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Corporate Social Responsibility Class 4: Monitoring and Reporting

Corporate Social Responsibility Class 4: Monitoring and Reporting Syllabus developed by Jens Trummer. Agenda Part 1: Monitoring & Reporting Why & How. Reading: 1. “RG. Sustainability Reporting Guidelines”, Version 3.0, GRI, 2006

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Corporate Social Responsibility Class 4: Monitoring and Reporting

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  1. Corporate Social Responsibility Class 4: Monitoring and Reporting Syllabus developed by Jens Trummer

  2. Agenda Part 1: Monitoring & Reporting Why & How Reading: 1. “RG. Sustainability Reporting Guidelines”, Version 3.0, GRI, 2006 2. See How Daimler applies GRI by following the GRI link in: http://sustainability.daimler.com/reports/daimler/annual/2010/nb/English/0/home.html and take a close look at a minimum of 3 indicator groups.

  3. Class 3 Class 2

  4. Monitoring & Reporting CSR: KPMG: 80% of the world largest corporations report on sustainability Source: (Economist, 2010, 16)

  5. Norway: Accounting Act (2005 & 2006) Requires & gives guidelines for companies to report on Environmental and HR issues in Annual Reports Denmark: White Paper (2008) Large businesses must account for their work on CSR in their Annual Reports

  6. Monitoring & Reporting CSR: What comes to mind, why bother???

  7. Why??? Reporting & Monitoring Communication Management Tool Basis of Linkage to Stakeholders: Internal, External Employees, suppliers, etc. Community, government, customers, NGOs, etc.) Business Tool: Assess ROI ! - Identifying indicators - Benchmarking - Evaluation - Comparison over time - Cost & Benefit Cross functionality, workshops, etc. See Class 3!!!

  8. 1. Communication PR: “Management of communication between an organization and all of its publics” (James Grunig, 1992) How significant is PR in CEE in terms of CSR? = ‘stakeholders’

  9. 1. Communication Effective Communication (Grunig, 1992): Which of these should PR be??? Which of these typically misunderstood when thinking of (poorly implemented) PR? What is the Risk?

  10. PR should be integral tool in ‘Stakeholder Dialogue’!!! Class 2 1. Porter-Kramer Inside-Out/Outside-In Model 2. Stakeholder Analysis: Power of company to impact stakeholders & vice versa

  11. Class 1 PR ‘CSR Driver’ = Adaptive to Change Risk of labeled ‘Green-washing’

  12. Greenwashing: What is it ???

  13. Defintion: “A term describing the deceptive use of green PR(??!!) or green marketing in order to promote amisleading perception that a company's policies or products are environmentally friendly” Over- communicating CSR Strategy? Misleading, Deception? Source: Wikipedia

  14. Is this Greenwashing? Cost of Campaign RED Gap, Apple & Motorola: $ 100 mil Charity raised (2007): $18 mil … Charity raised (2010): $150 mil

  15. Czech Republic – Blood drive: About 10x more blood donations No PR to communicate blood drive Cost Euro 1 million Mostly PR budget What Stage – 2 or 3?? Is this Greenwashing? Was it good CSR Strategy?

  16. ‘Comes with the Territory’ Inherent Risk of CSR: Doing & Communicating CSR Doing & Communicating CSR & being “branded” ... Amplified by: - Misunderstanding over what CSR is ?? - Regional Context ??

  17. - Overexpectation:CSR can not solve society’s problems. At best, it is a business strategy with just a few strategic programs - CSR in CEE: Typically at earlier ‘cosmetic’ stage – greater risk of being labeled Greenwashing

  18. Class 1

  19. Greenwashing Reputation: By the way, why bother?

  20. Greenwashing: - Reputation: Worse than doing no CSR! - Reputation: It sticks - Reputation … Sales ? Class 1

  21. Besides improved PR, what other tool is there to reduce likelihood of being labelled Greenwashing?

  22. Proof: Transparency Reliability Accuracy Accountability through effective Monitoring and Reporting What tool???

  23. Sustainability Reporting: For: Companies, Government & NGOs By: Multi-stakeholder Initiative

  24. Sustainability Reporting: GRI G3 (2006): - Vision and Strategy - Profile - Governance Structure and Management Systems - GRI Content Index - Performance Indicators – measures of the impact/effect Where in Daimler SR?

