Executive summary (with the permission of UNEP)
We see evidence of an emerging 'new order' in the world of corporate environmental disclosure. Corporate environmental performance is in the process of becoming both a competitive and a strategic issue for business. As a result, the public reporting of corporate environmental performance is now emerging as one of the most pressing environmental challenges for business. It is closely tied to basic environmental issues, such as regulatory compliance and pollution control, as well as to emerging concerns such as liability and product stewardship. External reporting is also closely associated with the expanding range of environmental management tools such as auditing, life-cycle assessment (LCA) and full-cost accounting.
The objective of the report is to help companies - wherever they may be based and operate - to decide whether, to whom and how they should report on their current environmental performance and on what their future targets should be.
Survey of 100 Pioneers in Environmental Reporting
The report focuses on the first wave of reports from 100 companies operating - for the most part - in Europe, North America and Japan. The results of the survey can be found in Appendix 1, which - for each reporting company- identifies the country of origin, the sector, the year of the latest report considered, the industry reporting agreements the company has signed, the extent to which reporting occurs in the company's annual report or in a free-standing environmental report, and key areas covered.
Company Environmental Reporting looks at the interplay between three core themes of corporate environmental management. responsibility, accountability and sustainability (see Chapter 2). Five levels of corporate environmental disclosure are identified (see Figure 2, page 19)- and these have been used here to assess the annual and free-standing environmental reports. This embronic grading system is used to assess the reports of the 100 pioneering corporate reporters in Appendix 1
| many of these report makers (39%) are still at Stage l or 2; |
| A quarter (25%) of the companies surveyed are at Stage 3, with a further 11% making the transition to Stage 4; |
| Only 5% have reached Stage 4; |
| Stage 5, which will be based on the extensive use of quantitative methods (such as life-cycle assessments and mass balances) and on strong 1inks with industry-wide and national sustainable development reporting against pre-agreed targets, remains largely unexplored territory. |
Environmental Reporting Worldwide
The status of reporting in different world regions is covered in Chapter 3 and in Appendix 2. The key international reporting agreements and frameworks are discussed in Chapter 4 and in Appendices 3, 4 and 5.
Reporting 'recipes' and 'ingredients'
Chapter 5 then identifies some 50 key areas of corporate environmental performance which are covered, at least to some extent, by some of the current corporate environmental performance reports. Readers might like to think of these 50 reporting areas as a list of ingredients, with the different corporate environmental reporting frameworks offering recipes on how to pull together different mixtures of these ingredients in such a way as to satisfy the growing appetite for environmental performance data - and to meet the tastes of different stakeholder groups. Appendix 5 shows how these 50 'ingredients' relate to the main reporting frameworks or 'recipes', while Appendix 6 provides examples of how some companies have reported their performance against some of these yardsticks.
Recommendations are made in Chapter 6 on a 'core reporting set' of indicators which could be used by small and medium sized companies. Chapter 7 focuses on some key reporting requirements for a range of industry sectors. Chapter 8 briefly reviews some of the practical issues which corporate reporters need to address in developing their broader stakeholder communication activities. Chapter 9 then looks ahead to the next challenge: sustainable development reporting. Selected references are listed in Appendix 7 and some useful contacts in Appendix 8.