Back to Basics: What is CSR Reporting?

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The concept of CSR reporting (CSR means "corporate social responsibility") is almost as flexible as the concept of CSR itself. Just like every company can define to itself what CSR means, it can also choose how to communicate its CSR progress in whatever way it finds suitable. On one hand this lack of uniformity can be pretty exhausting and sometimes even irritating – just think what would have happen if every company decided independently how to report its financial results. On the other hand, this level of flexibility enables companies to be creative and come up with a report that has some sort of personality, reflecting the vision, values and personality of the company.

Take 3M for example. The company, which published its first corporate environmental report back in 1993, stays ahead of the curve, adopting new measures before almost everyone else, whether it’s a release of a fully integrated electronic report (2002) or publishing externally verified one (2003). Another example is Philips, which is using its report to emphasize the changes the companies is going through, its R&D capabilities, the importance it gives to  stakeholder engagement and also how it provides  an example of the business case for sustainability.

Philips, which is using the integrated reporting format, is not the only company that has decided to move into a new format that better reflects its own culture. Take for example Timberland which has switched from a CSR report into a CSR portal with accessible, user-friendly, transparent, and updated information on the company’s main environmental and social impacts. The portal gets updated on a quarterly basis. Another example is Patagonia, which in 2004 produced an audited CSR report, but didn’t like the result. As Jeffrey Hollender describes in his book ‘The Responsibility Revolution’, “the published document felt antiseptic and inauthentic. Yvon Chouinard called it “absolute bullshit” and Jill Dumain, Patagonia’s director of environmental analysis at the time said “it was as boring as all the other reports out there – it felt like a meeting statement.” Eventually Patagonia came up with the Footprint Chronicles, its “tell it like it is” version of CSR reporting.

There are of course downsides for these degrees of freedom. One of them is the fact that companies tend to tell a story they feel comfortable with rather than the whole story about their level of commitment and progress (see Chevron’s last report for example). Some reports are too long, published only every couple of years, provide partial or even wrong data, lack external verification, or are not even prepared in accordance with the GRI guidelines. As you can see, the list of potential issues is long and we haven’t even started talking about complaints that CSR reports are just too boring, have become a PR tool, are worthless in general and basically 99 percent of the stakeholders don’t really bother to read them.

Still, we shouldn’t ignore the fact that we have seen significant progress in CSR reporting in the last couple of years both in terms of quality and quantity. It has practically become a requirement for every company that claims to take CSR seriously, and companies keep pushing the envelope to create better reports. And while we should demand them to keep doing so, we should also take advantage of what CSR reporting is offering right now, because with all of its flaws, it is still the only corporate report with personality you will have a chance to read for better or for worse.

Raz Godelnik is the co-founder of Eco-Libris, a green company working to green up the book industry in the digital age. He is an adjunct faculty at the University of Delaware’s Department of Business Administration, CUNY and the New School, teaching courses in green business and new product development.