Hershey's baptism of fire and the impact of shadow reporting

By CSRwire Contributing Writer Elaine Cohen

Hershey's knows what it's like to be shadowed. The minute the company published its first CSR report, activists shadowed it. But is this really an effective way of calling attention to the sustainability shortcomings of corporations?

Last month, The Hershey Company published a first social responsibility report, extolling their greatness as responsible players in the confectionery market. Immediately thereafter the "alternative" CSR report was published by a coalition of activists for human rights in the cocoa supply chain and timed to coincide with Hershey's greatest CSR moment. As positive as Hershey's report is about its achievements in upholding human rights in their supply chain, the alternative report is negative. Both reports leave you wondering where the truth lies and raise questions about the credibility of each. What is most interesting in both reports is what is not written. "J'accuse", say the activists. Nothing says The Hershey Company--to date there has not been a public response to the alternative report.

The Centre for Social and Environmental Accounting Research (CSEAR) at St. Andrews University researched alternative reports some years ago. This research produced "shadow" reports, composed of CSR information available about companies (including Tesco, HSBC and Ryanair) from information in the public domain. Colin Dey, Senior Lecturer in Accounting at Stirling University who led the research, said, "By critiquing and challenging conduct, shadow accounts have transformative potential. The broad conclusions of the academic literature are that companies use their own disclosures to manage their reputations, and a big part of that is responding to external threats to their legitimacy… as long as accounting is powerful within institutions, then shadow accounting also has the potential to mobilise opinion and bring about change."

And as sure as there is sun, there are shadows. A few shadow reports include, "The Other Shell Report" (2005) by Friends of the Earth UK, dedicated to the memory of Ken Saro-Wiwa. Shell was reported as rebutting the accusations leveled at them in this alternative report. Greenpeace China produced an alternative report in 2004, attacking the China Light and Power Company--a frequent subject of Greenpeace attacks. More recently in 2009, Friends of the Earth (FoE) Australia produced an alternative report for BHP Billiton, claiming "there is a growing gap between the company's rhetoric and the case on the ground." Dr. Jim Green, National nuclear campaigner, FoE Australia, said, "BHP's response to the alternative report was an extremely short, dismissive statement."

Producing such alternative reports is a major investment of time and resources. By and large they seem to fall on deaf corporate ears, and I believe it is hard to assert that these reports have solicited any significant reaction or driven change by the targeted companies. Compare this with the more sensational, viral nature of Greenpeace, Oxfam or other campaigns, which clearly deliver results, and one might wonder why an NGO would invest such efforts in alternative reporting. Alternative reports have limitations. The interests of activists are not without biases and personal agendas. Even NGOs have organizational objectives beyond the cause promoted - financial pressures, stakeholder interests, personal agendas of leaders - and these cannot be divorced from the activist campaigns being advanced. Dey adds, "The voluntary nature of shadow accounting raises questions about the rights of those preparing these accounts to represent those they claim to be acting for. If it is to achieve its transformative potential, we argue that shadow accounting must engage more effectively with other social movement campaigning strategies and tactics."

I like to believe what people are looking for is the whole truth, not the bad truth or the good truth. In presenting good-news-only CSR reports, companies shoot themselves in the foot. In presenting bad-news-only shadow reports, NGOs do the same. What we really need is dialogue, and where there is not enough maturity to engage, we need the protagonists in our CSR-o-sphere to offer some balance. This is where the research of CSEAR was important and innovative - its shadow reports provide a full spectrum of information, positive and negative. Perhaps that's one of the reasons they did not truly impact the corporate consciousness. They just weren't sensational enough.

About Elaine Cohen

Elaine Cohen is a Sustainability Consultant and Reporter at Beyond Business and blogger on sustainability reporting and author of CSR for HR: A necessary business partnership to advance responsible business practices.

This commentary is written by a valued member of the CSRwire contributing writers' community and expresses this author's views alone.

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