A Little Secret – Sustainability Leadership at the Business Roundtable

The Business Roundtable is an association of CEOs of leading US companies with $6 trillion in annual revenues and nearly 12 million employees. So when they published a report entitled Enhancing Our Commitment to a Sustainable Future, I had to take a look and found an unsung hero.

The report contains statements by nearly 100 CEOs on their businesses’ commitments to lower emissions, increased energy efficiency and pursue more sustainable business practices. A little research also showed that over half of the featured companies in this report use GRI’s sustainability reporting framework (see attached spreadsheet: BRT GRI Use Review - and listing at end of this blog).  I suspect other featured companies also utilize the GRI framework but prefer not to advertise that fact publically (perhaps a good topic for a future blog after I finish some billable work).

So why is this significant and how does this relate to activities of other CEO-led associations? According to SocialFunds.com, only about 13% of companies listed on the S&P 500 publish GRI-type sustainability reports. But as evidenced in the Business Roundtable’s publication, this small group gets the lion share of visibility.

What about the other members of the Business Roundtable or the S&P500? Just like their GRI-reporting peers, they all continuously invest millions of dollars in policies, systems, processes, monitoring, auditing and reporting.  Think about quality, environmental and occupational safety systems. Many also have stakeholder engagement processes in place (perhaps without using the term 'stakeholders'). These include customer and employees satisfaction surveys, philanthropic activities and community outreach efforts. These are all part of continuous efforts designed to manage risks, and do more and better business. And all of these activities can provide the information and context needed to produce a disciplined, balanced and more widely accepted GRI-type reporting that transcends the credibility discount applied to ‘PR brochures’.

Why are so many S&P 500 companies not leveraging their major investments to provide a better context, show off their commitments and highlight continuous improvement?

A look at ICMM, the International Council on Mining and Metals, showcases a very different situation. ICMM is a CEO led-association of 18 major mining and metals companies, along with 30 mining and commodity associations. ICMM’s company members (which include Business Roundtable member Freeport-McMoRan Copper & Gold) decided to leverage their investments by adopting GRI's sustainability reporting framework already in 2008.  It seems to me that ICMM members like BarrickGoldcorpNewmont and Vale decided to avoid a defensive approach and embraced transparency by adopting GRI, the most credible reporting framework at this time. ICMM even posts the GRI reporting status of its members for all to see here.

What does all of this mean for US businesses and their ‘clubs’.  The Business Roundtable’s ‘Enhancing Our Commitment to a Sustainable Future’ is an admirable statement. But it seems that very similar statements are being made by almost every industry and professional association across the US. It has turned into one of those motherhood and apple pie statements.

Are such statements credible and sufficient value for membership money? Or are due-paying members expecting more? Looking at sustainability related leadership efforts of industry associations, ICMM's actions strike me as most impressive and real value for its membership (and let me not forget: their stakeholders).

What’s next? Should the Business Roundtable and other leadership-driven business associations take their cue from ICMM? I would welcome your comments.

PS - And here tipping my hat to GRI reporting contingent in the BRT publication: ABB, Abbott, Accenture, Alcoa, American Electric Power, AT&T,  CB Richard Ellis Group, CH2MHill, Chevron, Coca-Cola, ConnocoPhillips, Cummins, Darden, Deloitte, Dow Chemical, Duke Energy, DuPont, Eastman Kodak, EMC, ExxonMobil, Freeport McMoran, Harrah’s Entertainment, HSBC, IBM, Ingersoll Rand, ITT, Johnson & Johnson, Johnson Controls, Life Technologies, McKesson, Merck & Co, Motorola, NextEra (formerly FPL), Office Depot, Owens Corning, PepsiCo, Praxair, Proctor & Gamble, Ryder, Sara Lee, SAS Institute, Siemens, Southern Company, Target, UAL, Weyerhaeuser, Whirlpool, Williams Companies, Xerox.

About the author: Mehrdad Nazari (MBA, MSc, LEAD Fellow) is a Corporate Responsibility, Sustainability Reporting & ESIA Advisor, and Director of Prizma. He was previously an environmental consultant with Dames & Moore, Principal Environmental Specialist at the EBRD and CSR Research Director at CoreRatings. Mehrdad is a GRI-approved trainer on GRI's sustainability reporting framework and a licensed AA1000 Assurance Provider.