Most Corporate CSR Policies Missing Completely or Poorly Developed

Most Corporate CSR Policies Missing Completely or Poorly Developed

A new report from the Sustainable Enterprise Institute finds that of the companies in the Russell 1000 index that have anything approaching an EHS policy, less than 10 percent include policies to make them effective.

The report, "The Road Not Yet Taken: the State of U.S. Environmental Policy and Management," analyzes the policies of some of the country's largest companies and finds them failing to provide sufficient information to be useful or successful.

"We have heard repeated concerns from investors and other company stakeholders that the depth, consistency, and overall quality of corporate environmental disclosure does not provide a sufficient factual basis for an understanding of a firm's environmental posture or performance," explained Peter Soyka, the president of Soyka & Company, which created the report along with IW Financial. "This study represents an initial step in bridging this gap by documenting the current state of environmental disclosure across all of the largest publicly traded U.S. companies using a consistent methodology."

About 60 percent of the companies in the Russell 1000 index provide any reporting that could be the basis of an environmental or sustainability policy, the report finds. But even of that number, less than 28 percent of firms include any of six key policies that the report's authors have laid out; just 9 percent have at least three of these six policies in place.

The policies that are critical to a solid environmental policy are:

• Board of Directors has responsibility for the environmental policy;
• Policy specifically applies to all company operations;
• Policy includes commitment(s) to quantifiable targets or goals;
• Policy includes a commitment to public reporting;
• Policy addresses pollutant emissions;
• Policy addresses conservation of energy and/or water.

Other findings from the report include:

• Only about 13 percent of companies in the index have published a CSR or sustainability report;
• Although 27 percent of firms do disclose their direct greenhouse gas emissions, only 16 percent have a corporate policy addressing climate change;
• Just 11 percent of Russell 1000 companies disclose their annual energy costs, and only 7 percent disclose total water use and costs.

More details about the report are available from GreenBiz.com; for more information, visit SustainableEnterprise.org.