Study Shows Increased Transparency In Corporate Responsibility Reporting
Consumers are demanding more accountability and transparency from companies in the area of social and environmental responsibility. According to new research, companies are starting to take note, but there is room for improvement. CorporateRegister.com, a global directory of corporate social responsibility resources, conducted an analysis of the 335 companies in the Global FT500 which issued a corporate social responsibility report in 20071. The research assesses what these companies are communicating about corporate responsibility and, in particular, about climate change. 44% of those who issued a report included an external, third-party assurance of the statements and data included in their CSR reports. Only 7%, however, offered specific independent assurance of their disclosures on climate change.
“We are seeing it more and more everyday, companies want to communicate to their stakeholders what they are doing to increase their environmental and social responsibility. The question on everyone’s mind, is ‘how can I trust you?’” commented Rebecca Bowens, Global CSR Product Manager, SGS. “Independent third-party assurance is an important way to address concerns regarding company statements and information on topics of corporate social responsibility. Furthermore, adherence to international guidelines such as the AA1000 Assurance Standard and the Global Reporting Initiative framework, show a company’s commitment to providing credible and accurate information,” she continued.
Assurance within the Global FT500 companies is more widespread than within the general run of reporting companies. Of the 2,500 companies within the database which issued a CSR report in 2007, only 27% included an independent third-party assurance statement compared to 44% within the Global FT500.
“Our study shows nearly half (44%) of the world’s leading reporters recognise the value of assuring their CSR disclosures. This sets them apart in terms of reporting quality and credibility. Worldwide only a quarter (27%) of all CSR reporting companies take this extra step – they’ll have to raise their game.” said Paul Scott, Managing Director, CorporateRegister.com.
Independent assurance and verification offer an ongoing management tool to customers who need to measure themselves against non-financial performance indicators, which in the end may be just as significant as typical financial metrics. When considering the issue of climate change, measuring and monitoring one’s carbon emissions can be valuable and important information, beyond simple inclusion in a company’s CSR report.
According to Robert Dornau, Director of Climate Change Programme, SGS, “Boardroom decisions in many companies already take greenhouse gas (GHG) emissions data into account. This can be irrespective of any mandatory requirements to measure or reduce emissions. There are strategic and competitive drivers to voluntarily report and reduce GHG emissions, including: protection of early action to reduce emissions for companies that face mandatory regulation in the future; expected market advantages through the provision of emission neutral product and service offerings; and pressure from governments and customers who want to know the emissions embedded in the products and the supply chain of the products they source. Independent verification of any GHG reduction is necessary to retain credibility when talking to regulators, customers and consumers.”
SGS offers a wide variety of services in the area of general and specific report assurance that ensure the transparency and credibility of social and environmental reports. In addition, SGS is a leader in offering services designed to protect the environmental and financial integrity of emission trading schemes, including the validation and verification Clean Development Mechanism (CDM) Projects and Joint Implementation (JI) Projects under the Kyoto Protocol; verification of GHG emissions from legal entities participating in the European Union’s Emission Trading Scheme, the United Kingdom Emission Trading Scheme, the California Climate Action Registry and others.
Corporate Responsibility Reporting Summit & Awards Ceremony
SGS is a sponsor of the CR Reporting Awards, organised by CorporateRegister.com, which will be held in conjunction with the 2007 Global Corporate Responsibility Reporting Summit held in Berlin on the 3rd and 4th of March. SGS is sponsoring the award for best overall report; the ceremony will be held on the evening of the 3rd of March. To learn more, visit www.corporateregister.com/crra
1The 2007 Corporate Climate Communications Study is available online at www.corporateregister.com
SGS is the world’s leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 50'000 employees, SGS operates a network of over 1’000 offices and laboratories around the world. SGS is the Lead Sponsor for CorporateRegister.com’s Corporate Climate Communications Report 2007, as well as being a category sponsor for their CR Reporting Awards 2007. To learn more, visit www.sgs.com
CorporateRegister.com Ltd, authors of the Corporate Climate Communications Report 2007, provides online CSR resources, and hosts the world’s most comprehensive directory of non-financial reports. Its directories are free for use by the global CSR (corporate social responsibility) community – over 20,000 users subscribe to its services.
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