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Johnson Controls’ Global Reporting Initiative Report Should Be a Model

Jennifer Hicks | Monday April 19th, 2010 | 2 Comments

global csr reportingWant to get wowed?  Check out Johnson Controls’ Global Reporting Initiative report – and its more than 500 supporting documents.  Talk about information overload!

Eight years ago, the Global Reporting Initiative was launched as an independent global institution at the United Nations. The goal? “To make sustainability reporting as routine as financial reporting,” as reported by GreenBiz.com.  Johnson Controls signed on—and since 2003 has been disseminating its GRI reports that outline financial efforts, corporate practices and the glittery as well as tarnished events that occur in its efforts to be a responsible company.

The company also produces a Business and Sustainability Report—a sort of glossy, feel-good publication that highlights the company’s efforts toward financial sustainability and corporate social responsibility. It makes it easy to see how the company deals with people, planet and profits. It’s a great, and feel-good, read.  Below are some highlights of that report.

How Johnson Controls deals with profit

In 2009, Johnson Controls, like most companies, faced a worldwide recession.  It weathered the storm by restructuring, prioritizing capital expenditures, and issuing debt to improve its liquidity and credit. It maintained its stock dividend and invested in growth initiative–notably in its energy efficiency offerings. (See the Letter to Stakeholders by CEO Stephen Roell.)

How it deals with planet

The company is involved in energy efficiency and monitors 63 million metric tons of greenhouse gas emissions for 5,000 buildings located in 88 countries. It was part of the team tasked with retrofitting the Empire State Building to reduce its energy use by 38%.  It also helped develop, and is currently manufacturing, the new SmartGauge with EcoGuide instrument cluster for the 2010 Ford Fusion and Mercury Milan hybrid sedans.

How Johnson Controls deals with people

Charitable giving: JC gave $10 million to charities based in the areas where its employees lived in 2009—even though it had a net loss of $338 million for the year, according to its 2009 annual report.  This compares to net income of $979 million the year before, and more than $12 million donated to nonprofit and community organizations, $1.4 million to earthquake relief efforts in China and several hundred thousand dollars in scholarships—to name but some. (See the 2008 Business and Sustainability Report.)

Employee benefits: Among other benefits, Johnson Controls has non-contributory defined benefit pension plans that cover many of its 130,000 employees and made $165 million in voluntary contributions to those plans in 2009. It also contributes or matches a percentage of employee contributions to savings plans, according to the annual report.

Diversity efforts: The company actively recruits women-owned and minority suppliers and for the sixth year was named to the Billion Dollar Roundtable as one of 16 corporations worldwide that spend more than $1 billion annually with women- and minority-owned suppliers. It encourages a diversity of ideas among its employers and runs programs for kids aimed at creating ideas for more sustainable living.

Now, for the transparency

However, the full transparency exists in the actual GRI report.  We learn that the company had three significant spills in 2009—75 gallons of propylene solution in Grantley, Pa.; 2,000 gallons of ethylene glycol solution in Waynesboro, Pa.; and a 2 to 3 cubic meter acid spill in South Africa.

And we learn that it increased its output of Group I hydrochlorofluorocarbons—up to 458.9 metric tons in 2009 compared to 404.3 metric tons the year before. There are other nuggets, too.

But we can also learn about JC’s mitigation efforts to reduce waste, energy consumption and improve efficiencies.

Yes, it should be a model

All told, this type of GRI report provides us with the great and not so great  It gives us a measure by which we can decide, on our own, whether the company is truly committed to corporate social responsibility and if it is making progress in its efforts.  By all accounts, it appears as if Johnson Controls really is.

The company is in the quiet period until April 23 and was thus unavailable for any comment.

(Editor’s Note: Do you want to get certified in GRI reporting? A two-day course is available this summer in Berkeley, Calif. Details here.)


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