Image Image Image Image Image Image Image Image Image

Walmart Archives - Sustainability Reporting and Risk Management

10 Aug


Intro to TSC Product Sustainability Toolkit

August 10, 2016 | By |

UPCOMING WEBINARS: Intro to TSC Product Sustainability Toolkit

The Sustainability Consortium is dedicated to improving sustainability of consumer products across the globe. They have created product sustainability toolkits to help in this process. So now you may be wondering what exactly are these toolkits, how do they work and who they benefit. ISOS Group is prepared to break it all down for you.

What are TSC Product Sustainability Toolkits?

These are interactive surveys that highlight the environmental and social issues that producers should focus on when working to improve the sustainability of their products. The toolkits are scientifically crafted with input from stakeholders. Fifteen key performance indicators (KPIs) are identified and used to track and measure product performance across all levels of the supply chain. The results of the survey produce a type of supplier scorecard. This scorecard helps both buyers and suppliers understand key issues and opportunities in their businesses. A company’s fifteen KPIs vary depending on product category. Currently there are 220 consumer product categories. For example, a company producing diapers in the United States will look at a different set of KPIs than a pencil manufacturer based in Guatemala because the resources and individuals that it takes to produce the products and get them to market are extremely different.

Why use TSC Toolkits? What are the benefits?
  • TSC Toolkits are a simple way to prioritize a company’s impact and drive decision-making about how to most effectively improve a company’s environmental and social footprint.
  • They create a positive impact on people and the environment.
  • Value is added from network building. TSC Toolkits engage actors throughout the supply chain, which allows more ideas to be exchanged and brings voices to the table that may otherwise not be heard.
  • The Toolkits drive business innovation, which leads to business growth.
  • More and more customers are demanding information on where and how their products are made. TSC Toolkits show company transparency, which leads to higher consumer satisfaction, trust and loyalty. These three things ultimately lead to increased revenue.  
  • Evaluating the supply chain requires a lot of data. TSC Toolkits save lots of time as they focus on the appropriate data to review.
  • Identify issues before they become issues. Toolkits help organizations recognize problems and alleviate them before they are too big to control.
  • TSC members collaborate and work together for the common good.
  • Major corporations, like Walmart and Sam’s Club, are starting to require all suppliers to monitor, manage and report on their social and environmental impact. (Wow – let’s talk about that!)
TSC, Walmart, and other Retailers

Walmart  the ‘Walmart Sustainability Index,’ which is based on the TSC Toolkit to survey its suppliers and analyze data to determine supply chain performance and formulate solutions for improvement. Every year, all of Walmart’s suppliers must report the results of their TSC Toolkit survey. Other major corporations are starting to adopt this model too and the pressure to comply is only getting stronger as this is no longer a ‘nice thing to do’, but a business imperative.

So I’m interested. Now what? What is involved?

The Toolkits are available to TSC Members and can also be purchased through the Walton College TSC Marketplace. Once you have your toolkit follow these steps:

  1. Define the product category
  2. Review relevant scientific sources
  3. Research your hotspots
  4. Discover research improvement opportunities
  5. Evaluate the evidence
  6. Design key performance indicators
  7. Hold a multi-stakeholder review
  8. Publish your Toolkit
  9. Update and revise your Toolkit

ISOS Group will be leading free webinars on the TSC Product Sustainability Toolkit:

U.S. RetailersSept 30 / 7:00 AM (PST)

18 Aug


Using GRI to Compare Apples to Apples in Sustainability Reporting

August 18, 2011 | By |

It will not come as news to sustainability readers that social and environmental issues can have a short and long term impact on the financial performance of a company. But, objectively measuring a company’s sustainability performance is easier said than done.

Sustainability reports are as different as each of us. They vary in format, material issues selected, boundary and scope, and cultural orientation which makes it very difficult to judge performance based on a common set of indicators.

Investment institutions like Bloomberg, the Dow Jones Sustainability Index or FTSE4Good have some of the more widely recognized methods of reviewing corporate sustainability. But they aren’t the only companies in the game.

