Implementation and Planning of Sustainability Reporting - Coursework Example

Sustainability Reporting Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Name Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Course Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Instructor Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Date Sustainability Reporting With today’s competitive business environment, it is very necessary that Australian organizations adapt sustainability reporting in the 21st century. Evidently, sustainability reporting has greatly gathered great support from various companies across the globe. This has further been transferred to their suppliers who are made to adopt sustainable practices within their business operations. Adaption of sustainability reports widely demonstrates the commitment of an organization practicing this kind of reporting especially towards corporate responsibility (Geraghty, 2010, p. 145). This essay focuses on understanding why it is very necessary for Australian companies to adopt sustainability reporting in the 21st century. This will entail describing the reason why adopting sustainability reporting is important according to various writers. Further, the essay will analyze the various approaches adopted by organizations in the implementation and planning of sustainability reporting. Finally, to get a clear view of our essay topic, two examples of organizations will be analyzed on how they have adopted sustainability reporting where the essay will compare and contrast the approaches of these two organizations towards sustainability reporting. According to a guide on sustainable reporting by KPMG, sustainability reporting has largely become a mainstream which is greatly driven by potential business value, which is generated through stakeholder reporting as well as communication. According to the guide sustainability reporting is defined as the practice which involves measuring, disclosing as well as being accountable to both external and internal stakeholders for best organizational performance especially toward goal achievement indicating sustainable development (Hubbard, 2011, p. 824). Within the article, the main reason why organizations engage in sustainability reporting is to ensure a company is able to understand social, economic and environmental aspect of their various business activities. Further, it is indicated that sustainability reporting assists towards the contribution of long term investment returns as well as financial performance. In addition, reason for sustainability reporting may further include aligning with stakeholder which includes their capitalization, sustaining value chain, capturing operational efficiencies and finally, pre-empting stakeholder action (Hubbard, 2011, p. 824). According to the Parliament of Australia, sustainability reporting largely involves organizations and companies’ ability to demonstrate the way they carry out corporate responsibility. This is by way of measuring as well as publicly reporting their environmental, social and economic practices, impacts and performance. Organizations engage in sustainable reporting for various reasons (Hubbard, 2011, p. 825). These reasons include; to effectively inform both stakeholders and non stakeholders on the impacts of companies strategies and performances, also, to inform companies shareholders and the business environment on how the company largely deals with both financial and non financial risks and to largely assists the organizations in indentifying various areas that are linked to key risks as well as analyzing the company performance. According to this report the main target for organizational sustainability reporting are mainly their employees with 87% which is closely followed by customer with a 79%. Further, the report indicates that there is a great and strong correlation between sustainability reporting and low probability of organizational distress. This therefore implies that it is within the company interest to ensure it engages in sustainability reporting (Gray, 2006, p. 67). According to Hubbard (2011), there is a great realization among Australian organizations that despite the fact that sustainability reporting being voluntary, it highly plays a vital role in the evaluation of companies performances. Disclosing voluntarily company information regarding environment and social performance greatly shows an organization commitment towards it corporate responsibility. Australian organizations constantly practicing sustainability reporting have largely realized that there are various necessary intangible organization successes on all definable fronts such as employee engagement, reputation as well as corporate responsibility. The establishment of Global Reporting Initiative especially in various Australian organizations has greatly achieved success especially in the facilitation of various business discussions on the issue of both external and internal entities (Gray, 2006, p. 67). There are various ways in which organizations approach both the planning and implementation of sustainable reporting. For instance, many organizations have largely adopted sustainability reporting features based on GRI. This mechanism involves three main steps towards its implementation. The first step involves preparation which largely focuses on improving a company’s internal discussion (Adams, 2011, p. 569). Here, organization adaptation entails focusing on management level with an effort of identifying both beneficial and adverse effects on society, environment and economy. The second step toward the approach widely entails connect. This step is very vital to the process of sustainability reporting in that it requires obtaining various inputs of stakeholders in relation to the contents of the final report. The third step in the adaptation of sustainability reporting involves definition. Here, stakeholders are required to largely affirm whether the acknowledged impacts are significant (Adams, 2011, p. 569). The forth step is