Las Mejores Prácticas De Sustentabilidad Empresaria De 2008 En Canadá



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Canadian Corporate Sustainability Reporting Best Practices 2008 About Stratos Stratos is one of Canada’s leading sustainability consultancies. National and international clients rely on Stratos for forward-looking, strategic analysis and advice. Stratos' success is built on expertise in corporate sustainability, public sector management and assurance. Our Vision: A world where decision-makers at all levels integrate sustainability into their actions to improve ecological and human well-being. Our Mission: We provide business, governments and organizations with expert advice, information and tools that assist the development and implementation of more sustainable policies and practices. Study Sponsors This study was made possible through the financial support of organizations dedicated to improving sustainability reporting practices. We express sincere thanks to our sponsors. Natural Resources Canada Ressources naturelles Canada Stratos is a carbon-neutral company through the Tree Canada Foundation program. ISBN 978-0-9689895-3-1 Copyright 2008 Stratos Inc. Design by Reproduction and dissemination of this report is encouraged with credit; quotation from this report is permissible with citation. Stratos Inc. is wholly responsible for the content of this report and the associated technical documentation. This survey does not assess corporate performance, but rather assesses how companies report on their sustainability practices. It is our experience that greater public disclosure of sustainability information enables stakeholders to use this information to inform their decisions. Project sponsors had no input in the assessments or analysis. Canadian Corporate Sustainability Reporting Table of Contents Executive Summary ......................................................2 About This Report..........................................................3 Methodology..................................................................3 Trends in Corporate Sustainability Reporting in Canada......................................................4 Overall Findings ............................................................6 Detailed Results by Category Context and Coverage ..................................................8 Leadership and Direction ............................................10 Policies, Organization and Management Systems ................12 Stakeholder Relations ................................................14 Environmental Performance ..........................................16 Economic Performance ..............................................18 Social Performance ..................................................20 Integrated Performance ..............................................22 Extending Influence Upstream and Downstream ..................24 Quality, Credibility and Communications ............................26 Emerging Issues and Best Practices in Report Strategy and Content Report Strategy ........................................................28 Report Content ........................................................32 Conclusion ..................................................................35 Canadian Corporate Sustainability Reporting Executive Summary Best Practices in Canadian Corporate Sustainability Reporting is Stratos’ fourth review of corporate sustainability reporting in Canada. This study examines the state of corporate sustainability reporting in Canada, and takes an in-depth look at sustainability reporting by seven leading companies with a view to identifying best reporting practices. The seven companies included in this study have consistently ranked in the top 10 of Stratos’ previous benchmark surveys. The sustainability reporting field in Canada is entering a period of change. The disclosure of sustainability information by companies on the Toronto Stock Exchange (TSX) Composite Index is now common practice, with 80% including some environmental or social information in their annual or stand-alone sustainability reports, up from 70% in 2005. Meanwhile, the growth in stand-alone sustainability reports is slowing, with the number of sustainability reporters down 5% from 2005. Nonetheless there is an ongoing transformation in the discipline with the rapid development of sustainability reporting systems and more rigorous tools and reporting frameworks. This suggests that companies are investing to gain from the business value they are finding in reporting and to respond to more sophisticated stakeholder expectations to improve the quality of reporting. Against this backdrop we find that leading companies are innovating with best reporting practices on a number of fronts. We identify examples of excellence in reporting including long-term goal setting (page 10), stakeholder engagement (page 14), environmental performance (page 16), and Aboriginal engagement (page 20). We also look in more detail at four priority areas for corporate reporters: materiality, the Global Reporting Initiative’s (GRI) G3 Guidelines, climate change, and Aboriginal relations. As we look ahead at the changes to the sustainability reporting landscape in Canada, we encourage corporate sustainability reporting practitioners to get ready and get serious about tackling these issues in a more substantive way: content maps being particularly useful. We expect use of the Guidelines to increase and encourage companies to determine their approach to applying the GRI based on a sound assessment of the business case. Materiality, a work in progress: There are signs that leading Canadian companies are grappling with the concept and implications of materiality of sustainability information. Our seven leading reporters hint at formal processes, but none provide sufficient detail to allow the reader to fully understand the rigour of their internal systems to identify material sustainability issues. Over the coming year we expect processes to become formalized and as a result, reports to become shorter and more focused. Reporting on Aboriginal relations is critical in Canada: More than half of Canadian sustainability reporters (51%) discuss Aboriginal relations, highlighting the importance of the issue to Canadian corporations. Reporting on Aboriginal relations among leading companies encompasses corporate approaches and performance on engagement and relationships, economic development and Aboriginal rights. Climate change reporting gets serious: Reporting on corporate activities to address climate change impacts is starting to take off, with the topic mentioned in 84% of company sustainability reports. Among our seven leading companies climate change reporting is becoming more sophisticated, reflecting the maturity of company strategies to address the issue. We expect disclosure on the corporate response to climate change to continue to grow in sophistication with issues including governance and product performance getting increased attention. Use of the GRI Guidelines hits critical mass: Forty-five percent of Canadian sustainability reporters now make use of the GRI Guidelines either as a general guide or through adherence to its requirements. However, to date only 6% of reporters have adopted the new G3 version. Companies are innovating to signpost readers to GRI content, with the use of hyperlinked GRI 2 Canadian Corporate Sustainability Reporting About this Report/Methodology About this Report Corporate sustainability reporting is a dynamic and fast moving field. In Canada, best practice is evolving quickly with companies simultaneously seeking to innovate and refresh reporting approaches and meet expectations for greater standardization. Best Practices in Canadian Corporate Sustainability Reporting is Stratos’ fourth review of corporate sustainability reporting in Canada. It presents the results of research on the uptake of and approaches to sustainability reporting in Canada and presents our review of sustainability reporting at seven leading Canadian companies, including the results of our detailed report assessments and examples of best practice reporting. This study does not look at sustainability performance specifically, but rather at how companies report on their sustainability performance and practices, with