Social and sustainability Reporting
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Transcript of Social and sustainability Reporting
Social and sustainability ReportingCorporate Sustainability Reporting, trends and opportunities for the future
29 May 2012
Corporate Sustainability: an overviewPage 2
Introduction - what is Sustainability Reporting?
► The roots of sustainability from social philanthropy to Corporate Social Responsibility to sustainability.
► Triple bottom line business accountability expands on traditional business reporting to take into account environmental and social performance in addition to financial results.
► It provides stakeholders with insight into the organization’s key non-financial risks and challenges
► It demonstrates how a company’s financial results can be affected by sustainability performance
Corporate Sustainability: an overviewPage 3
Sustainability ReportingGlobal Trends
Global output by year*
Global output by year & region*
*CRRA 2011 **CDP 2011
Research by Ernst & Young shows that more than two-thirds of Fortune Global 500 companies publish some form of sustainability or corporateresponsibility reports, reflecting the broad trend towards greater disclosure
CDP reporting companies**
Corporate Sustainability: an overviewPage 4
Sustainability Reporting- why bother?
Source: “Striking the Balance” - WBCSD
Regulatory compliance
Creating financial
valueAttracting favorable financing
Employee motivation, attracting
talent
Improving management
systems
Risk awareness
Encouraging innovation
Continuous improvement
Enhancing reputation
Transparencyto
stakeholders
Corporate Sustainability: an overviewPage 5
The benefits of sustainability reporting
► A tool to enhance brand value, reduce political and stakeholder resistance and help to differentiate a company in the global marketplace.
► Establishes a foundation for open, positive communication between a company and its stakeholders.
► Sustainability reporting can reinforce the link between short term financial goals with longer term environmental and social objectives.
► Can offer a dynamic organizational learning process which benefits employees.
Corporate Sustainability: an overviewPage 6
Key questions for management
► Does the business understand its material sustainability related risks and impacts?
► Have key stakeholders been engaged to understand their expectations of the business in relations to sustainability activities?
► Are strategies for significant sustainability issues such as energy management clearly articulated?
► Is there appropriate governance to deliver consistent standards and drive performance improvement?
► Is there accurate performance data to support performance improvement claims?
► Can the systems and processes for collecting and collating performance data be relied upon?
Corporate Sustainability: an overviewPage 7
Investors push for sustainability/ESG data
► Investors looking at safer investments, comprehensive risk management including environmental and social risks.
► Companies with good sustainability performance record or innovating around sustainability trends identified as good investment targets.
► Sustainability Indexes established to enable investors to track company sustainability performance:► Dow Jones Sustainability Indexes (DJSI)► FTSE4Good► Nasdaq Global Sustainability 50 Index
The DJSI criteriaCriteria include: Industry specific
environmental issuesEnvironmental reporting
BiodiversityClimate ChangeSocial reportingGender Diversity
Standards for suppliersCorporate citizenshipCodes of conduct on corruption & bribery
Labour & compensation
PRI: 850 signatories, USD 25 trillion CDP: 551 signatories, USD 71 trillion
Current investment into clean energy and finance:
Europe – EUR 94 billion, China- USD 54 billion,
USA- USD 34 billion
Corporate Sustainability: an overviewPage 8
Typical issues:► Pollution► Biodiversity► Business
Excellence► Water consumption► Carbon emissions► Health and Safety► Occupational health► Governance► Community
relations► Government
relations► Revenue
transparency► Employee
Satisfaction► Supply chain
capacity
Failure to identify CSR risks
CSR risk review/risk mapping
Ineffective engagement with stakeholders
Advice on stakeholder engagement strategy
Lack of mitigation plans for CSR impacts
Advice on/reviews of CSR action plans
Ineffective CSR management processes
Development/reviews of management systems
Insufficient monitoring and weak governance controls
Building/testing governance controls and monitoring systems
Insufficient internal/external communications
Advice and assurance over disclosures
Effectivecorporate
sustainability report
What is covered in sustainabilityreporting ?
Corporate Sustainability: an overviewPage 9
What makes a GRI sustainability report?
► Society/Community► Labor Practices/Decent Work► Human Rights► Education & Training► Corruption Prevention► Health & safety► Product/Service Responsibility Corporate
Governance
EnvironmentSocial
Economic
► Energy► Water► Emissions► Waste► Products and Services► Carbon footprint
► Economic Performance► Market Presence► Indirect Economic Impact
Approach towards multi-front reporting on sustainability, a vital measure of successful businesses
Total indicators : 79
KPIs40
KPIs30
KPIs9
KPI = Key Performance Indicator
Corporate Sustainability: an overviewPage 10
Key challenges and risks of reportingDoing a reality check
Issuing the sustainability report is a challenge by itself; it requires a lot of ground work and data gathering; it also requires dedication and a very high level of involvement from all process owners in the organization. Another challenge is the ability to fulfill commitments in places where is lack of regulations and systems to support the initiatives in our report.Raji HattarChief Sustainability Officer, Aramex
1. Data consistency
2. Data comparability
3. Striking the right balance
4. Dialogue vs Communication
5. Continuous improvement
Corporate Sustainability: an overviewPage 11
Where do you start and how do you get there?
