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Starbucks, Levi’s, other top companies talk transparency trends

<p>At SustainAbility&rsquo;s annual Engaging Stakeholders workshop, companies delved into the critical issues of transparency and trust.</p>

Just before the Thanksgiving holiday, SustainAbility convened its annual Engaging Stakeholders workshop at member company PG&E's Pacific Energy Center in San Francisco. The venue, a public education resource that promotes and supports energy efficiency, provided an ideal setting for wider discussions about the sustainability agenda.

The future of transparency and trust

The Engaging Stakeholders network is for companies that believe transparency has a critical role to play in moving toward a more sustainable world.

In "Changing Tack," the final output of GlobeScan and SustainAbility's Regeneration Roadmap, we put transparency forward as one of six attributes essential to corporate leadership on sustainable development — what we call the "Extended Leadership" challenge of the next decade. Along with the other attributes — vision, goals, offer, brand and advocacy — "Changing Tack" presents transparency as critical to building trust, and suggests this trust is essential to the kind of collaboration required to address the system challenges endemic to sustainable development.

This is hardly new: Transparency has been long advocated within this agenda. NGOs demand disclosure around sourcing, as does GRI while providing guidance on such reporting. Companies themselves employ certification and labeling, and also have enhanced sustainability reporting and traceability. In doing so, they have improved quality and safety while providing improved insights on social and environmental performance.

What is novel is today's emphasis and approach. This is what we sought to explore at November's workshop, asking:

What is the role of transparency in systems change?

How can companies provide relevant, appropriate and timely signals to all stakeholders that will enable better decisions?

Reading the map

As always, getting where you are going depends on learning from where you have been and understanding how the journey forward may be different. A key session at the workshop, "Lessons from the Transparency Trenches," featured speakers from Good World Solutions, Starbucks, Levi Strauss and EcoShift, whose insights provoked significant discussion and helped identify the following transparency trends: 

Amplified voices: Good World Solutions' Labor Link uses mobile technology to anonymously survey factory workers. Surveys are voice-based, removing illiteracy as an obstacle. The information can be accessed virtually 24/7/365, as opposed to the sporadic insights gathered via formal site audits, which may happen only a few times a year. 

Partner, not proxy: Companies often rely on NGO experts to serve as a proxy for workers in supply-chain factories. If Labor Link and similar tools fill this void, NGOs and companies might spend less time identifying and debating issues, and more time developing and implementing solutions.

Diverse transparency interests demand traceability: The companies at the workshop discussed the varied nature of their transparency interests. In response to crises such as the European horse meat scandal and the factory collapse in Bangladesh, they are facing a slew of regulations. They've also squeezed toxics from the supply chain to support the Zero Discharge of Hazardous Chemicals initiative, and attempted to address growing interest in the provenance of food, clothing and other goods. With myriad stakeholders, emerging traceability solutions including GeoTraceability, StringTogether and Oritain are moving center stage, and will become increasingly important in the near-term future — especially if they can connect producers and consumers with stories that make products more compelling and desirable.

Calling all investors

Another session at the workshop focused on the emergence of the Sustainability Accounting Standards Board (SASB). SASB's vision is "a world where all forms of capital are accounted for and managed." To that end, it is developing industry-specific standards to help "companies compete and improve performance on the sustainability issues that matter most" and to motivate "investors [to] drive capital to the most sustainable outcomes." (Learn more about SASB's mission in the video below.)

A little over one year in, it's too soon to say if SASB will succeed. But it's clear that the next transparency-sustainability wave will depend on attracting more investor attention. Without investor carrots to reward corporate investment in enhanced sustainability performance, it will be hard for executives — and especially leaders of currently successful companies — to justify changes to the products, services and business models necessary to build a sustainable economy. 

The road ahead

The SASB experiment is an important one in terms of making sure investors are included in the drive toward a more sustainable world. Even if it does not succeed in its push to make sustainability reporting mandatory for publically traded U.S. companies, SASB will be a significant contributor to discourse and debate on how corporations can institutionalize sustainability — and make it material to investors — through greater disclosure of non-financial issues. It will be one of the key organizations for transparency-watchers to follow.

Reports photo by maxuser via Shutterstock

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