CSRHub Blog Research on ESG metrics and comments on sustainability best practice

Tears Don’t Mend Broken China

[fa icon="calendar'] Jan 12, 2017 11:32:16 AM / by Bahar Gidwani

renewal.jpgI’ve always been clumsy.  There were many broken dishes and glasses in my childhood.  My Mom was always kind about it.  She’d say, “Tears don’t mend broken China.”  She had other similar phrases I remember (e.g., “If you get a load of lemons, it is time to make lemonade!”), but the lesson was always Midwestern positivism.  Don’t sit around moaning about what can’t be fixed—keep moving forward and don’t let your own failures hold you back.

Our recent election broke dishes for those of us in sustainability.  Many of my friends in the field and a number of our clients have asked if US corporate sustainability programs will be put on hold for the next four years.

I’m not as good as my mother was, at mending dishes (or comforting someone who is crying!).  But I do see some reasons for hope:

  • Well-run corporations care about profit, reputation, and mission. If their sustainability programs generate a profit, reduce risk, or help them accomplish their longer-range goals, they should continue to pursue them.
  • Young folks soon take over. We get requests daily from students around the world who need data for a sustainability study or project.  For every student who majors in CSR there are ten other young people who care passionately about the world’s future.  Unless something dramatically changes how young people view the future, we will continue seeing a generation-driven rise in interest in sustainability.
  • US companies trade with the rest of the world—and the rest of the world won’t backtrack on sustainability. If a US company wants to be successful in Europe, Asia, the Middle East, etc. it must adhere to a high standard of ethics, respect indigenous peoples, avoid polluting local water supplies, combat climate change, etc.
  • US companies have the same stakeholders they did on November 7. Managers, employees, communities, suppliers, customers, and investors will continue to remind companies about the risks that companies will face if they do not behave responsibly. It will remain important to have a “social license to operate.”
  • Momentum matters. Corporations are big ships that turn slowly.  They have put money and time into corporate social responsibility (CSR) programs.  They won’t shift these resources into other things, without good reason and a lengthy analysis process.

 

What types of changes may occur?  Don’t expect stringent new guidelines from US regulators (e.g., the SEC, the EPA, OSHA, etc.).  Look for more boycotts and “buycotts.”  (Several groups are boycotting Trump-related brands and there seems to be a countervailing push to punish firms that won’t advertise on Breitbart.)  Some companies may offer less-sustainable alternatives in certain product areas.  (E.g., muscle cars, heavily-sugared cereals, and other “retro” products.)  Corporations may put on hold major new green investments until things “settle down.” None of this is long-term stuff.  We can mend these pieces and fix these holes.

We at CSRHub see our data and tools as a way to improve how a company communicates its progress and a means to reduce the cost of and improve the effectiveness of sustainability reporting. My mom once put the lid of a tea pot I’d smashed under my pillow and told me that it would give me sweet dreams.  Let’s remember what we’ve been through and all that we’ve accomplished so far.  Then, let’s move forward and dream again, about a better future.

Photo courtesy of  Ruth Edwards


Bahar Gidwani

Bahar Gidwani is CEO and Co-founder of CSRHub.  He has built and run large technology-based businesses for many years. Bahar holds a CFA, worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. Bahar has consulted to a number of major companies and currently serves on the board of several software and Web companies. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City.

CSRHub provides access to the world’s largest corporate social responsibility and sustainability ratings and information.  It covers over 16,800 companies from 135 industries in 133 countries. By aggregating and normalizing the information from 500 data sources, CSRHub has created a broad, consistent rating system and a searchable database that links millions of rating elements back to their source. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices, and seek ways to improve corporate sustainability performance.

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Rays of Hope for 2017

[fa icon="calendar'] Jan 5, 2017 11:24:05 AM / by Carol Pierson Holding

Donald Trump’s picks for his cabinet and advisors created a climate denier’s dream team, and their promises to renege on the Paris Climate Agreement and dismantle the Department of Energy and the Environmental Protection Agency are firing up the global Green movement big time.

