Companies are facing increasing pressure to share information with the public about their internal processes, where (and how) they source their materials, and the impact on the environment. Frequently accompanying this pressure is the underlying fear that the more information a company shares, the more likely they are to come under scrutiny from the public. However, the long-term benefits of being perceived as a transparent, socially-responsible organization can quickly surpass any initial pains associated with greater public focus.
A large number of organizations are now providing sustainability rankings such as the Dow Jones Sustainability Index or Bloomberg analyses. These rankings are created based on public information (or lack thereof) available. By releasing a Corporate Social Responsibility (CSR), Global Reporting Initiative (GRI), or CDP report, companies not only provide stakeholder’s insight into the company, but also directly impact the information collected and communicated as part of the independent rankings. A company’s integrity when communicating the current state of operations, exhibits a commitment to continuous improvement and holds the company accountable for annual progress. Consumers do not expect a company to be perfect, but they appreciate the transparency that comes with voluntarily sharing information.
Embarking upon the initiative to complete and issue a sustainability report can be an overwhelming plan to start. As with any new initiative the first year of reporting is often a discovery year. Quite frequently, the information requested for reporting purposes, from water consumption to human rights, is not always available on hand. This may require additional time and effort upfront to define the items that are material to the business and collect the relevant data points necessary to report on the material items. Once the information has been collected, a benchmark can be created for the current state operations. The benchmarking effort is completed through the definition of key performance indicators (KPIs) that allow the company to track progress against the original operations baseline.
The initial assessment and drafting of the report helps a company truly understand the environmental impact of the business and identify any critical risk areas that need to be addressed. Tracking baseline data and KPIs provides leadership with the data points needed to drive decision-making. This is most important when analyzing the portfolio of future state projects as this data can be used to identify which project(s) will provide the greatest improvements to the business, while minimizing the environmental footprint. The end result is a positive impact to the company’s standings in a given ranking. A year-over-year improvement shows the company’s commitment to sustainability principles and sets the company up for long-term growth and success that is not only understood by the employees, but stakeholders, consumers, and evaluators, as well.