► Start with what you have, you don’t have to start from scratch► Collect sustainability data from different departments across the
organization
► Review the current state in order to set (reasonable and achievable) targets for the future
► Be transparent to stakeholders about achievements and goals going forward
► Use international reporting standards and frameworks like the GRI and AA1000 in order to generate a world-class sustainability report
► Balance, materiality and transparency establish credibility
Collect data
Set targets
Report
Assure
► Obtain limited (a review) and/or reasonable (an audit) assurance on your sustainability report
Corporate Sustainability: an overviewPage 12
Sustainability reporting in the Middle East – trends and developments
Corporate Sustainability: an overviewPage 13
Sustainability Reporting in the UAE
► Abu Dhabi Airports Company
► Abu Dhabi Chamber of Commerce and Industry
► Abu Dhabi Commercial Bank PJSC
► Abu Dhabi Department of Economic Development
► Abu Dhabi Department of Municipality Affairs
► Abu Dhabi Department of Transport Authority
► Abu Dhabi Water and Electricity Authority
► Abu Dhabi Sustainability Group
► Abu Dhabi Tourism Author► Abu Dhabi Gas Industries Ltd
► Abu Dhabi Gas Liquefaction company
► Abu Dhabi National Oil Company
► Aldar properties► Dubai Aluminium Company
Ltd. ► Dubai Centre for Corporate
Values► Dubai Customs► Dubai Properties Group► Dolphin Energy ► Emirates Foundation ► Emirates Integrates
Telecommunications Company PJSC (“du”)
► Energy Management
Systems International► Environment Agency- Abu
Dhabi ► Jumeirah Group LLC► Landmark Group► Metito (overseas) ltd. ► National Bank of Abu Dhabi ► Ras Al Khaimah Ceramics
PSC► Sama Dubai ► Sorouh Real Estate PJSC► The Emirates Group► Tourism Development and
Investment Company (TDIC)► Zonescorp
Corporate Sustainability: an overviewPage 14
Sustainability Reporting in the Middle East
Bahrain► Arab Bank ► Zain telecommunications
Syria► Syria telecommunications
Kuwait ► Burgan Bank ► Commercial Bank of Kuwait
SAK► Kuwait Finance House► National Bank of Kuwait
Qatar► Qatar National Bank ► Qatar telecom► RasGas Company Limited
Oman
► Petroleum Development Oman LLC
KSA► Saudi Aramco ► Dr Solman Fakeeh Hospital ► Saudi Arabia Fertilizers
Company ► Saudi Arabian Oil Company ► Saudi Basics Industries
Corporation ► Saudi Electricity Company ► The National Commercial bank► The Saudi British Bank
Egypt ► Arab African International Bank ► Assut Cement Company
► Bavarian Auto Group ► Orascom Telecom Holdings► Sekem Group► Shell Egypt NV► Suez Cement Company
Jordan ► Arab Bank ► Aramex international Ltd► Jordan Aircraft maintenance
Ltd► Jordan River Foundation► Nuqul Group► Schema- tactical thinking ► Zain (Jordan)► Lebanon► Holcim Lebanon sal
Corporate Sustainability: an overviewPage 15
Report output by type and year
Source: Corporateregister.com
Corporate Sustainability: an overviewPage 16
2011 – Developments in the Middle East: awareness
► Organized groups/ communities► Abu Dhabi Sustainability Group► Estidama► Green Building Councils
► Awards► Dubai Award for Sustainable Transport► CSR Arabia Awards
► Government push► Corporate Governance and ESG standards► Abu Dhabi 2030
► Competitiveness► Leader vs. follower
► Financial incentives ► Sustainability Indexes, carbon trading, energy efficiency projects, etc.
Corporate Sustainability: an overviewPage 17
2011 – Developments in the Middle East (cont’d)
► Top down vs. bottom up approach► Majority of Sustainability initiatives are being pushed through middle management► Executive management/ Board
► Sustainability systems and policies implementation (“You Can't Manage What You Don't Measure”)
Corporate Sustainability: an overviewPage 18
Trends for 2012/13
► Increased number of reports (one in five a ‘first time reporter’): increase in quantity, but awaiting the step-change in quality
► Independent third party assurance ► Increased level of stakeholder engagement
► Internally: Executive/ Board awareness and understanding ► Externally: interaction with communities, customers and suppliers
► Communication feedback process
Corporate Sustainability: an overviewPage 19
Trends beyond 2013
►Credibility through Assurance►Openness & Honesty►Relevance and Materiality►Carbon Disclosure►Creativity in Communications►Integrated Reporting
Thank you
For further information please contact us:
Amjad RihanPartner Climate Change & Sustainability Services - Middle EastDirect: +973 17 203 971Office: +973 17 535 455Mobile: +973 3962 7674 [email protected]