Shareholders and analysts want compulsory sustainability reporting,

Source: ECC Group, 2 October 2002

Three-quarters of all respondents to a survey of German-speaking readers of sustainability reports want the process to be compulsory for larger companies, a study has found. The demand for compul-sory reporting extends beyond environmental pressure groups to analysts and investors.
736 questionnaires were returned to the online survey sent out by lead-ing communications consultancy the ECC Group in August 2002, a re-sponse rate of 17 percent.

Respondents were generally pleased with the environmental data pre-sented in sustainability reports, but improvements were demanded in other areas. In particular, 65 percent of readers were dissatisfied by the social data reported, and 64 percent felt that transparency was the key function of such reporting. A similar number wanted all companies to use the Global Reporting Initiatives guidelines for reporting.

The pressure on companies to get their key information over to the read-ership is intense. 75 percent of readers state that they spend no more than 30 minutes on a report. Only nine percent of respondents said they read a report in full. The majority of report recipients (62 percent) read selectively, with a quarter of readers skip complete chapters. This means a high risk for companies that some of their essential messages will not get across to their stakeholders.

Almost 70 percent of readers required on-line access to sustainability data, but in most cases this was seen as a supplement to a printed re-port, rather than as a substitute for it.

Andreas Steinert, managing partner of ECC Kohtes Klewes, commented: There is a good deal for companies to reflect on in these findings. Re-spondents are clearly no longer satisfied with an environmental report with a few random findings on social and economic issues: they want sustainability reports which are published to a common standard, such as the GRI, and deal with difficult issues such as human rights and the business case for sustainability.

The pressure for more detail runs however counter to another finding the limited time that most respondents are willing to spend on reading reports. The answer is clearly to produce readable and well-structured printed reports which are suitable for a flick-through approach, while posting more detailed data on the internet.

Download the report in German