February 21, 2011

Oxygen, the scientific monthly published by Italian utility Enel, dedicated its February edition to corporate social responsibility, a theme inspired by the Sustainability Day organised by Enel in Madrid last week. The publication, in both Italian and English, provides a useful overview of current themes and trends in CSR and sustainability with contributions from some of the field’s leading lights. 

There are interviews with Georg Kell, executive director of the United Nations Global Compact, who talks about how the field of CSR has evolved and where the organisation is heading, and John Elkington, founder of Volans and co-founder of SustainAbility, who discusses issues such as corporate transparency, innovation and social progress. Mervyn King, president of the Global Reporting Initiative among many other roles, writes about integrated reporting. 

In this distinguished company, I was invited to write about the state of CSR communications. I explain how there is a growing dissatisfaction about the effectiveness of the report as a medium for CSR and suggest that companies can better serve the needs of their stakeholders by using the internet to communicate CSR information and engage with stakeholders. As our research at Lundquist has shown, many users make little distinction between the information presented on a company’s site and in its CSR report: what is important for most is to have reliable, pertinent data (thanks for example to third-party assurance) and frequently updated information. 

The switch in focus between reporting and communicating may seem like a simple progression when described in these terms. Indeed, many companies have become well aware of the need to evolve – reporting less and communicating more – and there are some interesting experiments in that direction. But the transition involves a radical change in mindset. 

Websites today are generally static and text-based, lacking dynamic and engaging content. They also tend to be stand-alone spaces, cut off from the rest of the corporate communications agenda (financial performance, careers information, commercial sites, etc.). And, above all, they lack openness. So while many people will continue to judge the success or otherwise of the CSR reporting phenomenon by counting reports, a communications gulf remains between enterprises and their audiences, which is disappointing for those who wish for greater social accountability for corporations. 

To tempt you to dig in to this publication, here are a few snippets from… 

…Georg Kell: “We believe that few companies can currently claim to be top innovators in all areas. Several have a compliance gap in the sense that top management understands the importance of CSR and fights for its implementation but then there are the affiliates around the world who are far behind in the achievement of the targets set by central government.” 

…John Elkington: “In the future, we will not see all companies or all governments become 100% percent transparent (…) A lot depends on which part of the world you are operating in but there are some basic principles of the CSR agenda that should be embraced wherever you are.” 

…Mervyn King: “Integrated reporting is not intended to replace financial reporting or sustainability reporting, but there is no doubt that integrated reporting, where there is a summation of pertinent financial and sustainability information and the company’s long-term strategic direction, is a form of reporting whose time has come, because of the crises of our time.”

Mike Tyrrell 04am February 25 The distinction you make between 'reporting' and 'communicating' is important - and when it comes to the investor community 'communicating' ... View Full Comment Close Full Comment

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