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

Why Mandatory Reporting is the Key to Better Benchmarking

[fa icon="calendar'] Jul 9, 2015 10:48:02 AM / by CSRHub Blogging

Guest Author: Adriana Salazar

A well-known quote from 19th century American writer Mark Twain says “Comparison is the death of joy”, but if you’re a company wanting to create a sustainability strategy that makes business sense, what if I tell you there’s a lot to be happy about in comparing yourself with others?

And what if I tell you mandatory reporting is instrumental in helping you make these comparisons?

By others, of course, I mean your industry peers. Peer benchmarking is the process designed to assist companies in comparing themselves with each other (on specific metrics or processes for instance) in order to grow and make better strategic decisions. If we focus on sustainability benchmarking, the process naturally closes in on sustainability-relevant metrics.

So why benchmark? Companies that grasp the importance of a solid sustainability strategy (and view it as an asset rather than a hindrance) know investors increasingly value this forward-thinking approach. In addition, knowing where you stand against your competitors and identifying strengths and weaknesses for improved strategic decision-making can help your corporation drive innovation and increase bottom line benefits. But for all its benefits (if you follow the blog, you’ll know we’ve discussed this before), the benchmarking process also has its challenges. To name one, sustainability benchmarking is only as good as the data it’s based on.

If you’re a company wanting to benchmark your sustainability data against your peers, you’ll likely want to use third party tools and services offering a good range of data and allowing you to run quick and reliable comparisons on a variety of indicators. But if you think about it, the only reason your company will even have access to this type of data in the first place, is because your industry peers and competitors have made their sustainability data publicly available.

In short, data (always) matters. Good quality and publicly available metrics are at the core of sustainability benchmarking. And this is where the question of mandatory reporting comes in. The next time you hear someone complain about compulsory sustainability reporting, there’s at least one solid argument you can give them: Although voluntary reporting is fairly extended, it’s the mandatory disclosure of key (and sometimes sensitive!) data that’s going to take sustainability benchmarking to the next level. For a corporation to obtain a truly reality-based snapshot of where it stands against its peers, both industry leaders and laggards need to have previously measured and released the ‘metrics that matter’, including those they would rather not report about.

While it’s true that regulatory instruments remain largely voluntary at the global level, mandatory sustainability reporting standards and legislation are increasingly present at the national level. According to GRI’s 2013 ‘Carrots & Sticks’ publication, which analyzed the increasing number of national and international reporting policies from around the world, in 2006, 58 percent of policies were mandatory, while 7 years later, over two thirds (72 percent) of the 180 policies in the 45 reviewed countries were compulsory.

In 2013 (see image below), GRI already highlighted that sustainability reporting requirements and recommendations were on the rise in the EU. More recently, due to the December 2014 EU Directive on the Disclosure of non-financial and Diversity Information by Certain Large Undertakings and Groups, by the end of 2017 an estimated 6,000 public interest companies with over 500 employees, across 28 Member States, will be required to disclose relevant and material environmental and social information in their annual reports.


In addition, increased mandatory reporting (contributing to improve and expand the quality and availability of data for sustainability benchmarking), also means the days of greenwashing are over. Highlighting a few obscure and supposedly ‘green’ KPIs in your next sustainability report is probably not going to convince anyone. Fortunately, globally and in the past few years, sustainability reporting has taken the opposite direction (towards increased disclosure, transparency, visibility, dialogue…), and that’s something we should all be very grateful for.

There are a number of user-friendly solutions to help you benchmark. At Enablon Publisher, we partnered with CSRHub to create a benchmarking tool allowing any corporation to quickly and efficiently measure environmental, social, governance and community performance against industry peers. From a user perspective, all you have to do is enter the name of your company, select your competitors, and start benchmarking!

If the idea intrigues you, visit us at: http://publisher.enablon.com/templates/benchmark/


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A Link Between Stock Exchange Membership and CSR Performance

[fa icon="calendar'] Jun 1, 2015 3:42:44 PM / by Bahar Gidwani

By Bahar Gidwani

CSRHub recently examined corporate social responsibility (CSR) and sustainability rating data for the 18,991 companies in fourteen major stock exchanges.  Despite the fact that CSRHub includes 64 million pieces of data from more than 380 sources, there is enough data to rate only 17% of the companies on these exchanges.  For some exchanges, only 1% of their companies could be rated.  The NASDAQ had the highest percentage of rated companies, with data available on 57% of its companies.

The average perceived sustainability performance of the companies varied, across the fourteen exchanges.  Companies on exchanges that require sustainability reporting had higher average ratings than those that did not.  We expect sustainability reporting to increase dramatically over the next few years in all parts of the world, as both exchanges and exchange regulators mandate more disclosure of material non-financial information.  Even without mandated disclosure, we should be able soon to assess the sustainability performance of most public companies, just as we currently measure their credit score or brand value.

Relative Performance

CSRHub measures twelve different areas of sustainability performance across four main categories of interest: community, employee, environment and governance issues.  There is enough data to fully measure the performance of 2,427 of the companies we studied—13% of the total.  We used this data to give an overview of the performance of the companies by exchange, as compared to all 9,300 companies we track.

