It's a conundrum every company faces when thinking about sustainability reporting - who reads this stuff anyway and do these reports actually assure anyone of anything? Sustainability reporting methodologies have grown up, for better or for worse, to ape financial reporting, replete with their own standards of assurance audit and verification.
But is there not a better way? Financial reporting methodologies are at least anchored down in regulation, they have to be completed to a certain standard or you go to jail. But if the core of sustainability management is based on voluntary action and collaborative governance then the Achilles heel is in assuring the relevant stakeholder base that the actions you take are material, legitimate, worthwhile and appropriate and not ‘greenwash'.
PR titan Edelman too has recently been exercised on similar concerns. They teamed up Boston College Centre for Corporate Citizenship, Net Impact, World Business Council for Sustainable Development to, funnily enough, reach the conclusion that better corporate communications practices are just the ticket.
But the Edelman folks seem a bit fuzzy on the role of the established quality process for reporting. In describing best practice, Edelman rattles off the Global Reporting Initiative (GRI), SA8000, ISO14000 and AA1000 and suggests that these are all somehow basically interchangeable or equivalent and that:
..a single standard used by all reporting companies does not exist. In fact, a number of different standards have been created to guide the development and evaluation of social reports. Most companies use one of the following four standards.
But each of these standards are fit for purpose in their own right and of this bunch only the GRI can be recognised as the de facto standard for sustainability reporting. SA8000 is basically a quality assurance standard for ethical sourcing, ISO14000 is a quality standard for environmental management whilst AA1000 is actually a sustainability reporting assurance standard which is something quite different from a reporting standard. In fact the GRI standard specifies the necessity for an assurance process to test the veracity of the report produced to GRI standards.
But there is some mileage in the Edelman study all the same and they rightly identify the growing dynamic of employees as key corporate sustainability influencers. Net Impact surveyed their member base of mostly graduate students and found the number one factor for employer selection was a 'belief that your job will make a positive difference in society'. Incidentally, the Net Impact model of activism is an interesting one - they organize individuals into chapters inside your company whose mission it is to pressure internally for greater take up on sustainability. It's all terribly viral and disruptive. But it is very innovative and it may well represent a taste of things to come as the millennial generation reaches critical mass in the workforce.
I think Edelman missed an opportunity to major, rather than tantalize on the potential for technology to reshape stakeholder engagement and sustainability reporting as we currently know it.
Many companies are moving outside traditional reporting structures and channels to engage stakeholders in a more effective, bi-lateral manner. This can be through direct stakeholder contact, new web-based CR reporting efforts, or other means that improve responsiveness to stakeholder issues and recommendations.
Also in the recommendations section:
Use web-based reporting and other dynamic communications tools
And here we come circle to the core process of quality reporting and assurance. Simply put, a sustainability report and all the voluntary action in the world is of little value if it does not assure the stakeholder base. The basic assurance standards are based upon principles such as inclusiveness and responsiveness, and these are clear attributes of web 2.0. The application of web 2.0 is clear, not to mention the benefits of more accurate risk identification, moderation and dynamic feedback loops. Alas, we must wait perhaps for the next Edelman report to tackle this.