a view to identifying examples of best practice. This study also explores approaches to four top-of-mind reporting issues – materiality, the Global Reporting Initiative, climate change, and Aboriginal relations. Categories Category 1 Category 2 Category 3 Category 4 Category 5 Category 6 Category 7 Category 8 Category 9 Category 10 Context and Coverage Leadership and Direction Policies, Organization and Management Systems Stakeholder Relations Environmental Performance Economic Performance Social Performance Integrated Performance Extending Influence Upstream and Downstream Quality, Credibility and Communications Reports were assessed against detailed guidance for each criterion and assigned a rating of 0-3 for each, with a total of 138 points available. The methodology and criteria were updated to reflect new reporting requirements in the Global Reporting Initiative’s G3 Guidelines. The most significant change in the methodology is the application of the concept of materiality, which requires that companies report on the issues that are most significant to them in terms of their business impact and the degree of stakeholder interest. The updated methodology and criteria remain comparable to our 2003 and 2005 benchmark surveys. However, due to this year’s smaller sample size, we have not compared 2007 performance with performance in previous years. Our focus in this report is to highlight best practice. Rating System 0 1 No meaningful information is provided on the specific criterion. Patchy information is provided. The company is beginning to report on information related to this criterion, but gaps exist, and the information is not comprehensive. The report provides good information on the criterion. However, important issue areas or key performance indicators may not be adequately addressed. The company may not be reporting on its entire operations as identified within the report; or it may not present three years of data and/or future targets in this area (for performance related criteria). The report provides full coverage of the criterion. For performance criteria, it covers preceding periods and future targets, and provides an analysis or explanation of performance trends. How We Chose Reporters We invited companies to participate in this study based on their demonstrated leadership in sustainability reporting, as evidenced by their rank in our previous benchmark studies, as well as through our extensive knowledge of sustainability reporters in Canada. We invited companies from a range of sectors. Companies that agreed to participate provided financial support, but had no input in the assessment or analysis. 2 Methodology The methodology used for this study was similar to that used in previous benchmark surveys. This methodology assesses the issue coverage and quality of information presented in corporate sustainability reports against ten categories of information that we would expect to form part of corporate sustainability disclosure. Collectively, these categories comprise 46 criteria. 3 Please refer to our last detailed benchmark survey, Gaining Momentum, page 5 and Appendix 1 (page 37), for the list of criteria assessed in each category: 3 Canadian Corporate Sustainability Reporting Trends 60 Over the past 15 years we have seen tremendous growth and improvement in corporate sustainability reporting. In 1993, less than one percent of large Canadian corporations were committed to public environmental reporting.1 Today, corporate sustainability reporting is a core element of business strategy at 47 of the 265 companies on the TSX Composite Index.2 In more recent years we have seen a slight dip in Canadian corporate sustainability reporting, with a 5% decrease in the number of reporters between 2005 and 2007 (from 114 to 108), and a decrease in the number of TSX companies producing stand-alone sustainability reports (from 25% in 2005 to 18% in 2007). This is set against the steady increase in the number of TSX companies including at least some sustainability information in their annual reports or in a standalone report from 70% in 2005 to 80% in 2007, up from 35% in 2001. 40 20 0 2001 2003 2005 2007 Percent of TSX Composite Index Producing Sustainability Reports % 57 Trends in Corporate Sustainability Reporting in Canada Every year more companies take their first leap into corporate sustainability reporting. Since 2001, the number of corporate sustainability reporters in Canada has increased from 57 to 108.3 Over the same time period, the percent of TSX companies that produce sustainability reports increased from 10% to 18%. Trends at a Glance Canadian Sustainability Reporters 11 10 0 10 8 120 100 80 25% 20% 10% 5% 0 2001 10 % 22 % 25 % 4 15% 2003 2005 2007 The term “sustainability report” includes reports that provide information on a company’s management and performance related to one or more aspects of sustainability beyond financial performance. For the purpose of this study, this term encompasses environmental, social, community, corporate responsibility, sustainability, or corporate social responsibility reports, along with annual reports that include five or more pages of environmental and/or social information, including performance data. This study focuses on “Canadian reporters”, defined as Canadian companies with or without Canadian operations that produce sustainability reports, or international companies with operations in Canada that report on these operations in their sustainability reports, including Canadian-specific performance data. Forty-five percent of Canadian sustainability reporters used the GRI Guidelines in 2007, up from 35% in 2005. While the majority of companies using the GRI are still using the 2002 Guidelines (over 85%), there are signs of uptake in use of the G3 Guidelines released in late 2006, which are actively used by seven companies. Of the seven Canadian sustainability reports that were assessed as part of this study, six referenced the use of the GRI or reported in accordance with the Guidelines. We take a more detailed look at approaches to using the GRI Sustainability Reporting Guidelines on page 30. 60% 50% 40% 30% 20% 10% 0 2001 35 % 2003 60 % 70% 2005 70 % 2007 Percent of Canadian Reporters Using GRI 50% 40% 30% 20% 0 2001 2003 2005 2007 7% 25 % 35 % 45 % 18 % % 10% Percent of Canadian Reporters Using Assurance 2 TSX Composite listed companies identified as of August 30, 2007. 3 In order to identify Canada’s sustainability reporters, Stratos looked at the websites of 379 companies drawn from lists such as the TSX Composite Index, Report on Business Magazine’s top 100 companies by revenue and top crown corporations, winners of the Canadian Institute of Chartered Accountants (CICA) corporate reporting awards (sustainable development category), and Corporate Knight’s 2007 Best 50 Corporate Citizens. 15% 10% 5% 0 2001 2003 2005 2007 9% 15 1 4 13 % 20% 80 % Global Reporting Initiative Percent of TSX Composite Index Disclosing Sustainability Information in Public Reports 90% 80% 18 Canadian Corporate Sustainability Reporting Trends Assurance The use of assurance in sustainability reporting continues to be a dynamic area. We see a slight dip in the use of assurance with 15% of Canadian companies assuring their reports in comparison to 18% two years ago. The mix of assurance approaches used by Canadian companies is shifting, with heavier reliance placed on internal assurance and stakeholder-led processes, with the latter now used in 50% of assured reports. Third-party auditing of reports continues to be the approach of choice with over 80% of assured reports using this approach. The big four audit firms are starting to dominate with more than half of companies who choose third-party auditing engaging a big four firm. Of the 379 companies that we reviewed for sustainability information, 34% discuss climate change in their sustainability and/or annual reports; of these companies, 67% provide supporting performance data. Similarly on Aboriginal relations, 22% discuss the issue; of these companies, 37% provide supporting performance data. When we look more closely at Canadian sustainability reporters, Aboriginal relations and climate change are clearly material issues. Climate change is covered in 84% of sustainability reports, and 86% of these reports include supporting data, suggesting