Reporting 2025 – Perspectives: Interview with Mario di Loreto, People Value Director, Telecom Italia

The GRI global organization is conducting a series of interviews with thought leaders to gain their perspectives on what they expect the main issues to be on corporate agendas and their public reports in 2025.  These are produced monthly and G&A Institute will share these through our websites, newsletters, blog, social media, and various other channels to raise awareness of this important initiative.

Interview with Mario di Loreto, People Value Director, Telecom Italia

21 December 2015

Brief Notes for Your Favorite Investor Relations Officer To Help Move the Needle on Sustainability at The Board Level in 2016

If you are a corporate investor relations officer, you’ll want to read this week’s top story.  If you are a manager looking for information to take over to the IR office in your company, this is good for helping to “build the investment case.”  IR magazine, an authoritative voice for the investor relations professional, puts the recent Ceres report in focus.

Ceres, an important NGO, recently released a brief summary that calls attention to important topics for the board room and C-suite – climate change, pollution, diversity, workers’ rights,  governance issues – and the board room general lack of oversight of these important issues.  What is the board room missing out on?  What should the IR professional tune in to regarding corporate sustainability?

The IR Magazine article by Adam Brown is a good conversation starter for the sustainability manager and the IR manager.  Conclusions reached include tying executive compensation to sustainability advances and urging the board to pay more attention to “the extraordinary challenges of global climate change” and more.  It’s a good quick read for the IR officer.

From all of us at G&A Institute to our valued clients, friends and colleagues:  A most joyful holiday season and our best wishes for the 2016 New Year.  The promise of the New Year is shaping up to be a most momentous period for corporate sustainability and responsibility, and for sustainable investing practices.  We stand ready to assist your company to become a sustainability leader in 2016 (please contact us to schedule an introductory call in Q1!), and we’ll continue to bring you the news, research & highlights of actions that advance the sustainability agenda in the new year!  See you in January.

Ceres report recommends boards focus on sustainability
(Friday – December 11, 2015)
Source: IR Magazine - Boards of directors should focus on sustainability issues that significantly affect revenue, promote board diversity and establish stronger ties between executive compensation and sustainability to prepare for the ‘extraordinary…

Reporting 2025 – Perspectives: Interview with Jeanne Ng, Director of Group Sustainability, CLP

The GRI global organization is conducting a series of interviews with thought leaders to gain their perspectives on what they expect the main issues to be on corporate agendas and their public reports in 2025.  These are produced monthly and G&A Institute will share these through our websites, newsletters, blog, social media, and various other channels to raise awareness of this important initiative.

Interview with Jeanne Ng, Director of Group Sustainability, CLP

14 December 2015

U.S. Industry & Trade Associations Encourage Corporate Sustainability — Today, the American Cleaning Institute is in Focus

by Hank Boerner – Chairman, G&A Institute

As more and more U.S. companies begin or expand their disclosure and reporting on their sustainability journey, and their widening range of corporate responsibility activities, the choice of reporting frameworks both narrows and expands.

Narrows in the sense that the Global Reporting Initiative (GRI) framework — now in its fourth generation (“G4″) since the introduction of the GRI approach in 1999-2000 — is considered the de facto global standard by thousands of company managements. There are now 30,000 sustainability reports in the GRI database — 21,000-plus of those published GRI Reports.

And the number of reporting frameworks and generally accepted standard steadily expands — there are many more standards, frameworks, codes of conduct, guidelines, third party requests for information, that now take sustainability / responsibility / citizenship / environmental performance reporting far beyond where these activities were a decade or so ago. Many corporate managements recognize the importance of such reporting and devote the necessary [human and financial] resources to the task.

Examples of available standards include corporate responding to the annual CDP CSA request for information (the voluntary Corporate Sustainability Assessment). CDP began operations in 2000 as the Carbon Disclosure Project with focus on collecting, organizing and providing information on corporate Greenhouse Gas Emissions (GhGs) to investors; today the CDP focus include water issues, forestry issues, supply chain issues, and sector-by-sector research and analysis (the first sectors included chemicals and automotive). The client base is almost 500 institutional investors with more than US$55 trillion in AUM — they accept the CDP approach as an important standard in reporting on corporate environmental performance (or lack of).

There are also global and U.S. industry associations and trade groups that help their corporate members to understand key issues, map materiality; understand stakeholder expectations; align corporate strategies, activities and programs, third party engagement, and disclosure and reporting with the ever-expanding stakeholder and shareholder expectations. Among these are such well-known organizations as Automotive Industry Action Group (AIAG) and the Electronics Industry Citizenship Coalition (EICC).

Industry Effort:
The American Cleaning Institute and Sustainability

One large industry-focused effort we focus on today organized resources to develop a charter to provide a common, voluntary approach to promote and demonstrate continual improvement in the industry’s sustainability profile is that of the cleaning (products & services) industry — the American Cleaning Institute (ACI).

