Ten Innovative Sustainability Reports

25.01.2013

What does Innovation in Sustainability Reporting mean? According to CorporateRegister.com, who added this new category in the reporting awards line-up this year, it is all about evolution:

"CR reporting evolves continuously. Some reports consist of mini-sites which incorporate new features of web technology. Others demonstrate new ways of approaching a reporting issue, of interacting with stakeholders, of presenting an overall picture. Which report demonstrates an innovation which may be adopted by other organisations, and which may help reporting evolve?"

The ten companies shortlisted in this category obviously think they have something to add to our sustainability reporting evolution. Of these companies, five are from the U.S., three from Asia (Korea, China and Malaysia) and two from Europe (France and the Netherlands). There are 966 pages of content (although the one report is a website download and is 302 pages!, so forgive me if I didn't read each one with total meticulousness). All but one of these reports are written in accordance with the GRI Framework, with five at Level A or A+.

Before I go on, I will subtly remind you to VOTE. The voting closes in a less than a couple of weeks. I do think it's important to recognize great reporting. Remember, if you vote in each category, you could win a cash prize every week until the voting closes!

I had a look at the ten reports shortlisted in this category, on a mission to find what is evolutionary (and innovative) about their reporting. Here, in alpha order, are my conclusions:

GRI A+, 179 pages, Technology Hardware Sector, France

One thing that is nicely innovative about the presentation of this report is the hyperlinked PDF. I just love PDF's which enable fast navigation, so that you can reach each section and subsection in the document efficiently. Alcatel Lucent call this the "Smart PDF". Absolutely! I recommend Smart PDF's to all reporters. Hyperlink your PDF. It makes reports so much easier to read.

But that's not all....

Alcatel Lucent have incorporated an Augmented Reality experience into their report. By downloading an App for iPhone/iPad or Android smartphone or tablet, and, using the App to connect to an image in the report, the App automatically opens up a video of the person in the static image.

Alcatel Lucent says: "Augmented Reality could dramatically change the way we use mobile phones! This technology uses recognition of images in reports, magazines, advertisements and websites to provide immediate access to additional information on your smartphone." What better way to demonstrate this company's technological prowess and innovative approach than by offering an example of how this works. I tried it, and it does what it promises!

GRI A, 114 pages, Technology Hardware Sector, U.S.

Here is another reporter using the wonders of modern technology to present their report. Not only is the report online and downloadable in both full and summary PDFs, it is also available as an ipad App and an Android App. The tablet version contains additional content in the form of videos, interactive graphics and links to AMD’s web pages. The App culture is definitely here to stay and the reports of the future will all be in this format, no doubt. Kudos to AMD for getting ahead of the game (AMD is not the first company to publish a Sustainability Report and/or Annual report as an App, but it's still new enough to be considered evolutionary and innovative). AMD also uses a QR code for interactive use of the Summary PDF.

This report is actually AMD's 17th report. There aren't all that many companies who have delivered that many reports. There's something to be said for reinventing your reporting year after year.

GRI Undeclared Level, 87 pages, Electricity Sector, China

The evolutionary and innovative thing about this report is the inclusion of an external rating by experts from the China CSR Report Rating Panel selected by the CSR Research Center of the Chinese Academy of Social Sciences, Economics Department. The rating provided to China Southern Power Grid is reported with commentaries from four of the panel experts. While these commentaries are exclusively positive, the evolutionary thing here is the presentation of the detailed comments in full. This is not a first, of course, but it is by no means widely accepted practice either. Sharing the feedback of report readers and evaluators is a feature of reporting that we will see more of in the future.

GRI B+, 42 pages, Beverage Sector, U.S.

This report opens with a question: "How can a drink build a more sustainable tomorrow?". While many reports use the question technique to raise issues and address them in their reporting, this is still not so widely used as a reporting practice. It's good, because reading a question immediately starts your brain ticking over to develop an answer. It engages you straight away.

Another nice thing is the Deliver/Inspire (Deliver for Today, Inspire for Tomorrow) Spotlights inserted throughout this report. Using people to tell the story about what they have delivered and what's inspiring them is a leading-edge way to make the report come alive. It's always best if real people tell your company CSR story. Again, not a first, but definitely something we should see more of in reports.

Similarly, external stakeholder voices are included in this report, also in the form of questions. Each main section starts with a question from an external stakeholder which is responded to by a CCE exec. It's a nice touch, and an innovative practice.

