In the words of the African Delegate from Johannesburg to Rio+10, sustainability means:
Enough—for all—forever.
Sustainability integrates the environmental and social dimensions within the economic dimension of an entity’s operations to ensure sufficient resources and a good quality of life for present and future generations. To some, sustainability appears to be an enormous challenge that is too overwhelming and not worth the effort. In contrast, others are well on their way to making our world a better place for all. For example, 89 percent of business leaders say “commitment to sustainability is translating to real impact in their industry” (United Nations Global Compact-Accenture Strategy 2018, p. 11). In line with the sustainability concept, the influential Business Roundtable (BR) in the United States has redefined the role of a corporation as benefiting all stakeholders (Business Round Table 20.9), not just shareholders. This BR commitment was signed by 181 of the nation’s CEOs. These businesses believe that partnerships and other collaborative arrangements are essential to address the challenges that we face. The material in this book provides an approach for working together through commitment both to sustainability performance and reporting. Performance supports reporting and vice versa.
Stakeholders wishing to grasp an organization’s performance or managers of any type of entity wishing to improve their performance and make their reporting more credible will find the material in this book relevant and useful. Reporting should be a natural extension of performance not only to inform internal and external stakeholders about an entity’s sustainability journey but also to learn to improve performance. Reporting has evolved and is continuing to evolve from reports that were initially called “green glossies” in the early days to current day integrated reports. Integrated reporting combines conventional financial reporting with environmental and social reporting to demonstrate the organization’s value added through maintenance of its capital assets (both tangible and intangible) in the short term, medium term, and long term.
This book begins in Chapter 1 by questioning whether our current economic model is appropriate for practicing a more sustainable capitalism. It gives a brief history of sustainability along with an overview of conventional and emerging sustainability models and their strengths and weaknesses. Chapter 2 couples sustainability performance with reporting to comprehend how they are interrelated. It provides a brief history of major environmental disasters that spurred the demand for more transparency. Companies responded through various means of communicating sustainability information causing sustainability reporting to evolve over the years. Now, there is a plethora of demands for sustainability information. Many multi-stakeholder groups, including corporations, are involved in setting reporting standards and raising the bar on various aspects of sustainability and its disclosure. Chapter 3 introduces a model for a sustainable organization. Chapters 3 to 7 cover various elements of this model by providing guidance on how an organization begins its journey of continuous improvement toward sustainability. This journey starts with organizations engaging their stakeholders to determine the topics of importance (material topics) to them (Chapter 3). Once materiality is determined, the organization then develops its management systems incorporating critical policies and procedures to ensure its sustainability objectives are fulfilled (Chapter 4). Certain reporting standards help select appropriate indicators to measure performance; however, organizations should consider desired inputs, outputs, outcomes, and impacts, as well as efficiency and effectiveness in the indicator selection process (Chapter 5). Quality sustainability reporting incorporates essential qualities, such as comprehensiveness, credibility, comparability, balance, and others (Chapter 6). Although organizations generally produce one comprehensive sustainability report appropriate for all its stakeholders, they have many reporting demands that range from voluntary to mandatory, broad to sector specific. Organizations develop internal controls and undergo internal audits to reach their sustainability objectives. Some organizations choose to have certain aspects of their reports assured by an objective third party to ensure a certain degree of accuracy (Chapter 7). Finally, Chapter 8 recaps where we have been and where we might be going. It reviews major concepts and speculates on the direction of sustainability performance and reporting for the future.
The book uses many examples and illustrations from leading-edge organizations to provide context to the material. It places the reader in the world of sustainability performance and reporting. Various learning aids are interspersed throughout the chapters to support the reader’s understanding of the points of view of organizations and their many diverse stakeholders. Some of these include the following:
Sustainability in Action: Examples from organizations’ actual experiences.
Reflections: Thoughtful questions or concepts that require critical thinking.
Key Takeaways: Reviews of major concepts in each chapter.
Glossary: List of terms and their definitions.