Firms ‘Must Scale Up CSR Efforts’
Companies aren’t doing enough to address climate change and other sustainability issues that could affect the environment — and firms’ bottom lines — according to a report by Ceres and Sustainalytics.
The report, Gaining Ground: Corporate Progress on the Ceres Roadmap for Sustainability, which assesses the sustainability performance of 613 of the largest publicly traded companies in the US, covers nearly 80 percent of the total market capitalization of all public companies in the country. It tracks corporate performance against 20 key metrics including governance, disclosure, greenhouse gas emissions reductions and labor standards. It identifies sustainability trends across eight key sectors, highlighting industry best practices and which companies are leading among their peers. It also provides aggregate data and online scorecards for companies on each performance area.
Key findings include:
- While many companies are taking action to reduce GHG emissions, few have set time-bound targets. More than two-thirds of the companies evaluated (438) have activities in place aimed at reducing GHG emissions, but only 35 percent (212) have established time-bound targets for reducing GHG emissions. In terms of renewable energy, 37 percent of companies have implemented a program, while only 6 percent have quantitative targets to increase renewable energy sourcing.
- A growing number of companies are incorporating sustainability performance into executive compensation packages. Twenty-four percent of companies (147) link executive compensation to sustainability performance – up from 15 percent in 2012.
- More companies are setting clear sustainability standards for suppliers. Fifty-eight percent of companies (353) have supplier codes of conduct that address human rights in supply chains, compared to 43 percent in 2012. However, only a third (205 companies) have some activities in place to engage suppliers on sustainability performance issues, up from 27 percent in 2012.
A Ceres report published last June found a relatively small cluster of the 600 largest US publicly traded companies are leading on sustainability practices and performances, while broad corporate action is lacking and overall the group has fallen short in governance, stakeholder engagement, disclosure and performance.
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