Tag Archives: sustainability

A checklist to improve your CSR program!


Red exotic flowerWe have decided to publish a series of 8 press releases, along with blog articles, providing organizations with a checklist of questions they can ask to easily identify potential improvement areas in the sustainability/CSR management.

The first one focuses on the overall CSR strategy, and is divided into 6 main themes:

1 –  Is the management engaged?

2 – Are employees involved?

3 – Are stakeholders consulted?

4 – Is the sustainability strategy intertwined with the overall strategy?

5 – Is a mechanism review implemented to measure the efficiency of the strategy?

6 Does the company communicate about the CSR program?

The above points should ensure that the CSR/sustainability program is efficient.

First, the management needs to understand the importance of such topics, at least in terms of risks and opportunities. It is better to assign dedicated roles and responsibilities to make sure that topics are taken into account.

To ensure the success of the CSR program, it is important that employees are aware of such programs and can actively take part in it. Employees are the ambassadors of the company, which means that they can influence the reputation of the company. Also, such initiatives can reinforce their motivation.

Third, all stakeholders (not only management or employees) need to be consulted and engaged as the role of CSR is to manage impacts towards them. Their opinions and ideas are thus required.

From a strategical standpoint, the CSR program makes even more sense when it is embedded in the overall strategy. In this sense, organizations can prioritize topics which are relevant to address them. This can ensure a long-term strategy, which will be beneficial for the stakeholders and the organization.

Once the strategy is decided, the program can be rolled out. With this, it is paramount to set quantitative targets that will be measured by specific metrics. The metrics will show the success of the initiatives, and are a way to reassess the strategy and its objectives.

Finally, such successes and decisions should be communicated to impacted stakeholders, included involved employees and the management, so that they understand the efficiency of the CSR program. Such communication also acts as a basis for discussions.

To discover the full checklist for the overall CSR program, please go to http://dfge.de/en/checklist-to-easily-improve-sustainability-programs/ or contact us at info@dfge.de

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Define your sustainable procurement strategy with the SDGs


Cliff and blue seaSince their adoption, there is an ongoing discussion how SDGs can be integrated and used by businesses; indeed, the SDGs explicitly name companies as contributors to a solution for sustainable development challenges. This article describes how the SDGs can be used as a framework for sustainable procurement strategy.

Sustainable procurement means turning risks into opportunities

Many risks companies face today are located in the supply chain and refer to reputation (corporate image) and strategy. First, deficits in the supply chain can damage a company’s reputation severely. This refers both to social and environmental issues; a widely known example is BP whose reputation was damaged due to the company’s handling of the Deepwater Horizon catastrophe. While every supply chain issue can cause direct financial cost for a company, reputation damage is something which can last for a very long time and which can hit a company in multiple ways. Despite lower sales, a reputation damage can for example also discourage talented people from applying for a job at the company.

Secondly, it can also be a strategic risk for a company not to manage its supply chain properly. If future scarcities of resources which are essential for a company’s operations are not properly accounted for in the strategy, and if a company is therefore not prepared to future price rises, it endangers its economic viability in the long term.

To tackle such risks, companies can implement sustainable procurement. It means that they can set standards that their suppliers need to follow. It consists of integrating sustainability criteria into the supply chain. On the one hand, risks are reduced. Indeed, if the supplier environmental system is solid, accidents and crisis should be solved quicker, reducing operational risks. If there is sound social dialogue and decent working conditions, there are less risks of strikes and of related production disruption. If human rights are respected, the reputation risk is managed. In the other hand, companies can benefit from various opportunities: more collaboration, more trust, innovation and new products, customer satisfaction, …

How can now the SDGs help companies to address and structure supply chain management?

You can tune your sustainable procurement strategy with the SDGs

The SDGs essentially represent a framework which addresses the full scope of sustainability topics and actors. The strength of this framework lies in its global acceptance and popularity; thus, using this framework for CSR communications means lowering the threshold of stakeholders to understand and back a company’s CSR strategy, including the sustainable procurement strategy.

