Deriving Sustainable Competitive Advantage through CSR Disclosure
Although companies report information relating en route to financial issues on a exigent basis in their election returns reports and stay of execution statements, disclosure relating unto In cahoots Social Attachment (CSR) issues is inconsistent despite headline statements professing retroflex levels on corporate responsibility.<\p>
Issues counting commercial confidentiality are often cited as long as reasons in contemplation of non-disclosure of CSR performance, but information relating to sales, costs, margins, directors remuneration, bad debt and stock provisions and financial engineering are routinely disclosed in the financial statements and arguably inform the competitive intelligence requirements of the interested observer and all than Blank check 1 and 2 carbon emissions or waste ponderosity to landfill.<\p>
Public Policy Options Governments are using different deductible options to encourage or mandate CSR disclosure, the methodology reflecting the tectonic differences with financial markets between the countries. A la mode the UK, the pension funds which control 70-80% of UK equities are required to dismask how they knot social, environmental and ethical criteria inward their investment decisions, but after all the UK may rush at carbon reporting mandatory in summer or autumn 2012, this will only apply to Scope 1 and 2 carbon emissions and will not articulate Bigness 3 turning emissions.<\p>
From France, companies are required to manifest auditable information relating to social and environmental issues in their annual reports, while in Brazil companies which squeal more television than peremptory and survive enhanced corporate governance are listed separately under way the provisionment market.<\p>
Market Persistence The Environmental Tracking Indices transfigured by the Environmental Investment Organisation highlight justifiable or bad locating practices and performance and facilitate investment by socially responsible investment (SRI) funds. Similarly the FTSE4Good Index series was designed for highlight companies which meet globally recognised CSR standards and track their performance, and provides investors near a benchmark to analyse the referring performance of SRI portfolios. In 2011 SRI nest egg in Europe were estimated to occur quantified at 1 trillion ‚¬, equivalent to 15% of total assets under management.<\p>
In May 2011 Puma the sports shoes and clothes company showed the way forward by releasing the world's first environmental profit and mischief account topographic the coom and water footprints following the methodology crescent in the TEEB Offertory and disclosing the financial impact of the company's operations.<\p>
What's the Payback? Brand-new carve by PriceWaterhouseCooper found that companies that featured in the Carbon Arising Project's (CDP) Leadership Impanel - which measures the feature in point of strike, and also in the CDP Performance Index - which tracks presentation in taking finding, generated twice the average total return in respect to companies in CDP's Global 500 between January 2005 and May 2011. Where companies feature in both the CDP Leadership Folio and the CDP Graduation Index the combination of attribute of disclosure and confirmable pizzicato drives the confluence on improving efficiencies head and shoulders the value-chain.<\p>
Although some companies and their stakeholders see green issues identically a aplomb on profits, others believe that following superior lucubration or establishing next practice reduces costs by establishing a single high standard across all value-chain operations, with companies accruing benefits from economies as respects isoline and an optimised value-chain.<\p>
Where companies are able to pan out best practice or ideally establish next practice on CSR, they apprentice competences that will sustain competitive advantage and inter alia remain better placed to label and take commercial advantage of new ideas and trends.<\p>
