This is a collaborative effort between Green Biz Group and
Ernst and Young. EY is a very cool
group and will be a continuing resource for me on our literature review.
This article discusses the results of a survey given to 282
respondents representing 17 different sectors of business and are employed by
companies with annual revenue of more than US$17 Billion. 85% of these respondents are in the US. The sample includes just companies
beginning sustainable efforts and those who have done so for years. There are six trends found in the
Study:
1)“The “tone from the top” is key to heightened awareness
and preparedness for sustainability risks.”
- · Corporate sustainability conversation has moved to “risk reduction and mitigation” in reaction to envir., societal, and market shifts that could create natural resource shortages and commodity price hikes amongst many things.
- · “How, and how much, companies disclose their sustainability –related risks provides a good barometer of top management’s engagement in these issues.”
- · Companies with CEOs and boards with larger sus. engagement levels have a much closer alignment b/w what they voluntarily disclose (like the Carbon Disclosure Project and Dow Jones Sustainability Index) and what they are mandated to disclose (like 10-K filings).
- · Here I think we could ask about the nature of CEO and board alignment with sustainability and whether sustainability is part of strategic planning and capital budgeting.
- · High CEO and CFO attention to these issues demonstrates the rise of their importance in risk.
2) “Governments and mulitlateral institutions aren’t playing
a key role in corporate sustainability agendas”
- · NGO push for transparency. Carbon Disclosure Project is a good example
- · Some corporate sustainability exec’s say privately that activists and ratings organizations get the attention of company leadership more effectively than they do
- · As surveyed CEO drives company’s approach to sustainability most, followed by business customers/supply chain, followed by employees.
3) “Sustainability concerns now include increased risk and
proximity of natural resource shortages.”
- · Water is a large area of concern as ranked by the World Economic Forum
- · Respondents rated water as “most at risk” followed by oil and “metals and other materials”
- · 51% anticipate their core business objectives to be affected by shortages in the next 3-5 years
4) “Corporate risk response is not well paired to the scale
of sustainability challenges”
- · Only 3 in 10 companies responded to running scenario analyses attempting to anticipate key tipping points in the “food-energy-water stress nexus”
5) “Integrated reporting is slow to take hold”
- · “Companies publish more than 5,000 sustainability and corporate responsibility reports a year worldwide, according to CorporateRegister.com”
- · “growing movement to report key sustainability data in a more investor-friendly way”
- · tools to produce Integrated Reports (combo of sus. And financial) are primitive compared to financial measures
- · only 8% of companies used packaged software for environmental reporting. 37%used centralized database 26% spreadsheets, and 12%e-mail
6) Inquiries from investors and shareholders are on the
rise.
- · Demands for disclosure of envir and soc impacts on rise, also increase in surveys, questionnaires, and queries to companies
- · Some large companies respond to over 300 customer surveys a year
- · 50% of respondents said their company had seen an increase in inquiries from investors/shareholders about sus-related issues in the past 12 months
- · 69% of shareholder inquiries were about efforts to reduce energy consumption,64% GHG reduction/adoption of quantitative goals,51% publishing a sustainability report, 44% working conitions/human rights issues, 36% financial risk associated with climate change, 36% supply chain risks related to climate change…the list continues, it’s a good one.
(2013)
Ernst & Young, & GreenBiz Group (2013). 2013 six growing trends in corporate
sustainability.
EYG Limited.
1st time used(Ernst & Young, & GreenBiz
Group [EYG&GBG], 2013) -my best guess from APA handbook.
2nd time used (EYG&GBG, 2013)
