Post on 20-Dec-2015
How Business Measures How Business Measures Sustainability:Sustainability:
One Company’s Perspective One Company’s Perspective
How Business Measures How Business Measures Sustainability:Sustainability:
One Company’s Perspective One Company’s Perspective
Sandra Odendahl
Director, Corporate Environmental Affairs
Royal Bank of Canada
CSIN Conference
March 2010
OverviewOverview
I. About RBC
II. Why Measure?
III. Who Cares?
IV. Setting Priorities
V. Measuring Success
VI. How to Report
VII.What next?
I. About RBCI. About RBC
• Assets ~ $655 billion; Market capitalization ~ $77.6 billion.
• Approximately 80,000 employees in 50 countries
• Major operations in Canada, US, UK and the Caribbean
• Over 1700 branches and more than 4,800 ABMs globally
• Business areas:
– RBC Canadian Banking (~44% of revenue)
– RBC Capital Markets
– RBC Wealth Management
– RBC US and International Banking
– RBC Insurance
Largest Canadian bank, 5th largest bank in North America13th Largest Bank in the World
II. Why Measure?- Financial measurement and reporting
II. Why Measure?- Financial measurement and reporting
Financial performance measurement and reporting well-established
• Objective:
– “…to provide information about the financial position, performance and changes in financial position of an entity that is useful to a wide range of users in making economic decisions.”
• Users of financial statements:
– present and potential investors, employees, lenders, suppliers and other trade creditors, customers, governments and their agencies and the general public.
• What users want:
– All user groups interested in the ability of an entity to generate cash and of the timing and certainty of those future cash flows.
From the IASB's Framework for the Preparation and Presentation of Financial Statements
II. Why Measure?- Sustainability measurement and reporting
II. Why Measure?- Sustainability measurement and reporting
Sustainability performance measurement and reporting less well-established
• Objectives:
– management, increased comparability and reduced costs of sustainability, brand and reputation enhancement, differentiation in the marketplace, protection from brand erosion resulting from the actions of suppliers or competitors, networking and communications, benchmarking tool, corporate governance tool and an avenue for long term dialogue with reporting organizations*
• Users of sustainability reports:
– Subset of present and potential investors, employees, lenders, customers, governments and their agencies and the general public.
• What users want:
– They all want something different!
* From the Global Reporting Initiative
II. Why measure?Why RBC measures & reportsII. Why measure?Why RBC measures & reports
• To inform stakeholders of progress
• To inform socially responsible investors
• To track progress toward goals
• To benchmark against other organisations
• To demonstrate commitment
• Federal requirement that all financial institutions produce an annual PAS
Formal CR Report since 2003
III. Who Cares? Indicators our stakeholders care about
III. Who Cares? Indicators our stakeholders care about
StakeholderIndicators of Interest
Economic Environmental Social Governance
Clients
Employees
Regulators
Shareholders
NGOs
Significant interest
Some interest
Little interest
8
IV. Setting PrioritiesOur Corporate Responsibility Vision
IV. Setting PrioritiesOur Corporate Responsibility Vision
Indicators Depend on Priorities
IV. Setting PrioritiesIntegrity: Governance and EthicsIV. Setting PrioritiesIntegrity: Governance and Ethics
Priorities
• Demonstrate sound corporate governance principles
• Provide clear disclosure of financial results, and disclose reliable performance data on key non-financial items
• Comply with all applicable laws and regulations in every country in which we operate
• Conduct business with honesty and integrity
In Financial Reports & Websites
Priorities• Provide strong return to
shareholders• Pay fair share of taxes• Create employment• Support small business
and economic development• Foster innovation and
entrepreneurship• Purchase goods and
services
IV. Setting Priorities
Economic Impact IV. Setting Priorities
Economic Impact
In Financial, CR Reports & Websites
Priorities• Maintain progressive
workplace programs and practices
• Respect diversity and promote inclusion
• Provide competitive compensation and total rewards, and enable growth through training and development opportunities
• Foster a culture of employee engagement
IV. Setting PrioritiesWorkplaceIV. Setting PrioritiesWorkplace
In CR Reports and Website
Priorities
