Sustainability reporting has evolved rapidly over the past decade. What was known a decade ago as “corporate social responsibility” as largely morphed into “sustainability,” or as many companies now prefer to say, “ESG” (environmental, social and governance).
But according to Toronto-based The Works Design Communications, which describes itself as an “integrated design studio and communications agency with a focus on sustainability,” what you call your report really doesn’t matter, at least according to the firm’s latest research.
What does matter is that your stakeholders can find, understand and use this data seamlessly. To their credit, more companies are framing this information so that investors can better understand it. That, in the end, is a win for people, planet and the equity markets.
Wesley Gee, Works Design’s director of sustainability, also noted those tasked with composing these reports are speaking the languages of many stakeholders. “More recently, I’ve noticed that a lot of reporting has started to offer smart functionality enabling companies to develop a better experience for multiple users at once,” he said during a recent interview with TriplePundit.
Gee acknowledges that the challenges that face sustainability reporting teams are daunting, especially considering the alphabet soup of various reporting standards, including CDP, GRI, the SDGs, TCFD and SASB – just to name a few.
Less important than meeting all those checkboxes of standards, however, is getting across the company’s purpose, goals, success and struggles. “There is no one-size-fits-all approach because most analysts still don’t really know what they want,” Gee explained, “so we recommend that companies report on a combination of two or three frameworks. But when sharing the data, don’t forget the story. Context matters.”
Indeed, Gee noted that more companies are striving so set the context as they establish their purpose in making it clear to stakeholders that they do, indeed, have a forward-thinking agenda. And corporate reporting can help in this quest, along with tools such as social media, which can help companies rally support for their efforts as they make these stories authentic and relevant.
The results seem encouraging. Years ago, sustainability reports were mostly storytelling. Then, as stakeholders blanched at the public relations-heavy, glossy PDF reports, more of them became heavily data-driven, which often can distract from a company’s core story and purpose.
“Today we’re seeing, and supporting, a reporting approach that is more intentional. We’re working in a more coordinated way with corporate communications, investor relations, human resources and sustainability leads to plan and deliver a complete solution,” said Gee. “We believe that good reporting acknowledges expectations and executes on a plan that is far more customized. The formats we choose, those who we engage with and the analytics we assemble enable us to be nimbler and more objective. It helps us all have a little more fun to thoughtfully and objectively adapt to this changing space.”
But the bottom line for companies is that once the formats, details and tone of reporting are sorted out, the real objective for companies should be to build trust.
You can’t sow trust if you’re not authentic. And you can’t be authentic if you don’t show your vulnerabilities. So what’s the answer, then?
Being upfront would be a start.
According to Works Design’s research, only one-fifth of companies included case studies that were related to a negative event.
“The fact that only 20 percent of companies will discuss or disclose a negative event is really surprising,” said Gee. “After all, we’re all grown-ups here and we know how to relate to other human beings, so let’s show our challenges, threats and risks – don’t just beat your chest; no one wants to read that.”
Gee nails it when it comes to is comments about trust and “beating your chest.” It was a reminder of earlier this year when one public relations rep contacted 3p’s staff about a client in the financial services sector that recently issued a sustainability report. And the key point of this report was that the company, unlike other high-profile companies within and beyond the financial sector, had not suffered a data breach over the previous year and were proud of it. My response, written but never sent, was, “Wait, they are proud they didn’t have a data breach? But isn’t data protection part of their job?”
One example Gee held up as an example of a company that does as much as possible to build that trust, and is doing so with authenticity, is Westpac Banking Corporation, based in Sydney, Australia. (We should add Gee made it clear this company is not a client of Works Design).
The title of Westpac’s latest sustainability report makes it clear: “Strength. Service. Trust?” And that final word, along with the question mark, is colored in bold red. “They had undergone challenges, including data security,” Gee said. “And this report is a way for them to explain how they are working to do what they can to gain, earn and keep that trust.”
That’s a pretty bold chance Westpac is taking to admit it has struggled with trust. But there you have it, on page 109 – the bank had received over 600 substantiated complaints related to breaches of customer privacy or loss of data.
This frank approach to sustainability communications may rattle many communications professionals, but to reiterate what Gee said during his talks with 3p, trust and accountability matter. There’s no sense in trying to overlook it or sweep it under the rug – as it will come out eventually.
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Leon Kaye has written for TriplePundit since 2010, and became its Executive Editor in 2018. He's based in Fresno, CA, from where he happily explores California’s stellar Central Coast and the national parks in the Sierra Nevadas. He's lived in South Korea, the United Arab Emirates and Uruguay, and has traveled to over 70 countries. He's an alum of the University of Maryland, Baltimore County and the University of Southern California.