Developing a corporate social responsibility (CSR) report can be daunting. It’s not easy to summarize a company’s sustainability activities; to demonstrate the passion the company has and its commitment to better practices. But today, it’s vital. Showing your commitment to sustainability is no longer a nice-to-have; consumers are demanding to be aware of the impacts a company has on the environment and the communities where they operate. Investors, on the other hand, are realizing that economic, social, and governance (ESG) impacts do not live in a silo away from the financial impacts they’ve traditionally been focused on.
Corporate social responsibility requires balance: balancing the needs of all your stakeholders, balancing data and stories, and balancing impact and importance. It’s also about being transparent and authentic; showcasing what you’re doing, both the good and bad, in a way that aligns with your brand and messaging style.
We believe there are six key pillars to developing a corporate social responsibility report successfully:
Following these pillars, will keep you in balance and ensure that your report and CSR strategy are successful.
Transparency is one of the most important elements of CSR reporting, especially since it requires publishing company information around potentially sensitive topics, such as data around emissions, water consumption, and diversity. It’s natural for companies to be concerned about sharing data, especially if that data could reflect poorly on the business or its products. As a result, many companies will report superficial data points and leave stakeholders asking for more information. For example, if you say that you reduced your carbon emissions by 25%, you don’t leave your consumers wondering how you did that, what data you included or what your baseline was.
CSR reporting requires asking deep questions to understand how and why things happen. Many companies lean on reporting standards (such as the Global Reporting Index, the United Nations Communication on Progress or the Sustainability Accounting Standards Board) to ensure they’re asking the right questions and reporting the right data.
Today, consumers crave authenticity and your CSR report is an opportunity to resonate with them in a genuine way. Your communications around corporate social responsibility should be consistent with the look, feel, and voice of the rest of your corporate messaging. It’s an opportunity for you to have a genuine conversation with your stakeholders, and as such, it should feel human. And, it should include real, human stories and examples of CSR projects and initiatives that your company is doing.
It is not the time to try to portray yourself as perfect, but as genuine and open. It requires you to be upfront and honest about both the positive and negative impacts that your company has on all its stakeholders, including your consumers, customers, investors, employees, and communities. And, it builds trust with your stakeholders. It’s an opportunity to show that you share the same values as your consumers and are actively working to address issues that they care about. By being open and sharing data on your practices and policies, consumers’ trust in your company will only grow.
In order to be authentic and transparent in your CSR report, you need to make sure that you’re including information that is important and relevant to your stakeholders. Stakeholders are key to the success of any CSR report and it’s vital to identify and engage with them early on. True stakeholder engagement is a two-way conversation and engaging your stakeholders and reporting on topics that are important to them shows that you’re listening to and incorporating their feedback.
It’s also important that you communicate your CSR efforts to each stakeholder group in a way that makes sense. Your CSR report will be read by consumers, investors, prospective and current employees, media, NGOs, industry elites, and others. Therefore, it’s important to view your CSR efforts from each of their eyes. You need to make sure that your CSR report provides the right information to each group and that you communicate with them appropriately. Take time thinking about who your stakeholders are, what they need and how your CSR reporting will be used by each of them.
Your sustainability efforts should fall under a larger, more holistic strategy. It’s easy to get swept up with a million small projects, but that makes it more difficult for your internal and external stakeholders to understand your efforts. Developing an overarching strategy for your CSR efforts and report will make it easier to address the concerns of your employees, investors and consumers, and measure the impacts of your CSR efforts.
Your CSR report should also be embedded into your company’s overall business strategy. Successful CSR strategies requires the input and effort of every business unit and employee. By embedding CSR into your overarching business strategy, you’ll show that your CSR report is more than words on paper. It will also help your business units prioritize sustainability and to build processes to support your goals and methodologies to collect data.
Ideally, your CSR report will show that you’re progressing towards your goals. But you can’t achieve a goal that isn’t measurable. When setting goals, it’s vital to keep the SMART (Specific, Measurable, Achievable, Relevant, and Timely) framework in mind. For example, we commit to reducing our global Scope 1 emissions by 25% by 2025.
To do this, you need to put data and reporting processes in place and ensure that you’re collecting accurate data in a timely matter. This shouldn’t be something you’re doing alone though. CSR reporting requires input from the entire company, and all business units should work together to make sure that you’re getting the information you need, when you need it.
One of my favorite sustainability stories is about Bill Gates. In the 90s, Bill carried a letter with him in his briefcase everywhere he went. The letter was from the mother of a child who desperately needed a kidney transplant that the family couldn’t afford. This story pained Bill; as much as he wanted to help, he knew that he could either pay $20,000 and save this one child or use that money to bring malaria vaccines to hundreds of children in Africa and save many more. When you’re setting your sustainability goals and strategy, it’s vital to think about not only what is important to your company and stakeholders, but also where you can make the biggest impact.
It also means understanding how different sustainability initiatives impact your organization. Do you need a constant flow of clean water to operate? Or perhaps, you require a specific material that is sourced from a vulnerable area. Discussing the risks that your organization may face and the efforts to mitigate those risks through CSR initiatives should be addressed in your report.
The (Triple) Bottom Line to Developing a CSR Report
Corporate social responsibility is increasingly important in today’s world; for customers, employees, and investors. CSR reports are a way for companies to showcase their economic, environmental, and social impacts. But not all CSR reports are created equal. By following the above CSR reporting pillars, your company can develop a CSR report that resonates with stakeholders, engages your employees, and wins customer trust.
Contributions by Katerina Baduk and Noah Bidna