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Weekly Short
22 October, 2021
Last week Tortoise Media released the 6th Edition of the Responsibility100 Index, which ranks the FTSE 100 companies on their commitments to certain social, environmental and ethical objectives.
An alarming headline from the report is the finding that, in response to Covid-19, many big businesses have rolled back their environmental transparency and fair pay policies.
But it’s not all doom and gloom. The report shows there are now more women on boards and in positions of senior leadership and direct carbon emissions from the combined R100 companies has declined by 9% since last year. This demonstrates that the net zero focus is beginning to pay dividends.
Yet the most significant finding is the patchy quality of non-financial reporting – and we’re talking about the biggest companies in the UK here. It’s telling that one of the reasons (though not the only one) for Severn Trent topping the list this year was its decision to start reporting on indirect carbon emissions. In 2021, the surprising thing is that there are companies that aren’t currently doing that already.
Reporting is inconsistent where companies are able to pick and choose data points or decide to ignore entire issue areas and this does nothing to help stakeholders to make informed decisions. More than 100 data points that Tortoise collected for the previous R100 update are missing this year. When reporting is inconsistent and opaque it undermines the core value of the process. Yes, a function of reporting is for the outside world to hold organisations to account but more importantly it is to ensure that businesses confront these measurements, building on successes and committing to address where they are failing.
We look forward to a day when the focus is on the positive progress businesses are making on these key issues – rather than just whether they are reporting on them.
By Jessie Smith