Groups like CSRHUB and Sustainability HQ have a deep knowledge of sustainability principals. They have successfully developed systems that make it possible to query a full range of sustainability data and share it with a broad audience. CSRHUB Cofounder Cynthia Figge says, “We aggregate data from more than 100 sources to provide our users with a comprehensive source of CSR information on nearly 5,000 publicly traded companies in 65 countries.”

ISOS Group has capitalized on the standardization of the GRI reporting framework to create another measurement system.

Since the GRI framework is standardized, a true apples to apples comparison is possible. ISOS Group has developed a framework to quantitatively measure the strength of a GRI report, and we have collected dozens of reviews of reports using the framework. These all add up to a strong body of data that allows us to compare companies between sectors on the basis of the quality of their reporting.

In 2010, we assessed Walmart, Southwest Airlines, Qualcomm Incorporated, Bucyrus, Johnson & Johnson, Holland America, NextEra, Medtronic, Mattel, Citigroup, UPS, Sempra Energy, State Street or HP on all tests associated with the Quality and Content Principles in the GRI reporting framework. Although not all of the selected reports were GRI-based, all had referred to the framework to some degree as a guide for developing their reports and therefore, could undergo a common set of tests.

According to the final results, HP rated highest, while Walmart lagged in all areas. On average, most reporters failed to effectively apply Materiality and Stakeholder Inclusiveness, (which are key components of a GRI report). This shows that we are still in the elementary stages of sustainability reporting and that the best we can do is to educate ourselves on the importance of applying the right principles to the reporting process.

In order to improve in these areas, reporters should consider:

  • Materiality: Moving away from siloed decision-making on relevant performance indicators. Consider your sustainability context and related impacts, gather input from others, prioritize and chart those that are most relevant for the organization. Explain the process! Refer to Symantec or SAP’s Materiality Matrix and description as best-cases.
  • Stakeholder Inclusiveness: First brainstorm all the groups that affect or are affected by your company’s daily activities. Prioritize each group and think about ways that you currently interact with them. Consider methods for obtaining their input on your sustainability related activities. Don’t be afraid of engaging in stakeholder dialogue! Refer to Kimberly Clark’s testament to their interactions with environmental groups for an example on how opportunities can flourish from building deeper relationships with external groups.
  • Balance: A purely positive report doesn’t work to transform business practices. Include both positive and negative performance and set targets for improving efforts in the short and long-term. It’s highly unlikely that you will receive criticism for sharing both the good and the bad. Take a look at Weyerhaeuser or 7th Generation’s report for examples of honest reporting.
  • Comparability: Readers may not be able to determine whether your performance was positive unless they have something to compare it to. Provide some point of comparison for your disclosures, whether it is based on year-to-year performance, industry averages or against your peers. Utilize tools, such as CSRHUB to draw comparable data and include illustrations! Refer to 2010 Qualcomm Social Responsibility report ‘Total Lost Time Injury & Illness Rate’ or ‘Direct Energy Consumption’ disclosures for a quick example of how easily this can be done.
  • Reliability: How reliable is the data when mention of a sound process for tracking and analyzing data is absent from the report? Claims made in the report should be supported by internal controls and systems should be strong enough to undergo possible examination by external parties. Refer to long – time reporter, Advanced Micro Devices (AMD) 2010 report under ‘Transparency’ for a great example!
  • Accuracy: Express measurement techniques, estimates, assumptions and bases for calculations so that the reader can trust your claims! Refer to Chevron’s recent report– they do a terrific job at footnoting.

We have already started another round of assessments by looking at 2010 reports from 14 companies with others planned as they come online. In order to build greater value from this education experience, results are then offered to the reporting organizations as critical feedback and to registries, such as CSRHUB.

There is no customary form required by law for this type of reporting, yet there are guidelines we can follow that have been developed and used by thousands of groups globally. Someday, a tool for comparing apples to apples may enter the market. However, until that day comes, we will have to rely on our educated judgment of the GRI to determine the quality of reports and supporting systems. Essentially, mastering the use of GRI’s Quality and Content Principles provides an un-matched authenticity for reporting.

If you want to learn more about the Global Reporting Initiative’s (GRI) sustainability framework and become a certified sustainability reporter, consider attending one of ISOS Group’s  GRI certifications in Sustainability Reporting.