that systems to track and report on climate change performance are becoming well developed. Aboriginal relations is covered by 51% of sustainability reports, and 44% of these reports include supporting data such as Aboriginal employment or spending on procurement with Aboriginal businesses. Reporting on these issues is lower if we consider coverage strictly within the annual reports of sustainability reporters, with 35% of sustainability reporters covering climate change (45% of which provide data) and 20% covering Aboriginal relations (27% of which provide data) in their annual reports. The relatively widespread coverage of climate change in annual reports suggests a growing recognition that climate risks are material to business performance. Climate Change: Sustainability Reporters Total number of sustainability reporters:108 (100%) Reporters discussing climate change in their sustainability reports: 91 (84%) Of the reporters discussing climate change in their sustainability reports, those providing data: 78 (86%) Climate Change: Annual Reports of Sustainability Reporters Total number of sustainability reporters:108 (100%) Reporters discussing climate change in their annual reports: 38 (35%) Of the reporters discussing climate change in their annual reports, those providing data: 17 (45%) Who Assures 13% 44% 38% 50% Internal Audit Big Four Audit Firms Non-big Four Audit Firms Stakeholder Groups Reporting on Key Issues Two key issues rank high in the minds of Canadian companies – climate change and Aboriginal relations. We have tracked which companies report on these issues in their annual or sustainability reports, and which companies provide performance data. Aboriginal Relations: Sustainability Reporters Total number of sustainability reporters:108 (100%) Reporters discussing Aboriginal relations in their sustainability reports: 55 (51%) Of the reporters discussing Aboriginal relations in their sustainability reports, those providing data: 24 (44%) Aboriginal Relations: Annual Reports of Sustainability Reporters Total number of sustainability reporters:108 (100%) Reporters discussing Aboriginal relations in their annual reports: 22 (20%) Of the reporters discussing Aboriginal relations in their annual reports, those providing data: 6 (27%) 5 Canadian Corporate Sustainability Reporting Overall Findings The seven companies assessed in the study are recognized sustainability reporting leaders, having all scored in the top 10 in previous Stratos benchmark surveys. The top mark achieved by a company assessed in the benchmarking component of this study was 78% with all companies scoring over 58%. The quality of reporting among these seven reporting leaders is high, with just five points separating the top three and only a 28 point spread across all companies. The reports of these seven leading companies are generally strong in describing the context for their operations and the sustainability challenges and opportunities they face (Context and Coverage and Leadership and Direction). Reporting on Environmental Performance and Economic Performance is also strong, and reporters use sophisticated approaches to communication and ensuring the credibility of the information presented (Quality, Credibility and Communications). The quality of reporting on stakeholder engagement (Stakeholder Relations) is far more mixed. Reporting on influence on sustainability performance in the corporate value chain (Influence Up and Downstream) is a particular weakness in a number of reports. Of the four performance categories – Environmental, Economic, Social and Integrated – Economic Performance is particularly strong, reflecting the success of corporate efforts in reporting on socio-economic impact. Leading Reporters Assessed in the Study BC Hydro Enbridge Suncor Syncrude TELUS TransAlta Vancity Drilling down to specific criteria, some interesting findings emerge: > The quality of reporting on corporate sustainability vision and the links to corporate goals and priorities is good, hinting at better integration of sustainability in business planning. > Strong reporting of health and safety performance highlights the maturity of management approaches in this area. > Weaker reporting on water and material inputs suggests that there is still work to be done on some aspects of environmental reporting. > Reporting on the influence of companies on sustainability performance in their value chain is limited, offering potential differentiation for companies who cover this area systematically. 6 Canadian Corporate Sustainability Reporting Overall Findings Top Five Criteria (Category) Company Profile Corporate Vision Key Financials Community Development Health and Safety (Context and Coverage) (Leadership and Direction) (Economic Performance) (Economic Performance) (Social Performance) Bottom Five Criteria (Category) Water and Material Inputs Human Rights Business Ethics and Integrity Supply Chain Management Customer/Consumers (Environmental Performance) (Social Performance) (Social Performance) (Influence Upstream and Downstream) (Influence Upstream and Downstream) Maximum, Minimum and Average Scores by Category 100% 90% 80% 70% Average Score as % 60% 50% Maximum Score 40% 30% 20% 10% 0% 1. Context & Coverage (2) 3. Policies, Organization & Mgmt Systems (8) 4. Stakeholder Relations (2) 6. Economic Performance (7) 9. Influence Up & Downstream (3) 10. Quality, Credibility & Communications (3) 2. Leadership & Direction (3) 5. Environmental Performance (7) 8. Integrated Performance (4) 7. Social Performance (7) Minimum Score Study Average Category (Number of Criteria) 7 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 1 Context and Coverage Top Scores: BC Hydro, Enbridge, Suncor, TELUS, TransAlta, Vancity This category measures the degree to which the report informs the reader about what the company does, the scope and scale of its operations, and the scope and materiality of issues in the report. All of the companies score highly on Context and Coverage, and six companies share the top spot. These reporters are adept at describing their business and the sustainability issues they face (with an average score of 95% on company profile) while scoring on the quality of the report profile – which assesses disclosure on the approach to setting geographic, organizational, temporal and issue coverage of the report – is lower (67%). None of the reports fully identify the process for determining report content, with few of the companies providing clarity on their issue priorities, a topic we examine in more detail on page 28. Category 1: Context and Coverage 100% 90% 80% Average Score as % 70% 60% 50% 40% 30% 20% 10% 0% 95 % Best Practices > Suncor provides a good schematic diagram and description of the company’s operations. > Vancity clearly communicates its organizational structure and the different companies that make up the group. Source: Suncor 2007 Report on Sustainability, foldout. 8 1.1 Company Profile 1.2 Report Profile 67 % Canadian Corporate Sustainability Reporting Results by Category Source: Vancity 2004-05 Accountability Report, p. 4. 9 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 2 Leadership and Direction Top Scores: BC Hydro, TransAlta The three criteria in this category measure how well the report describes the significant challenges and opportunities related to sustainability that the organization faces, how it plans to address these challenges and capitalize on these opportunities, and how it intends to position itself in the future. Overall performance on Leadership and Direction is strong, with an average score of 81%. Performance is strongest on corporate vision at 86%, with the seven leading companies doing a good job describing their corporate vision and how it integrates economic, environmental and social performance. Best Practices Average Score as % Category 2: Leadership and Direction > BC Hydro presents the company’s five core values, as well as 15 long-term goals that will guide the business over the next 20 years, including progressive commitments related to safety, environmental impact, and electricity conservation and efficiency. > Suncor clearly articulates the company’s vision and strategy to become a sustainable energy company, including presenting a strategic framework to achieve this goal. > TransAlta’s CEO statement includes a compelling discussion of climate change – a key issue for the company. 