The difference between social and environmental reporting is often misunderstood by many people who have no idea of what either entails. Social reporting is related more to how humans interact with one another while environmental reporting is more concerned about how humans change and impact their environment.
While there are distinct differences between the two types of reporting, they are often mixed together in context to cause confusion. By distinguishing what social reporting actually entails, you can then determine that it is not the same thing as environmental reporting despite sometimes being used interchangeably.
- What are the differences between social and environmental reporting?
- How to Create a Social Report for Your Business
- What are social diversity factors?
- What kind of data will you need to collect?
- How to display information
- How will you measure progress?
- Who should use this information?
- 5 challenges in writing sustainability reports?
- How can I overcome these challenges?
- How to Write an Environmental Report for Your Business
- CSR or sustainability reports
- What are the 3 tools of the global reporting initiative?
- Why do companies need social and environmental reports?
- Caveats and Disclaimers
What are the differences between social and environmental reporting?
Social reporting is more about how people relate to one another and the context that they exist within together. This type of reporting often looks at different types of human interaction such as communication, family, friendships, and social groups to name a few examples. Environmental reporting, on the other hand, relates more to environmental factors such as government regulations and how they impact citizens and consumers.
This is not to say that social reporting excludes environmental awareness, however, because some might think this. Social reporting does take into account the ecological factor of human interaction; it just does not go into depth about such matters like environmental reporting can. For example, an article about social groups within a particular demographic might have a section about environmental impact. This would be an instance where the two reporting types overlap with one another, but it should not be mistaken as a requirement.
While social and environmental reporting both have their own unique qualities, they are sometimes used interchangeably due to their overlap in certain contexts. By recognizing the distinct differences between the two types of reporting, one can then understand that they are not the same thing despite how often this is the case.
How to Create a Social Report for Your Business
Social reports give broader coverage than just one particular topic or issue. There are many areas that can fall under social reporting such as:
- The diversity of the company’s employees and customers
- How well women are represented at work
- Working conditions for different groups of employees
- Any different kinds of inequalities identified within the company, such as pay inequality or differences in hiring practices
- The working environment for suppliers and contractors; what kind of conditions are they subject to?
It is best to start a social report by first identifying a goal or a focus area. You can always go back and add more topics later, but it is important to have some kind of starting point for your report. As you choose which goals to include in your report, think about how they relate to the company’s overall mission statement.
What are social diversity factors?
When it comes to the diversity of the company’s employees and customers, you should spend some time looking at the following:
- The number of employees in each different group (gender, race, age range, etc.)
- The percentage of the company’s leadership that comes from various groups
- Any differences between how well men and women are represented within leadership roles it is best to be as specific as possible. If you only show that there are more men in leadership, you will not be giving the best picture of what is going on at your company. You should also include metrics like how that compares to other companies in your sector, or within the country’s sector (or industry) as a whole.
- How well women are represented at work
- The percentage of different groups being hired and the retention rate for each group
- The percentage of positions that different groups hold within the organization; this will help you to better understand how well men and women are represented through promotions, as opposed to simple hiring numbers. This should be compared against the number of positions available to make sure everyone has a fair shot at attaining those positions.
What kind of data will you need to collect?
Then, once you have answered those questions, you can start to think about what kind of data you would need to collect.
The kind of data that will need to be collected might include:
- The number of customers that represent different groups, and the amount they spend on average
- What kind of feedback you have received from customers in each group
- How employees from different groups feel about their work environment This is one area where it is important to get a broad range of opinions, not just from managers or HR. You can do this through surveys, or by asking employees to write their own stories.
- The number of suppliers and contractors working with your company; this will help you understand how these people are being treated on the ground.
How to display information
Once you have that data, then you can start thinking about how to display it. You should try to visualize the data whenever possible; visualization will help you see your company’s progress or lack thereof, and give stakeholders an easy way to take their own notes.
The kind of charts and media that are useful for social reporting include:
- Pie charts
- Bar graphs
- Percentage change over time
- Line graphs
The exact format of the charts is not important, but you should make sure that they are easy to read. The point of your report is to get people thinking about these issues, not to impress them with how smart you are.
How will you measure progress?
Next, you will need to decide how will you measure your progress. A few common ways of doing this include:
- Completing a certain number of trainings on social issues
- Creating a particular number of positions for people from underrepresented groups
- Having the executives and managers within your company complete an assessment on how well they support their employees (this can be done anonymously or not)
It is important to note that you should look at more than just one benchmark. If you only look at the percentage of people hired from a certain group, for example, it will not give you a complete picture. You need to consider whether there is turnover or other issues that might skew data over time.
Who should use this information?
