More and more firms are reporting their sustainability credentials in a bid to raise capital on the markets.
We know what’s driving this – the fact that larger companies in the UK and Europe are now legally obliged to report their record regarding climate targets, energy usage, pollution, use of natural resources, and so on.
You would have thought that the United States would be the next to follow but – amazingly – it’s China. They’ve just implemented this sustainability reporting rule for all larger companies listed on the main stock exchanges.
I would therefore say that it’s inevitable that sustainability reporting of some sort is firmly coming down the line for the majority of firms, certainly larger ones (defined, you will note, by the Office of National Statistics as companies with over 250 employees… so not just the giants).
Now this is already causing a headache for corporations to achieve consistency through their external publishing of key metrics.
First, the language and ground-rules for sustainability reporting are principles-based, rather than proscriptive.
Second, the language of sustainability is still making its way towards proper, widely agreed definitions.
Third (here comes the cynical comments) board directors want instant results. They are sometimes (often?) pressurising their people to come up with positive sounding sustainability reporting… even when the hard reality is not yet truly up to scratch.
All of this combines to present something of a Wild West scenario.
So, pity the poor Comms people!
How can they tell what’s reliable and dry fact, and what is a selective version of the truth, designed to present the company in the best light but possibly not telling the whole story?
I can see an important new role for the Comms director here, though.
Given that they will get it in the neck if a smart journalist or regulator spots an anomaly, should the Head of Comms not be the final arbiter what ESG statements and ‘facts’ are communicated externally?
To give a sense of scale for the ESG inconsistency problem, I have seen a recent analysis of sustainability (direct emissions data) reporting that revealed data discrepancies in 40+% of cases between self-reporting and other respected sustainability data repositories.
So – watch out Comms Heads!
You WILL be dragged into this stuff, if you haven’t already been.
Don’t take on that responsibility without making sure you have the power to filter and control the quality stages before something goes out in the public domain.
I hope you find these bulletins entertaining. I’m happy to discuss all relevant engagements – from customer community creation, to directorial mentoring, to strategy development, to thought-leadership content development, to full campaign structuring and management, and more.
Do get in touch!
