Rolling off more presses: reports on 'social responsibility'
The 2,000 such reports are efforts to provide more disclosure – and to communicate with important stakeholders.
They come every year – a flood of sometimes glossy reports from companies eager to tell you what they're doing right. They'll tout a new environmental program or community donations. But do these corporate social-responsibility reports reveal challenges and failures, too? Do they tell the whole truth? To find out, the Monitor's Laurent Belsie sat down with two experts who help companies put out these reports. Andrew Brengle is a senior analyst with KLD Research & Analytics, a social research firm in Boston. Jeff Erikson is US director of SustainAbility Inc., a consulting firm and think tank with offices in Washington. Here are edited excerpts of their conversation:
Andrew Brengle: Estimates say about 2,000. It was only in the hundreds a year or two ago.
Brengle: I would say a small fraction – 15 to 20 percent would be very thorough and complete. Of course, it depends what you're looking for.
Jeff Erikson: In short, it makes good business sense for them to do it. More and more companies are understanding that it's not only about disclosure, it's about communicating with important stakeholders. Stakeholders include their employees as well as the folks that are buying their stock, buying their products, [and] supplying their products.
Brengle: It's a great introduction for trying to describe their view of environmental stewardship. But yes, the proof in the pudding will come in what kind of data they have to back up those assertions.
Brengle: It lends credibility. The company is attempting to offer specific numbers that you can hold them to.
Erikson: One thing that struck me about ... the contrast between the two companies is that the latter, Dow, indicated very specifically how it will be managed and how it will measure success, which the first report did not. And that's important. The other piece that's quite important for readers of the report to understand is: How important is the issue to the company? Now, the piece that's missing from Dow is: Is this a driver of value for the company?
Erikson: There's a movement toward more complete transparency – companies telling the whole story. And it's often quite clear in the introduction to the report, most often a letter written by the CEO or a senior executive. A couple of years ago, in a report by Gap Inc., in their CEO letter, they said: We've got some big-time problems in our supply chain, and we don't even know how big they are. That kind of statement, that kind of honesty, lends so much credibility.
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