The Charter for Sustainable Cleaning is one of ACI’ major initiatives to fulfill the mission, and provide a framework for corporate members to go beyond basic legal and regulatory requirements.

You know many of the member company names and their brands, which are ubiquitous in American and global business-to-business and consumer marketing; a sampling includes Amway, BASF, Church & Dwight, Clorox, Colgate-Palmolive, Dow, DuPont, Huntsman, and International Flavors & Fragrances (IFF).

The American Cleaning Institute’s sustainability mission is to “benefit society and improve the quality of life through hygiene and cleanliness by driving sustainability improvements across the industry and throughout the supply chain.” The ACI Charter for Sustainable Cleaning was launched in January 2014 at the group’s annual meeting & industry convention. The charter was in part based on the A.I.S.E. Charter for Sustainable Cleaning, a voluntary initiative of the sister trade association in Europe (AISE). The bulk of ACI’s U.S. member companies are cleaning product manufacturers and chemical suppliers.

To date, 25 ACI member companies are signing on to the charter; they are required to have systems in place to continual assessment; review; and improvement of sustainability performance. This includes product life cycle; raw materials; resource use; product specs; manufacturing; end use and disposal of products and packaging; and occupational health and safety.


Discussion:
Brian Sansoni, VP, Sustainability Initiatives

We spoke with ACI’s Brian Sansoni, the VP, Sustainability Initiatives, based in Washington, D.C. Brian described the ACI’s sustainability efforts with the Charter as “an ongoing roll-out, beginning with speaker presentations and participant discussion at the 2014 annual conference. We are now two years into the effort.” The effort is to develop and demonstrate the sustainability efforts of a major industry sector in the United States, the cleaning products and services manufacturing and marketing industry and the industry’s supply chain.

Brian, who joined ACI in 2000, was named VP, Sustainability Initiatives in 2012 (he also has the title of VP, Communication & Membership). Brian works closely with the association’s communications team, the government affairs team, research & science team, and with a sustainability committee whose members come from member companies. He’s a radio news reporter and Congressional press secretary by background and past experience, and applies those skills to the communication about the industry association and member companies’ commitments to greater sustainability.

Brian’s teammate is Melissa Grande, Senior Manager, Sustainability Initiatives, who joined us in the conversation. Brian and Melissa oversee the production of the ACI Sustainability Report, which Brian describes as being thorough, distinct and relevant with metrics that clearly provide a hallmark of what the association and its member companies are doing in their collective sustainability journeys. The report summarizes data from 33 member companies participating in the 2014 Sustainability Metrics Program (the metrics relate to energy use, GhG emissions, water use and solid waste generation). The report features an updated summary of ACI’s social and environmental sustainability programs, and details for ACI’s scientific and research programs. They also conduct the “Sustainability Academy” for the education of ACI’s member companies.

The report is available at: www.cleaninginstitute.org/sustainability2015

Melissa Grande explained that as part of the association’s ongoing collaboration with other standard setters, ACI is a member organization of the Sustainability Consortium (Melissa was previously a member of the consortium staff).  ACI participated in the Sustainable Accounting Standards Board (SASB) development of suggested (voluntary) materiality disclosures for the Consumption Products Sector (including household and personal products).

Brian Sansoni stressed that the ACI effort is intended to create an industry-wide, discrete approach that member companies can benefit from, and contribute to as the initiatives move forward.

Important:  ACI’s Critical Issue Assessment

For the first time, the Institute staff and participating companies conducted a comprehensive materiality assessment to map risks and opportunities facing the U.S. cleaning product value chain, including key energy and environmental metrics. The mapping identified and characterized the key issues that affect ACI’s membership and the industry-at-large.

The top issues identified in the materiality process by internal and external stakeholders:

1 – Materials (safety of chemical ingredients; raw material sourcing, scarcity).
2 – Disclosure & Transparency (public disclosure related to sustainability, governance, products).
3 – Climate Change / GhGs (climate risk & opportunities; GhG emissions).
4 – Ecological Impacts (biodiversity, deforestation, environmental management, responsible agricultural practices).
5 – Water (use, waste water treatment, recycling).
6 – Workplace Health and Safety (health & safety management; health & wellness training programs).
7 – Waste (hazardous, non-hazardous waste; management of product end-of-life).
8 – Energy (energy use, renewable energy).
9 – Supply Chain Management (screening business partners on ethics & sustainability issues).
10 – Compliance (with EHS regulations).

The American Cleaning Institute’s Materiality Assessment, Brian notes, is an important way of guiding the association’s and member companies’ reporting on industry priorities. It’s also useful for the dialogue between companies and their stakeholders. ACI CEO Ernie Rosenberg notes that the association will be more strategic about tracking industry performance [on the issues] and the ACI sustainability reporting will evolve as a result.

In our view, the American Cleaning Institute’s sustainability program is an excellent example of the preferred method of the American business community in addressing ESG performance issues: adopting of voluntary, industry-wide standards, approaches, guidelines, codes of conduct, and other non-regulated approaches.

