Accounting for the Environment, a new report by OXERA Environmental, finds that major companies within the FTSE 100 index still do not produce a corporate environmental report. Although standards of reporting among utility companies are good, companies in the banking, and food and retail sectors still lag behind, with a low standard of publicly available information on the environment. A joint effort is required by companies in these and other sectors to agree the framework for a true account of environmental performance, based on impact assessment.
The report, Accounting for the Environment, is based on the evaluation of reports from companies within four sectors (banking, food and retail, oil and gas, and utilities) from the FTSE 100 index against an model report, which credits and scores companies on performance and action, above words on policy. Utilities perform relatively well: scoring 33%, compared to 6% within banking. All utility companies surveyed produce a report, but half of food and retail, and two-thirds of banks in the FTSE 100 do not. The main findings of the research are that:
biodiversity and transport issues are consistently under-reported;
there is a vast range and variation between reports even within sectors, making comparison on performance using eco-efficiency measures extremely difficult; and
one-fifth of companies offer no commitment to improve performance on reported impacts.
Colin Mayer, OXERA Director, said, in light of the report, that:
There have been considerable advances made in environmental reporting over the past decade. However, as this carefully researched briefing paper records, there remains an immense amount to be done. The paper provides a valuable benchmark against which to evaluate progress in this increasingly important and influential area of corporate activity.
The report also recommends a standard blueprint and guidelines for environmental reporting both for business overall and within sectors, and identifies outstanding issues that need to be tackled. Future government guidance through the new powers within the Utilities Bill, to deliver renewable energy supplies, energy efficiency and social action, as well as guidelines from the DETR on global-warming reporting will provide a greater need for effective reporting on the environment. More companies need to engage in initiatives to coordinate environmental reporting if company reports are to be of value to investors, government and the public
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