100% 76 % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% % 81 2.2 Corporate Vision 2.1 CEO Statement 86 % Source: Suncor 2007 Report on Sustainability, p. 8. 10 2.3 External Trends Canadian Corporate Sustainability Reporting Results by Category Source: 2007 BC Hydro Annual Report, p. 123. 11 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 3 Policies, Organization and Management Systems Top Score: Enbridge This category assesses the quality of reporting on the company’s relevant sustainability policies, procedures, management systems and decision-making structures. Reporting on Policies, Organization and Management Systems is variable across the eight criteria. Reporting on environmental management systems (EMSs) and socio-economic management systems is strong with an average score of 81% and 76%, respectively, suggesting maturity in these management approaches. Reporting on policies and codes of conduct, voluntary initiatives, and integration of triple-bottom line (TBL) considerations into decision-making is weaker with average scores of 57% for all three criteria. Low scores on policies and codes of conduct were often the result of reports not including enough information on policies. Most often missing in voluntary initiatives were discussions of the company’s involvement in and outcomes of these initiatives. Best Practices > BC Hydro discusses the company’s Triple Bottom Line Project, undertaken to develop a framework and tools to help ensure more consistent and effective TBL decision-making. > Enbridge presents a CSR integration case study on their Waupisoo pipeline, demonstrating how the company puts CSR into practice. > Suncor highlights their public policy direction and positions for six key issues, including climate change and labour shortages. > Vancity discloses the members of its executive team that are held accountable for each target related to sustainability performance. Category 3: Policies, Organization and Management Systems 100% 76 71 % 90% 80% Average Score as % 57 % 57 % 62 % 81 % 70% 60% 50% 40% 30% 20% 10% 0% 67 % % 3.4 Governance, Org Structure & Responsibilities 3.1 Policies & Codes of Conduct 3.3 Public Policy & Industry Influence 3.5 Issue/Risk Identification & Significance Source: Enbridge 2007 Corporate Social Responsibility Report foldout, p. 13. 12 3.8 Integration of TBL into Decision-Making 3.7 Socio-Economic Management System 3.2 Voluntary Initiatives 3.6 Environmental Management System 57 % Canadian Corporate Sustainability Reporting Results by Category Source: Suncor 2007 Report on Sustainability, p. 10. Source: 2007 BC Hydro Annual Report, p. 56. 13 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 4 Stakeholder Relations Top Score: Vancity This category assesses how well the report describes the company’s stakeholders, how it solicits their input and how the company considers their input in its decision-making processes and in determining the content of its report. The results of this category suggest that while companies are adept at identifying their key stakeholders and the mechanisms used to engage them (criterion 4.1), there is less comfort with direct disclosure of stakeholder feedback and how it is used to drive improvements and decision-making (criterion 4.2). Best Practices Average Score as % Category 4: Stakeholder Relations 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 4.1 Stakeholder Identification & Engagement 4.2 Stakeholder Feedback & How It Is Used > BC Hydro, Enbridge, Suncor, TELUS and Vancity seek feedback on their reports from external stakeholder/expert advisory panels. > BC Hydro reports on a number of innovative stakeholder engagement mechanisms, including a Community Advisory Committee to the Board of Directors, and an Electricity Conservation and Efficiency Advisory Committee that helps generate new ideas to build a conservation culture in B.C. > Vancity and TELUS provide details of the feedback received from stakeholders on their reports, and also communicate how they have responded to this feedback. 71 % The Value of Stakeholder Input There is growing consensus among leading reporters in Canada on the value of stakeholder commentary and feedback on reporting, an approach used by five of the seven leading reporters in our study. The approaches to stakeholder involvement in reporting activities fall into two categories: > Appointment of a stakeholder panel to provide critical feedback and challenge on report development, some providing an assurance-style statement in the report. > Stakeholder workshops or feedback sessions to provide pre- or postpublication comment. Involving stakeholders in the reporting process can provide numerous benefits: > Direct feedback on whether the report meets the information needs of key stakeholders. > Input to issue identification materiality processes. and > Focused recommendations on areas for improvement. > Demonstrates the responsiveness of the reporter to stakeholders. > Assurance for readers that the report meets stakeholder needs. > Assurance for the reporter that controversial issues have been identified and managed to stakeholder satisfaction. > Improved relationships with key corporate stakeholders. 14 57 % Canadian Corporate Sustainability Reporting Results by Category Source: Vancity 2004-05 Accountability Report, p. 14. 15 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 5 Environmental Performance Top Score: Vancity This category assesses how well the report describes the company’s past and current environmental performance. A report should address all relevant material and resource inputs and environmental outputs; provide trend data; explain how and why changes have occurred over time; and describe what level of future performance the company commits to achieve. The growing concern over climate change was a highlight in these reports, however, reporting on greenhouse gas (GHG) emissions scores slightly lower than other criteria, reflecting that GHG data and targets are still a work in progress for some companies. Reporting on energy inputs, air emissions and land use, biodiversity, habitat and species is strong at 76%. Environmental performance reporting is weakest on water and material inputs, with few companies providing good data on their major material inputs. Best Practices > BC Hydro identifies energy savings resulting from the use of demand-side management, and sets future targets. > Suncor uses benchmarks to compare its GHG, SOx and NOx performance against that of the broader industry. > TELUS compares its water consumption to domestic water consumption rates and sets a future target to improve water monitoring coverage. See page 32 for an in-depth discussion of reporting on climate change. Category 5: Environmental Performance 100% 76 % Average Score as % 70% 50% 40% 30% 20% 10% 0% 5.2 Water & Material Inputs 52 60% % 5.3 Solid & Hazardous Wastes 67 % 5.4 Effluent & Spills 67 % 71 % 76 90% 80% 76 % % Source: BC Hydro Service Plan 2007/08 to 2009/10, p. 31. 16 5.7 Land Use, Biodiversity, Habitat & Species 5.1 Energy Inputs 5.6 GHG Emissions 5.5 Air Emissions Canadian Corporate Sustainability Reporting Results by Category Source: TELUS 2006 Corporate Social Responsibility Report, p. 62. Source: Suncor 2007 Report on Sustainability, p. 55. 17 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 6 Economic Performance Top Score: Suncor This category assesses how well the report describes the company’s past and current economic performance, including both financial performance and broader economic contributions to, and impacts on, local and national economies. All companies receive top marks for reporting on key financials with information either presented in sustainability reports or linked to annual reports. Reporting on community development is high at 90%, with information on financial and in-kind support for community development now routine. Reporting on taxes and royalties is less developed with data broken down by taxing authority rare, and few of the study companies in the extractive sector reporting on royalty payments. Best Practices > Syncrude provides a range of data on direct economic contributions, including total annual economic contributions, expenditures, procurement of goods and services, cumulative payments to governments, and royalty payments. > Vancity provides a wealth of information on community development including information on their grants to social enterprises. Category 6: Economic Performance 90 % 81 % 67 % % 100% 90% 80% Average Score as % 70% 60% 50% 40% 30% 20% 10% 0% 10 0% 67 6.2 Investment in Intellectual Capital 62 % 6.1 Key Financials 6.4 Taxes & Royalties 6.5 Direct Economic Contribution 6.6 Community Development 18 6.3 Employee Compensation 6.7 Customer Satisfaction 67 % Canadian Corporate Sustainability Reporting Results by Category Source: Syncrude 2006 Sustainability Report, p. 21. Source: Vancity 2004-05 Accountability Report, p. 70. 