Korea Railroad Association, GRI A+, 101 pages, Transportation Sector, Republic of Korea

The thing that stuck me about this report is this:

"Media Analysis :We analyzed 3,246 media reports regarding KORAIL between 2010 and 2011, in order to identify our sustainability issues and use them in selecting issues to be reported. These issues primarily concerned consumer issues, community involvement & development and response to climate change." This was supplemented by other forms of direct stakeholder engagement in order to distill all issues into a nice-looking materiality matrix, containing 10 core issues, grouped into Emerging, Medium and High categories. The use of Media Analysis to support the materiality process is a good approach, and while other companies may do this as part of a regular business intelligence process, it is rarely mentioned in Sustainability Reports.

Another nice touch is the way Korail sets out its future growth and development strategy, with the aspiration of becoming a Global Green Cultural Service Provider. Moving from the narrower paradigm of rail network services to a much broader role in society, Korail maps out the route to 2020 in a visual way. This forward looking approach in reporting provides context for future confidence that the company growth plans are aligned with sustainability commitments and opportunities.

Not GRI, 46 pages, Aerospace and Defense Sector, U.S.

Lockheed Martin’s 2011 Corporate Sustainability Report was designed as an interactive, electronic “book.” For those who like digital presentation in this format, it works well and enables quick navigation through active links.

What I liked about Lockheed's report is the visual presentation of diversity in its workforce demographics - including the number of Baby Boomers and Gen Xers, minorities, veterans, gender and education level.

GRI A, 301 pages (web-download), Pharma and Biotech Sector, U.S.

Merck has a dedicated report microsite, and also a PDF download. The PDF is over 300 pages long, and, as you can imagine, goes into quite some detail. Almost every topic has its own page, some have several. One piece of detail that I liked and which you don't often find in Sustainability Reports is the breakdown of workplace injury types. I often think that workplace safety does not get enough exposure in Sustainability Reporting, despite it being one of the most essential prerequisites of a sustainable business. Merck sets out the detail of what injuries occur and how in their 2011 report.

GRI B, 81 pages, Household Goods and Textiles, U.S.

Nike shines as a leader in sustainability thinking and practice, and this is reflected in the many aspects of Nike's report that are innovative, evolutionary and very engaging. (You should check out the Nike CR website which also hosts the corporate responsibility report, if you haven't already seen it.) In the FY10/11 report, Nike presents the conclusions of an analysis of meta-trends (prepared with SustainAbility) - trends which have shaped Nike's sustainability strategy and approach and offer opportunities for innovation. These are presented in a form of materiality-type matrix which shows the trends that represent a risk to the current business model and those which provide business opportunity.

Nike's own Sustainability "Considered Indexes" for Footwear and Apparel also seem to me to be leading edge in both practice and reporting. These Indexes measure to what extent sustainability thinking has been used in the design process of Nike products (as choices at the design phase significantly influence life-cycle impacts). In fact, Nike has developed several proprietary Indexes which measure different aspects of Nike's value chain sustainability performance and impacts. The Manufacturing Index Metrics Roadmap presented in this Sustainability Report, for example, is a transparent representation of how Nike measures and recognizes process in its supply chain. Reporting on progress in this way can certainly be considered innovative.

GRI A+, 38 pages, Oil and Gas Sector, The Netherlands

Shell is another reporter which has incorporated QR coding, and this summary report of 38 pages is the tip of the iceberg of much greater content on the Shell website (the summary report contains links to additional content). What I like about Shell's reporting is its storytelling style - every section is written in a narrative which provides informative and immensely readable context and background, which is accessible and eye-level for all readers. Is that innovative and evolutionary? Possibly. Not too many companies have mastered this art.

Also, environmental and social performance data is presented for ten years (2002-2011) which is some achievement.

GRI A+, 90 pages, Investment Companies Sector, Republic of Korea

The first thing that strikes you about this report is its cover page which presents a concept which is probably not all that familiar to most of us :)

Shinhan explains this in this way: "The essence of 'compassionate finance' lies in making the world a better place through the main businesses of finance." Yes, that's definitely innovative. The narrative spells out in great detail what Shinhan means by compassionate finance and what actions are in place to drive compassionate behaviors at this financial group.

What is nice about the presentation of this report is that it's filled with smiling faces of Shinhan people. While I suspect that every hour at work might not be Happy Hour at Shinhan, the report does present a sense of optimism and positive spirit. That's something that more companies could learn from - without going overboard :)

Shinhan also details the social responsibility profiles of each of the companies in the Shinhan Group - this helps stakeholders understand the different impacts of the individual components of the group, and offers those interested in specific companies a reasonable level of content. This is not frequently done by holding companies or large conglomerations in corporate-level sustainability reports. Both the group-level view as well as the detailed view by company make this report somewhat evolutionary.

Ten reports, ten examples of innovative reporting practice. Which one gets your vote? Or are you spoilt for choice?