The SDG Compass, issued by the Global Reporting Initiative gives an overview, how companies can link these targets to their business. By means of a high-level mapping of their value chain, companies can first identify topics where impacts are likely to occur. In the end, it should be clear whether core competencies, technologies and product portfolio of a company have rather positive or rather negative influence. This mapping process includes external stakeholder participation which adds additional aspects and points of view to the process. It is highly important to interact with the suppliers to understand what the impacts are, and where they occur. Indeed, in some cases such impacts are located only in the supply chain. For example, any retailer will avoid the potential risks linked to manufacturing, like occupational health and safety linked to machine use and high resource consumption. To do so, companies can ask suppliers about such risks during business reviews, make a quick analysis of their website or resort to risk databases.

After the mapping, a company should set measurable and time-bound goals to reflect the priorities and adopt related indicators. Such indicators express the relation between the company’s activities and the impact on stakeholders, and data for these indicators should be collected. Depending on the magnitude, severity and likelihood of current and potential negative impacts, a company then prioritizes indicators. Indicators linked to the supply chain need to reflect actual actions: share of suppliers considered at risk, share of suppliers audits, share of suppliers completing corrective action plan, share of successful re-audits, number of products including new sustainable features thanks to supplier collaboration, …

These preconditions met, a company is ready to integrate sustainability into its sourcing practices. In the case of supply chain, active leadership by the procurement management is key to implement the company’s requirements. A shared understanding of how value is created by becoming more sustainable help to anchor the set sustainable procurement strategy. In this sense, the company needs to communicate such requirements to the procurement department, who then interacts with the suppliers. Another best practice is the integration of sustainability goals into supplier performance reviews.

Finally, progress has to be constantly reported in order to demonstrate credibility. Results should be communicated to both suppliers and buyers. To ensure transparency throughout the supply chain, it is important to communicate such results publically. Indeed, clients of the company might also want to want to know what happens in the upstream supply chain. In this sense, the use internationally recognized reporting standards such as GRI, CDP or others is recommended in order to achieve comparability between companies.

For more information, contact us at info@dfge.de or visit our page on Sustainability Management.

Discover the linkage between GRI and CDP


CDP GRI

Main findings

All information requested in the CDP Climate Change Questionnaire can be reused in a GRI G4-based report, on the condition that the climate change related Aspects[1] (Energy, Emissions, Products and Services, Public Policy) have been identified as material. Material means that the topic is relevant for the company while has impacts on the stakeholder that the company tries to manage.

Under GRI Guidelines, there are two types of information that can be reported: General Disclosures, giving information about the overall economic, social and environmental background, and Specific Disclosures, under which organizations report on the topics/aspects considered material.

In this sense, G4 General Disclosures have a broader meaning than the CDP corresponding questions, and can then be reused in the CDP questionnaire and adapted to the context of climate change, while the other way around is trickier, as CDP questions are only linked to climate change.

For the Standard Disclosures, we recommend to directly consult the document. All details and matching tables can be found here: https://www.globalreporting.org/resourcelibrary/GRI-G4-CDP-2016-Climate-Change-Linkage-Document.pdf?dm_i=4J5,4509P,LP4UW0,F1FH5,1

Linking standards: a relevant reporting approach

In the linkage document, GRI and CDP explain the importance of aligning on international recognized standards and to merge them whenever possible. We at DFGE also support this approach through our Sustainability Intelligence Model. Indeed, documents can be reused to answer different requests, which can be time-saving for companies. It is important to answer through recognized standards as they are usually multi-stakeholder and independent, assuring a representation of all parties in an objective and unbiased way. Moreover, standards are a tool to compare the performances of various companies and to identify best practices.

How to answer CDP or GRI

CDP and GRI are sustainability reporting frameworks, meaning that companies need to implement some actions before being able to report anything. DFGE can help you define and implement your actions. Also, DFGE can support you through the CDP process via assessing your carbon footprint, answering the questionnaire or performing a response check. In addition, DFGE can define the report contents according to GRI. Please feel free to contact us for more information at info@dfge.de

More information about CDP:  https://www.cdp.net/en-US/Pages/HomePage.aspx
More information about GRI: https://www.globalreporting.org/Pages/default.aspx

[1] The word Aspect is used in the GRI Guidelines to refer to the list of subjects covered by the Guidelines (e.g., Energy, Emissions, Products and Services)

Discover DFGE’s new website!


