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Fortune 50 Lacks Transparency in Web-Based Environmental Reporting
OAKLAND, Calif. --
The majority of Fortune 50 corporations use the Internet to disclose some information on their environmental performance but most are missing opportunities to involve stakeholders, tap the interactive potential of the web, and provide transparency in their reporting, new research suggests.
Researchers at Brigham Young University and KDPaine and Partners set out to test a new model for transparency, a hot topic in the field of corporate communications. After studying environmental information reported in the websites of F50 copanies, researchers found that a minority allow for any two-way interaction with stakeholders, which could inform and enhance the type of information they report.
"Make it more interactive," said Bradley Rawlins, the report's co-author and chair of Brigham Young's department of communications. "Open it up and let people comment because you might think you're doing a good job but until your stakeholders say this is what they need, you don't know."
The transparency standard researchers used to measure corporate environmental reporting includes four tenets: stakeholder participation in defining the type of information being reported; usefulness of information; balanced reporting that holds the company accountable for their performance; and a sense of openness in providing information that is easily available, easy to understand and timely.
"Measuring the Transparency of Environmental Sustainability Reporting Through Websites of Fortune 50 Corporations" found that few companies take advantage of the Interactive tools afforded by the Internet, such as blogs or discussion forums. Most reporting is static and one-way. For instance, the web allows for real-time reporting but all companies instead only report progress once a year.
Only 38 percent offered evidence of stakeholder involvement in the development of the reports.
Most environmentally reporting was two to three mouse clicks away from the home page.
Many companies didn't score well in providing balanced information or accountability. For example, only 36 percent reporting some sort of unfavorable result but only 6 percent included an explanation. Most lacked context to help readers understand the results. The results of only 13 percent of companies included third party verification.
Rawlins plans to expand the research in the coming months to include the Fortune 500.
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Stakeholder Dialogue Can Yield Valuable Feedback
As Timberland’s CSR Manager of Strategy and Reporting , I think Rawlins’ call for companies to “open up” reporting models and invite stakeholder comments hit the nail on the head. We became the first U.S. company to disclose our CSR performance quarterly in May 2008, with the goal of moving away from the static, one-way communication that an annual, printed report allows to create a meaningful two-way dialogue with many types of stakeholders.
One of the first things we learned was that ensuring our quarterly disclosure is valuable to diverse audiences is hard to do; more times than not, stakeholders don’t have a consistent set of expectations or interests. Workplace issues might be a priority topic for some, our climate strategy might be key for others. By disclosing all of this information online, we allow CSR professionals, NGOs, analysts, students and others to review our performance and quarterly progress in the areas most relevant and interesting to them, and plug in where they see fit. (I invite folks interested in how we’re doing – and how we’re doing it -- to visit www.timberland.justmeans.com.)
Another way in which we’re working to improve dialogue with our stakeholders is through quarterly calls, hosted by our CEO. By including tough issues in these conversations with Timberland’s highest-level decision makers, we hope to be transparent but also to start addressing complexities. Our first two calls focused on community greening and eco-labeling; already, those conversations have provided us with valuable feedback on how we might become a more sustainable organization and encourage others in our industry to do the same.
"Make it more interactive," requests Rawlins. While we are working to do just that, a two-way dialogue needs both companies and stakeholders to participate in the conversation. We want to test the notion of “if we build it, they will come” – and hope to see many others joining the discussion.
Beth Holzman
Timberland
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