Once the report is complete, your audience might need some guidance as to how they should analyze it. Here are a few tips:
- Break down how each group is doing into subcategories whenever possible. You can divide them this way for an easier understanding of the numbers.
- For example, you could break down race by ethnicity to illustrate that there are differences within each group. When it comes to gender, you might consider breaking the data down by region or baby boomers versus millennials.
- Put the data into context whenever possible. For instance, if you are measuring turnover rates it is important to know whether this is happening in another industry with similar jobs. Or, if you are tracking performance reviews of women compared to men, you will need to look at managers’ overall scores as well as the percentage that each group receives.
Don’t just focus on the numbers. Consider using quotes from employees or customers, images, charts, videos to help your audience engage with your report.
5 challenges in writing sustainability reports?
There are a few obstacles you might encounter when creating social and environmental reporting. Some of these include:
- Having too many data points makes it difficult for people to sift through all of the information and find what is most relevant for them
- Many people might be overwhelmed with the amount of data you present and not know where to start
- It can be hard to motivate change when you use only hard numbers. If your report does not include a way for readers to engage with it, they might not care about it
- You might not have the data you need. For instance, many multinational companies do not track results in all of their locations, which makes it difficult to get an accurate picture
How can I overcome these challenges?
To use your reports to motivate change, consider answering any of the following questions:
- What do our numbers look like compared with other companies?
- What should we be doing to fix these numbers?
- The data might not paint the whole picture, but it is a good place to start. And if you provide your readers with ways to engage with the information, they will be more likely to do so.
How to Write an Environmental Report for Your Business
The first step to creating an environmental report is conducting a self-assessment of the company’s impact on the earth. The focus here is on negative impacts, because it can be easier to make planetary changes in this area. Some areas where the company might have some harmful impacts include:
- Carbon footprint and energy usage
- Water usage and any related water pollution
- Waste production and recycling practices
The focus of the environmental reports is on areas where you can improve. No company is perfect, but it’s good to be aware of how your business affects the environment. In addition to publishing a report, companies will often set goals and make changes to address the concerns in the report.
For larger companies, an annual environmental report is published and distributed to stakeholders and interested parties. For smaller or newer businesses, you may need to start with just sharing your self-assessment with a few key people within the business before publishing it broadly.
CSR or sustainability reports
CSR stands for corporate social responsibility. These reports, often provided as part of a larger company’s annual report, focus on the relationship between different types of people and their environment. CSR reports provide insight into how companies are conducting business in areas such as equality and diversity or environmental sustainability. The report is used by organizations including small and medium-sized enterprises to show their communities, employees, stakeholders, and partners how their business practices have been improving over time. The CSR report can be used as a way for organizations to show step-by-step changes that have been made to improve
What are the 3 tools of the global reporting initiative?
The Global Reporting Initiative is an independent, not-for-profit organization that designs the global standard for sustainability. They have developed a reporting framework to help companies provide useful information about their social and environmental performance that can be used by stakeholders.
The Global Reporting Initiative has three primary tools for this purpose:
- Sustainability Reporting Framework (SRF) – A reporting framework that consists of 10 material issues, 14 principles, and 133 indicators. They provide guidelines for how to implement the SRF
- Sustainability Accounting Rules (SAR) – A set of 61 rules which define whether an indicator is material, meaning it could potentially impact the business’ license to operate; where information can be found; what the reporting format looks like; etc.
- Sustainability Standards – A standard that applies to some of the larger markets, including Australia, Brazil, Canada, France, Germany, Italy, Japan, Mexico, Russia. They have standards for not-for-profit organizations as well as private companies.
The Global Reporting Initiative is one of many reporting standards that companies can use. Many consumers and investors want to understand a company’s social and environmental impact, though they don’t always know what specific information they should be looking for. The Global Reporting Initiative has many tools to help companies better communicate their impact to stakeholders
Why do companies need social and environmental reports?
If you are a business owner and want to communicate your social impact, there is no “one size fits all” approach. The end goal of any report should be the same: To provide key stakeholders with reliable information about how their company has been impacting society in positive or negative ways. Whether this means providing an annual sustainability report that shares insights into environmental impacts on the planet or a social report that discusses workplace equality policies, companies need to have a plan in place so they can share accurate information with those who need it most.
Caveats and Disclaimers
We have covered many topics in this article and want to be clear that any reference to, or mention of
what is a work in progress, businesses or benefits costs, law, transparency, data, exist, world, overview, achieve in the context of this article is purely for informational purposes and not to be misconstrued with investment advice or personal opinion. Thank you for reading.
Research & Curation
Dean Emerick is a curator on sustainability issues with ESG The Report, an online resource for professionals focusing on ESG principles. Their primary goal is to provide resources to help middle market companies, SMEs and SMBs transition to a more sustainable future.