• Provide donations with a lasting social impact
• Sponsor key community initiatives
• Enable employees to contribute
IV. Setting PrioritiesCommunitiesIV. Setting PrioritiesCommunities
In CR Reports and Website
IV. Setting PrioritiesEnvironment IV. Setting PrioritiesEnvironment
The RBC Environmental Blueprint sets priorities on environmental management
Priority Issues
Priority Activities
• Reduce our environmental footprint • Risk Management & Responsible Lending• Environmental products and services• Engage with Communities
Climate Change Forests/Biodiversity Water
V. Measuring Environmental Success V. Measuring Environmental Success
• Meaningful indicators
– Snapshot - Summary indicators
– Progress Report – Qualitative
– Data
• High standards for data quality
• Broad data coverage
• Targets
• Benchmarking
V. Measuring Environmental SuccessMeaningful Indicators - Summaries V. Measuring Environmental SuccessMeaningful Indicators - Summaries
IndicatorIndicator 20092009 20082008 20072007
Office paper use (kilograms/FTE)
CO2e emissions from energy use (t/m2)
CO2e emissions from employee travel (t/FTE)
Transactions assessed under Equator Principles
Vital Statistics
The Snapshot
V. Measuring Environmental SuccessMeaningful Indicators - Progress V. Measuring Environmental SuccessMeaningful Indicators - Progress
2009 Commitment2009 Commitment StatusStatus 2009 Progress2009 Progress
1 Launch and promote Employee Environmental Stewardship Guidelines
Launched on Earth Day 2009 to all of our employees globally
4 Purchase green power for 20 new branches in Alberta and Ontario
Purchased clean, renewable green power for 27 new branches
Conduct training in environmental risk mgmt across business units
Renewable energy workshop
Training in Atlantic
9 Research and report on water-related risks and opportunities
Conducted research on agencies responsible for water protection in Alberta
Blueprint Report Card
The Progress Report
V. Measuring Environmental SuccessMeaningful Indicators - Data V. Measuring Environmental SuccessMeaningful Indicators - Data
Operational FootprintEnergy • Fuel (MWh)
• Purchased electricity (MWh)• Green power purchased (MWh)
Canada, US and Britain1700 branches and 100 offices
Paper • Office Paper (tonnes)• Marketing and Direct mail• Paper Use per FTE• % sustainably sourced
Canada and USA
Travel • Air, rail, auto (km)• Travel per FTE
Canada, US, Britain, Partial Caribbean
GHG emissions
• Fuel• Purchased Electricity• Employee travel
Canada, US and Britain
The Details (for Data Junkies)
V. Measuring Environmental SuccessMeaningful Indicators - Data V. Measuring Environmental SuccessMeaningful Indicators - Data
E-statement conversions (millions)
Related paper savings (tonnes)
CO2 trading volumes (Mt)
Assets under management for SRI funds
Lending to clean energy ($ millions)
Responsible Lending
Transactions requiring environmental risk review
Transactions screened under equator principles
Portfolio reviews completed
Policies launched or updated
Green Products and Services
V. Measuring Environmental SuccessMeaningful Indicators - DataV. Measuring Environmental SuccessMeaningful Indicators - Data
Community Engagement
Donations to Environmental causes
• Corporate Donations• Blue Water project• Employee Donations
Website hits • RBCnet and RBC.com/envrionment
Formal Stakeholder meetings • Groups consulted and subject
Brand / Image • Ipsos ASI - RBC Brand Monitor• Employee satisfaction survey• Angus Reid CSRI
Competitor benchmarking • Shareholder resolutions• Scores on DJSI• Scores on CDP
VI. How to ReportVI. How to Report
• RBC.com/environment
• RBC.com/responsibility
– Customised PDF generator
• Annual CR Report and PAS
– Online only
• CR Review
– Brief printed brochure
– For consumers, general public and employees
• Ad hoc “sustainability surveys”
– We avoid them, and direct people to our website
• Quarterly reports to shareholders, Annual Report and Management Proxy Circular
Websites, print documents, surveys, financial reports
VII. What next?VII. What next?
• Shift away from hardcopy reporting to electronic disclosure
– RBC CR Report (full) only available online
– RBC report generator for customized reporting
• Manage increased volume of client, staff and public inquiries on sensitive environmental and social topics
• Establish criteria to screen surveys and requests for more detailed information
• More rigorous assessment of which sustainability indicators are financially material
– Hint: not that many
It Takes a Lot of Reporting to be Considered a Sustainability LeaderIt Takes a Lot of Reporting to be Considered a Sustainability Leader