Dear readers, we are happy to inform you that we have changed our website design and content. You can find it here:  http://dfge.de/en/. In this article we briefly explain the main changes and how we hope you will benefit from our relaunched website.

A new structure based on our Sustainability Intelligence approach

DFGE’s Sustainability Intelligence approach aims at leveraging the life of companies by reusing existing and available data to reusethem for other standards, and making the link through them.

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In this sense, our offer is built around Sustainability management: we transform existing data (calculation), we include them in sustainability reporting frameworks (reporting). We also help companies plan their strategy, implement their actions and review these actions with dedicated KPIs. All these processes are documented and can be reused in calculation and reporting – this is Sustainability Intelligence.

Thus our website is structured around calculation, reporting and management.

New pages following new market trends

Since 1999, DFGE has been specializing in carbon footprint reporting and environmental management. Over the past few years, DFGE has noticed increasing participation in CSR standards such as United Nations Global Compact (UNGC), EcoVadis, GRI[1],… DFGE has extended its competencies to better support companies in their current challenges, from CO2 emissions to a broader CSR/sustainability strategy.

In this sense, you can find new webpages on our EcoVadis and GRI support.

We have just signed a partnership with EcoVadis and will provide response checks of questionnaires as a starter package. The complete package features a fill-in questionnaire and a prioritized CSR improvement strategy with dedicated feedback on current documents and practices.

Our GRI support enables us to help companies identify their main impacts and topics of interest, and to prepare the contents of CSR report following the GRI G4 Guidelines.

A more visual website

To ensure a nice visitor experience, we made sure to structure the pages in different blocks and to reduce the amounts of texts and. For instance, the background information about a dedicated standard can be found at the bottom of the page, if you decide to expand the text blocks.

new website

Blog integration

Our blog is moving and will be integrated in our new website – for the next couple months we will feed all new blog articles here on our external blog and in parallel on our new blog at http://dfge.de/blog/

There will be a special announcement for the final move – we hope you will like the new blog style.

We would be happy to receive your feedback at info@dfge.de. Happy reading!

[1] See our blog entry on growing CSR trends for more information

Be part of the growing CSR reporting trend!


Background story: The majority of our blog posts deals with CSR topics; we write about the latest developments in this field and try to relate it to a company’s daily business. Our background stories have a different perspective: Here, we explain trends, scientific background and societal implications of corporate sustainability – sometimes with a personal touch.

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You already have heard this acronym at work, and even came across a CSR report, and you will hear even more. Indeed, CSR reporting is growing.

CSR reporting is a communication tool on dedicated topics.

You may wonder: what is CSR reporting? There are different scientific and accepted definitions. Our definition is: any documentation related to the company’s management and performance regarding social and environmental topics that is disclosed publicly, and which aims at informing the stakeholders of how the companies manage the impacts towards them.

A stakeholder is said to be any party affected by the organization’s operations: shareholders, customers, suppliers, employees, local communities, civil society, industry, government… CSR reporting is then a tool to communicate the organization’s efforts to the impacted stakeholders.

We identified some of the main CSR reporting schemes

To bring more value to your reporting, you can use reporting standards and schemes. Although there are many CSR schemes, standards, ratings, we chose to focus on the ones which are leading in terms of influence and companies participating and which are not-for-profit organizations. The following list is then not exhaustive.

Regarding environmental reporting, you can choose to answer the CDP questionnaire, on water, climate change, or forest management. CDP[1] (Carbon Disclosure Project) is an NGOs collecting environmental data to ensure transparency to decision-makers like investors or clients.

To structure your CSR report, you can opt for two options: use the framework suggested by the United Global Compact, or use the GRI (Global Reporting Initiative) Guidelines.

When you adhere to the UNGC 10 principles[2], you have then to report your progress on a Communication On Progress. This can be a good idea for beginners, as this communication offers a structure which is not too much stringent.