  25. Sustainability Reporting: GRI - Vision and Strategy (p. 8) - Profile (chapter 1) - Governance Structure and Management Systems(chapter 2) - GRI Content Index(p. 72) - Performance Indicators – measures of the impact/effect In GRI – what main categories are there? See Table of Contents (pages 4&5)

  26. Sustainability indicators 1 Environment Materials, energy, water, biodiversity, emissions, effluents and waste; products and services, compliance, transport;

  27. Sustainability indicators 2 Social 1: Employees - Human rights (investment and procurement practices, non-discrimination, freedom of association and collective bargaining, child labor, forced and compulsory labor, security practices, indigenous rights) - Labor practices and decent work (employment, labor/management relationship, occupational health and safety, training and education, diversity and equal opportunity)

  28. Sustainability indicators 3 Social 2: Society - Society (community impact; corruption; public policy; anti-competitive behavior; compliance) - Product responsibility (customer health and safety, product and service labeling, marketing communication, customer privacy; compliance)

  29. Sustainability indicators 4 Economic Economic (economic performance, market presence, indirect economic impacts)

  30. Sustainability Reporting: GRI Grading: C B A Increasing transparency & application/coverage (Externally verified: C+, B+, A+) See P. 72 Does it work??

  31. Sustainability Reporting: GRI 77% of these use GRI (KPMG & Ethical Corporation 2009) = Over 1,500 organizations in 60 countries LINK TO LIST

  32. Sustainability Reporting: GRI In Hungary (2009): 30 companies and organizations!!! Poland (6); Romania (5); Russia (4); Slovakia (2); CZ (1);

  33. Sustainability Reporting: GRI Does it work? Daimler Link Can measuring impacts result in more sustainable business? PROS and CONS ???

  34. Monitoring & Reporting Pros: - Builds Trust: Accountability & Transparency = Reduces of Risk of labelled Greenwashing!

  35. Monitoring & Reporting Pros: - Standardization & Benchmarking: Allows comparison! Internal – Goal setting, comparison over time External – Companies can compete for sustainability LINK

  36. Monitoring & Reporting Pros: - ‘Forces’ companies to considerenvironmental and social impact: Highlights ‘holes’ and opportunities

  37. Monitoring & Reporting Cons: - Reduces flexibility for company to link CSR strategy with business activity Indicators Vs.?

  38. Monitoring & Reporting Driver of mindless compliance?

  39. Monitoring & Reporting Cons: - Relocates CSR budget from programs to compliance and reporting - Over-reporting is green-washing … ? What do you think?

  40. Monitoring & Reporting Cons: - Misconception: A company that reports is not necessarily ‘good’ at CSR, responsible, etc. It simply means that it measures and communicates its impact to stakeholders Real sign of responsible company if it improves indicators over time

  41. Monitoring & Reporting Starbucks: Core CSR Issues 5 Issues! How does Starbucks strategically address these issues???

  42. Starbucks ‘Issues’ Prioritization Matrix: 3 1 = Interest of Stakeholders 2 4 = Power of Stakeholders

  43. What Impacts on Stakeholder Groups is measured here ?

  44. What Impacts on Stakeholder Groups is measured here ?

  45. Starbucks & : Example: ‘Diversity’ HOW to measure???

  46. GRI Indicators:

  47. LA13

  48. Monitoring & Reporting Starbucks: Find GRI indicators for: ?

  49. Note: No CO2 Emissions Indicator!

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