About Social Media Today
Elaine Cohen, Exclusive to the Sustainable Business Forum as part of the Reporting: How They Do It series
Showa Denko Group is a Japanese chemicals group with a sales turnover of $10.5 billion, employing over 11,500 people aspiring to create a society in which" affluence and sustainability are harmonized." This is an analysis of the Showa Denko Group CSR Report 2011.
Reporting period: 2010 calendar year
Format:
Framework: References ISO 26000, GRI and Japanese Environmental Reporting Guidelines – no index or GRI reporting level declared).
Assurance: Third –party verification of all information in the report.
Material issues: Not clearly identified.
Special features: In addition to the full report, Showa Denko issued a 9-page Special Edition to the 2011 CSR Report, showcasing the company's efforts towards restoration from the Great East Japan Earthquake (using information contained in the full 2011 report).
Interesting practices:
- Corporate Ethics Month each January.
- Extensive Responsible Care implementation at many sites.
- 6.2 million aluminum cans collected from employees and other companies for recycling (100 tons of aluminum).
- Calculation of economic benefits from environmental investments.
- Low level of lost time injuries – only 2 incidents in 2010.
The Showa Denko Group's CSR report for 2010 is a ground level view of CSR activities which focus squarely on the CSR actions of the company. Rarely does the report elevate the discussion to give a birds' eye view of the role of this company in society, despite the Group's lofty vision of contributing to a society where affluence and sustainability are harmonized, whatever that actually means. In fact, Showa Denko calls this a CSR Activity Report and that's pretty much what it is. This is in contrast to the prior year report which addressed indirect impacts of the company's performance by reviewing how Showa Denko's chemical products are used in the home, offices and elsewhere, being either "socially useful" or "environmentally friendly". In fact, the 2009 report is altogether readable and relevant. The 2010 report is technical, crowded and difficult to follow. This makes me wonder if there was a change in the reporting team or in the reporting approach this year.
The report is organized into four sections: CSR Management, Social Commitment; Environment and Safety. At first glance, the report looks packed and gives an impression of a thorough and meticulous approach to CSR practice and disclosure with many diagrams, tables, graphics and charts. On deeper scrutiny, it's hard to find the data that substantiates much of this intensive presentation. Most of the content is policy and statements of practice which are not substantiated by data. Forward-looking targets are vague. For instance, the 2011 plans for Occupational Health include: "enhancing sanitation management structure" and "improving work environment and work methods". These are not terribly specific and do not really describe what the company is actually going to do. In fact, reading through this report, you get the sense that the company stops just a little short of full disclosure, making it rather a frustrating read, especially as there is an underlying positive feel to the report.
Showa Denko's data is not presented clearly in the Environment section. I was not able to make sense of the reported GHG emissions data. In the 2010 report, Showa Denko K.K. (the Japanese company, not the Group) discloses 2,306 CO2e tons, stating this as a 20% versus prior year. The 2009 report disclosed 2,400 CO2e tons which I calculate as 4% reduction. It is a shame that an experienced reporter such as Showa Denko does not provide data tables which show comparative data over several reporting years, rather than isolated single-year percentages which take time to understand. I found a similar disconnect in the presentation of data for other environmental indicators.
Showa Denko indicates that the CSR Report was produced "referencing" ISO 26000, GRI and Japanese Environmental Reporting Guidelines. Quite how these frameworks were used is not clear as they are not referred to in the body of the report. Some form of index would be useful because, although the separate sections of the report are well delineated, actually finding specific data is not easy. I would also recommend that Showa Denko decides which reporting framework it wishes to use and aligns the report with this framework to provide a clearer benchmark against which to understand the scope of this company's disclosure.
A nice touch is that the Showa Denko Group report starts out with the reprinting of letters from the Group's President and CEO to the Group's employees in March 2011 following the Great East Japan Earthquake. This is a fitting backdrop for a company which has been clearly affected by natural disaster but remains true to the goal of annual sustainability reporting, highlighting the additional challenges the company now faces. I agree that it is commendable that Showa Denko has maintained its reporting pace in this tragic year, but I would recommend a review of the Company's approach for future reports. What we want to know is how this company is impacting society, not only how it is thinking about impacting society.
