This afternoon workshop on day 2 of #NewMetrics caught attendees up with the latest from early adopters of integrated reporting. Practitioners have always aimed to derive the best way to report status, progress and value of sustainability work, but the Holy Grail of processes has been elusive. Four leaders in this area gathered in this session to discuss the lessons and challenges from their experience of adopting integrated reporting.
Matt Ellis, CEO of Measurabl and session moderator, raised the all-important question: Why do we do integrated reporting? The answer: To created integrated strategy and thinking. When sustainability reporting is separate from business reporting there is permission for companies to not fully embed or embrace CSR goals as a fully integrated part of the business.
“Instead of having a corporate sustainability strategy, we now have a corporate strategy that is sustainable,” said SAP’s Thomas Odenwald. Digging into his experience, Odenwald explained how SAP first reframed how it looked at sustainability in 2007, and since then it has become a part of its core value proposition. The four strategic objectives of its inclusive reporting include revenue, profit margins, employee engagement, and customer satisfaction, and companies can review a deep dive of the SAP process at SAPintegratedreporting.com. Having integrated sustainability reporting changes the conversation with stakeholders — and gives a new relationship with investors who have a deeper understanding of ESG data and how all company metrics relate to each other. Odenwald emphasized that “monetizing indicators is essential.”
“People want to know more information about the products that they consume — so if you are going to ask suppliers for data, you might as well as for product-specific data,” commented Aaron Smith, Director of Sustainable Building Solutions at Assa Abloy. He has taken the approach that product-driven disclosure can set up reporting success and innovation, often revealing blind spots in product impact. “If you can stay on top of what is voluntary (in reporting), then you can be prepared for new regulations,” he said. Assa Abloy has found incredible opportunity by taking reporting down to the operational level — and making it relevant for the person on the factory floor.
Novo Nordisk’s Cora Olsen reported that they have now surpassed their 10th anniversary of a published integrated report because the company bi-laws were changed — mandating that financial, social and environmental performance be measured and reported. The benefits: a solid governance structure where board and committee members are involved and set performance goals. As she pointed out: “Just because you have data doesn’t mean you need to include it,” as integrated reporting does not allow for long-winded data-spewing. But having a foundation of integrated reporting leaves the company’s commitment to CSR unquestionable, helping to brave the storms of positive or negative publicity.
All speakers agreed that as early adopters learn, grow and stabilize, costs and processes will become more manageable for others. Companies need a greater awareness of how all company metrics tie together so that communication can be clearer and the pace of transformation can increase.