Two new reports
reveal the growing importance of corporate responsibility reporting
as part of the core strategies of leading global companies.

A href=”http://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/corporate-responsibility/Documents/2011-survey.pdf”
target=”_blank”>KPMG InternationalSurvey of Corporate
Responsibility Reporting 2011, survey shows that even amid
the pressures of a tough economy - and maybe because of it - more
U.S. companies are formally reporting their Corporate
Responsibility (CR) activities to stakeholders.

However, compared to their European counterparts they are only
“scratching the surface” of corporate responsibility, concentrating
more on communication than on actual performance, according to
KPMG.

The report looked at corporate responsibility reports for more
than 3,400 companies - including the world’s 250 largest, and the
100 largest in each of 34 countries.

Among the top 100 U.S. companies by revenue, 83 percent report
on their CR activities, up from 74 percent in the 2008 KPMG
analysis.

Most countries in the “Leading the Pack” quadrant of the KPMG
analysis are from European nations. Six European countries were on
the top 10 list of nations where their largest companies report CR
activities.

 

 

Similar evidence of the growing importance of corporate 
responsibility was presented in a “href=”http://www.bsr.org/survey2011” target=”_blank”>BSR/GlobeScan
State of Sustainable Business Poll 2011,” released last
week at a target=”_blank”>BSR Conference 2011 in San Francisco.

For the second straight year, more than eight in 10 respondents
(84 percent) are optimistic that global businesses will embrace CSR
/ sustainability as part of their core strategies and operations in
the next five years. BSR and GlobeScan surveyed nearly 500 business
leaders drawn from BSR’s global network of nearly 300 member
companies.

“Even with the current uncertainties in the global economy,
companies remain highly focused on the value of sustainable
business strategies,” said BSR President and CEO Aron Cramer. “This
year’s survey indicates that sustainability holds a critical,
valued seat at the table when it comes to defining corporate
strategies for growth.”

Bolstering the Brand

John R. Hickox, KPMG’s America’s leader for Climate Change &
Sustainability, said the KPMG survey found reputation and brand (67
percent), ethics (58 percent) were cited by the companies as the
top priorities and impetus behind CR reporting.

“During these tough times, companies look to the value of their
brand to carry them through,” said Hickox. “In addition, managing
risk, keeping workers engaged, and innovating for new products
or  services, or opening new markets can provide additional
key foundations for corporate strength.”

Stakeholders Demand Accountability

“While corporate responsibility reporting was broadly considered
an ‘optional’ activity only a few years ago, more organizations are
generating CR reports to meet rising stakeholder demands for
greater accountability, transparency and accuracy in assessing
parts of the business that are not necessarily financial, but which
contribute to the overall value of the company,” KPMG’s 
Hickox said.

Former U.S. Vice President Al Gore echoed this sentiment at the
BSR Conference. “Sustainability is now on the agenda for so many
companies around the world in a way it was not in the past,” he
said.

“Many companies that did not think of
sustainability and  responsibility in the past are starting to
figure out that it is a business plus. Businesses now understand in
a much more textured way that what you represent is a very positive
benefit. This is now a global agenda.” Former U.S. Vice President
Al Gore

Krista Bauer, director of Global Programs at GE and also a
speaker at the BSR Conference in San Francisco stresed the fact
that corporate responsibility strategies open the door to new ways
of looking at business.

“For every dollar that we spend, how many people do we impact?
And for every activity that we engage in, how do we make it
sustainable,” she said.

“It’s got nothing to do with units out the door, with margin to
the company, or with any sort of commercial angle or metric. And
that’s been entirely liberating because it has opened our eyes to a
lot of things … that GE doesn’t make but that GE can enable,” she
added.

Tax Aspects of a Green Strategy

John Gimigliano, the KPMG’s U.S. firm’s tax leader for CC&S,
emphasized that applying a tax lens to a company’s green
strategy-which is often a keystone of CSR programs–can help drive
an  organization’s return on investment (ROI).

“At KPMG, we believe an important first step for companies that
seek to do well while doing good is to turn to their tax
departments,” Gimigliano says.

“Companies who look critically at their sustainability-related
investments around facilities, energy and supply chain discover
that federal and state tax incentives can improve ROI, lower
effective  tax rates and increase cash flow-with some of these
benefits running as high as 50 percent of a project’s cost,” he
added.