Teneo’s analysis of 200 S&P 500 company (predominantly large-cap) sustainability reports across industries published between January 1, 2021 and June 30, 2021, revealed these and other noteworthy practices and trends.
Format
- Reports most frequently use the term “Sustainability” (43%), followed by “CSR” (24%) and “ESG” (23%).
- Reports varied considerably in length, but averaged 70 pages.
- More than 25% of reports included a summary or “highlights” version, which Teneo recommends (see example at Figure 1).
- Nearly all reports were available in a pdf format, which Teneo recommends for easier search capabilities.
- More than 75% of reports were accompanied by a corporate press release that typically included a quote from the CEO or head of sustainability and report highlights.
- Companies most commonly release their reports in June (32%), followed by April (27%) and May (22%).
- More than 75% of report included a sustainability data table, which Teneo recommends (see Figure 2).
Content
- Nearly all reports included a CEO letter, which Teneo recommends to signal that company leadership deems ESG to be a priority (see example in Figure 3).
- A majority of companies addressed their board sustainability oversight structure and their internal management structure – typically a cross-functional, executive-led sustainability committee (see Figure 4).
- A majority of reports included a “materiality” matrix to communicate the company’s most important sustainability issues (see Figure 5).
- More than 90% of reports included employee demographic data, typically gender and race/ethnicity. One-third of the companies publicly disclosed their full EEO-1 report. Teneo suggests that companies concerned about potential misperceptions associated with their EEO-1 report supplement the report with additional explanatory disclosure (see Figure 6).
- More than one-third of reports included some level of employee pay gap information.
- More than half of reports included at least one DE&I demographic target/goal.
- The most popular frameworks referenced were SASB (88%), GRI (73%), UN SDGs (65%), and TCFD (61%)
- More than half of companies obtained external assurance for at least some information (see Figure 8).
The report is replete with reporting process, content, and design considerations.
See Teneo’s release and our recent reports: “ESG Governance: Here’s How!” and “Environmental & Social Disclosures: Disclosure Controls & Procedures.”
This post first appeared in the weekly Society Alert!