The UK’s Corporate Responsibility Index is being refreshed this summer in a bid to maintain its relevance and popularity. EP looks at how it will change for participants
Five
years is a long time in the corporate world. Business in the
Community’s annual Corporate Responsibility Index will have its fifth
birthday next year and is in need of a service. While the index has
been a high profile success for the membership organization, Bitc knows
it needs to remain relevant, and is altering the index format over the
next few months.
One of the main reasons for the overhaul is the
need to involve more companies. The 2005 index, published last month
and headed by The Co-operative Bank, followed in descending order by
BAA, Barclays, BT, National Grid, and PricewaterhouseCoopers, attracted
131 large UK organizations willing to provide information on their
social and environmental performance and to benchmark the results
against others’.
But that was 13 fewer participants than the
144 taking part last year – a drop of nine per cent. Bitc feels
adjustments are needed both to attract more entrants – especially
mid-250 companies – and to maintain the commitment and interest of
those already taking part.
One of the main changes will be to
move away from the ranking of companies in numerical order, which Bitc
feels can put off businesses that are at an early stage of implementing
social and environmental policies. Rather than publishing a list of the
top 100 best performers, it will instead grade entrants, awarding
platinum, gold, silver and bronze stars. It will also present results
by sector, CSR subject area and company size, allowing more meaningful
comparisons.
An ‘entry-level assessment tool’ is being developed
for companies that feel they are not ready to be tested against all the
indicators, with 69 questions that will ascertain how they are
managing, measuring and reporting their social and environmental
impacts. The tool will identify areas of weakness in a company’s
performance and the actions needed to remedy them. Bitc also says it
will offer ‘greater value’ by providing more advice and private
feedback for prospective entrants.
Phil Hodkinson, group
financial director of HBOS bank and a Bitc board member, says the
changes are planned in response to feedback from index participants and
Bitc members. One frequently voiced concern has been the amount of
information that participating companies have to submit. Hodkinson says
Bitc will ‘lighten the load’ for businesses by allowing them to update
previous submissions rather than starting from scratch each year.
He
adds that his own experience at HBOS has shown him that gathering
information for the index ‘can cost many tens of thousands of pounds’
and eat up staff and managers’ time. He hopes the new measures will cut
the time required by half.
Newcomers will initially be able to
focus on a limited number of areas, Hodkinson says. ‘For a company with
limited resources the “all or nothing approach” can be a lot to ask.
But it would be fairly easy for them to make a start by addressing two
or three things they might do to move their business forward.’ There
will also be a rolling timetable for submission of data ‘if feasible’.
This would enable companies to provide the necessary information when
it suits them.
In an effort to keep the leading companies on
board, Bitc may ask them for a detailed assessment once every three
years, instead of annually as at present, and invite them to join a
‘leadership network’ to help raise the performance of others.
The
changes proposed have been well received, but participants are keen to
maintain standards. One CSR executive from a top 40 company in the
index told EP: ‘Making the
level of entry easier is a good thing, but there should be some kind of
requirement to report on certain issues in each sector, otherwise
you’ll just get firms reporting on the areas they perform well on but
which are not core in terms of their impact.’ Another from one of the
best-performing banks in the index added: ‘To get an increase in
businesses taking part, they need to allow firms to report on certain
areas and build from there. But you’ve also got to help those that have
scored well in the index and are looking for a new challenge.’
The changes will be finalized before September, at which point Bitc will begin gathering information for the 2006 index.