CSRHub CSR Stock Exchange Link

To see the full discussion including variations in coverage, the current and future international reporting requirements and future implications, download a full report here.

Bahar GidwaniBahar Gidwani  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. Bahar is a member of the SASB Advisory Board. He plays bridge, races sailboats, and is based in New York City.

CSRHub provides access to corporate social responsibility and sustainability ratings and information on 14,400+ companies from 135 industries in 127 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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Join Cynthia Figge at the Sustainable Business Oriented CSR Awards & Summit 2014 Event

[fa icon="calendar'] Mar 11, 2014 10:22:39 AM / by CSRHub Blogging

Sustainable Business-Oriented CSR Summit 2014Our co-founder Cynthia Figge has been invited to speak in Shanghai at the 2nd Annual Sustainable Business Oriented CSR Awards & Summit 2014 (SBC 2014). Hundreds of top CSR professionals from Asia (and the rest of the world) will convene in China on April 21-24, 2014, and hear Cynthia’s take on how “big data” will affect sustainability reporting. Other speakers will address issues of shared values, sustainable construction, and interesting ideas such as artificial islands. Learn more at http://dconnector.wix.com/csrsummit2014. To enjoy a special 15% registration discount, please write to support@csrhub.com.

Conference: 21-22 April, 2014
Post-event Workshop: 23-24 April, 2014
Shanghai, China

This event will help you get a deeper understanding of Social Media and Big Data Strategies for CSR projects.

Key Themes of the Conference:

  • Cause-related marketing case study: new challenges, new tools, most advanced international case study
  • Identify the key global and local CSR challenges and emerging trends: key issues, hot topics, opportunities, risks to your future business
  • How to effectively champion CSR within your organization? Transform the culture, strengthen competitiveness and meet your business needs
  • What constitutes CSR best practice and how is it applicable to your organization?
  • Global solutions for local problems: efficient tools, methods, techniques to improve CSR performance to boost sustainable business
  • Partnership and project identification: key techniques to choose the NPO partner and project that fits with business and brand image.

Benefits of Attending:
From this two-day conference and two-day workshop you will be able to:

  • Gain in-depth analysis on compliance risks, financial rewards and the leadership strategies of CSR which will make an impact on your corporate’s bottom line
  • Fresh insight on latest development and future trends of CSR in China and how regulators, corporate leaders and international intellectuals evaluate CSR’s value to business, society and environment and how they respond to the changing environment
  • Cause-related marketing: How can we help government, customers and other critical audiences understand the full value of the contributions we make and leverage CSR benefits by successful marketing campaign
  • Learn the latest international reporting principles and know what the readers want to see: deliver excellent reports by using effective framework and guidelines
  • Best practices in integrating CSR system into business strategy to deliver sustainable products, make consumer-driven branding strategy, enhance corporate soft power in the new age of transparency
  • Skills and techniques to successfully communicate, implement and evaluate your company’s CSR program
  • Find out tools, solutions, practical advices and useful connections to help you dealing with the challenges and difficulties in the process of implementing CSR in 2014 and beyond
  • Network with key regulators, powerful NGO representatives and potential investors to design higher value CSR initiatives and support future projects

You will also be able to meet:
CEO, CRO, CMO, CSR Managers/ Directors/ CFO/ Managers who are responsible for:
• Corporate Social Responsibility
• Corporate Communications
• Public Relations/ Branding/ Marketing
• Sustainable Development/ Environmental Affairs
• Corporate Governance
• Community and Investor Relations
• Strategic Planning
• Human Resources/ Risk & Compliance
• Supply Chains

Cynthia FiggeCynthia Figge is a forerunner and thought leader in the corporate sustainability movement. She is COO and Cofounder of CSRHub, the world’s largest database that aggregates and organizes data and knowledge on the social, environmental, and governance performance of 8,900 companies to provide sustainability ratings to the marketplace. In 1996 she co-founded EKOS International, one of the first consultancies integrating sustainability and corporate strategy. Prior to founding EKOS, she was an officer of LIN Broadcasting / McCaw Cellular, and led new businesses and services with Weyerhaeuser, New York Daily News; and with New Ventures. Cynthia is Board Director of the Compassionate Action Network International. Cynthia received her bachelor's degree in Economics and an MBA from the Harvard Business School. She lives in the Seattle area.

CSRHub provides access to corporate social responsibility and sustainability ratings and information on 8,900 companies from 135 industries in 103 countries. By aggregating and normalizing the information from 300+ 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 change the world.



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New G4 Bridging Module!

[fa icon="calendar'] Aug 9, 2013 2:55:26 PM / by CSRHub Blogging

You’ve taken the 2-day, GRI-certified course – now what?  With the release of the new G4 BrownFlynn G4 TrainingGuidelines, it’s time for a refresh on GRI with guidance on how the new Guidelines will affect your reporting process. Our training partners, BrownFlynn have a great solution and are offering a new G4 Bridging Module.

