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Model for Organizational Sustainability
-Policy
-Performance
-Stakeholder needs and desires
Organizational Documents Useful for Setting Sustainability Direction (Strategy)
-Vision Statement
-Mission Statement
-Core Values and Beliefs or Code of Ethics
-Existing Policies
-Contractual Obligations
-Applicable Laws and Regulations
-Guiding Principles
What is Teck’s Materiality Matrix about?
What is important to the stakeholders? How are they doing? Climate change, workplace environment, community impact, Indigenous rights, biodiversity, etc.
Steps to Define Material Topics (From GRI)
-Identify issues and create a list of topics;
-Prioritize what is material to the organization and recognize any potential conflicts or different perspectives through form of stakeholder panel;
-Review the topics by an internal, high-level committee/team or an external consultant.
Dual Materiality
-Material because of social and environmental impact.
-Material because of the effect on financial outcomes.
Benefits of Stakeholder Management
-Identifying material sustainability concerns and issues,
-Determining the communication strategy appropriate for each stakeholder group,
-Assessing performance on material topics,
-Determining the credibility of the sustainability disclosure and report,
-Deciding which company decisions need to be explained, and
-Participating in projects with certain stakeholders to improve performance.
Types of Stakeholder Engagement
Informing: strong one-way communication (from firm to the stakeholders)
-Newsletters, regional or global sustainability reports on all dimensions, reports on specific aspects of concern on environmental or social dimensions or specific commitments.
Responding: strong one-way, weak return communication. (Strong from firm to stakeholder; weak from stakeholder to firm)
-Consultation on material items or appropriateness of reports, grievance management; answering questions about certain aspects of a project, informal sessions or town meeting on project process.
Involving: strong two-way communication (from firm to stakeholder and from stakeholder to firm.)
-Project monitoring, negotiations, partnerships.
Strong Linkages
Policy <–> Performance = Management System
Performance <–> Stakeholder needs and desires = Sustainability Reporting & Assurance
Stakeholder needs and desires <–> Policy = Participation in multi-stake holder initiatives.
What Motivates Change?
Motivational Underpinnings:
-Greed (Profit)
-Fear (Penalties and Fines)
-Responsibility (Ethics and Good Citizenship)
-Policy and Regulations (compliance)
-Policy and Market Solutions (Free Market)
-Internal Motivation and Value Systems
Organizations Can Develop Capability By:
-Allocating resources through budgets and investments
-Hiring people with the required expertise
-Building expertise internally through training
-Providing opportunities to learn from others internally and externally
Complementary Environmental and Economic Efficiencies
-Re-designing processes used in the office, in production, in delivery, purchasing, or any number of steps in the value chain.
-Retrofitting buildings in which we work.
-Re-designing products or services offered to use fewer resources.
-Turning materials that were once waste into re-usable materials.
-Working with suppliers, customers and other stakeholders jointly to find solutions to new, less impacting products and a better world in which to live.
Characteristics of Good Indicators
Specific
Measurable
Achievable
Relevant
Timely
Economics Indicators
-$ of economic value distributed;
-percent of employees hired locally;
-percent of goods purchased locally;
-percent of taxes paid;
-percent of independent directors on the board of directors.
Environmental Indicators
-tons of GHG and air emissions;
-number or volume of spills;
-tons of wastes;
-kilowatts of energy use;
-tons of water used.
Social Indicators
-percentage of employee turnover;
-number of injuries;
-hours of training;
-number of code of conduct infractions;
-number of minorities in top management positions.
Input Indicator
What is going in to a process (e.g. dollars invested into a community)
Output Indicator
What is coming out of a process (e.g. number of food bank meals provided).
Outcome Indicator
Short-term effects of the input or output (e.g. satisfaction or enjoyment of the individuals eating the meals; flavour and nutritional value of the meals).
Impact Indicator
Long-term effects (both direct and indirect) of input or output (e.g. health effects or better quality of life).
Measuring Success of a Business
How we measure success:
-Quarterly Financial Reports
-Return on Financial Investment
-Dividend payout
-Increase in Stock Price (day traders)
-Growth
How should we measure success:
-Number of societal problems solved
-Number of societal problems created
What is Sustainably Reporting?
It acts an accountability document. Source of information if the organization are legitimate whether its implicit social license to operate ( we need people to operate).
Sustainability Report Formats
-Stand-alone reports communicating with the pillars’ performance.
-Integrated reports communicating financial, three pillars’ performance.
-Other special reports on climate change, human rights, modern-day slavery, conflict minerals, and other sustainability aspects.
Many Names of Sustainability Reports
-Impact Report (Tesla)
-Community Report
-Integrated Annual Report
-Corporate Citizenship Report
-Environmental Social and Governance (ESG) Report
-Corporate Social Responsibility (CSR) Report
-Triple Bottom Line Report
-Sustainable Development Plan (Cascades)
-Corporate Responsibility Report (IGM Financial)
Evolving Structure and Content of Sustainability Reports
Mostly social information –> environmental information –> Stakeholder engagement, Reporting standards –> Third-party assurances –> Integrated report combine financial with environmental and social information.