Read our article for a full overview: https://blog.dfge.de/2015/01/29/un-global-compact-dfge-publishes-2015-cop-report/

For more experienced reporters we will suggest to use GRI Guidelines[3], where companies can identify the topics which are the most relevant for them and their stakeholders, and then report specific indicators accordingly (see our blog article for more information: https://blog.dfge.de/2015/11/25/understand-gri-in-2-minutes/).

CSR reporting has grown steadily over the past fifteen years

Over the past decade, CSR reporting has become mainstream. The figures show that the use of internationally recognized standards and schemes is steadily growing. This can be explained by the fact that these initiatives are multi-stakeholder, hence they are more objective than a stand-alone reporting. They also provide guidance and structure which can help the company identify gaps to improve on some areas.

GRI trends

(data extracted from the search function of GRI database, http://database.globalreporting.org/search)

UNGC trends

(data extracted from UNGC infographic Communication on progress, 2015 key facts,https://www.unglobalcompact.org/docs/communication_on_progress/cop-key-facts-2015.pdf)

CDP, in its 2015 activity report, indicates that they analyzed 1799 responses in 2010 against 1997 in 2015, showing also a growing participation. The number of signatories has also been increasing.CDP trends

(data extracted from CDP Global Climate Change Report 2015, https://www.cdp.net/CDPResults/CDP-global-climate-change-report-2015.pdf )

It means that companies have an advantage to report through these schemes: they are of interest for investors, clients, and other stakeholders.

What are the next trends in CSR reporting?

We believe that reporting will increasingly focus on sectorial-specific issues. Indeed, now that the general framework is somehow set and recognized by organizations, some more specific information can be added.

For instance, the Telecommunications sector is faced with the problematic of conflict minerals. Electronics companies now report on how they implement due diligence process in their supply chain and declare if they are conflict-free for the following materials: gold, tin, tantalum, tungsten. A dedicated guidance is provided by the CFSI (Conflict Free Sourcing Initiatives).[4]

We also think that more and more SMEs will report their CSR progress – as bigger companies will increase their pressure on suppliers to take the next step and report along the whole supply chain.

DFGE can guide you through your reporting process. Don’t hesitate to contact us for more information at info@dfge.de or consult our website.

 

[1]CDP: https://www.cdp.net/en-US/Pages/HomePage.aspx

[2] UNGC: https://www.unglobalcompact.org

[3] GRI: https://www.globalreporting.org/standards/g4/Pages/default.aspx

[4] CFSI: http://www.conflictfreesourcing.org/conflict-minerals-reporting-template/http://www.conflictfreesourcing.org/conflict-minerals-reporting-template/http://www.conflictfreesourcing.org/

image link: https://pixabay.com/en/success-curve-hand-finger-touch-1093889/

Freely chosen employment: a focus of EICC Code of Conduct latest version


Background story: The majority of our blog posts deals with CSR topics; we write about the latest developments in this field and try to relate it to a company’s daily business. Our background stories have a different perspective: Here, we explain trends, scientific background and societal implications of corporate sustainability – sometimes with a personal touch.

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The EICC Code of Conduct – 5.1 version was released in January 2016 to include stringent requirements on the fight against forced and bonded labor.

A sectorial initiative to tackle CSR issues

The EICC is a nonprofit coalition of electronics companies comprised of more than 100 electronics companies with combined annual revenue of over $3 trillion, directly employing more than 5.5 million people. The companies are committed to supporting the rights and wellbeing of workers and communities worldwide affected by the global electronics supply chain.[1]

To do so, a Code of Conduct was set up, and the coalition provides training and assessment tools regarding environmental, social and ethical responsibilities.

The Code of Conduct was launched in 2004, and has been adapted and changed to match the evolution of these themes. The version 5.1 has been released on the 1st of January 2016 and will come into force from the 1st of April 2016.

Change in freely chosen employment section

The only change from version 5.0 released in November 2014 to the version 5.1 of January 2016 focuses on freely chosen employment (section A,1).

