US companies doing little to back up big CSR claims

KPMG has concluded that US companies are favouring style over substance in their CSR priorities, with a national corporate emphasis on ‘communication’ rather than actual performance.

While, globally, reporting has rightly become a business imperative and even “the de facto law for business”, according to KMPG’s International Survey of Corporate Responsibility Reporting, US firms have fallen into the trap of merely “scratching the surface” with their reporting.

The report, which analyses the world’s 250 largest companies, notes that US firms, along with those in Canada and less developed countries such as Brazil and Chile, run the highest risk of failing to deliver on the promises made in reports, and therefore facing increased pressure from stakeholders – ultimately running the risk of an investor backlash.

In contrast to the honesty and rigour of many European countries and, especially, China in terms of action on commitments made, the processes and systems that govern corporate responsibility performance are deemed to be poorer in the US than every other country included in the survey except Russia and Singapore.

Even as far as the mere act of reporting is concerned, US companies lag behind. Two-thirds of the 5% of ‘G250’ firms not reporting on their CSR activities are US-based. Europe sees the highest global reporting rates, with “the Americas and the Middle East and Africa quickly gaining ground”.

In terms of industry performance results were much more even, with media and pharmaceuticals striking the best balance between reporting and performance, and transport and retail lagging somewhat despite signs of improvement since KPMG’s last survey in 2008.

Though the assurance firm paints an optimistic picture of the global CSR reporting landscape generally, it suggests that ‘data integrity’ remains an issue, posing a risk to credibility and reputation which is in need of rectifying through better governance, systems and assurance.