19 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 7 Social Performance Top Scores: BC Hydro, Suncor This category assesses how well the report describes the company’s past and current social performance, including human resources and labour issues, health and safety, human rights, business ethics and relations with Aboriginal Peoples. Reporting on Social Performance is mixed, with sophisticated approaches in place for health and safety and human resource management and employee relations, but weaker disclosure on human rights, as well as business ethics and integrity. The very low score on human rights (38%) is a reflection of the low materiality of human rights issues for most of the companies in the study that have only Canadian operations. Issues related to discrimination and harassment are covered under workplace diversity and labour rights criteria in our methodology. Reporting on human resource management and employee relations and workplace diversity is well established with the seven leading companies tracking information on the general quality of workplace life and the diversity of their workforces. Six of the seven companies in the study report on employee surveys or focus groups. Best Practices > Enbridge discusses its human rights policy and program in Columbia, which includes extensive education and awareness training. > Syncrude produces a review of its approach and performance on Aboriginal engagement. They use innovative approaches to reporting activities in this area including interviews with Aboriginal Youth and include a range of performance information on employment, education, business development and leadership. See page 34 for an in-depth discussion of reporting on Aboriginal Relations. Category 7: Social Performance 100% 90% 80% Average Score as % 70% 60% 50% 40% 30% 20% 10% 0% 7.1 HR Mgmt & Employee Relations 7.2 Health & Safety 7.3 Workplace Diversity 7.7 Indigenous Peoples 7.4 Labour Rights 7.5 Human Rights 7.6 Business Ethics & Integrity 76 % 86 % 67 % 62 % 20 38 % 52 % 62 % Canadian Corporate Sustainability Reporting Results by Category Source: Enbridge 2007 Corporate Social Responsibility Report, p. 58. Source: Syncrude 21 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 8 Integrated Performance Top Score: Suncor This category assesses the quality of reporting on performance measures which illustrate inter-relationships between economic, social and environmental issues and put corporate performance in context of regional, national and industry performance. Scoring on Integrated Performance is fairly consistent with an average score of 66% across the category. Among the seven reports assessed in this study there are clear signs that companies are looking to present information in ways that link their sustainability performance to regional, national and sectoral benchmarks. This helps companies put performance in context and manage expectations on their ability to impact global, national and regional sustainability trends. Best Practices > Enbridge provides comprehensive compliance data for each business segment, reporting on major incidents, regulatory notifications, and EH&S fines and penalties. > Suncor and TransAlta provide performance information related to many environmental, social and economic systemic indicators. Average Score as % Category 8: Integrated Performance 100% 90% 80% % 60% 50% 40% 30% 20% 10% 0% 8.2 Liabilities, Risks, Exposures & Uncertainties 8.3 Systemic Indicators 8.1 Fines & Non-Compliances 8.4 Cross-Cutting Indicators Source: Suncor 2007 Report on Sustainability, p. 54. 22 62 % 67 67 70% 67 % % Canadian Corporate Sustainability Reporting Results by Category Source: TransAlta Corporation 2006 Report on Sustainability, p. 94. Source: Enbridge 2007 Corporate Social Responsibility Report, p. 66. 23 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 9 Extending Influence Upstream and Downstream Top Score: BC Hydro This category assesses how well the report describes the company’s environmental, social and economic impacts both upstream (i.e. within the supply chain) and downstream (i.e. as a result of the company’s products or services) and how the company manages or influences these impacts. Extending Influence Upstream and Downstream is the weakest category overall. Nevertheless, there is evidence that companies are starting to explore reporting in this area, which provides a real opportunity for competitive differentiation. We expect disclosure on product sustainability performance to be an area of rapid progress in future years as more companies explore ways to reduce the impact of their products and services, especially in relation to climate change. Best Practices > BC Hydro is a clear leader in reporting on product and service stewardship, providing information on a range of programs and performance related to reducing energy consumption and peak demand, including: Average Score as % Category 9: Extending Influence Upstream and Downstream 100% 90% 80% 60% 50% 40% 30% 20% 10% 0% 9.1 Supply Chain Mgmt 9.2 Product/Service Stewardship 9.3 Customer/Consumers 57 % • Program and performance information and targets for Power Smart, the company’s initiative to reduce energy consumption at homes and businesses; • The number of Green Power Certificates sold, which are supplied from certified green generation facilities, and the GHG emissions avoided as a result; and • Details of programs to reduce peak demand. > Enbridge reports on a range of demand-side management programs and related savings from these programs, including savings to customers. > TransAlta describes several initiatives undertaken in the area of supply chain management, including criteria for choosing suppliers, a commitment to use local vendors, a pilot supplier scorecard for safety performance, and an update of the vendor certification process. > Vancity reports on third-party screening of strategic suppliers to determine their alignment with the company’s Baseline Ethical Policy. 70% 52 % 24 48 % Canadian Corporate Sustainability Reporting Results by Category Source: BC Hydro Annual Report 2007, p. 64. Source: TransAlta Corporation 2006 Report on Sustainability, p. 18. 25 Canadian Corporate Sustainability Reporting Detailed Results by Category Category 10 Quality, Credibility and Communications Top Score: Suncor This category assesses the degree to which a report presents information in an accessible, reliable, balanced and useful manner. Reporters use a number of approaches for improving the reliability of the information reported, including disclosure of internal audits and footnotes to explain data quality. There is also a strong focus on building reports into effective communication tools with the use of online content becoming common and increasingly sophisticated. The use of assurance is more mixed with an average score of 62% and four of our seven leaders using internal or external assurance processes, and five of seven using some form of stakeholder feedback mechanism (e.g. stakeholder advisory panel) to add to the credibility of the report. There is significant variation in the type of assurance process and assuror used, suggesting that assurance remains a developing area of reporting strategy. Best Practices Average Score as % Category 10: Quality, Credibility and Communications 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 10.1 Reliability of Data & Information 10.2 Verification/ Assurance 10.3 Communication % 76 % 62 % 76 > Enbridge, Suncor and TransAlta provide information on the reliability of the data and information in their reports, including detailed footnotes that provide information on specific boundary conditions, changes in methodology, and revisions of historical data. > Suncor, TELUS and Vancity use external verification. In addition to clearly stating the scope and limitations of the audit, Suncor’s external auditor’s report presents overall strengths and areas for improvement. > The assurance statement in Vancity’s report provides specific commentary on the coverage of material issues in the report. 