Understanding Corporate Social Responsibility - Case Study Example

REPORTING ON CORPORATE SOCIAL RESPONSIBILITY Name: Lecturer: Course name: Course code: Date: Executive summary The need to address the requirements of a wider group of shareholders has led to progressive development of corporate social responsibility. The bulk of CSR reporting has considerably grown and the conception has led to conformable academic and media levels of consideration. Increased number of frameworks for reporting has developed alongside growth in activity to give a model in which companies can follow when reporting their initiatives (Accountants), 2012). This report intends to examine 2 listed companies in Australian Stock Exchange which provide corporate social responsibility report. The report is assessed against the key elements of Global Reporting Initiative (GRI), (G3 and G4). This report epitomizes the overall model of corporate social responsibility reporting in the 2 Australian companies listed in Australian stock exchange. This will evolve around broad environmental, social and economic issues. Energex ltd utilities and Origin energy ltd are listed Australian companies which embrace corporate social responsibility reporting and will be used for analysis. Introduction Corporate social responsibility is defined as the voluntary undertakings by an organization to work in , economic, social and environmentally sustainable manner. Responsibility taken by Australian organizations in their operations promotes values of the county locally and internationally and it also improves citizen's sustainable development. Australian Center for Corporate Social Responsibility (ACCSR) has been formed to help Australian organizations to create a lasting value by introducing responsible company strategies and productive shareholder relationships. Global Reporting Initiative (GRI) is a nonprofit organization that promotes environmental, social and economic stability (Marce, 2011). Global Reporting Initiative (GRI) has formed a comprehensive framework for sustainability reporting approach that is applicable and acceptable in all companies around the world. Environmental guidelines for reporting Global Reporting Initiative (GRI) objective is to streamline reporting standards for all companies, irrespective of size and country. GRI is aiming at promoting the status of environmental reporting issues. One of the major concerns of GRI under its scope is transparency in issues pertaining the environment. Global Reporting Initiative is urging all participating companies to give reports of their environmental performance as it is specified in GRI 3(Accountants), 2012). The recommended reporting guidelines on the environment are contained in the Global Reporting Initiative indicator protocol set. Criteria on biodiversity energy emissions are contained in the indicator protocol set. The environmental indicators as established in GRI 3 are explained from EN 1 (materials used by weight) to EN 30 (the total expenditures on environment by type of investment). The governance of the environment in relation to GRI GRI execute its duties independently uncontrolled by top – down command power structures related to governments. Sustainability reporting is a concept that engages in environmental performance reporting by institutions and companies around the world. The definition of sustainable reporting is the way in which organizations examine their own environmental achievements as well as failings, and give the analyzed information to the interested members of public. Sustainability reporting is also referred to as reflexive environmental law. Reflexive environmental law is a guide in companies are recommended to analyze their operations and bring in to light the drawbacks and positive effects of their operations as well as revealing how they are dealing with drawbacks, with the main objective of encouraging growth as well as safeguarding the environment. GRI core performance indicators are identified to be of very important to the most of the shareholders and are deemed material except considered otherwise on the basis of global reporting initiative principles of reporting. As outlined in GRI principles, environmental performance have categories which are energy, material, water, compliance, emissions, effluents and waste, products and services, biodiversity, transport and overall (Earl, 2007). Society performance are indicators for society fall into categories of corruption, local community, public policy, compliance anti-competitive behavior . Economic performance indicators are laid down from EC 1 (direct economic value generated and distributed, including operating costs, revenues, donations, employee compensation, and other communal investments, the generated profits, and payments on principal providers and governments) to EC 8 (development and primarily impact of infrastructure investments and services provided for public through commercial engagement). Performance indicators for the economy are put into categories of market presence, economic performance and indirect economic impacts. Energex ltd utilities and Origin energy ltd are the selected listed companies in Australian stock exchange. Energex ltd utilities and Origin energy ltd both observe sustainability reporting of economic, environmental and social stability. Energex's is based in Queensland and it is one of the largest electricity companies in Australia. Energex operates in electricity supply industry and it transmits, generates, retail and distribute energy in Australia. Energex ltd is controlled by the government of Australia and it is doing business within the provisions of the Act of government owned corporations of the year 1993 (Cecilia, 2007). Energex exercise corporate social responsibility as an important way of doing business in the community to promote sustainability. The operations and long term plans of Energex are based on the provision of sustainable and balanced results