Specific Challenges in Corporate Sustainability Reporting:
In contrast to corporate reporting generally, sustainability communication and reporting are characterized by some specific management challenges. Among the most important challenges related to company internal communication are:
It is often difficult to identify and analyse sustainability issues, which requires a change in current and traditional terms and perceptions. Management is furthermore challenged to link strategic analysis and management together with information management, corporate accounting and Sustainability reporting.
The complexity of corporate sustainability as a set of interrelated goals leads to problems for management in operationalization, measurement and
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Since SMEs constitute a large part of the economy and of its social and environmental effects, it is necessary to emphasise the benefits and to keep the costs of sustainability reporting low (ACCA 2004, European Environment Agency 2003, GRI 2004).
These challenges currently complicate the development of confidence and credibility in communication processes within companies, as well as between enterprises and their stakeholders. In addition, corporate sustainability reporting is confronted with sustainability specific challenges to company’s external communication (Herzig and Schaltegger 2004) such as:
On the one side, information about the sustainability of a company is not simple for stakeholders to access directly and they can often do this only with difficulty, and its acquisition can involve very high costs in both time and money. This leads to information asymmetry between the company and its stakeholders (Schaltegger 1997). Situations of asymmetric information tend to create a climate of low credibility which the company has to overcome with specific communication and management activities such as warrants, verifications, labels certified by credible NGOs,
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Non-financial costs come from increased pressure to meet goals or criticism from stakeholders. Also, commitments to stakeholders (such as investors, employees) and environmental protection should not be viewed simply as costs (Kolk, 2004). Instead, they help insure survival in the long run. In practice, most medium and small size companies still chose not to produce the sustainability or CSR reports because there was no mandated regulation and they needed to hire new staff or train current accounting staff to learn and understand the preparation procedures. They think these additional costs may not outweigh the future benefits in short
Wheelen, T. L., & Hunger, J. D. (2010). In Concepts in Strategic Management and Business Policy Achieving Sustainability, Twelfth Edition. Pearson Education.
Marrewijk (2003) demonstrates the concept of social responsibility (CSR), also known as corporate citizenship, which is mainly about a corporation’s initiatives to take responsibility for a company’s activities that impact the environment and social wellbeing in order to obtain sustainability. According to Deegan et al (2002), legitimacy theory is an approved theory that would be used in the practice of corporate social reporting because it is based on the notion of social contract and on the assumption that governance mechanism would adapt the strategy showing that the corporation is trying to comply with society’s expectation. Apple’s Environmental Responsibility Report (2014), discloses the carbon emissions of the facilities and the footprint of the supply chain with comprehensive product life cycle analysis.
This paper critically analyzes Nike company sustainability strategy. Every investor or a group of investors wishes to see the business profitable at the current time as well as having good prospects for future (Werbach, 2009). For this reason, business sustainability strategy is very important. A strategy is a plan that guides the company or a business firm towards a certain direction or set goals. Thus, sustainability strategy is an action plan that a company set in order to maintain the plan toward the achievement of company’s goals in future. Sustainability strategy puts into consideration aspects such as the source of raw materials, competition, human resource development, and sustainability, and the general business environment. Thus, in evaluating a business’ sustainability, it is important to consider the business planning in this direction (Heslin and Ochoa 2008)
Companies have presented investigations about their motivation towards voluntarily social and environmental as insolvent. This paper argues in agreement with Adam’s view that the goal of CSR reporting is to promote credibility and corporate image of stakeholders operating in a particular industry. Whereas companies must focus their efforts on enhancing their profitability, they should also ensure that the welfare of other stakeholders is protected.
Strengths and Weaknesses of the Sustainability and CSR Reporting According to the information disclosed in Annual Report 2016 of Tabcorp, this letter has discussed the sustainability reporting of Tabcorp by using triple bottom line reporting
Stuart Hart, in a business article, discusses the tough task for companies to make a sustainable global ec...
It is critical during the planning stage to consider and incorporate the appropriate attention for the organization's sustainability and Corporate Social Responsibility (CSR) practices (Bauer, Erdogan, & Taylor, 2012). With current business trends toward sustainable business and the impact this has on an organization's reputation, it is advisable for organizations to incorporate their commitment to sustainability into their onboarding indoctrination. Once the process has been planned, it is possible to discuss
Companies have to distinguish themselves in different ways if they are to have a good reputation and this can be done through their communication strategies. In a time of crisis the company’s reputation is threatened and the communication strategies used will save or hurt the firm’s reputation. Before creating communication strategies, companies ought to identify their stakeholders. Appendix 3 illustrates the different stakeholders of a company.
Sustainability is a concept with a diverse array of meanings and definitions – a widely used glamorous, ambiguous, ambivalent and vague concept that is used by different stakeholder groups in various ways. Presumably to avoid noodling over a terminology or to avoid the confrontation with a definition, most widely the concept is broken down a planning process (c.f. e.g. Döring & Muraca, 2010). That is why most common sustainability is understood as sustainable development.1
Important companies like Shell, DuPont, BP have been reorganised to generate profits from this green market of goods and services. In this sense, it may sound altruistic, "the sustainability", the logic of profitability and competition is what will determine the ability of companies of the future to meet the changing needs of consumers. This premise of "sustainability" as a necessary quality to be competitive, falls short, according to Bryan Walsh of Time magazine. In a 2007 article, the expert shows how "sustainable" is helping to drive out competition, given the approach taken by companies to become more efficient, flexible and cutting waste, which helps them provide better products and reduce costs. Companies that refuse to accept that they will face a strict and demanding environment.
For example, Woolworth Pty Ltd set a Sustainability Strategy in 2007 (Woolworthslimited.com.au, 2012), which set a range of goals for the business to improve its sustainability and reduce its impact on the environment. A couple of key issues the strategy put in place were to reduce their water usage by 200 million liters per year and to develop and implement policies for ethical sourcing including animal welfare and the use of palm oil which lawfully, they should be doing already as globally and domestically, governments have responded to the challenge of global food markets and decreased safety interpretations of consumers by suggesting new legislation and regulations which should ensure safe and animal-friendly production and save resources (Poetz, Haas, and Balzarova, 2012). To organize the tasks, people, and other resources in order to make these goals happen Woolworths Pty Limited, assured their farmers, producers and facilities were using water as sustainably as possible through improved fittings, equipment, and infrastructure. Woolworths Pty Limited led by example to influence their employees and suppliers, to work hard in order to maintain these ethical practices and finally they controlled these ethical goals by monitoring the progress of these goals using a third party factory audit program (Anon,
In today’s competitive world, the survival of any company depends on how it is perceived by key stakeholders such as customers, consumers, employees, shareholders, investors, and the general community in which the company operates (Cornelissen, 2014). One of the key objectives of corporate communication is to protect the reputation of the company. It is important for the senior managers to understand communication related problems in the company and devise appropriate plans of dealing with them (Cornelissen, 2014).
Global sustainability is an integral part to any business’s practice and should be not overlooked by big firms in the
Now-a-days it is considered that CSR is one of the major concerns of organization’s business ethics. Companies increasingly increase their corporate social responsibility (CSR) and ethical management accepting the positive impact on the bottom line. The vast bulk of Standard & Poor’s 500 companies publish sustainability reports unfolding their program challenges and achievements. These pre-emptive efforts can pr...
The sustainability of the ecosystems on which the global economy depends must be guaranteed. And the economic partners must be satisfied that the basis of exchange is equitable” (World). This quote demonstrates the complexities of sustainability. Another thing corporations should focus on when trying to be sustainable is their environmental impact.