26 Canadian Corporate Sustainability Reporting Results by Category Source: TransAlta Corporation 2006 Report on Sustainability, p. 74. Source: Suncor 2007 Report on Sustainability, p. 57. 27 Canadian Corporate Sustainability Reporting Emerging Issues and Best Practices in Report Strategy and Content The evolution of corporate sustainability reporting is characterized by shifts in the strategies that inform report design and focus, and the topics that a report addresses. Reporting has transformed from the ad-hoc and single-issue approaches of the 1990’s to today’s standardbased reports that reflect the dimensions of a company’s influence and impact across the sustainability agenda. The development of the materiality concept and the GRI G3 Guidelines are prompting companies to rethink their reporting strategies and focus their reports on the issues of most relevance to the company and its stakeholders. This section of the report discusses the use of materiality and the GRI in report strategy, and examines reporting on two material issues facing companies in Canada: climate change and Aboriginal relations. We assessed the use of the materiality concept by our group of leading reporters through our report profile criterion and found practices to be mixed. For companies to score a “3”, the process for determining materiality and topic prioritization must be identified. Tellingly, no company scored a “3” on this criterion. While some companies show evidence that a process has been used to determine what to report, full descriptions of materiality processes are absent from all of the reports, and a number of the reports suffered from a lack of clarity on which issues are a corporate focus. Nevertheless, some companies are taking steps towards better use of the materiality concept. Suncor identifies its four key challenges upfront, and comments on the use of a stakeholder review panel to provide input on these issues. Suncor also presents a case study on each of these issues, providing context and indicating how the company is responding. Vancity’s assurance provider looked at materiality, and the assurance statement in the report explicitly states that “based on our work, we believe that issues material to Vancity’s stakeholders have been considered and communicated in this report.” Some companies explain why specific issues are not material to their business. For example, Vancity explains that biodiversity is not material to its business since the company has no holdings in biodiversity rich areas. Materiality: The information in a report should cover topics and indicators that reflect the organization’s significant economic, environmental, and social impacts, or that would substantively influence the assessments and decisions of stakeholders. Source: Global Reporting Initiative www.globalreport Content/ Report Strategy Materiality The growing focus on the concept of materiality is a significant trend driving the evolution of corporate sustain ability reporting. Materiality describes the process by which companies determine the issues which are most significant in terms of their business impact and the degree of stakeholder interest. The concept of materiality has been used by leading global companies and is having a profound impact on corporate sustainability reporting strategy. The GRI now includes the concept of materiality in its G3 Guidelines as one of the core principles for determining report content. Implications of Materiality Strategy > Clarity on the issues driving long term business value > Robust rationale for focusing sustainability activities > Integration of sustainability into risk management and other business processes > Assurance that programs are in place to manage critical issues > Robust basis for identification of issues > Shorter more focused reports > Greater assurance that key issues are covered > Stronger integration between sustainability and annual reporting > Rationale for use and selection of reporting standards and indicators Reporting 28 Canadian Corporate Sustainability Reporting Emerging Issues Stratos recommends that companies use a robust, auditable process to determine the materiality of issues. We recommend identifying issues based on business priorities, peer activities, regulation, media attention and global and sectoral standards. Stakeholder interest and business impacts associated with each of these issues can be assessed and quantified and a matrix used to identify issue priorities. The results provide critical business intelligence, allowing the assessment of strategic priorities and providing a basis for focusing resources and reporting. As we look ahead, we expect to see materiality more strongly influence Canadian corporate sustainability reporting. Reports will start to be shorter and more clearly focused on business priorities and the needs of certain stakeholder groups, and there will be greater clarity on the processes used to determine report content. Business impacts > Operations > Reputation > Customers > Direct costs > Share price H Stakeholder interest Online Stakeholder interest > Media > NGOs > Investors > Customers Printed Report Available on request Online L L Business impact H Source: Vancity 2004-05 Accountability Report, p. 11. Source: Suncor 2007 Report on Sustainability, p. 1. 29 Canadian Corporate Sustainability Reporting Emerging Issues and Best Practices in Report Strategy and Content Global Reporting Initiative The 2006 release of the G3 revision of the GRI’s Sustainability Reporting Guidelines has brought the use of standards back to the top of mind for corporate reporters. The results of our study suggest that the use of the GRI Guidelines is reaching critical mass in Canada with 45% of reporting companies making some use of the Guidelines. Of this 45%, 14% are using the new G3 Guidelines with one company reporting to an “A” level and two companies reporting to an “A+” level, including Suncor. Suncor, the only company in our detailed report assessment that achieved an A+ application level of the new G3 Guidelines, was also the highest scorer in our assessment. As an “A+” GRI reporter, Suncor’s report provides full profile disclosures as defined by the Guidelines, discusses the management approach for each indicator category, responds to each core G3 indicator with due regard to the materiality principle, and has been externally assured. Aspects of the GRI Guidelines that are not reflected in the main body of Suncor’s report are provided in a table at the end of the report. BC Hydro, reporting in accordance with the GRI 2002 Guidelines, offers a useful online comparative index that shows the degree of alignment between BC Hydro’s performance measures and those in the GRI 2002 Guidelines, and provides links to detailed tables or graphs containing the relevant performance information. Similarly, the GRI index in TransAlta’s report is “hyperlinked” and allows the reader to quickly navigate to the information supporting each GRI component in the sustainability report, annual report, or on the web. Six of the seven leading reporters we assessed use the GRI in some way, though most are still using the GRI 2002 Guidelines. Key features of the new G3 Guidelines include: > Reporting Principles [including materiality] which assist companies in determining report content, and achieving report quality. > New strategy and analysis disclosure guides encourage reporters to describe their overall approach to sustainability management. > The Disclosure on Management Approach (DMA) provides reporters with an approach to outlining the context within which their performance should be interpreted4. GRI 2002 Guidelines Reference TELUS In Accordance BC Hydro TransAlta Vancity GRI G3 Guidelines B Enbridge A+ Suncor 4 30 Canadian Corporate Sustainability Reporting Emerging Issues When considering whether to use the GRI, the decision needs to be made based on business strategy, in much the same way that a