Professor Liyan Wang

Information Contents or Usefulness
in the CSR / Environmental /
Sustainability Reports
Liyan Wang & Hongtao Shen
Guanghua School of Management
Peking University
Tel: 86-10-62756256
Email: lywang@gsm.pku.edu.cn
April 22, every year
CONTENTS 要 点
1. Introduction
2. Evolution of CSR Report
3. Guidelines for CSR Report
4. CSR Report in China
5. Conclusion
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Summary and Main Points
CSR, the hot issue
• The function of any reports is to disclose and
deliver information to users
• Fundamental issues:
– What information --- Relevance
– Information quality --- Reliability
– Delivery mechanism: Information effectiveness
• The concept of CSR is a very hot issue in
the world:
– Baidu ‘Corporate Social Responsibility’ ,
7,060,000 related websites, in 0.07 seconds
– Google ‘Corporate Social Responsibility’ ,
31,000,000 related websites, in 0.26 seconds
– ‥ ‥ ‥
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Report
Types of the Report
• As Professional Accountants, we prefer to
focus our discussion on, and can
contribute more to the report of
– Environment
– Sustainability
– Corporate Social Responsibility
• 5 types of social report
– Environment
– Environment, Health and Safety
– Corporate Responsibility
– Sustainability
– Environment and Society
• Environment Report is the most popular type in 20th
century
• Corporate Responsibility Report and Sustainability Report
are becoming dominant in 21th century
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CONTENTS 要 点
Evolution of CSR Report
1. Introduction
2. Evolution of CSR Report
3. Guidelines for CSR Report
4. CSR Report in China
5. Conclusion
• According to Corporate Register’s Report
(March 2009)
– The number of CSR Reports around the world has
increased more than 100 times during the past 16
years
1992:26
1999: 639
2006:2235 reports
2008:3100 reports
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Global Social Report Output Per Year
Social Report Output Per Year by Region
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Global Social Report Output by Type and Year
Who’s Viewing Social Reports
by Region (Nov 08-Jan 09)
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Who’s Viewing Social Reports
by Stakeholders (Nov 08-Jan 09)
CONTENTS 要 点
1. Introduction
2. Evolution of CSR Report
3. Guidelines for CSR Report
4. CSR Report in China
5. Conclusion
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Guidelines for CSR Report
GRI: G3 Guidelines
• 1997, GRI (Global Reporting Initiative)
was established by Ceres and as a
cooperated program with the UNEP
– 1999, GRI issued a draft of Sustainability
Reporting Guidelines, the first framework
for “Triple Bottom Line Report”
– 2002, revised G2
– 2006, revised G3
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Principles and
Guidance
Dimensions 范 围
GRI Reporting
Framework
Sustainability
Reporting Guideline
Sector
Supplements
Indicators
What to
Disclose
Standard
Disclosure
How to Disclose
• Economic
• Environmental
• Social
• Labor Practices and Decent Work
• Human Rights
• Society
• Product Responsibility
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Quality Criteria 编 制 原 则
Other Standards
• Completeness 完 整 性
• Inclusive 包 容 性
• Consistency 一 致 性
• Accuracy 正 确 性
• Clarity 清 晰 性
• Neutrality 中 立 性
• Timeliness 时 效 性
• Auditability 可 审 核 性
• Transparency 透 明 性
• Sustainability Context 可 持 续 性
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• ISEA (Institute for Social and Ethical
Accountability) is a non-profit organization set
up in 1995, aims to promote accountability for
sustainable development
• AA1000 is the first initiative offering a nonproprietary,
open-source Assurance Standard
covering sustainability Reporting and
performance
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ISEA:AA1000
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• 235 Assurance Reports have been issued
according to AA 1000 till May 2007
• e.g. EY prepared the assurance report
under AA1000 for BP’s Sustainability
Report
CONTENTS 要 点
1. Introduction
2. Evolution of CSR Report
3. Guidelines for CSR Report
4. CSR Report in China
5. Conclusion
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“
Some cases
• Using the framework of the GRI guideline
– Mar. 2006, State Grid, the first CSR Report by
Central SOE
– June 2006, Shanghai Pudong Development Bank, the
first CSR Report by financial agency
– 2006, COSCO Group, the first social report prepared
and audited by independent third party (DNV, DET
NORSKE VERITAS)
