FOCUS PAPER Publication in memory of Ron Speed inSocial focus Reporting Traditionally, stakeholders evaluated companies primarily on their products or services. Now, they want to know how a company treats its employees, if it is environmentally responsible and if its business practices are ethical. They are demanding greater levels of transparency and accountability on every aspect of company operations. In response, companies around the globe have begun to issue “social reports.” Social reporting measures and assesses the impact of a company’s environmental, social and economic performance. While its form varies widely, one thing is clear: social reporting is rapidly becoming a competitive necessity and a key component of any company’s corporate citizenship initiatives. The Center for The Center for Corporate Citizenship at Boston most common reporting standards, and highlights College is committed to helping companies improve the benefits and challenges you’ll want to consider. Corporate Citizenship and sustain their corporate citizenship initiatives. Most importantly, The Center hopes to both at Boston College This guide, Social Reporting in focus, will help you inspire and support your organization as you to develop a social report for your organization. consolidate your company’s environmental, social focuses on the business It outlines the steps required to create a social report, and economic performance into your first social of corporate citizenship provides an overview of best-practice companies report or take your current social reporting process currently issuing social reports, reviews the four to the next level. Of the 22,000 consumers surveyed, a majority based their impression of a company on its labor practices, business ethics, societal responsibility, and/or environmental impacts. – Millennium Poll on Corporate Social Responsibility, PricewaterhouseCoopers Six Key Steps to Creating Social Reports Social reporting is about being intentional, setting clear goals that can be measured and investing the human and financial capital required to make the report meaningful and accountable. Here are the six steps to get your process started and create a social 6report that communicates and reflects your organization’s effort and commitments. 1) Determine Goals and Objectives sure you don’t overlook an important audience: shareholders, Investor-related Will your social report be verified by a third party? employees, community organizations, consumers, media, access to markets and opportunities Independent verification of a company’s social report ensures What do you want to achieve or address by publishing a government, regulators, investors, financial and industry analysts, social investment ratings companies are truly being as transparent and accountable as social report? Is the report a tool to be more accountable to auditors, non-profit advocacy groups, labor unions, suppliers, cost, cost avoidance or tax savings possible. For example, the Worldwide Responsible Apparel stakeholders? Is it a tool to more effectively communicate your business partners, consumer activists, human rights activists, Customer-related Production (WRAP) has accredited PricewaterhouseCoopers, company’s responsible social, economic and environmental environmental agencies, and health and safety inspectors. customer awareness and support Intertek Testing Services, and Cal Safety Compliance practices? Is it to meet government or regulatory requirements? increased sales Corporation (CSCC) to monitor compliance with the audits Establishing your goals and objectives is the first step. Start with 3) Determine Who Needs to Contribute Community/Government-related around the world. the ending – the big picture goals you want to achieve. Then break What key players in the organization need to contribute awareness those goals into smaller bite-sized objectives you can measure in a to this report? While the ultimate responsibility may fall positive local decisions 6) Determine Resources Available changes in regulatory process or environment given timeframe. Put these to paper and communicate them on your shoulders, social reporting is not a one-person show – What resources are available to create a social report? trust in crisis situations throughout the organization to gather support and buy-in. nor should it be. You’ll need a cross-functional team that Is there a designated budget? a team responsible for Reputation-related Here are some examples of common goals to start your thinking includes people from each major operational area of your the project? One thing is clear: a social report can’t happen media/news coverage about what you want to achieve through your company’s social report: company. Select people who are able to highlight their off the corner of someone’s desk. It needs clearly defined awards and accolades Goals department’s performance and how this performance roles and responsibilities and dedicated financial and human Contact The Center for more information on measurement. • enhance reputation with stakeholders relates to the economic, environmental and social goals resources to get the job done. • become more accountable and responsive to stakeholders of the organization. You’ll have greater success if your 5) Determine Reporting Standards and Verification For example: • effectively communicate social, economic and team includes one or more social reporting “champions” employee time to plan, coordinate, measure, environmental practices Will your organization align its report with a specific reporting at the senior management level. Regardless, be sure to seek track and compile • meet government or regulatory requirements guideline or standard? While some organizations choose to input from every line function within your organization. employee or consultant time to write, design, produce • preserve your license to operate develop their own guidelines, there are a number of social and distribute • communicate core values 4) Determine Scope of Analysis reporting standards. You don’t have to “recreate the wheel.” auditors, if verified by third-party • support sales targets You can simply follow the standard that most closely fits with What level of analysis does the organization plan to undertake reporting or tracking systems or software • augment business marketing your organization or is used most widely within your industry print costs or programming if web published in producing this report? What types of measures or evaluation • help attract, motivate and retain employees so you will have a tool for comparison against competitors. tools are in place already? If your company is not already You can measure your progress toward these goals a number Pages 6 and 7 outline the most widely used reporting standards. tracking financial, environmental and social performance, of ways. Many of these are outlined later in this paper. then what measures can it establish? How can the cross- 2) Identify Key Audiences functional team assist in this process? What level of analysis will satisfy the expectations of the report’s audiences? Consider Who do you want to reach with your social report? these possible tools and measures to gather the data you need: Which audiences are most important to reaching your goals? Employee-related With which audiences will you have the greatest wins? To make awareness/opinion surveys an impact, you’ll need to understand the needs and expectations motivation/morale British Petroleum of your audiences and align them with the goals and objectives recruitment of your social report. Consider the following list of stakeholders British Petroleum uses a social report to explain its process to manage environmental, social retention to start your thinking. The list is not exhaustive and not all the and ethical risks, and to ensure that their actions are meeting BP standards. Their social report employee training and skills groups will apply to your organization. Use it as a tool to make plays a crucial role, says The Lord Browne of Madingley, group chief executive. “Behind everything reported in these pages lies our determination to make progress, to deliver on our promises in this area – which we take as seriously as our commitments on financial performance – and to seek continuous improvement, because, as in everything we do, there is no room for complacency.” —British Petroleum, Performance for All Our Futures, 2002 2 3 Who’s doing what WHY LEADING COMPANIES ARE PRODUCING SOCIAL REPORTS A social report can take several different forms and be used for a variety of purposes. Most companies create social reports to assess performance, to communicate and build trust with stakeholders, to help attract and retain talented employees, or to enhance the company’s reputation, transparency and accountability. Here’s what some of the world’s leading companies are saying about why they create social reports and the challenges they face. Petro-Canada Chiquita Brands Bristol-Myers Squibb Premier Oil Baxter International ING International purpose of social report purpose of social report purpose of social report purpose of social report purpose of social report purpose of social report To build its reputation as an ethical company To establish and communicate Chiquita’s To communicate sustainability To be open and transparent with To emphasize Baxter’s responsiveness To communicate with stakeholders on standard leadership standard for corporate performance to stakeholders. stakeholders about Premier Oil’s to diverse stakeholder interests.