Trump’s rejection of the Paris Agreement has generated “an unprecedented sense of solidarity among all the (signatory) countries,” says Alden Meyer, director of strategy and policy for the Union of Concerned Scientists. He believes that Trump has ceded climate leadership to China. Surely high levels of smog in Northern China help too: Beijing started the year in its third day of a smog alert, delaying flights and closing highways. On New Year’s Day, 25 cities in Northern China issued (even higher) “red alerts” for smog, closing factories, schools and construction sites.

Stop Dakota Access Pipeline.jpgGreen heroes are emerging everywhere. One example is the unlikely conversion of Portland’s Mayor, Charles Hale, once nicknamed “Fossil Fuel Charlie” for supporting a $500 million propane export facility proposed by the Pembina Pipeline Corporation, the largest pipeline in the Canadian tar sands and the largest business proposal in Portland history. Hale gave up his reelection campaign to push for projects including “the first stone in a green wall across the West Coast” — a zoning ordinance that effectively bans all new fossil-fuel-export infrastructure within the city’s limits, including the Pembina pipeline, and prevents expansion of existing facilities. On December 14, he got his wish, when the Portland city council voted unanimously for the ordinance.

Hale’s conversion came after a sustained campaign of relentless protests and public action. As his spokesperson Dana Haynes explained, “Public sentiment is very, very strongly against it, wildly against this thing. The mayor called Pembina in Calgary and said: ‘You’re walking into the chopper blades here. I was willing to support you last fall, but you’ve lost my support.’”

And these protests were even before Trump was elected.

Now, chopper blades, where personal stakes meet collective action, are everywhere. In December, Nevada’s Public Utilities Commission (PUC) voted to restore favorable rates to solar companies after a year of fee increases and a phase-out of credits for excess energy customers sent back to the grid. The reversal was supported by huge turnouts at the PUC hearings that included those whose power costs have gone up and those who suffered when major solar companies, including SolarCity and Sunrun, left the state as solar applications dropped from 1386 to 18 a month. Personal stakes are high. Hearing turnout is high. Chopper blades.

Best known are demonstrations in North Dakota, where Native Tribes and environmentalists staged a protest thousands strong at Standing Rock, the Sioux Tribe’s sacred land that was threatened by Dakota Access Pipeline, or DAPL. When the protestors change their designation from climate justice Water Protectors, focusing as much on potential contamination of the Missouri River as on land rights and ancient burial grounds, the action drew affected farmers and renewed support from leaders like environmentalist Bill McKibben and journalist Amy Goodman.

While that movement may have succeeded only temporarily, it did reset the agenda. “Water Protectors” pits fossil fuel companies against clean water, which many believe is a universal right. DAPL also engendered more protestors against the just-approved Trans Mountain Pipeline Expansion from Alberta to Vancouver. This project enlarges an existing pipeline to deliver three times its current volume of highly toxic and viscous tar sands oil to seven times as many tankers in the Salish Sea, just a few miles north of the pristine San Juan Islands and Seattle.  (Full disclosure: I live in Seattle and write on an island in Puget Sound.)

This 700% increase in oil tanker traffic is not sitting well in the Pacific Northwest. Water Protectors are already calling it “Standing Rock North.” Thousands of chopper blades.

The EPA releases a study that links fracking to water contamination. Fresh meat for chopper blades.

A coalition of outdoors enthusiasts, veterans, local businesses and environmentalists successfully argued that a $3 billion copper-nickel mining lease in Minnesota’s Boundary Waters Canoe Area Wilderness was illegally granted. Chopper blades.

Investors worth over $5 trillion have committed to dump fossil fuel stocks. Over 80% of that is from funds run for profit. More chopper blades.

And Obama churns out environmental edicts daily.