BrownFlynn is the first United States-based certified training partner of the GRI, the globally accepted gold standard for sustainability reporting. Whether  helping clients to understand the GRI reporting framework or developing their sustainability reports for them, the GRI provides a sustainability management process that generates tangible returns.


BrownFlynn's GRI-Certified G4 Bridging Module is a one-day, in-person course that will be held in Cleveland, Ohio on August 13, 2013.  The Bridging Module is a GRI-certified course designed specifically for those who have already completed the GRI-Certified course.  This course dives deep into the G4 guidelines and will cover the following topics:


  •  How current reporting trends are addressed with the development of G4
  • The main focus and features of the G4 Guidelines
  • G4's new concepts, format and disclosures
  •  Implications of applying new disclosures for organizations that complete a G4 report
  •  And more!


Participants will receive an updated G4 certificate of completion.  Standard pricing is $600, but for registrants who have taken the two-day course from BrownFlynn, our customized Module is only $300!  The course will be held at Tower City in downtown Cleveland, which is accessible by train from the airport and contains several hotels within or nearby.

To register, please click here.  CSRHub members can enjoy a 10% discount by entering coupon code BF11 during registration!

For more information, please don’t hesitate to contact Cora Lee Mooney directly, at coraleem@brownflynn.com.

See CSRHub's CSR Events calendar for more training offerings.  See BrownFlynn’s webinars on demand.


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Does Materiality Matter?

[fa icon="calendar'] Feb 27, 2013 9:00:53 AM / by Bahar Gidwani

By Bahar Gidwani

Our friends at Agrion organized a Sustainability Summit last week.  About 250 people gold w captiongathered in New York to discuss various aspects of corporate social responsibility (CSR) and sustainability practice.  I had the opportunity to lead an all-star panel on materiality in sustainability reporting.  (Our panel included speakers from NASDAQ, Bloomberg, Rockefeller, and the CFA Institute.)

When we met ahead of the meeting, our group expressed a collective fear that we’d put our audience to sleep!  Materiality can be a pretty technical subject.  Here’s a quick definition of the word, in case you need it: Materiality is a measure of the estimated effect that the presence or absence of an item of information may have on the accuracy or validity of a statement.

We discovered that our panel of experts disagreed about exactly how materiality should be used in sustainability reporting.  One camp felt that sustainability reporting should be centered around a legal/regulatory view of materiality.  This perspective was well expressed in a recent SASB/Harvard article:

“…the courts and the SEC have generally defined information sufficiently “material” to require reporting as information that would be useful to “reasonable” investors considering a “total mix” of information in their decision making…the SEC has an obligation to require sustainability disclosure if a substantial portion of the investment community considers this information material…”

The other group felt that sustainability reporting should focus on what matters to a company’s stakeholder groups.  A recent CSR report from Electrolux put forth this view:

“In the context of sustainability, materiality relates to identifying the issues most relevant to conducting business responsibly and well. These issues can either potentially affect our performance, or the development of our business.”

Our audience initially agreed with the second (stakeholder) view.  After hearing the arguments in favor of the legal/regulatory view, almost the whole audience changed its opinion to agree that both perspectives should be considered, when doing sustainability reporting.

Although our panelists disagreed initially on this definition issue, they agreed on many other points.  For instance they all felt:

  • More companies are releasing more data, and some of it is becoming more material.  But we still get a lot of lousy data and smaller companies lag behind.

  • Stakeholders have different views of what data should be provided and whether or not it is sufficiently material.

  •  It would be great if we could consolidate all the competing materiality standards into a single set, but this is unlikely to happen.

We spent a lot of time on the question of standards.  It was obvious that our audience (mostly corporate sustainability managers) felt strongly that the standards environment was confusing and counterproductive.  Most of the audience had a favorable view of the work that has been done by the GRI (Global Reporting Initiative) and there was a lot of enthusiasm for the ISO26000 framework.  Fewer people knew about SASB’s initiative and those who did expressed concern that it would distract from the standards that were already known and in place.

I resisted dropping the Rodney King line (“Why can’t we all get along”) and instead appealed to our audience to be aware of and actively participate in the standards-setting process.  Our panelists offered similar closing remarks and reminded the audience that materiality discussions should lead to better understanding of the business opportunities (and risks) that come from sustainability reporting.

Bahar Gidwani is a Cofounder and CEO of CSRHub. Formerly, he was the CEO of New York-based Index Stock Imagery, Inc, from 1991 through its sale in 2006. He has built and run large technology-based businesses and has experience building a multi-million visitor Web site. Bahar holds a CFA, was a partner at Kidder, Peabody & Co., and worked at McKinsey & Co. Bahar has consulted to both large companies such as Citibank, GE, and Acxiom and a number of smaller software and Web-based companies. He has an MBA (Baker Scholar) from Harvard Business School and a BS in Astronomy and Physics (magna cum laude) from Amherst College. Bahar races sailboats, plays competitive bridge, and is based in New York City.

CSRHub provides access to corporate social responsibility and sustainability ratings and information on nearly 7,000 companies from 135 industries in 82 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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