In a Land Far Away, There Are Meaningful Reports
Most non-financial performance reports serve up enough excess vanity to script the Academy Awards show. By William D’Alessandro
There is still some value to be gleaned from reading about corporate accomplishments beyond legal compliance. I do it often. But the stuff in these environmental and social accounts is not published in accordance with any overarching, meaningful objective standard. Sustainability reporting has become a vice.
Guidelines exist, of course. But they are infinitely malleable. Few have any mandatory denominator. Terrible waste can be massaged to look flattering, and truth is easily swept under the rug.
Research analysts at WestLB, a commercial bank, found fleet fuel efficiency data in just five of 24 sustainability reports from auto manufacturers. Their numbers diverged so much, even the handful of car companies that purported to disclose the information could not be compared on this fundamental measure.
The International Petroleum Industry Environmental Conservation Association has published voluntary criteria to improve reporting consistency. Why then does Exxon Mobil not follow the association’s recommendation to use 1 million exposure hours as the norm for calculating injury rates? So much for tracking Exxon’s performance against Shell’s.
The loopholes and opportunities for equivocation are intentional.
“What is the value of providing more and more information to people if that information is not put into context?” asked Dennis Minano, environmental officer for General Motors in 1999. GM had poured money and time into molding the then freshly released standard from the Global Reporting Initiative. Why the expense? Why such effort?
For the presentation. The panache.
“By explaining our environmental philosophies and our environmental principles, the community can see the big picture,” Minano rationalized.
So it comes down to that. A sustainability report is a stage to mount a morality play about an organization’s contribution to nature and humankind. Temperance is not a virtue in corporate communications.
Robert Massie, trained as a Christian theologian and the founding chair of the Global Reporting Initiative, visualizes standardized reporting as a pilgrimage across cultural borders and moral mountain ranges to the Land of General Acceptance (his exact words). “It is a place where enough of us can live, and enough can converse, so that we can move from measurement to meaning, and from powerlessness to choice,” he sermonized over dinner with 1,000 disciples at a Global Reporting Initiative banquet. Hearing that I wanted to crawl under the table and hide like a sinner.
So why not repent?
Most corporations report to make stakeholders happy, not to manage their businesses. “As much as we would like to live in Nirvana, that is the reality,” says Robert Rubenstein, CEO of the Brooklyn Bridge consulting group. Hesitantly, I have come to agree.
Non-financial corporate reporting is about 15 years old — a lame excuse for giving us such gobbledygook. “Companies could do much better if they wanted to,” the WestLB team concluded in its report.
Until then, read sustainability reports as you would lifestyle magazines.
For more information contact William D’Alessandro, Crosslands Bulletin, 12 Middle Street, P.O. Box 464, Amherst, NH 03031, USA. Tel: +1 603 672 5811; E-mail: wdalessandro@victorhouse.mv.com.
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