Ethical Performance
inside intelligence for responsible business


The vices and vanities of sustainability reporting

June 2009

Firms are exploiting a lack of reporting standards to distort their achievements, says Bill D’Allesandro

Sustainability reporting is becoming a vice. Most reports serve up enough excess vanity to supply the Academy Awards show.  Temperance, evidentally, is not a virtue in corporate communications.
There is value in reading about accomplishments beyond legal compliance.  I do it often.  But the stuff is not in accordance with any overarching objective standard.  There are none.  Of course guidelines exist.  But they are all optional and infinitely malleable.  Few have any mandatory denominator.  Terrible waste can be massaged to look flattering.  Research analysts at WestLB, a commercial bank, found fleet fuel efficiency data in just five of 24 sustainability reports from car manufacturers.  Their numbers diverged so much that even the handful of car companies 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 ExxonMobil not follow the recommendation to use one 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 poured money and time into moulding the standard from the Global Reporting Initiative.  Why the expense?  For the panache. The presentation.

‘By explaining our environmental philosophies and our environmental principles, the community can see the big picture,’ Minano said.  A sustainability report is a stage to mount a morality play about an an organization’s contribution to humankind.  

Robert Massie, trained as a Christian theologian and the founding chair of the GRI, visualises standardised reporting as a pilgrimage across cultural borders and moral mountain ranges to the ‘Land of General Acceptance’.  ‘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 has sermonised.  Hearing that I wanted to crawl under the table and hide like a sinner. So why not repent?   

Robert Rubenstein, chief executive of the Brooklyn Bridge consulting group, has the answer.  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,’  he says. Hesitantly, I have come to admit the same.  

Bill D’Alessandro is executive editor of Victor House, a specialist news agency in the US.

Bill D'Allesandro | Global | Sustainability Reporting


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