Trump will undoubtedly give no quarter to environmentalists or native tribes. With all that’s happened since his election, we collectively are setting chopper blades against his disdain for climate action. Isn’t this how a democracy is supposed to work?

 

 Photo courtesy of  Fibonacci Blue


Carol2 Carol Pierson Holding is President and Founder, Holding Associates. Carol serves as Guest Blogger for CSRHub. Her firm has focused on the intersection of brand and social responsibility, working with Cisco Systems, Wilmington Trust, Bankrate.com, the US EPA, Yale University’s School of Environmental Sciences, and various non-profits. Before founding Holding Associates, Carol worked in executive management positions at Siegel & Gale, McCann Erickson, and Citibank. She is a Board Member of AMREF (African Medical and Research Foundation). Carol received her AB from Smith College and her MBA from Harvard University.

CSRHub provides access to corporate social responsibility and sustainability ratings and rankings information on 16,891+ companies from 135 industries in 133 countries. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices and seek ways to change the world.

 

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A Gift - Help 10 Students and Yourself - One for TEN for CSR

[fa icon="calendar'] Dec 16, 2016 11:06:19 AM / by CSRHub Blogging

We are thankful for all the hard work to advance CSR and sustainability this year. In gratitude, CSRHub will give you 10% off an annual plan AND give TEN students a free subscription for their academic research… from now until 12/31. We are calling this our One for Ten for CSR.

Every day we receive many requests from students around the world seeking access to our database for their research CSRhub on company behavior. These students can change the world and often cannot afford even a reduced fee subscription.  

Many are reviewing their yearend 2016 budgets and telling us they are ready to start their CSRHub subscription. Are you ready to get started, too?  Simply use coupon code ONEfor10 during checkout.

There is no better time to gain full access to the world’s largest sustainability business intelligence database available. Our ratings and rankings tools will help you benchmark, evaluate, and improve company sustainability performance.

  • 16,500+ companies to drill down to 12 subcategory levels and pinpoint areas to improve
  • Ready-to-go, macro-powered dashboards to do the analysis for you
  • API access – custom research – reports
  • We can’t tell you this one yet – but it will knock your socks off! We are piloting a new tool to help you figure out which of your “high influencer” raters think you’ve been naughty or nice! 

 

More easy-to-use tools are under development right now to ensure you have a sustainable and successful 2017! Now is the time to get started - use coupon code ONEfor10 during checkout.

Do you need help picking out the best plan for your needs? Simply contact us and we will be happy to guide you and answer your questions. Please feel free to pass this offer along.


Sincerely,

Bahar and Cynthia

 

 Cofounders of CSRHub.png

Bahar Gidwani and Cynthia Figge, Co-founders of CSRHub

CSRHub provides access to the world’s largest corporate social responsibility and sustainability ratings and information.  It covers over 16,000 companies from 135 industries in 133 countries. By aggregating and normalizing the information from 491 data sources, CSRHub has created a broad, consistent rating system and a searchable database that links millions of rating elements back to their source. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices, and seek ways to improve corporate sustainability performance.

 

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Understanding the Just 100

[fa icon="calendar'] Dec 15, 2016 9:40:43 AM / by Bahar Gidwani

Just Capital was established in 2015 by two successful and well-known investors: Paul Tudor Jones and Martin Whittaker.  Its mission is to use “the power of markets to drive positive change on the issues Americans care most about.”  After two years of research and reflection, Just Capital has now published a list of the 100 best “corporate citizens.”

We’ve been interested in this project from its inception and provided the Just Capital research team with access to our ratings and other data.  Unlike other ratings systems that attempt to decide what things are good behavior or bad behavior, Just Capital sought the opinion of ordinary citizens about what defines good corporate citizenship.  When they released the first readings from these surveys last year, it caused a stir within the sustainability community by showing that social and ethics issues were more important to most Americans than environment or other governance issues.

