Sustainability Reporting 101 - Part 3: Five Key Elements of a Good Sustainability Report
Not all corporate sustainability reports (CSRs) are created equal. Some reports areglossy marketing brochures that lack substantive data. Others are so data focused that reading them requires a strong cup of coffee to resist boredom-induced sleep. The best reports provide a balance of accessible, engaging text and comprehensive, material data presented in a well-designed format. It is both art and science.
But what are the elements that go into making a good report? Which reports should you look to for inspiration? A good place to start is the list of finalists for the Ceres-ACCA North American Sustainability Reporting Awards. For years, these awards have been the highest accolade for U.S. sustainability reports. According to their press release, “The awards are not intended to endorse or reward corporate sustainable performance, but rather to acknowledge exemplary disclosure that places performance in the broader context of sustainability challenges, risks, and opportunities.” The last awards came out in 2011 (recognizing 2010 reports).
Referencing the most recent reports from companies on that list as examples, here are five elements we believe are vital to producing a quality report:
Aside from collecting and compiling the data, which is no small challenge, transparency requires putting new company information into the public domain. There is organizational inertia and a fear that additional data could reflect poorly on the organization, or even on individuals. The other fear is that the information could in some way benefit the competition. As a result, many reporters take a shortcut by including superficial data rather than truly transparent information. True transparency requires context and parameters. For example, if a company reports a 20% reduction in water usage, readers shouldn’t have to ask; “20% of what baseline? Over what time period?”
The UPS Corporate Sustainability Report demonstrates a solid commitment to transparency. The data is detailed and well defined in the body of the report, but extensive backup is also included in the appendices. All this is evidence of a meticulous dedication to full disclosure of the data scope and boundary. In addition, UPS’s report is examined in detail and assured by an external assessor. [Note: To be completely transparent here, Emotive Brand worked on the UPS report and I managed this report within UPS.]
We all know that no one is perfect. And no company is perfect either. But most companies have been so conditioned to portray themselves as perfect in the marketplace, that admitting to flaws and challenges is tremendously difficult. A sustainability report is not the place to portray perfection. That does adisservice to stakeholders – because it simply isn’t believable. Good reports acknowledge challenges and failures, provide context and communicate next steps.
The Seventh Generation Sustainability Report clearly shows the company’s dedication to authenticity. Seventh Generation lists not just highlights, but also challenges up-front and on the same page. Additionally, the report does not shy away from discussing the very public ouster of Founding-CEO Jeffrey Hollender. Rather than gloss over this open wound in passing, the report dedicates a full page to the difficulties surrounding the leadership changes, the impact on the company, and the way the company continues to address those challenges.
Good CSRs provide evidence that the transparent and authentic information included is also a true reflection of stakeholder interests. Many reports handle this GRI requirement by describing channels and perhaps volume of communication with various stakeholder groups. True stakeholder engagement, however, is apparent when there is evidence of an authentic two-way exchange resulting in some degree of change in the company. This proves that the company is really listening andincorporating stakeholder feedback into their business.
The Baxter Sustainability Report does an excellent job of detailing the company’s stakeholder engagement. This report features a dedicated web page that explains the channels and frequencies of the company’s communication with employees, patients, healthcare professionals, shareholders, and communities. The report includes narrative, a detailed graphic, and a well-organized chart that effectively explains the channels of engagement with each stakeholder group. It also outlines specific ways that the company responded to each of the concerns raised.
Sustainability reports have a wide array of audiences – each with very different expectations. If your audience can’t find the information they need, any hard work put into the other elements will go unnoticed. It is important to develop a good structure for content and navigation whether reporting in a printed piece, a PDF, a website or a mobile app. Good structure and design will organize the complex range of information into a structure simple enough that all readers will be able to navigate intuitively.
The GE Sustainable Growth Report is particularly successful at creating a structure that leads readers through the company’s sustainability story. The content is divided into three easy-to-understand sections: People, Planet, and Economy. Then each of those sections has three layers of information from the high-level, at-a-glance “Highlights,” to the narrative details in “Progress,” to the detailed data in “Metrics.” This enables readers to easily find the information that interests them. The structure is always visible in the navigation, providing readers the signposts that allow them to feel comfortable exploring the report with the confidence of knowing where they are and how to get back to where they started.
Finally, successful reports will do all of the above in a way that is truly meaningful to each audience. At Emotive Brand, we believe that people(i.e. stakeholders) are increasingly skeptical and sophisticated, and that they will support companies that offer them meaning. Sustainability reports present an opportunity for organizations to communicate authentically about issues that matter to people. So, it is important to tie each of the previous elements together in a way that speaks clearly and directly to stakeholder interests, while providing an opportunity for continued dialogue.
The Nike Responsibility Report, which won the last Ceres-ACCA awards, effectively connects each of the first four elements together in a way that is truly meaningful. Through clear writing, straightforward infographics, and engaging photography, the Nike report tells a compelling story of the company’s commitment to sustainability. For example, the CEO letter says, “We’ve made significant progress in these areas. But as we all know at Nike, there is no finish line.” This statement recognizes the need for continued improvement with an image connected to the roots of Nike’s business in sports. That ismeaningful.
Quality sustainability reports will have all five of these characteristics. So, make sure your report has transparency, authenticity, stakeholder engagement, intuitive structure and design, as well as meaning. For more inspiration, check out the Ten Outstanding Sustainability Reports from earlier this year on Triple Pundit.
Rebecca Treacy-Lenda, a Strategist at Emotive Brand, is an award winning communications professional with more than a decade of experience in corporate communications and public relations. Rebecca specializes in sustainability strategy and communications having managed the industry-leading UPS sustainability report for several years.
Rebecca is part of the team at Emotive Brand, an award-winning brand and design consultancy that transforms businesses by making brands matter more to people.
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For more than 15 years, our team has been providing strategy, content development and design services to the Fortune 500 to help evolve their corporate reporting. We have built a strong reputation for our work in Sustainability, Corporate Responsibility and Annual Reporting.
We view corporate responsibility reporting as an equation, not a annual document. Therefore, our approach is to build the strongest available reporting equation, in any given year, as part of a multi-year evolution that benefits the client, its stakeholders, and society. For further reading of our approach, please see An Equation for Sustainability Reporting.
Our ability to understand the complexities and nuances of global corporations, coupled with a deep understanding of corporate reporting, has given Emotive Brand a keen ability to recognize the right stories to tell, to the right audience, at the right time and in the right way.