953 – Social Resp. of Businessmen 1989 – Ben & Jerry’s S/H Report 1995 – AccountAbility 1997 – Global Reporting Initiative 2000 – UN Global Compact 2002 – Sarbannes-Oxley 2004 – ISO 14000 2005 – Accounting for Sustainability 2010 – ISO 26000
- 30. WHY REPORT? External Pressures !!! Governmental regulation NGO advocacy Consumer concerns Channel requirements Investor Requirements
- 31. WHY REPORT - MANDATES !
- 32. WHY REPORT - UPSIDE! Identify & minimize legal & business risk Improve trust/credibility with stakeholders Enhance reputation and brand Increase customer loyalty
- 33. WHY REPORT - UPSIDE! Increase market share Gain competitive advantage Increase innovation Improve employee recruitment and retention
- 34. MAJOR STANDARDS
- 35. UN GLOBAL COMPACT 2000 - 18 members 2010 - 8,000+ Ten Principles: Human Rights Labor Environment Anti-Corruption
- 36. AccountAbility AA1000 1995 – DC/NY/London/Bejing 1999 – AA1000 Standards Principles Standard covers: Inclusivity Materiality Responsiveness Assurance standard
- 37. GLOBAL REPORTING INITIATIVE 2000 G-1 Standard, 2006 G-3 80 Indicators Economics Labor Practices Human Rights Society Product Responsibility Assurance
- 38. WHERE DO YOU BEGIN? 8 STEP PROCESS Do your homework Develop strategy Establish goals Create metrics Engage stakeholders Collect data Evaluate results Write the report
- 39. IT’S AN ONGOING PROCESS
- 40. BE AHEAD OF THE CURVE! OR BE LATE!
- 41. Jennifer H. ElderCPA, CMA, CIA, CFFThe Sustainable CFOThe GPS for your business!Consulting-On Demand CFO ServicesBusiness Coaching-Trainingwww.sustainablecfo.com 410.231.1881 jelder@sustainablecfo.com SustainableCFO
- 42. RESOURCES GRI www.globalreporting.org AccountAbility www.accountability.org UN Global Compact www.globalreporting.org Sustainable Business Institute www.sustainablebusiness.org
- 43. HOW TO READ A REPORT CEO Statement Summary key facts Voice of stakeholders Issues
- 44. WHAT TO LOOK FOR IN A REPORT ? Timeframe Subjects covered Standards used KPI’S
- 45. WHAT TO LOOK FOR IN A REPORT ? Trends Interactivity Consistency with prior reports Verification
Editor's Notes
- No not yet
- Per Corporate Register1992 – 26 companies2008 – 3,379US still lags (# reports)1992 -2008UK – 2,780US – 2,200Per PWC80% Global Fortune 250 report75% Europe S&P 35030% US S&P 500But growing 2005 32% of top 100 US cos2008 73%
- US still lags (# reports)1992 -2008UK – 2,780US – 2,200Per PWC80% Global Fortune 250 report75% Europe S&P 35030% US S&P 500But growing 2005 32% of top 100 US cos2008 73%
- CorporateRegister.com1992 – 26 reports2010 – 5,171 reports32.1% compound growth rate!US still lags (# reports)1992 -2008UK – 2,780US – 2,200Per PWC80% Global Fortune 250 report75% Europe S&P 35030% US S&P 500But growing 2005 32% of top 100 US cos2008 73%
- Harvard – 11 yr study found socially responsible companies had 4x sales growth and 8x employment growth than shareholder first companiesDJSI – 2010 DJI – 11%, DJSI North America 40 – 14.58%Total Of 18 indexes, 15 outperformed the DJI (3 Europe funds were exception)Domini 400 outperformed S&P 500 since inception in 1990
- Per Corporate Register1992 – 26 companies2008 – 3,379US still lags (# reports)1992 -2008UK – 2,780US – 2,200Per PWC80% Global Fortune 250 report75% Europe S&P 35030% US S&P 500But growing 2005 32% of top 100 US cos2008 73%
- Internal, external, 10Q, 10K, regulatory agencies, balanced scorecard
- Separate report – Vodafone 2007 report = 378 pgsCombined – Southwest Airline One ReportStatement – Monsanto 1 pageOnline - Nike
- Sometimes results are this year onlySometimes limited to good news only
- Connected Reporting – Prince Charles Accounting for Sustainability Project
- Social Responsibility of Businessmen – Howard Bowen
- 15 of 51 stock exchanges in World Federation of Exchanges have Environ or Sust IndexesSocially responsible investing grown 2005 – 2010 to $3.07 trillion - 34% growth (overall investments only 3%) no
- 1997 France co’s with 300+ employees report on 134 labor & emp indicators2004 Germany non-financial factors materially impacting business2004 Japan2006 UK all listed companies2007 Malaysia all listed companies2009 Sweden All state owned co’s201 US – SEC interpretive guidance disclosure of risk factors – should consider and disclose material impact of laws and regs on climate change including int’l accords and environmental impacts (Pepsi India - Kerala plant ordered by state to cut water use by 2/3)
- Inclusivity - people should have a say in the decisions that impact on themMateriality - decision makers should identify and be clear about the issues that matterResponsiveness - organisations should be transparent about their actions
- CERES – Coalition of Environmentally Responsible Economics
- Strategy:Why? What’s the purpose? How does it benefit your organization, how does it help you meet your mission?Who? Who’s your audience? Communicate in most appropriate mannerSet objectives and goals – tie to mission, benefit organizationMetrics – can’t manage what you don’t measure, get baseline readingsBenchmark against similar orgsStakeholders shareholders suppliers customers employeesReport – how - print or online, with annual report or separateWhen – annual or bi-annual
- Wash-Rinse-Repeat
- Per Corporate Register1992 – 26 companies2008 – 3,379US still lags (# reports)1992 -2008UK – 2,780US – 2,200Per PWC80% Global Fortune 250 report75% Europe S&P 35030% US S&P 500But growing 2005 32% of top 100 US cos2008 73%