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Corporate Responsibility Reporting the Norm for Global Firms
4 November 2008:
Nearly 80 percent of the largest 250 companies worldwide issued reports in 2007-08, up from about 50 percent in 2005.
KPMG says reporting is now the norm, not the exception, among the world’s largest companies. “Since motivations for reporting have shifted away from reactive and risk management factors and toward aspirational and innovative ones, we expect reporting to become more common at the national level and in smaller companies in the near future.”
National level companies trail the G250 with only 45 percent of the total sample issuing reports, but numbers vary from less than 20 percent in Mexico to more than 90 percent in Japan.
“Although the N100 companies are trailing their global counterparts, we are seeing a distinctive maturing of corporate responsibility management systems overall. The use of the GRI Guidelines by the majority of G250 and N100 companies shows that this has become a leading standard for reporting. Stakeholder engagement is an area that could be strengthened - and included as part of a broad-ranging approach to corporate responsibility strategy and reporting.”
Ethical considerations and innovation emerged as some of the most common drivers for reporting, while risk management fell in the G250 group, KPMG said.
Other findings:
- Although 92 percent of G250 companies disclose a corporate governance code of conduct or ethics, only 59 percent report on incidents of non-compliance with the code.
- Nearly all G250 companies have a supply chain code of conduct, but only half disclose the details of how it is implemented and monitored.
- While 62 percent of G250 companies disclose information about climate risks, 69 percent of N100 companies do not. Whereas understanding the risks starts with understanding the footprint, a large part of the G250 (41 percent) need to develop this. Carbon footprint reporting is focused largely on the own operations.
In theory the link between corporate governance and corporate responsibility seems clear, KPMG says, but in practice many companies do not appear to be making the connection and capitalizing on the potential benefits. “Reporting on supply chain risk and reporting by suppliers both look set to increase as investors, and customers in particular, demand greater responsibility and transparency. Whereas carbon footprint reporting is not as common as might be expected, there are other indications that companies are taking the risks and opportunities associated with climate change seriously.”
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