We suspected that Just Capital’s approach would generate ratings that differ from those of the other 491 ratings sources we integrate into CSRHub’s data set.  A simple comparison between the top 100 company ratings and CSRHub’s ratings shows there is about an 8% R Squared between Just Capital’s perspective on corporate social responsibility (CSR) and that of CSRHub’s aggregate of all other sustainability rating sources.

Just 100 and CSRHub Correlation.png

 

For this first review, Just Capital chose to focus on components of the Russell 1000 Index.  They pointed out that this group of companies has a large market capitalization and that most are headquartered in the US.  (Only around 40 of the current members of the Russell 1000 Index have non-US headquarters.)  One of the planned uses for the Just ratings is to encourage US investors and consumers to support “just” companies.  Investors may find this first list useful, but US consumers and businesses buy products and work with hundreds of large foreign companies that have not yet been evaluated.

Just Capital looked at about 90% of the companies in the Russell 1000 Index.  It sought to discover how these companies performed across 67 different metrics.  CSRHub covers 969 companies from this Index and has access to around 3,000 different metrics on these companies.  Just Capital had to make a number of assumptions and adjustments to account for missing data.  CSRHub’s system automatically adjusts for missing data issues through its normalization and weighting algorithms.  Despite these methodological differences, there is some agreement between our systems.  In particular, the 100 companies Just Capital picked did have better average performance using CSRHub’s rating system than the other 869 companies we rate in the Index.

CSRHub Rankings comparison.png

 

On the other hand, there were some major differences between our rating systems.  19 of Just’s top 100 companies had overall CSRHub ratings that were in the bottom quintile (lowest 20%) of the 16,500 companies we track.  69 of the 869 companies that didn’t get into the Just 100 were in the top quintile of CSRHub’s ratings system.  To put it another way—the five top-scoring companies in the Just 100 had an average CSRHub rating of 59.  More than 100 of the other 869 that didn’t make the list had CSRHub scores above 59.

In order to better understand the difference in our results, we looked at individual examples.  Companies like Accenture, Intel, Cisco, Johnson & Johnson, and Microsoft were both in the Just 100 and at or near the top of CSRHub’s ratings.  (The average overall CSRHub percentile rank for these five companies was 96%, which means they were perceived in our system to perform better than more than 15,000 other companies.)  As we would expect, these companies had especially strong average scores in the Employee area (average 90% performance) and somewhat lower average scores on Environment and Governance issues (83% and 76%).

CSRHub and Just Capital high scores.png

 

The other end of the spectrum was more puzzling.  Here are five examples of where CSRHub’s view diverged with those of Just Capital.

high and low csr scores.png

 

Both Just Capital and CSRHub attempt to remove the influence of issues such as company size.  The ratings we have been using from Just Capital are their “relative” ranking—the measure of a company’s performance compared to others in its industry.  CSRHub’s rankings are also relative (since most of CSRHub’s sources take an industry-centric view of performance) but span all entities rather than just those in one industry.  Many of our sources overlap (and Just Capital had access to CSRHub’s ratings during its research process).  So, why are these five companies included in the Just 100?

The Just Capital folks deserve huge credit for transparency.  There is a tear sheet report on each of the companies in the Just 100—so it is fairly easy to see what factors swayed them to feel that a company deserved to be included.  CSRHub has a similar level of transparency—our users can inspect which sources we used and most of the data details that underlie our scores.

For instance, CSRHub has 62 sources and more than 1,200 ratings indicators for Discovery Communications.  Our systems show below average performance for all aspects of sustainability performance when compared to all of the companies we track (top section), the 128 Broadcasting and Advertising industry companies in our system (middle section), and the 6,374 US companies we have ratings for (bottom section).

 

Discovery Communications CSRHub drilldown.png

 

In its drill down, Just Capital gives Discovery an above average score on Worker Pay & Benefits based on 7 subscores.