The version 5.0 states that “workers shall not be required to pay employers or agents recruitment fees or other aggregate fees in excess of one month’s salary. All fees charged to workers must be disclosed and fees in excess of one month’s salary must be returned to the worker.”, whereas the 2016 version reads that “workers shall not be required to pay employers’ or agents’ recruitment fees or other related fees for their employment. If any such fees are found to have been paid by workers, such fees shall be repaid to the worker.”

This means that the requirements are strengthening. Before, there was a limit which is no longer tolerated. Our understanding is that a common practice of forced labor is indeed that employees have to pay a fee to be employed, either to the employer or to a recruiting agent. However, they usually cannot afford it right away, so they remain in debt to the employer or recruiting agent, so they have to keep working in the company at least to be able to pay this employment fee.

This more stringent requirement can be explained in a larger context where forced labor is still existing. For instance, the NGO Verité’s two-year study of labor conditions in electronics manufacturing in Malaysia found that “one in three foreign workers surveyed in Malaysian electronics was in a condition of forced labor.”[2]

Tackling forced labor issues

There are different ways to tackle this existing issue:

  • Risk-mapping to identify where cases are most likely to happen
  • Action plans accordingly
  • Actions can feature:
    • Specific HR procedures preventing unreasonable restrictions on entering or existing the facilities, forbidding employment fees, prohibiting the confiscation of immigrant documents
    • Training of HR population in this sense
    • Whistle blowing system to detect and treat such cases
    • Audits to check the status of such actions

For more information, please contact us at info@dfge.de or read the EICC Code of conduct: http://www.eiccoalition.org/media/docs/EICCCodeofConduct5_1_English.pdf

[1] http://www.eiccoalition.org/about/

[2] http://www.verite.org/research/electronicsmalaysia

image source: https://pixabay.com/en/document-agreement-documents-sign-428334/

SDGs: a topic of interest for companies


 

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On the 17th of February, DFGE co-animated a webinar on Sustainable Development Goals with the World Environment Center. For those who missed it, we summarize the main conclusions of the webinar in this article.

The webinar featured sustainability experts.

Elisa Tonda (Head of Business and Industry Unit, UNEP), Lorraine Francourt (Director, EH&S & Sustainability, EMEA & AP, The Dow Chemical Company), Wolfgang Berger (VP Business Development, DFGE- Institute for Energy, Ecology and Economy) and Terry F. Yosie (President and CEO, World Environment Center) presented current trends on how companies are using the Sustainable Development Goals and on how companies can address them.

Main highlights from the webinar

(1) The SDGs are becoming important because they provide an internationally approved framework to address global challenges. Business has a vital interest in a world free from human suffering and environmental degradation and finds it essential that coordinated and measurable action takes place.

(2) Companies find value in using the SDG’s, e.g. because they help identify and meet societal expectations, especially in developing markets where the major growth opportunities lie.

(3) Companies such as Dow Chemical are already applying the SDGs. They have gone through intense stakeholder consultations (both internally and externally) and have now embedded their sustainability goal-setting-process into a structure that allows for measuring and reporting on the SDGs. Dow sets goals for each of the SDG’s but not for each indicator. Even less ambitious companies that address just a few goals would be coherent with the United Nation’s objective: every company should find its own way of contributing to the SDGs.

(4) Companies can align the SDGs with their business strategies and existing reporting frameworks such as Global Reporting Initiative (GRI), UN Global Compact, and CDP responses. While the SDGs may have similar content to the aforementioned, these pre-existing initiatives and frameworks are generally more focused in certain areas. The SDGs are, instead, a framework to report on a company’s contribution to solve global challenges and enable a strategic perspective for companies that actively want to identify business opportunities for the common good.

A worldwide topic

It seems that companies show a deep interest in this topic. Slightly more than 100 sustainability experts attended the webinar. 74% were business representatives, while 26% were from academia, advisory firms, governments, and NGO’s. Geographical distribution was 49% from Europe, 38% from the US, 8% from Latin America and 5% from Northern Africa/Middle East/Pacific.

For more information, please consult: https://sustainabledevelopment.un.org/sdgs or our blog article on how to address SDGs: Companies are key to the success of the Sustainable Development Goals. You can also directly consult us at info@dfge.de