While corporate sustainability measures undertaken by most large companies are ‘overly introspective’, few of the world’s largest companies have developed a capacity for ‘sustainability leadership’, according to sustainability research firm Two Tomorrows.
The researchers find only 28 percent of the large global companies it studied could be classified as taking a ‘sustainability leadership’ role. The industry furthest behind in sustainability efforts, the report notes, is healthcare, while oil, gas and mining industries have made more advances to help offset the negative environmental consequences of their activities.
The study, the ninth annual such report by Two Tomorrows, covers the 25 largest companies from each of the major regions of the world – Australia/Asia, North America and Europe – plus the 25 largest firms from emerging markets and the top performers in each of the super-sectors in the Dow Jones Sustainability Index.
‘Companies today are increasingly aware of sustainability issues and actively integrate sustainability into core business strategy and decision making,’ the study concludes. ‘They are opening up and describing in detail how they define material issues, engage stakeholders and join multi-stakeholder initiatives.
‘However, as they become more responsive to the Global Reporting Initiative (GRI) sustainability reporting guidelines and other reporting frameworks, they are failing to adequately put their performance into context.’
Two Tomorrows also compiled a list of the ‘10 Best Practices’ among the companies it studied. Companies in the list include Citibank, because it ‘identifies its many stakeholder groups and the communication channels it uses for dialogue with each group – including, for instance, public webinars with NGOs and community groups.’
HSBC is commended for ‘balanced reporting’, Ford Motor Co is mentioned for setting concrete specific, measurable, attainable, relevant and timely (SMART) targets for financial health, climate change, water and other areas, and Hyundai Engineering receives a favorable mention for very thorough materiality analysis. This covers benchmarking against peers, a media analysis, close study of guidelines and frameworks such as ISO 26000, the UN Global Compact and the GRI sustainability reporting guidelines, and wide-ranging stakeholder consultations.’
The research also commends GE, because its ‘ecomagination program of research in clean technology R&D is stimulating the development of products and services that measurably improve customer/investor value and environmental performance. This is an example of sustainability deeply embedded in core business processes.’
The report concludes that so-called high-risk industries such as oil drilling, mining and heavy manufacturing, have made some of the most significant advances in sustainability practices as they seek to ‘deliver the building blocks of society and growth in a manner that is, put simply, less bad. For instance, decades of experience of operating in challenging environments has helped oil & gas sector leaders develop best practices in risk management that integrate stakeholder feedback.’