from its operations. Energex ltd upholds corporate social responsibility through analysis and adoption of reporting programs with stipulated guidelines and feedback to improve their operations of the company. The company puts safety of the employees as well as that of the community first. The company lays down what they want to achieve basing on what they have attain in terms of safety. The company also highlights the key safety performance indicators in its reports. The company's safety policy evolve around maintaining a safe work environment, ensuring that all employees remain safe while on duty, involvement in harmonized national work, health and safety legislation, empowering to change behavior, improving health and wellbeing of workers and community, managing safety risk, engaging in community education about safety. The company also strives to improve the network performance through improving the standards of service for reliability in networks, and go beyond the industry minimum standards of service, management of vegetation, investigating on the use of electric vehicles and undertake additional analysis of market and modeling of user data on the networks to reveal its impacts, implementation of new software to improve distribution management system (Earl, 2007). The company provides responds to customer expectations in their report. They also include community engagements in their reports. They focus on building sustainable growth and giving support to customer's way of life with the main aim of gaining trust from the community members. The company has values and objectives that reflect community expectations, which include code of conduct, character of the customer, company policy of health and safety, the assured level of services and coming up with community consultation committee. The company is committed to giving quality services, operating with integrity and honesty. The company is determined to promote Australian communities with a variety of organizations and events yearly. The company aligns its business operations with the community values. The company is partnering in areas of education, sustainability, environment, safety and community. Origin energy limited is a leading integrated company of Australia. The company engages in generation, exploration an delivery of energy solutions to local and international markets. The company is the largest Australia's energy retailer providing energy needs to more than four million electricity, natural gas and liquefied petroleum gas (Clarke, 2012). The company is creating energy solution for tomorrow through significant investments in technologies for exploration of gas and renewable energy, for example, hydro, solar, wind and geothermal. The company is focusing on commitment in diverse and all-inclusive work environment. The company specializes in gas and oil exploration, generation of power, production and retailing of energy. The operations of Origin energy brings them into contact with diverse communities. The company being one of the largest in electricity and gas production in Australia, they engage in community sustainability. The company funds various community initiatives and partnerships in support of communities. Through engagement in community, the company educates and engages the communities. The company reports its sustainability performance in compliance with GRI indicators. Origin energy is in compliance with customer and product stewardship through; their management approach, the company is also the largest energy provider in Australia, the company also value customer experience, they produce quality products and services to its customers, they demonstrate leadership in green energy, solar energy, electric vehicles, origin also engages in energy education and community programs, responsible marketing communications, programs to improve and maintain access to electricity and customer support services. Community involvement; the company has community engagement directive that sets standards on community interactions and company decisions, the company manages their impacts that might affect the community, the company provides affordable housing, they build roads and infrastructure, they concerned about community health and safety, engages in active consultation with the community, have opportunities for community members, the company also gives back to the community through contributions (Cecilia, 2007). Work force development; the company has an increasing trend in number of employees per year, they retain valued employees, the company engages in building skills and capacity of its workforce. Ethical business and human rights; the company embraces company ethics, they pay taxes and other charges to the relevant authorities, they observe industry relations, and obeys the human rights. From the information above, the company is fully following the GRI 3 framework in its reports. Conclusion From the review of the corporate social responsibility of the two companies’s sustainability reporting, it is revealed that both companies are almost in the same rank basing on the review. Both companies sustainability reporting is rooted to GRI 3. The economic reporting for the two companies is in compliance to the EC 1 to EC 8, on the other hand, Energex and Origin are in compliance to the environmental reporting and also social sustainability. Both companies demonstrate almost equal strengths in community sustainability and environmental reporting engagements and disclosures. References (Accountants, I. (2012). Chartered Accountants Financial Reporting Handbook GRI Google eBook. John Wiley & Sons. Cecilia, D. (2007). Corporate Accounting in Austalia. UNSW Press. Clarke, E. A. (2012). Accounting: An Introduction to Principles and Practice. Cengage Learning. Earl, C. (2007). The international handbook of financial reporting. Cengage Learning EMEA. Marce, N. (2011). Accounting: General Accepted Financial Accounting Standards. Cengage Learning. Read More