CorpComms Magazine

UK companies are frequently disclosing incorrect and irrelevant data in their corporate and social responsibility (CSR) reports, according to researchers at the University of Leeds and Euromed Management School.

After examining more than 4,000 CSR reports, rankings and surveys published by companies worldwide, researchers conclude reports often feature unsubstantiated claims, holes and inaccurate figures.

Ralf Barkemeyer, a lecturer in corporate social responsibility at the University of Leeds, said: 'Some examples show that the quality of environmental data in sustainability reports remains appalling at times. In financial reporting leaving out an undisclosed part of the company in the calculation of profits would be a scandal.

'In sustainability reporting it is common practice. How can stakeholders assess or compare performance without exactly knowing what the data actually covers?'

A forthcoming study from Leeds University's Sustainability Research Institute will also reveal patchy disclosure of greenhouse gas emissions by Europe's largest companies.

The researchers' findings appear to contradict a recent survey by consultancy KPMG that claimed UK firms lead the world in corporate sustainability reporting. 

Barkemeyer added: 'Very few criteria applied in CSR ratings relate to the actual impact of corporate activity on the environment and society. Instead, aspects such as the existence of a strategy or the implementation of environmental management systems or policy formulation take centre-stage in the identification of best practice.

'Put provocatively, companies get points for knowing where they want to go. But nobody seems to check whether this is where they are heading. Aspiration replaces performance. We need to change the way in which we process quantitative corporate sustainability information - in essence, now that companies are starting to provide it, we need to actually start using it.'

Frank Figge, professor of sustainable development and CSR at Euromed Management School, said the Global Reporting Initiative (GRI) has helped to improve the quality and comparability of reporting across different companies but it is often misused and poorly implemented by firms. 

Outside of the UK, researchers also flagged up 'bizarre' claims from CSR reports, including one from Italian energy company ENEL. In its 2009 report it reported carbon emissions amounting to 122,089 million tons - four times the emissions of planet earth.

Other anomalies include multinational technology firm ABB which overstated its emissions by a factor of 1,000 over several years. And Ford, which reported a higher level of mineral waste generation in North America than it did for worldwide (including North America). 

Barkemeyer said: 'Examples such as these lead to the conclusion that stakeholders are either not using data published in corporate social and environmental reports, or that they are using erroneous data without spotting flaws in the information. Even worse, they might even ignore data altogether when they assess a company's sustainability performance.'

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