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News Release Conference of 2005 CSR Report by the
State Grid, March 30, 2006, Beijing
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Firm number is increasing
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1
4
0
2
0
0
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News Release Conference of 2005-2007 Corporate
Sustainability Report by Sino-Steel, Jan. 31, 2008, Beijing
• Before 2006, < 5 reports
• 2006, 10 reports
• 2007, 40 reports
• 2008, 144 reports
• 2009, >400 reports (SZSE 175, SSE 258)
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• Types of Social Report (before 2008)
– 41, CSR Report
– 7, Citizenship Report
– 4, Sustainability Report
– 2, Environment Report
– 1, Health, Safety and Environment Report
• Types of Enterprise (before 2008)
– 39, SOE
– 10, private enterprise
– 6, others
Usefulness of CSR Report
• fundamental
factors:
– Content
– Creditability
• Content
– What should be disclosed
– How to regulate
– Who should be the
regulator
• Creditability
– Assurance provider
– Assurance standards
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Content Analysis ( a sample of
130 reports issued in 2009)
employees
Responsibilities to
shareholders and debt-holders
customers and suppliers
environment
community
government
No. of reports (total 130)
128
121
129
127
126
0
Responsibilities to
total
shareholders and
debt-holders
customers and
suppliers
employees
environment
community
Quantification
Narrative 叙 述 性
No.
130
127
120
128
126
120
%
100%
97.7%
92.3%
98.5%
96.9%
92.3%
Quantified 数 据 性
No.
127
114
50
77
81
114
%
97.7%
87.7%
38.5%
59.2%
62.3%
87.7%
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Length (number of words)
• Within 130 sample reports
– Max no. of words in a social report is 44,000,
while the min no. less than 1000, with an
average of 8200 .
– 56% of the reports are with 3000-8000 words
Assurance by 3rd party
• Within 130 sample reports
– 0nly 10 reports have been audited or
assessed by independent auditor, social
group or association
– 5 reports with feedback from stakeholders
– 3 reports with self-evaluation
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Creditability
• Practices Globally
– Without Independent 3rd party opinion
– With Independent 3rd party opinion
• by professional institution/agency
• by non-professional institution/agency
Some Examples
• Airbus
– 2006, expanded the scope of its Biannual
Environmental Report to include social and
economic issues, Environmental, Social &
Economic Report
– Independent verification statement on the
environment part, By Ernst &Young
Environment and Sustainability Services
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Some Examples
Some Examples
• Shell
– 1998, The Shell Report
– 2000, combine the HS&E with Shell Report
– 2005, Sustainability Report
• Assurance report KPMG + PWC
• Epson
– annual Environment Report
– Third-party opinion by BVQI
• SONY
– 2001, assessed by third-party
– 2003, Third-party opinion by BVQI
• COSCO
– 2005, Sustainable Development Report
• complied according to GRI G3
• Assurance Statement by DNV and CEC Compact
Promotion Office
– 2008, DNV Assurance Statement
• complied according to GRI G3
• Assurance Statement by DNV
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Some Examples
Some Cases
• State Grid,
– 2005, CSR Report without assurance
– 2006, CSR Report without assurance
• Third-party opinion by Deputy Director
General of China Enterprise Confederation
– 2007-08, CSR Report compiled according
to GRI G3 and AA1000
• Assurance Statement by DNV
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• SINOSTEEL
– Third-party opinion by Deputy Director
General of China Enterprise Confederation /
Professor from Peking University
• China-mobile
– Third-party opinion by
• Huaicheng Xiang, the president of the Social
Security Fund
• Secretary-General of Consumers Association
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CONTENTS 要 点
1. Introduction
2. Evolution of CSR Report
3. Guidelines for CSR Report
4. CSR Report in China
5. Conclusion
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Summary / Conclusion
• In short-term, CSR Report is still a kind
of decoration, advertisement or window
dressing / show
• In the long run, CSR Report should be
standardized and improved in two
fundamental aspects:
– With Substantial Content
– With Creditability
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In Business school
• CSR in MBA education
• Research
Thank You!
谢 谢 !
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