company would assess the case for implementation of ISO 14001 or AA 1000. Key questions to consider include: Questions What investments do we need to make? Considerations > Cost of implementing new/revising existing performance measurement systems > Cost of staff time to reshape reporting to GRI format and align performance management systems (including training costs) > Support in development of internal reporting frameworks > Ease of comparison of performance with sector peers > Assurance that sustainability program is built on established standards What needs do we have internally for reporting guidance? Do our stakeholders need to see us using a credible standard? > Investor needs for comparability of information > NGO needs for adherence to a multi-stakeholder standard > Customer needs for adherence to internationally recognized standard > Will use of GRI differentiate us from our peers? > Is use of the GRI a prerequisite for leadership reporting? > What scope is there within GRI to test new reporting approaches and innovate? How will use of this standard position us in the market? As more companies take on GRI reporting and move to the G3 Guidelines, the influence on reporting could be profound, with comparability and clarity on material issues being placed at the heart of reporting approaches. Despite renewed optimism in the potential of standards to improve the quality of reporting, the application of the GRI Guidelines must be viewed as a component of a reporting strategy rather than the ultimate goal of reporting. 31 Canadian Corporate Sustainability Reporting Emerging Issues and Best Practices in Report Strategy and Content Report Content Climate Change Climate change is currently THE hot topic in the corporate sustainability field. The public policy environment around climate change is dynamic and stakeholder interest in corporate management of carbon emissions and climate impacts is growing. Against this backdrop, pressure to improve corporate disclosure of climate change strategy is continuing to rise. Indeed there is a compelling argument that the high profile and importance of climate change makes it a material issue for all companies, whatever their sector. This view is supported by initiatives such as the Carbon Disclosure Project (CDP). Of the four study companies invited to participate in the CDP, all of them responded (Enbridge, Suncor, TELUS and TransAlta). Credible corporate management of climate change requires a robust and coherent strategy. Corporate climate change strategies are becoming more sophisticated with leading companies taking a holistic approach that encompasses identification of risks and opportunities, governance, setting reduction targets, and stakeholder engagement. Stratos recommends viewing climate change reporting, including the disclosure of approach and performance, as an important element of corporate climate strategy. As corporate approaches to climate change become more sophisticated, companies are pushing their climate change strategies to address not only the company’s operational impact on climate change but also the impact of the company’s products, services, and supply chain. The results of this study show that practices in disclosure of climate change performance are following suit – with evidence that leading Canadian companies are examining ways to provide innovative products and services as a response to climate pressures. For example, Suncor reports on its investments in low sulphur fuels, ethanol-blended gasoline, and wind power production. BC Hydro reports the success of its program to offer Green Power Certificates – green electricity that is 100% generated in B.C. and provided to domestic customers on a pilot basis. Enbridge reports on its commitments to invest in renewable and alternative energy sources that help reduce GHG emissions and address climate change. Vancity reports on climate-friendly financial products including: > Clean Air Auto Loans for hybrid and natural gas vehicles; > Home financing incentives to energy-saving home renovations; support Carbon Disclosure Project (CDP): an independent not-for-profit organization whose goal is to facilitate a dialogue, supported by quality information, from which a rational response to climate change will emerge. CDP provides a coordinating secretariat for institutional investors with a combined $41 trillion of assets under management. On their behalf it seeks information on the business risks and opportunities presented by climate change and greenhouse gas emissions data from the world's largest companies The CDP publishes responses from a questionnaire sent to 2,400 of the world’s largest companies. The largest 200 Canadian companies are invited to respond. Source: The Carbon Disclosure Project > Financing for green energy alternatives such as small-scale hydro projects; and > Green mortgage pilot projects. The key elements of climate change strategy that Stratos recommends to clients are mapped out on the following page. We examined reporting against each element and found evidence that corporate disclosure on climate change is growing in sophistication in line with corporate strategy. Source: Suncor 2007 Report on Sustainability, p. 6. 32 Elements of climate change strategy Identification of climate risks and opportunities Best practices in corporate disclosure > Vancity’s 2006-07 action plan includes a commitment to assess the climate change risks associated with its core business. > Suncor identifies climate change as a risk and is candid in discussing how the growth in its oil sands business is a major contributor to GHG emissions. The company also discusses the potential business impacts of future GHG regulations. Governance > Enbridge and Suncor describe the key roles and responsibilities for GHG management, including specific oversight responsibilities for the Board. > Vancity identifies the senior VPs responsible for all of the company’s targets, including those related to climate change. Policies and management systems > Enbridge reports on its specific Climate Change Policy. Business planning > Suncor reports on its decrease in GHG emission intensity through initiatives including renewable energy, energy efficiency and carbon capture and storage. > Vancity discusses its financing of green energy products such as Upnit Power Corporation’s China Creek power project. Employee engagement and corporate culture > Vancity reports on campaigns and programs to encourage staff to be more energy efficient at work, as well as to use alternative modes of transportation. Research and development > Suncor discloses that investment in research into alternative technologies is at the heart of their strategy for responsible growth. > BC Hydro, Enbridge, Suncor, TELUS and Vancity report direct and indirect GHG emissions. > BC Hydro, Enbridge, Suncor and Vancity provide a source breakdown of GHG emissions. > Suncor reports forecasted emissions out to 2011. > Enbridge and TELUS report GHG emission reduction targets. > Vancity reports a carbon neutral goal and indicates concrete steps that the company is taking to achieve this objective. > Suncor presents its public policy position on climate change which guides its engagement activity in this area. Performance targets and measures Stakeholder engagement Assurance > Suncor, TELUS, and Vancity have their GHG data verified by a third-party. > Enbridge reports plans to undertake an independent third-party audit of its Canadian GHG emissions data management system. > Suncor produces an annual Climate Change Report that highlights the company’s GHG performance. The report candidly discusses 10 key climate change challenges related to its business and the actions the company is taking to address climate change in the coming decade. Disclosure 33 Canadian Corporate Sustainability Reporting Emerging Issues and Best Practices in Report Strategy and Content Aboriginal Relations Relations between companies and Aboriginal Peoples is a key business and social issue in Canada, particularly, but not exclusively, for the resource sectors. There are increasing pressures on companies and Aboriginal communities to find improved ways to engage constructively for mutual benefit. Corporate sustainability reporting is a component of Aboriginal relations strategies, allowing companies to demonstrate the