Sustainability Progress: More ‘Words’ Than ‘Action’
by Michael Connor
While sustainability is increasingly “appearing on the radars and agendas of companies around the world,” a clear gap exists between corporate “words” and “action,” according to the newly-released Global Corporate Sustainability Report 2013 from the United Nations Global Compact.
The most recent survey of Global Compact companies found that while 65% of signatories are committing to sustainability at the CEO level, only 35% are training managers to integrate sustainability into strategy and operations. “Companies are making commitments, defining goals and setting policies at high rates, but still have much work to do to on the action steps: implement, measure and communicate,” the report said.
Management of global supply chains, for example, is the “top barrier” for large companies in improving performance on sustainability goals, according to the report. But while 83% of companies said they consider adherence to Global Compact principles by their suppliers, “only 18% assist them with setting and reviewing goals and just 9% take steps to very remediation.”
The report found that large companies are far more likely to lead on sustainability initiatives than small or medium-sized companies, which are often constrained by a “lack of resources and lack of knowledge.” Large companies are twice as likely to have a human rights complaint system or monitor and evaluate their environmental performance, the survey found.
Despite the perceived gap between words and action, the report said, “momentum is building as companies look for ways to align actions with global development priorities.” When asked to rank the top global sustainability challenges, companies put education, poverty eradication, climate change, and growth and employment at the top of the list.
The report said: “Turning a blind eye to sustainability issues is a ticking time bomb, and hiding missteps – no matter how deep down the supply chain – is no longer an option. Technology advances have enabled rapid access to information and accelerated the spread of social networks. These developments challenge the traditional forms of authority and make transparency a necessary tool for management. Earning a ‘licence to operate’ increasingly requires public legitimacy and proactive societal engagement.”
The United Nations Global Compact, launched in 2000, is largest corporate sustainability initiative in the world, with over 12,000 signatories (8,000 companies and 4,000 civil society organizations) based in 145 countries. The Compact’s ten core principles address issues affecting human rights, labor, the environment and anti-corruption.
The Global Corporate Sustainability Report 2013 drew on information from 1,712 respondents from 113 countries. European companies accounted for 55% of the responses compared with only 4% for North American companies. Other respondents were from Latin America (17%), Asia (16%), Africa (4%), Middle East/North Africa (35%), Australasia (1%).