Taking Shape – the future of Corporate Responsibility communications
The paper “Taking Shape – the future of Corporate Responsibility Communications” was launched at the Ethical Corporation/Business in the Community conference in May 2007.
It builds on a seminar “Ethics Profit and Materiality” run in London in November 2006.
The report is freely available on Business in the Community’s and Radley Yeldar’s websites and is offered as both a resource and source of stimulus for those engaged in reporting their company’s performance on its corporate responsibilities. We make a number of predictions for likely change and will be playing back the response to these later in 2007.
Project origins
In November of last year, Business in the Comumunity and Radley Yeldar got together to put on a “where’s it all heading” seminar on CR reporting. We had both been present at the GRI launch of its 3rd generation guidelines in Amsterdam. In our different capacities, we both worked with CR practitioners closely watching the developments around the Companies Act and the GRI.
We agreed that the time was right to provide an informative briefing for our business members and clients. We invited two leading CR practitioners to give their perspective on these developments and an investment analyst from the socially responsible investment market.
The CR practitioners were Chris Tuppen from BT and Rowland Hill from Marks and Spencer. BT has been closely associated with the GRI development and took as their presentation focus their materiality process. Marks and Spencer had launched their “Look behind the Label” campaign firmly making a marketing case out of their sustainability track record and commitments
Jennifer Walmsley from Hermes set out what she and her team looked for in companies’ accounts of responsible business practice and challenged the business community to set the agenda themselves and tackle the issues within the business itself.
What struck us from the questions at the seminar (see insert box) was the range of perspectives on CR reporting – from time wasting, to necessary evil, to part of the process of embedding CR.. In November when we ran the seminar, the Companies Act was freshly minted but familiarity was low. Not surprising given acrimonious reception of late clauses adding key contractual relationships into the section on contents of directors reports (section 417) and the cynicism hanging over from withdrawal of the mandatory OFR a year earlier. Many companies had adopted a “ we’ll wait till the dust has settled approach” to information about changes to their legal responsibilities.
The changes introduced through the Companies Act, plus the launch the of the GRI G3, plus the launch of the UN PRI in the same year seemed to us to draw a line in the shifting sands around CR reporting . We felt there was gathering consensus around the things that really mattered : that companies addressed the issues material to their business, engaged in stakeholder dialogue about the impacts of their business and looked to present value through a broader lens than simply the financial measures used traditionally.
We thought that the emphasis on materiality in the new GRI guidelines shifted the debate beyond standardisation as a goal towards insight and connection with business strategy. We saw the UN PRI as a significant driver for intelligent disclosure on ESG matters and the Companies Act as a given now for all UK businesses to discuss factors affecting the business.
We drew together excerpts from these three initiatives so that the paper would serve as a reference resource. And based on the discussions at the seminar we took a stab at predicting what might change .
Prediction 1
Boards will increasingly recognise that the CR reporting process is a valuable internal management tool.
Prediction 2
Boards will pay more attention to the accuracy of CR related information.
Prediction 3
Companies will improve internal communication on CR.
Prediction 4
Companies will make better use of existing communication channels to deliver tailored messages to specific stakeholders.
Prediction 5
Boards will increasingly use the Annual Report and Accounts as a tool to demonstrate accountability to important stakeholders not just investors.
Prediction 6
Companies will increasingly report material issues in their Business Review but will keep a separate CR section.
Prediction 7
The role of the CR manager will increasingly be driven by an internal “pull” rather than an external “push”.
Prediction 8
Companies will take a systematic approach to integrating stakeholders’ interests into their decision-making processes.
Prediction 9
Companies that engage in dialogue through partnerships will be better able to identify opportunities for value creation.
Feedback from one company (FTSE 100 financial services) has been to broadly support the paper’s thesis and comment on the change management role of the CR team “Our change management role is to interpret the CR business case and raise awareness internally of changing factors that impact on the business strategy and consequently rebalance the business case for specific activities”
We will test out responses to these predictons over the next few months and report back. To contribute feedback contact us at predictions@bitc.org.uk or predictions@ry.com