progress they are making and providing a vehicle for engagement with Aboriginal groups. Fifty-one percent of Canadian sustainability reporters discuss their approach to Aboriginal relations. Among the seven leading reports in the study, scores on Aboriginal relations were mixed, with BC Hydro and Syncrude emerging as clear leaders. In addition to providing a wealth of information on Aboriginal relations in its Sustainability Report, Syncrude also prepares an annual Aboriginal Review to communicate further its Aboriginal relations activities. Corporate reporting on Aboriginal relations should address three areas: > Aboriginal engagement and relationships: The approach to building and maintaining relationships with Aboriginal communities. This might include policies, engagement and response processes, formal consultation practices and the management systems to ensure consistent implementation. > Economic impact: The approach to managing and enhancing corporate economic benefits for Aboriginal communities. This might include products and services for Aboriginal communities, employment opportunities, procurement from Aboriginal-owned businesses, and provision of education and training initiatives. > Aboriginal rights: The approach to recognition and protection of the rights of Aboriginal communities. We look below at reporting among our seven leaders against these three areas. > Vancity has strategy. an Aboriginal engagement > Many companies provide examples of their Aboriginal engagement efforts, including BC Hydro, Enbridge, Suncor, Syncrude, TELUS, and TransAlta. Economic Impact of Aboriginal Relations Strategies > BC Hydro, Suncor, Syncrude, TELUS, and Vancity provide data on Aboriginal employment. Syncrude and Suncor also provide data on Aboriginal procurement, and BC Hydro and Syncrude provide data on Aboriginal community investment. > BC Hydro reports on its Aboriginal Procurement and Contracting Policy, and a 10-year Aboriginal Education and Employment initiative. > TELUS discusses its Connecting Communities Agreement that delivers high-speed Internet infrastructure to rural areas in B.C., including a number of Aboriginal communities, as well as its efforts to bring telephone service infrastructure to isolated Aboriginal communities in B.C. Aboriginal Engagement and Relationships > One of BC Hydro’s long-term goals is related to improving relationships with First Nations that are “built on mutual respect and that appropriately reflect the interests of First Nations.” BC Hydro also commits to address past grievances of Aboriginal communities. > Enbridge reports on its Indigenous Peoples Policy and identifies a number of signed agreements with Aboriginal communities on the Gateway Project to ensure economic and skills development. > Syncrude reports on its Aboriginal Relations Program and its six key commitment areas, and provides examples of its engagement with Aboriginal communities. > TransAlta identifies its Executive Vice President with responsibility for Aboriginal Relations and has established a transmission advisory committee to: • Develop best practices for transmission systems located on Aboriginal lands; • Foster employment opportunities; and • Increase dialogue. Aboriginal Rights > BC Hydro provides data on First Nation negotiation, litigation and settlement costs. Source: Syncrude 2006 Sustainability Report, p. 39. 34 Canadian Corporate Sustainability Reporting Conclusion This study tracks two parallel trajectories in sustainability reporting in Canada. Innovation and best practice is pushing ahead on a number of fronts at the seven companies in our assessment. For these companies, corporate sustainability reporting is a core component of long-term value creation which provides a competitive edge. At the same time, sustainability reporting is going through a period of change. While the rate of growth in Canadian sustainability reporting is slowing, there are signs that reporting companies are catching their breath while systems, tools and reporting frameworks are developed and implemented. Approaches to materiality, assurance and the use of the GRI G3 Guidelines are being tested and are finding traction as companies examine their strategy and plan to step up their reporting. Our findings are an early indicator of renewed activity in reporting. We expect the next two years to see further evolution and improvement in the quality of sustainability reporting in Canada. As companies are looking to navigate the coming changes, we identify key issues that reporting practitioners need to consider: > Get ready for materiality: Materiality is A final thought: going to have a profound impact on reporting approaches as key stakeholders demand greater clarity on key sustainability issues and focused reporting on performance on these areas. Build a robust process and trim down reporting to the issues that matter. > Get serious about climate change: Climate change will continue to be the big ticket issue in the corporate sustainability world. Consumers, customers, investors, regulators and non-governmental organizations are all scrutinizing corporate activity. Gear up the sophistication of your strategy and look to find competitive advantage in your response. As sustainability reporting gets more strategic and sustainability issues are increasingly addressed in financial reporting, we expect the level of scrutiny to increase. Stakeholders are going to demand confidence that the numbers, procedures and practices reported are an accurate reflection of business performance and activity. Do you have the mechanisms in place to give them that assurance? > Assess the business case for the use of the G3 Guidelines: Uptake of the G3 Guidelines is increasing. Assess the business needs for reporting to G3 standards and be realistic about the costs. Don’t just follow the pack - build an approach based on sound business principles. > Know your performance on Aboriginal relations: Reporting on policies, programs and practices for Aboriginal relations is becoming standard in Canadian sustainability reporting, and demonstrating genuine progress is vital to maintaining trust with stakeholders. Track engagement activity, community investment programs, and Aboriginal recruitment and business development and know how your operations, products and services are viewed by Aboriginal communities. 35 Stratos has conducted three previous in-depth assessments of corporate sustainability reporting in Canada. These reports are available online at Stratos has developed a sustainability reporting toolkit with the Government of Canada. The goal of the toolkit is to provide assistance to business to assess the need to report and create an effective report. The toolkit is available at Stratos, with the support of Industry Canada, conducted a study with seven Canadian and international companies who are seeing the value in integrating sustainability into their business processes. The study, and the individual company case studies, provide best practice examples for other companies to adopt or adapt. See to access the full study and individual case studies. 36 Stratos services to support your sustainability strategy and management Identify and priorize key issues Assess current state > Materiality analysis > Gap analysis - policies, systems and practices STRATEGY > Review peer best practices Benchmark Define policy and strategy > Facilitate executive decision > Governance advice, training, alignment Assign accountabilities Engage stakeholders IMPLEMENTATION > Stakeholder mapping and engagement Build action plan > Advice on priorities and actions Management system > Management system design and implementation Issue management > Design and support to implement programs (e.g. business ethics, human rights, community investment, biodiversity, climate change) Report progress ASSURANCE > Sustainability report assessment and strategy > Sustainability assurance and stakeholder feedback Review and audit 37 Furthering the Debate We encourage discussion and debate on the views expressed in this study. To share your comments and perspectives, please contact Julie Pezzack, Principal 613.241.1001 ext. 237 [email protected] or Matt Loose, Manager Corporate Sustainability 613.241.1001 ext. 236 [email protected] 1404-1 Nicholas Street, Ottawa, Ontario Tel: 613.241.1001 Fax: 613.241.4758