Communication about sustainability issues is a big topic. Not only are there many aspects of sustainability you could report on, there are many audiences and reasons for reporting, too. Are you reporting voluntarily (on your website or in a sustainability report), quasi-voluntarily (of your own free will, but after pressure from a third party you can’t refuse), or because you have to (to comply with a law or regulation, like a local energy disclosure or SEC requirement)?
It’s a reporting best practice to make sure that whatever you communicate, you:
- Understand the type and purpose of the communication;
- Use communication modes (the website, a formal sustainability report, a reporting framework, or a legal filing) that are appropriate for the type and purpose of the information; and
- Identify the audience you are intending to inform.
Here’s a look at this why, where, for whom concept for improving your reporting strategy.
Why. Be clear about why you are reporting. Mandatory reporting should identify and conform to the requirements of the governing law or regulation. Voluntary reporting should, on its face, be readily distinguishable from such mandatory reporting. Let your reader know why you are providing information.
Is it a feel-good list of some good things you’ve done, aimed mostly at marketing and brand enhancement? Then put it on your website or in a brochure, but plan on doing more in your sustainability report. There you want to talk about goals and targets you are working on and progress, both positive and negative. And you want to make your sustainability reporting available online, clearly linked to from your website home page either as a webpage, a download, or even a sustainability micro-site.
Are the things you are reporting on so important that the outcome might affect the value of the company in the future? If yes, you may not want to put those things on your website, but they will need a home in your annual report and any public filings.
As the last few points highlight, some information is more important. Some information gives more insight into how you are identifying and managing your sustainability risks and opportunities. In the realm of sustainability reporting, there is an ongoing effort to cull what is reported in more formal and mandatory reports to the most important information. Too much information runs the risk of burying what’s really important for intended audience.
Where. When it comes to financial matters, it’s clear that there are many things in an annual report to shareholders you wouldn’t consider putting on your website, and vice versa. The same consideration should be given to sustainability information.
So how do you decide what information to publish where? The best place to start is to look at who the intended audience is and what is important to that audience.
For Whom. The audience for your website is obvious – it’s everyone and anyone. This holds true for your blog, press releases, and social media. But it’s not just about who can read what you’ve written. It’s about who the intended audience is.
Reporting frameworks and legal requirements identify your intended audience so that you can include the information that is important to that group, and cut out all the distracting (and sometime obfuscating) rest. Some of them use the same words, like “material,” but define materiality by the intended audience. When you are clear about your intended audience, you can communicate more effectively about the level of importance your company ascribes to the information being disclosed.
Companies communicate different things in different places for difference audiences. That’s okay. The key to doing so without ruffling any feathers is to be clear about who the intended audience is and the degree of importance the information is given. One recent example of this is in Aegon’s most recent sustainability report, where the company defines its material issues and its audience. Take the time to figure out the appropriate outlets for your various types of sustainability communications!
For a legal perspective on reporting and reporting audiences, you can download a recent ABA article I co-authored.