As we said up top, this approach is represented by what we see in the automotive, electronics, chemicals, apparel and other industries and sectors. This is important to keep in mind as the public dialogue on sustainability reporting includes expectations that the Federal government will at some point issue mandates for greater sustainability disclosure and structured reporting (similar, some advocates say, to mandated financial reporting).

# # #

For Reference

 

Company participants in the 2014 American Cleaning Institute Metrics Program:

AkzoNobel Chemicals LLC; Amway; Arylessence, Inc; BASF Corporation; Brenntag North America; Celeste Industries Corporation; Chemia Corporations; Church & Dwight Company, Inc; The Clorox Company; Colgate-Palmolive Company; Corbion; Croda, Inc; The Dow Chemical Company; DuPont Industrial Biosciences; Ecolab, Inc; Evonik Corporation; Farabi Petrochemicals; Firmenich Incorporated; Givaudan Fragrances Corporation; GOJO Industries, Inc; Henkel Consumer Goods, Inc; Huntsman Corporation; International Flavors & Fragrances, Inc; Novozymes PQ Corporation; Procter & Gamble; SC Johnson; Sasol; Seventh Generation; Shell Chemical LP; Stepan Company; The Sun Products Corporation; Vantage Oleochemicals.

These companies are key members of the US$30 billion U.S. cleaning products marketplace. ACI members formulate soaps, detergents and general cleaning products used in household, commercial, industrial and institutional settings. They also supply ingredients and finished packaging for these products; and, ACI members include oleochemical producers.

Reporting 2025 – Perspectives: Interview with Kumi Naidoo, International Executive Director, Greenpeace

The GRI global organization is conducting a series of interviews with thought leaders to gain their perspectives on what they expect the main issues to be on corporate agendas and their public reports in 2025.  These are produced monthly and G&A Institute will share these through our websites, newsletters, blog, social media, and various other channels to raise awareness of this important initiative.

Interview with Kumi Naidoo, International Executive Director, Greenpeace
See also the interview summary
4 December 2015

Are Public Companies Including Sustainability Information In The Traditional Financial Communications Channels?

We are almost at calendar year end and for many companies approaching fiscal year end — and that means busy-busy-busy times in the corporate suite as senior managements prepare 4Q / year end results for the earnings release and the details of the earnings call to be scheduled not too far into the new year 2016.  The preparation for the 10-k will be underway in earnest at year-end.  So – reflecting the heightened interest of the investment community in sustainable investing – what about companies including narrative and metrics related to the progress of the company’s sustainability journey?  Are companies including these references?  Will they?  Our colleague, Pam Styles (Fellow of the Institute and principal of Next Level Investor Relations LLC) writes about this on the AlphaSense blog, exploring the question:  should ESG / Sustainability be coming up on earnings press releases and conference calls?

In conversations with U.S. corporate managers, we hear over and over – no one in the investment community ever asks about our CR or sustainability efforts/progress on the earnings call.  (It’s very different in Europe, where sustainability questions are more mainstreamed. Pam includes European company trends in her article.)  Pam’s research identified a small number of U.S. public companies that did include references to sustainability in their earnings releases, included references in their Proxy statement, in their 10-k, or in other financial communications separate of the many sustainability reports published by public companies.  Companies referencing sustainability topics included  Alcoa, Cardinal Health, Hormel Foods, and Campbell’s Soup.

Trendsetters:  Using the AlphaSense resource, Pam found eight U.S. companies that back in 2010 were referencing ESG/Sustainability in their investor communications:  Emerson Electric, Chesapeake Energy, CR Bard, Gentex, Google, St Jude Medical, EQT Corp, and electric utility Vectren.  Forward to 2012 – Baxter made comments on its annual conference call.  What’s ahead?  Will more U.S. companies expand their traditional financial communications to include sustainability information?  Read the findings in Pam’s commentary below.

ESG / Sustainability — Is the Topic Coming up on Earnings Calls?
(Wednesday - November 25, 2015)

Source: Alpha Sense – Pamela Styles, principal, Next Level Investor Relations LLC
 - There is growing evidence of attention to ESG / Sustainability in mainstream investing. Global ESG / Sustainability investments are now 30% of all professionally managed funds with significant growth both in the U.S. and UK …

 

Reporting 2025 – Perspectives: ‘Shaping the future of sustainability’ – a highlights video from the Sustainability and Reporting 2025 Forum held 21 October 2015 in Rome, Italy

The GRI global organization is conducting a series of interviews with thought leaders to gain their perspectives on what they expect the main issues to be on corporate agendas and their public reports in 2025.  These are produced monthly and G&A Institute will share these through our websites, newsletters, blog, social media, and various other channels to raise awareness of this important initiative.

‘Shaping the future of sustainability’ – a highlights video from the Sustainability and Reporting 2025 Forum held 21 October 2015 in Rome, Italy

30 November 2015