Safety 2012 producing a sustainability report session 654

Producing a Sustainability Report

Session 654

© JB, FF, MH CSR 2012

An Interactive Session

Speakers• James Boretti, CSP

– President– 28 Years

• Fay Feeney, ARM, CSP– Principal– Vice-Chair, ASSE Foundation

• Mark D. Hansen, PE, CSP, CPEA, CPE*– Director of Portfolio Environmental & Risk Management

BORETTI, INC. INTEGRATED SAFETY SOLUTIONS

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[* The information and views expressed in these materials are those of the author only and do not constitute in any way a position, policy, or pronouncement of his employer.  These materials are not intended, and may not be relied upon, as legal advice or binding authority and do not create any rights, substantive or procedural, enforceable by any party in any matter, whether civil or criminal.]

Objectives• Learn the elements of CSR reporting that SH&E

can manage– For your organization

• Be able to show your value as a contributor as the “new” economy materializes

• Walk away with confidence that you can add value– From application

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Just a Reminder…There are subtle differences

between …

… Corporate Social Responsibility …

… Sustainability and …

… Environmental, Social and Governance …

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© JB, FF, MH CSR 2012

Sustainability - ne Definition

“meeting the needs of the present without

compromising the ability of future generations to meet their own needs”

1987 Brundtland Report

CSR …• … is also called corporate conscience,

corporate citizenship, social performance, or sustainable responsible business

• form of corporate self-regulation• integrated into business model

• Aligns with “License to Operate”

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CSR

• Public Transparency • Hiring practices• Helping communities• Do No Harm• Climate Change

Social Accounting, Auditing, and Reporting

• Human Resources• Ethics• Risk Management• Brand Differentiation• License to Operate

Governance

• Legal• Ethics• Environmental, Safety & Health

Compliance

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ESG

Environmental

Social

Sustainability …• Capacity to endure

– In ecology, describes how biological systems remain diverse and productive over time

• For humans– Potential for long-term maintenance of well being

• Environmental, governance, and social dimensions

• Interfaces with economics – Social and ecological consequences of economic activity.– Involves ecological economics where social, cultural,

health-related and monetary/financial aspects are integrated

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Environmental Social

Governance Economic

• New regulations • Reputation damage • Continued access to natural resources•Climate change

Sustainability

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• Ability to hire & retain talent•Labor related controversies• Product related complaints • Human rights

• Reputation damage & legal costs • Shareholder controversies

• Supply Chain risk• Customer loyalty

Key Business Drivers

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Five Relevant Risks to CSR

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What is CSR History …• Term "corporate social responsibility”

– Common use late 1960s / early 1970s• Term “stakeholder”

– Those groups without whose support the organization would cease to exist• SRI

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What is CSR History …• 1976 OECD Guidelines released for Multinational

Enterprises– Voluntary standards and principles for responsible

business• 1977 Sullivan Principles

– Created to help U.S. companies apply economic pressure on South Africa to end apartheid

• 1977 French government– Requires disclosure of labor and employment- related information for companies > 300 ees

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What is CSR History …• 1984 Union Carbide (Bhopal) • 1989 Exxon Valdez• 1990s Royal Dutch Shell

– Conflict between Nigerian government and local communities (allegations of human rights abuses)

• 1990s Nike supply chain– child labor (Cambodia and Pakistan), hazardous

working conditions (China and Vietnam), poor wages (Indonesia)

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What is CSR Reporting …• 1997 GRI is formed

– Sustainability Reporting Guidelines released: 2000

• 2000 UN Global Compact (GC) launched • 2000 CDP created to encourage disclosure of

GHG • 2001  Enron• 2001 French government mandates CSR

reporting for all listed companies• 2003  AccountAbility releases AA1000 Assurance Standard.

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What is CSR Reporting• 2004 Johannesburg Stock Exchange

– Creates Socially Responsible Investment (SRI) Index• 2006 IFC

– Policy and Performance Standards on Social and Environmental Sustainability for project financing

• 2008 Sweden and Denmark– Mandate CSR reporting

• 2010 GRI and GC– Sign MOU: agree to align efforts to promote CSR

• 2010 ISO 26000© JB, FF, MH CSR 2012

CSR Reporting • Take a Moment…

• How would you determine which reporting mechanism to use?

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What is CSR Reporting …

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Who Reads CSR Reports?

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Company

Customers

Employees

Investors

Activist

Policymakers

Analysts

Supply Chain

Stakeholders

CSR Reporting • Take a Moment…

• Who would be part of your team (or can you do this alone)?

