Global companies’ confidence in correctly tracking the financial contribution of corporate social responsibility has fallen from 76 percent to 66 percent in two years, even as the proportion of companies trying to quantify that measure has skyrocketed, according to an IDC survey.
Global Corporate Citizens, an eight-country survey of companies with revenue of over €100 million, found that 63 per cent have tried to quantify the financial contribution of CSR, compared with only 23 per cent in the 2010 edition of the study. This, coupled with the decline in confidence, indicates a lack of reliable reporting solutions that can deliver accurate data, IDC says.
The survey found that 21 percent of CFOs have environmental tracking and measuring functionality embedded directly in their enterprise system, while some rely on third-party product integration. But 38 percent are unable to track corporate social responsibility measures at all.
The results are based on 409 phone interviews and web survey responses with companies in the US, UK, France, Germany, Denmark, Sweden, Norway and Poland. IFS, a developer of ERP systems, sponsored the study.
IDC says that accurate and reliable corporate social responsibility data will become increasingly important as a competitive factor for global companies, as companies are pressured to document their CSR activities and integrate sustainability and financial reporting.
This development is driving the interest among companies in CSR tracking tools embedded in enterprise software. Some 61 percent of the surveyed companies stated a strong interest in embedded enterprise software to track and measure the company’s impact on the environment. Comparing these results to the 2010 IDC survey on the same topic reveals “a growing interest in this type of functionality as pressure for more accurate data increases,” IDC says.
A report released earlier this week by Harvard University’s Initiative for Responsible Investment said that the disclosure of corporate sustainability data should be mandated, because such information is necessary for investors to make fully informed decisions.
According to On Materiality and Sustainability: The Value of Disclosure in the Capital Markets, sustainability data can help diminish financial risks and improve investment opportunities. It can also reduce distrust in capital markets, cut excess speculation and short-termism, and help prevent financial crises, the paper said.