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Should News Corp’s Anti-Climate Stance Impact its CSR Rating?

CSRHUB | Friday January 27th, 2012 | 1 Comment

CSR RatingsThe following is part of a series by our friends at CSRHub (a 3p sponsor) – offering free sustainability and corporate social responsibility ratings on over 5,000 of the world’s largest publicly traded companies. 3p readers get 40% off CSRHub’s professional subscriptions with promo code “TP40″

By Bahar Gidwani

One of our board members sent us a link to a great Harvard Business School article about how green ratings sources have failed to properly measure News Corporation’s social and environmental performance. The authors point out that News Corporation has set a goal to be “zero carbon” and therefore climate neutral.  But at the same time, the editorial side of News Corporation’s media properties has taken an anti-climate-change stance.

The authors describe a few of the ways in which a large company such as News Corporation could have actively pushed for positive change. They ask why ratings firms (including some who are our partners) don’t include “corporate activism” as one of the ways they measure corporate social responsibility (CSR).

It may sound smug, but we agree with this article and hope that our CSRHub ratings do make this adjustment. As a starting point, we would offer our ratings for News Corporation:

(Note: All ratings in this article are based on our CSRHub average user profile.  Our site’s users can adjust the ratings on our site to suit their personal opinions and values.)

As you can see, we show News Corporation as average within its industry and well below average on employee and community issues. Interestingly, at the subcategory level (we report 12 detailed ratings subcategories, as well), News Corporation is fairly good on Energy & Climate Change and Environment Policy & Reporting (a 58 on both or about 10th out of 57 Broadcasting & Advertising companies we follow).  However, it is weak on Resource Management (a relatively poor score of 45 that suggests the company does not control its actual use of resources well) and a weak 47 on Leadership Ethics (confirming that it may have inconsistent internal policies).  We certainly don’t put News Corporation at the top of its industry and we show fairly clearly that the company’s recent focus has been primarily on environment and governance issues, rather than on achieving broader social goals.

One reason our ratings are more tempered in their praise is probably that our base of data is very broad.  We have 2,944 data elements in our system for News Corporation, drawn from 23 sources.  Our sources each do their own independent research, so we have 23 opportunities to detect inconsistencies and a lack of commitment. We have another 115+ sources who don’t comment on News Corporation. The absence of their approval (or criticism) also informs our system.

For instance, unlike other major global companies, News Corporation is not a member of Business for Social Responsibility (BSR), Ceres, or the Committee Encouraging Corporate Philanthropy (CECP). The company did not endorse the Copenhagen Communique on climate change issues, did not participate in the Environmental Defense Fund’s Climate Corps, adopt the Equator Principles, commit to using the Global Reporting Initiative (GRI) reporting standards, issue a CSR report, commit to support the UN Global Compact (UNGC), or join the US Climate Action Partnership (USCAP).

We believe it is possible to avoid the kind of ratings failure that the HBS authors point out—or at least to gather enough data to predict and indicate that it may be occurring.  A company that doesn’t join, support, and interact with groups who support positive change, is probably not fully committed to change.

[Image credit: Sixth Lie, Flickr]


Bahar Gidwani is a Co-founder and CEO of CSRHub. Formerly, he was the CEO of New York-based Index Stock Imagery, Inc, from 1991 through its sale in 2006. He has built and run large technology-based businesses and has experience building a multi-million visitor web site. Bahar holds a CFA, was a partner at Kidder, Peabody & Co., and worked at McKinsey & Co. Bahar has consulted to both large companies such as Citibank, GE, and Acxiom and a number of smaller software and Web-based companies. He has an MBA (Baker Scholar) from Harvard Business School and a BS in Astronomy and Physics (magna cum laude) from Amherst College. Bahar races sailboats, plays competitive bridge, and is based in New York City.

CSRHub is a corporate social responsibility (CSR) ratings tool that allows managers, consultants, academics and activists to track the sustainability performance of major companies. We aggregate data from more than 130 sources including seven leading socially responsible investing (SRI) analysts, Carbon Disclosure Project, indexes, NGOs, crowd sources, and government agencies to provide our users with a comprehensive source of employee, environmental, community, and governance information on nearly 5,000 publicly traded companies in 65 countries. CSRHub is a B Corporation.


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  • Bahar Gidwani

    The above post has a factual error we’d like to correct. The error highlights an interesting subtlety of sustainability ratings.In the fourth paragraph of our post we stated that News Corporation did not participate in the Environmental Defense Fund’s Climate Corps. However, the truth is that News Corporation did participate in Climate Corps each of the past two years. We have been told that their experience with the program was excellent—as was the experience the interns had working with News Corporation. In fact, their first intern decided to join a climate change consulting firm after he graduated and is now doing sustainability consulting with Deloitte. Our mistake came because we thought the intern had been working at Dow Jones—a News Corporation subsidiary. We generally do not “credit” a parent corporation with the sustainability-related activities of its subsidiaries. However, New Corporation took an unusual—and interesting—approach with their interns. They worked first at News Corporation headquarters and then moved to Dow Jones to complete their project.The parent-subsidiary issue is an important one in sustainability policy and practice.Subsidiaries often have dramatically different positions and performance on social issues from their parent company. In some cases, these differences are driven by history (an acquired company may seek to maintain its old management style), local customs (different countries have different CSR requirements), or by a corporate “laissez faire” approach to social standards. Further, some organizations may only allow a parent to join or to submit information, or may require that a company be headquartered in a certain geography. For instance, our suggestion that News Corporation join US Climate Action Partnership was probably off base, since USCAP does not seem to allow non-US corporations to join. Having an intern work at both the parent company and a subsidiary is probably a good approach to encouraging communication about climate issues and discussion about corporate-wide policies. Outside ratings and measurement firms have a hard time dealing with this parent-subsidiary aspect of corporate behavior and the subtle differences in ratings that result. As we mentioned above, our general policy is not to include a subsidiary‘s performance when we calculate a company’s corporate social responsibility rating. Yet, given how News Corporation handled its Climate Counts internship, we will update their page on CSRHub to show that they did participate in this program. And, we will continue seeking ways to improve transparency and disclosure for both corporations and their subsidiaries. Bahar GidwaniCEO and Co-founder, CSRHub