Monday, 26 December 2011

The Top Ten CSR Reports of 2011

How can I not write this post? Any respectable blogger has to write a post about the best of 2011. It's part of our license to operate. It's about professional integrity. It's in our job description. Even though I did cover 2011 in Retrospect in a post for CSRwire, CSR Reporting is in a class all of its own. The Top Ten CSR Reports of 2010 got quite a lot of hits - in fact it was the fourth most popular post of all time on this blog.

During 2011, I have written about hundreds of CSR Reports (and not written about thousands more). I have formally reviewed reports on CorporateRegister.com, Ethical Corporation and Sustainable Business Forum. Here's the list of all my reviews - it's almost up to date :).

What makes a report an outstanding report, for me?

 I look for three things. I call it the AIM Reporting Model (hah, just invented that, sounds considered, right?)  AIM for Authenticity, Impacts and Materiality.

Authenticity: I look for whether the company has reported in an honest way, using stakeholder voices to supplement performance data. Authenticity for me includes balance, accuracy and completeness. I look for targets and progress against stated targets.
Materiality: I look for whether the company has clearly defined the most important issues for the company and its stakeholders and defined the way in which those issues have been identified and prioritized. Reporting materiality should also include a certain amount of contextual information which can assist us in understanding the issues and why they are material.
Impacts: I look for whether the company identified impacts rather than just presenting a shopping list of activities. This means discussing the outcomes of what was achieved. The outcomes are the achevement, not the activities. This is by far the most difficult thing for companies to address and very few, if any, do it well.

So, with AIM in mind, here are the reports that stand out for me in 2011, in no particular order:

WPP reports get better and better. This one is the best yet, I think. A wonderful online presentation, creative, clear, easy-to-read, covers all bases and provides good data. It has one of the most Authentic CEO Introductions that I have read for a while ("Sustainability is a slow motion crisis. More pressing issues intervene"). Materiality is represented under the heading "How we manage risk and opportunity", in a nice table which reports how WPP are addressing each issue. This is one of the few reports that actually mention Impacts head-on - there is a section called Impact of our Work. This section showcases WPP's client projects, some of which are quite fascinating. Authenticity is the aspect of this report which I might consider as an opportunity for additional work in coming years. There is very little in this report except good news (except, perhaps for the Employee Infringements section). No stakeholder voices provide additional credibility and the report is not assured. Overall, however, a great fun-serious report.

BT 2011 Sustainability Report
BT's printed report is compact but packed (the website offers more case studies). It covers a broad spectrum of BT's Impacts on society and environment and the thing I especially like about BT's reporting is the way they match "non-financial" performance indicators to financial performance indicators. Lost time injuries, for example is recorded as Injury Rate and also as a financial cost to the business in terms of the cost of time lost through injury. The number of days lost to sickness are also converted to BT sick pay costs. Waste management and recycling performance is translated into the financial net waste savings. Overall sustainability performance is also converted into the number of customer bids that BT won that contain a sustainability component (GBP 2.1bn in 2010). (BT has still not been able to develop an "appropriate financial measure" for the value of good diversity performance - this is something I find a little strange, as I have mentioned before). Nevertheless, the report includes examples of practice and in most cases, some form of result or outcome, for example. BT has conducted carbon impact assessments at customers showing how BT helps them reduce energy consumption and carbon emissions. While BT could go further in assessing and reporting Impacts in other areas, this is in the right direction.  A Materiality Assessment is provided and is nicely specific to BT's current business issues, including as a most material issue, for example, support for the London Olympic and Paraolympic Games. Internal and external stakeholder voices are present in this report. All in all, it passes my AIM test reasonably well.

Kuoni Travel Holding Corporate Responsibility Report 2010
I picked up this report when researching my post on 25 examples of creativity in Sustainability Reports, and it stayed in my mind, primarily because of its spectacular design. It's a great read, as well, includes a Materiality assessment, and some assessment of impacts is included in external stakeholder commentaries. A thoughtful, interesting and attractive report.

Ford's approach to Materiality is world-class and disclosures are comprehensive. Although a little light in the Impact area, this is an Authentic Report which covers complex issues such as business restructuring,  health care provisions, vehicle safety, and lifecycle sustainability design.  

Hauska and Partners is a privately owned Corporate Relations consulting business employing 37 people. The company is developing impressively on its sustainability journey, and this year reports at GRI B+ level, moving up from the C level report of last year. This is Hauska's third report and its's well presented online. While there is no materiality matrix, there is a list of key issues which broadly serves the same purpose. It's an Authentically written report (for example, 81% of employees received performance evaluations and this, says Hauska, was one of the areas the company was "least satisfied with".) It's a short, compact, report but makes a positive impression, though here again, Impacts are under-presenced. It would be nice to see this company reporting in the future on the kind of impacts it makes through its consulting work. In the meantime, kudos to a private, small business that advancing responsible business practices.

