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3 posts from January 2012

24 January 2012

Times article references Fronesys materiality report

Raconteur Sustainable Investments coverIn today's Times supplement on Sustainable Investments, Cary Krosinsky and Jyoti Banerjee have analysed how company reports often fail to take into account the key issues that are now crucial for future business success. 

Here's an excerpt from the article, which references the research work Fronesys has done on the materiality of sustainabilityissues in corporate reporting:

One important reason why this gap in communications [between the firm and its stakeholders] continues is that sustainability reporting does not have wider currency among investors, as it can be difficult to discern which of the dozens of non-financial issues on which a company reports are actually material to performance.

A report from Fronesys on Materiality Futures found that as of August 2011 less than 5 per cent of the 2,000 or so companies producing sustainability reports actually publish the process by which they decide which issues are most important to their business operations.  Even with these companies, there is a lack of transparency about how this “materiality determination” process works. This Fronesys report found that over 140 different sustainability issues are analysed across the 31 companies in the study. Of these, 50 issues figure prominently for a number of companies, including corporate governance, carbon, water use, human rights and privacy. 

And so it is not surprising that it remains difficult for investors to know which sustainability issues could have an impact on the future value of their investments. Ultimately, these are all either practical risks that any investor should consider or they are unimportant, and working out which is which will be essential to being able to pick the winners and losers going forward.

To read the article in its entirety, check out Page 12 on the Sustainable Investments supplement from Raconteur: http://np.netpublicator.com/netpublication/n39150548

Fronesys supports Aviva stance on sustainability reporting

Aviva investorsFronesys has joined the initiative led by Aviva Investors to convene a Corporate Sustainability Reporting Coalition (CSRC), which is calling on United Nations (UN) member states to commit to develop a policy framework on corporate sustainability reporting.

The focus of the initiative is the Rio +20 Earth Summit on sustainable development, which has its 20th anniversary in June 2012. Aviva's initiative is inviting heads of state and heads of government to take action.

The convention is proposing (see attached PDF) that UN member states at Rio +20 commit to develop national regulations mandating the integration of material sustainability issues in companies’ Annual Report & Accounts. We are also advocating effective mechanisms for investors to hold companies to account on the quality of their disclosures – eg through an advisory vote at the AGM.

The production of a report and accounts that integrates sustainability throughout will help create the right kind of discussions within boardrooms, throughout firms and encourage investors to think about the sustainability of the firm. We believe this will help capital to be allocated to more sustainable, responsible companies and strengthen the long term sustainability of the financial system.

Already countries like India and Brazil are exploring mandatory sustainability reporting and this initiative will be encouraging other countries to embark on the same journey. Clearly, the introduction of integrated reporting offers one key mechanism for bringing sustainability into the mainstream of corporate reporting.

 

17 January 2012

Step Change: Broadcasting Sky's sustainability story

Satellite broadcaster Sky has set itself ten targets as part of its overall vision of reducing the company’s environmental impacts. These targets, including a 25% reduction in gross CO2 emissions over three years, a 20% increase in energy efficiency, and 20% renewables use, are set in a context of continued business growth.

Two years into the programme, the company has already achieved a 19% reduction in CO2 emissions, and has exceeded the three year target for energy efficiency. Achieving these targets, as well as others relating to fleet emissions, business travel, water consumption and waste, has required considerable thought and action across the working of the company. An Environmental Steering Group (ESG) led by the chief executive of the company meets with twelve other executives leading individual departments to ensure that the company is operating in ways that will enable it to meet those targets. 

Sustainable broadcasting

The Sky Studios office in Isleworth, UK, has been built as Europe’s most sustainable broadcasting facility, with an integrated wind turbine, an on-site Combined Cooling & Heating Power (CCHP) plant which provides at least 20% of the energy needed for the building’s electricity and heating, and eight naturally ventilated studios. 

Although ICT equipment is found in many parts of the broadcast chain, the industry also uses some equipment that is unique to this industry, such as cameras, lighting, editing suites, transmitters, aerials, and so on. Due to the specialised nature of the kit, it is unlikely to have been purchased with energy efficiency in mind, nor would there be power management features. Further, the way equipment is used in the broadcasting industry, media professionals are usually unhappy to risk continuity of service by shutting equipment down, especially due to concerns that the equipment may come back on with different settings. 

It is issues such as these that differentiate Sky's new studio from its peers. The equipment for each studio was chosen so that a single switch can carry out an automatic shutdown of the entire studio, something that traditional broadcasting could never envisage.   A green IT policy is in operation where power management is used to shut down computers at the end of each day, as well as the use of energy efficient centrally-located multi-function devices replacing individual scanners and printers.

It is not just the IT that gets this attention. The studio's lighting is based on energy efficient technologies and the building has regenerative lifts. The CCHP uses locally-sourced biomass, and harvested rainwater is used to flush toilets and irrigate the green spaces around the building. 

Using less energy

Energy is a key consideration in the broadcasting industry which uses bright lights, huge audio and video files and widespread networks. Yet, around 80% of the broadcasting industry’s carbon emissions, estimated at around 2% of global emissions, relate to the energy use of their customers in accessing the output of the broadcasting industry via their televisions, radios, satellite and cable boxes, and other equipment.

As a result, the broadcasting industry can benefit in its own sustainability efforts if TVs and set-top boxes are more energy-efficient and use better power management in sleep and standby modes, something that Sky has to focus on in terms of its own set-top boxes.

As the broadcast industry transitions from analogue to digital, it finds that its energy use keeps rising, even when it seeks to use the most energy-efficient equipment available. For example, as broadcast and production companies digitise their archives, tapes that once sat on a shelf, not using any energy, are converted into digital files, which consume energy in their production and their storage.

But the functionality associated with these files go up as well, as it is easier for their contents to be accessed by a wider number of people, they can be more easily re-used, etc. Plus Sky reports that by digitising 1.64m tapes, it was able to eliminate the impacts relating to moving around 4000 tapes a day. So a straightforward energy calculation could miss the benefits related to the greater functionality of dematerialised content.