Reporting

The Nike court case is helping draw the battle lines in the on-going debate about how best to hold companies to account and encourage responsible business behaviour. The legal arguments are technical, but the positions are clear: should US companies enjoy a measure of protection in reporting their CSR activity, so allowing them freedom to speak out on social issues; or should the same standards of demonstrable truthfulness be applied here as in financial reporting, and risk having them clam up? The problem is, as Pilate said, what is truth? The newly-revised AA1000 assurance standard takes the view that trust in companies to tell the truth is now so low, nothing short of a fully-independent audit statement will inspire confidence in social reports. It recognises the practical difficulties in determining the factual accuracy of much social and economic impact, and so relies on stakeholders' views.

At Briefing we take the unfashionable view that few companies are out and out liars. Most are guilty at worst of presenting a partial view and then putting a positive gloss on it. We fear the rush to audit and indeed to standardise measurement and reporting (pace GRI) risks putting back the cause which is still in its infancy. We feel the priority is to win hearts and minds throughout the business and find innovative ways of understanding social impacts, not to raise the bar.

And what are we to make of the row that greeted the new BITC CR Index? To be honest, our sympathy doesn't lie with the unfairly criticized 'laggards' in the bottom quintile: if you enter a process built around a crude league table it was entirely predictable those at the bottom, however objectively good, would be criticised. No, sympathy is due to those who put huge effort into completing the assessment, believing the line that a BITC index would be used by rating agencies and so reduce the tidal wave of CSR surveys.

Alas, few such agencies want standardisation around someone else's survey - they are all in a competitive position, and these new indices are as much about promoting the profile of the instigator as shedding any new light on how to measure social impact. Increasingly companies will be very choosy about who to play this game with, cooperating only with those that add real value.