This report just made in time, having been published just last month. However, Avon makes its mark well as a company that does big things that make a big difference. With a very clear focus on three core pillars - empowering women, (environmental) sustainability and philanthropy - Avon shows how consistent actions deliver results. Personal stories of Avon Representatives do give a glimpse into the transformation that the Avon framework can achieve for women, while Avon's deforestation campaign shows the measure of Impact Avon is generating. Avon's Materiality issues are listed. While Avon is on the right track with this GRI B level report, I would like to see more focus on Impacts in the future - both from the standpoint of economic empowerment of Avon Reps and actual results of Avon's social and environmental campaigns, but also from the perspective of the products that Avon sells and the women who buy them. I believe a fascinating discussion could be developed about the way that Avon is making an Impact in the beauty market and how the unique selling proposition that Avon has perfected make a difference in the lives of Avon's customers.  

Delhaize Corporate Responsibility Review 2010
I reviewed this report in the context of Materiality during 2011, and it stuck in my mind as a well prepared, well-presented and interesting report to read, even for the lay reader. It covers Materiality well, includes internal and external stakeholder voices, good reporting on progress against targets and a nice mix of case studies. Impacts of a retail supermarket on healthy eating habits or other behaviors of consumers are covered in this report, which means that I can find some level of Authenticity, Materiality and Impacts, though, of course, there is still room for more.

Vestas Sustainability Report 2010
I used this report as an example of good reporting against waste management performance indicators. However, beyond this, it's an authentically written report which presents the case and impacts of wind power in a coherent and insightful manner. The report lacks a Materiality Analysis - something the company should consider in future years to demonstrate its responsiveness to stakeholders as well as focusing on the four priorities which Vestas has defined for itself - Cost of Energy, Safety and Citizenship, Partnership and Business Case Certainty. Case studies illustrate Vestas approach in an appropriate way and targets are clearly stated. Not AIM, but getting there.

Intel 2010 Corporate Responsibility Report
Intel's reporting is professional, direct, intelligent and pretty intense. The complexities of reporting for such a large global corporation are tremendous and I think Intel pulls it together pretty well. Intel reports on economic impacts, which is a bit of a number crunching exercise, but an interesting way of looking at how a company contributes to economic development beyond the direct sales of its products. Intel also includes a detailed water footprint analysis, and also describes a range of ways in which technology is used to solve environmental challenges. Intel's handling of the $1.45bn fine imposed for anti-competitive activities in Europe is directly hit on the head in the report, but it's there and one can sense Intel's indignation. Intel discloses its Materiality Matrix and includes some stakeholder voices, supplemented by videos which can be accessed from the interactive PDF. One difficult balance to achieve is to what extent annual sustainability reporting continues to trot out the same texts which relate to policies and management approaches which largely remain the same year after year. Intel could do a better job at identifying what I call the Delta, the things that have specifically changed from one year to the next, while cutting back on some of the policy statements which could be hosted for reference on the Intel website. While some Authenticity is lost because of the factual and punchy style of this report, comprehensive reporting, consistency and clarity make up for this. A reasonably AIM report.

Federacion Nacional de Cafeteros de Colombia Sustainability Report 1927-2010
Yes, you did read the dates correctly. This report covers 83 years, and all in only 175 pages. I reviewed this report earlier this year and even included a little coffee quiz, so now's your chance to go back and see if you do any better at a second attempt. It's hard to review this sort of report in the same light as single company reports, as the focus of an industry association is somewhat different, as I have also blogged about. However, the impact of industry associations can be very important, especially as sustainability is trending towards sectoriality, so this is as important a report as it is an interesting one. There's a good chunk of PR content in there, so Authenticity is a little diluted, but Materiality is addressed and key issues listed. Impacts are described both at the level of how member coffee growers have been supported by the Federacion's work and also at the level of advancing the sustainability of Colombian coffee. I like this report - I just hope we don't have to wait another 83 years for the next one!

De Beers Sustainability Report 2010
I reviewed this report as part of my "Reporting: How they do it" series on Sustainable Business Forum, and the report lodged with me as a clear, clean and progressive disclosure. This is a part of what I wrote: "The De Beers report is a delight to read, it is intelligently structured, well-cut, polished and completely aligned with the report's title "Living up to Diamonds". Reading the statements by the Chairman and Joint Acting CEO's is rewarding – both are focused, factual, forward-looking and frame the report content in a relevant way - a far cry from most of the platitude-ridden clichéd report-speak that features in most opening messages from company leaders." Impacts on diamond-delivering communities are also addressed to a certain extent. This report broadly meets my AIM threshold and is an impressive piece of work.

******

Of course, it is most difficult to select 10 reports out of the hundreds I read each year and the thousands that are available. There are several strong reports which I haven't mentioned here, which would appear in my Top 20, 50 or even Top 100 list. But all good things are better in small doses (except ice cream), so I have contented myself with ten reports this time around. Apologies to all those other fabulous reports that I have loved reading, learning from, reviewing, talking and writing about this year.

Note: Just to be fair, I didn't include four Sustainability Reports I worked on this year, even through all of those are my favorites too....Ellbit Systems Report, Baran Group's Report, Novus International Report and of course, my own Beyond Business Report.


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

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