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Company

Customers

Employees

Investors

Activist

Policymakers

Analysts

Supply Chain

Stakeholders

2012 Proxy Season

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http://www.ey.com/Publication/vwLUAssets/2012_proxy_season/$File/2012_proxy_season.pdf

27%

two-thirds

2012 Proxy Season• Shareholder environmental proposals – 27%• Proposals are asking for quantitative CSR goals• > 2/3 of the Fortune 500 companies issue

Sustainability Reports

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Ernst &Young Framework for CSR

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Ernst &Young Framework for CSR

Who is Reporting on CSR• Fortune 500

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CSR Reporting Outcome• Integrating deep into governance and accountability• Establishing incentives to reward sustainability

performance• Incorporating stakeholder feedback into strategic

planning and decision-making• Reporting strategies and results through public

disclosures• Building a diverse workforce and leveraging their

innovation• Requiring operations / supply chains to meet ESG goals• Developing and implementing sustainable products /

solutions that accelerate clean, profitable economic growth © JB, FF, MH CSR 2011

CSR Reporting Mechanisms• Global Reporting Initiative organized into

categories:– Environmental Performance– Social Performance– Governance Performance

• Foundational framework for all reporting mechanisms– Keys are:

• Defining report content, time period, and boundary

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CSR Mechanisms & SHE• GRI & Safety Metrics

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CSR Reporting • Take a Moment…

• What kind of data would you need to include in the report?

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CSR Reporting Mechanisms & SHE• Product Responsibility (Sub-Category)

– Customer Health & Safety = impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures; compliance

– Product Servicing & Labeling = number of incidents with of non-compliance with regulations and voluntary codes concerning product and service information and labeling

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CSR Reporting Mechanisms & SHE• Content Index

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Source: https://www.globalreporting.org/reporting/reporting-support/reporting-resources/content-index-and-checklist/Pages/default.aspx

CSR Reporting Mechanisms & SHE• Content Checklist

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Source: https://www.globalreporting.org/reporting/reporting-support/reporting-resources/content-index-and-checklist/Pages/default.aspx

Example Report• Policies and procedures• Business licenses• Social insurance receipts• Proof of age and pay documents• Restroom and stalls count• Occupational safety records• Emergency evacuation plans and drill records• Chemical list• Hazardous materials manifests• Refuse disposal records

Example 3rd Party Validation Obs.• Child Labor:• Wage and Hour• Health and Safety

– Work area is well lit, ventilated, free from debris, and aisles are marked and clear– There are functioning fire equipment and first aid supplies in all work areas– Unlocked, marked, and accessible exit doors with multiple exits in each area– Machine pulleys have guards; tagging needles are disposed of properly– There are sufficient number of clean, functioning restrooms with running water and trashcans– Chemicals are used, stored, and disposed of properly– Food area is sanitized and has fire equipment and freezers for storage– Employees are trained for emergencies.

• Employee Environment – Obtain reported work hours, wages, and overtime policies from different workstations– Diplomacy practices and freedom of movement are described– Security frisking and pregnancy testing are verified– Production quota: ability to meet goals and consequences for not meeting– Overall suggestions for improvement from employees– Do employee reports match other findings?

• Quota, Transshipment, Subcontracting

CSR Reporting Mechanisms & SHE• Reporting:

– Helpful to know:• Think on macro, strategic scale• Risk threats and opportunities

– Use a template• i.e.,

https://www.globalreporting.org/resourcelibrary/English-Lets-Report-Template.pdf

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SHE

ExecutivesHuman

Resources

Marketing / PR

Production / Operations

Legal

Quality

Contractors / Vendors

Working with Other Departments

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Case Study• Scenario:

– The CFO of your company approaches you with the Director of HR: two of the companies for which you supply product are going to audit the company now and going forward for sustainability / social compliance.

– These audits could mean continued business relationships, or discontinuing the business relationships.

– What they want is for the company to participate in sustainability / social compliance reporting, that will be audited annually, and you are the person Senior Management has decided should lead this process. Each company is worth $500 M annually to your organization.© JB, FF, MH CSR 2012

Case Study• How would you determine which reporting

mechanism to use?• Who would be part of your team (or can you

do this alone)?• What kind of data would you need to include

in the report?

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Internet Resources

ASSE SH&E & SHRM Human Resources CSR/Sustainability Network

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Internet Resources

http://www.globalreporting.org/Home

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Summary• Elements of CSR reporting that SH&E can

manage

• Key Takeaway:– SH&E opportunities within CSR reporting and

initiatives

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Final Thoughts

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