known as monitor. In this step, an organization is involved in the collection of various data that needs to be incorporated in the final report. In this step, for a successful implementation it is important for organizations to use GRI indicators so as to get the knowledge on what to monitor. This kind of approach ensures that proper management is promoted through constant reporting (Perego, 2009, p. 412). Finally, the final step in this approach entails communication. Communication largely entails dealing with the writing as well as preparation of final reports regarding economic, social and environmental operations within the company. Further, this step ensures that an organization is able to arrive at various decisions regarding the best way in which it should be communicated to the shareholders, stakeholder and general public based on the final report. In order to understand how organizations have adopted sustainability reporting the essay will analyze Boral Limited and Abigroup Company which are in the construction industry. Boral Limited is a company which is involved in distributing construction materials across Australia (Kelly, 2011, p. 34). The fact that this business is decentralized, it poses considerable challenges in driving constant improvement program that largely ensures accuracy and consistency in both measuring and reporting. In its sustainability reporting, the company rapidly roll out it best practices in both national environmental management systems as well as national safety management system. The company is involved in using a more centralized energy data capture system so as to ensure the company is able to provide reporting data that is more robust in accordance to various environmental policies (Hubbard, 2011, p. 824). In its sustainability reporting, the company reports that in delivering 527,000 tonnes of construction materials 8% of CO2 is emitted in the air, with the consumption of 20% of main water and finally, 331,000 tonnes of by product and waste produced only 31% of the waste is reused. Sustainability reporting within this construction company is evident in health and safety, energy conservation and climate change, market place and supply chain and finally, social responsibility which is exhibited in community engagement and relation (Perego, 2009, p. 412). Focusing on Abigroup, the company operates in ensuring that it constructs Australia’s future. The company is constantly involved in publishing its sustainability reports. In its reports sustainability is identified in five dimensions namely; people, environment, leadership, business and society. The company largely ensures that it adapts an innovative and healthy workforce where it bases its leadership on driving performance through positive organizational culture. Based on corporate social responsibility, the company ensures it constantly makes a difference in its community. Based on the business, the company ensures that it builds a strong relationship as a way of ensuring that the business is profitable (Perego, 2009, p. 412). In comparing these two companies, it is quite evident that sustainability reporting is a major challenge in construction companies across Australia. Here, companies are involved in CO2 emissions from the rapid use of natural resources. Also construction companies are involved in paying a lot of great concern to supply chain analysis in relation to sustainability reporting. In these two organizations, reporting on economic aspect is considerably less common as compared to that which is related to social and economic performance. This clearly gives an indication that the practice of sustainability reporting within the construction industry is not well established compared to other industries such as the financial sector. Based on their differences, Boral Limited sustainability reporting mainly focuses on environment mainly issuing the amount of CO2 emitted as well as water being consumed in their operations (Adams, 2011, p. 569). On the other hand, Abigroup is concern with both social and economic sustainability reporting defined with its five dimensions. Abigroup sustainability reporting is more compelled on community where local individuals are consulted to ensure that the company development meet up their desirable needs and gender equality where there is comparison in percentage between female and male (Adams, 2011, p. 569). In conclusion, it is quite evidence that there are numerous reasons why Australian companies need to engage in sustainability reporting especially in the 21st century. It is important for organizations to engage in sustainability reporting that focuses on all aspects which includes and are not limited to; environmental, social, economical and financial. There are various approaches in which organizations can decide to partake in ensuring that it practices the best sustainability reporting. Organizations need to realize that sustainability reporting should entail measuring, disclosing as well as being accountable to both external and internal stakeholders for best organizational performance especially toward goal achievement indicating sustainable development. List of References Adams, C., 2011. Sustainability reporting key to long-term viability. Keeping Good Companies, 63(9), p. 569 – 570. Geraghty, L., 2010. Sustainability reporting – measure to manage, manage to change. Keeping good companies, 62(3), p. 141 – 145. Gray, R., 2006. Does sustainability reporting improve corporate behaviour?: Wrong question? Right time?. Accounting & Business Research, Volume 36, p. 65 – 88. Hubbard, G., 2011. The Quality of Sustainability Reports of Large International Companies: An Analysis. International Journal of Management, 28(3), p. 824 – 848. Kelly, M., 2011. Do the right thing. Chartered Accountants Journal, 90(3), p. 32 – 34. Perego, P., 2009. Causes and Consequences of Choosing Different Assurance Providers: An International Study of Sustainability Reporting. International Journal of Management, 26(3), p. 412 – 425. Read More