 

Just Capital performance.png

CSRHub’s rating for this labor/pay topic are informed by 20 sources.  There are many negative reports, including:

  • No same-sex benefits (IW Financial).
  • No tie of compensation to overall climate performance (CDP).
  • Poor career management and promotion policies (Vigeo).
  • Low pay relative to global standards (MSCI ESG Governance Metrics).
  • Lack of Employment Quality monitoring systems (Thomson/Asset4).

These reports are offset somewhat by a positive score from Glassdoor regarding employee satisfaction (this 3.7 score is about 70th percentile) and 2014 awards from Forbes (Best Workplace), Best Workplace for Commuters, and Working Mother Magazine.  (Note though that only Working Mother repeated its award for 2015.)  It is hard to prove that Discovery deserves a poor score on this topic—but it is easy to see why others might disagree with Just Capital’s assessment.

Just Capital is well supported, media savvy (its launch events have been well attended and its article in Forbes received an “editor’s choice” star), and has a mission that resonates well with the general public.  It has taken a fresh approach to the challenge of evaluating corporate social behavior and its staff spent months forming its opinions.  Just Capital also reached out to the companies it was evaluating and invited them to contribute information.  For instance, Just Capital indicates in its tear sheet that Discovery plans to add same sex benefits for its employees in 2017.  When this is confirmed (and incorporated into the research done by CSRHub’s partners), it may “flip” some of the negative indicators we mention above.

CSR managers for companies who appear on the Just 100 should celebrate their good fortune.  Companies who did not should ask Just Capital to share the details that drove its assessment of their performance.  The CSR managers in these companies may then find facts that could be updated or corrected or areas where new programs could respond to Just Capital’s concerns.  As Just Capital expands its coverage and continues publicizes its ratings, we hope we will see benefits from its work for both corporations and consumers.  CSRHub plans to start incorporating Just Capital ratings into its analysis with its November data set, so that CSRHub users will be able to integrate this new perspective into their broader CSR communications program.

 


Bahar Gidwani

Bahar Gidwani is CEO and Co-founder of CSRHub.  He has built and run large technology-based businesses for many years. Bahar holds a CFA, worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. Bahar has consulted to a number of major companies and currently serves on the board of several software and Web companies. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City.

CSRHub provides access to the world’s largest corporate social responsibility and sustainability ratings and information.  It covers over 16,000 companies from 135 industries in 133 countries. By aggregating and normalizing the information from 491 data sources, CSRHub has created a broad, consistent rating system and a searchable database that links millions of rating elements back to their source. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices, and seek ways to improve corporate sustainability performance.

 

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Dark Data—5 Ways It Affects Sustainability Performance

[fa icon="calendar'] Dec 6, 2016 10:20:15 AM / by Bahar Gidwani

We have coined the phrase “Dark Data,” to describe information on corporate sustainability that exists, but cannot normally be seen and evaluated.  Dark Data is exchanged privately as part of supply chain, certification, and regulatory interactions.  As such, it forms an important part of how companies interact with their environment.

CSRHub already has 94 million pieces of corporate sustainability data-and its database is growing by several million pieces per month.  Our data set includes a large part (we estimate at least half) of the publicly available data on corporate social behavior for about 150,000 entities.  While this sounds good, we believe “dark data” sets may contain information on hundreds of thousands of companies that are not in “illuminated data” sets.

What are the types of dark sustainability data and 5 future trends?


Dark Data - 5 Ways It Effects Sustainability Performance - CSRHub

  


 

Bahar GidwaniBahar Gidwani is CEO and Co-founder of CSRHub.  He has built and run large technology-based businesses for many years. Bahar holds a CFA, worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. Bahar has consulted to a number of major companies and currently serves on the board of several software and Web companies. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City.

CSRHub provides access to the world’s largest corporate social responsibility and sustainability ratings and information.  It covers over 16,000 companies from 135 industries in 133 countries. By aggregating and normalizing the information from 491 data sources, CSRHub has created a broad, consistent rating system and a searchable database that links millions of rating elements back to their source. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices, and seek ways to improve corporate sustainability performance.

 

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