LONDON - The report, ‘Indicators that Count’, is the culmination of a two year project run by Business in the Community’s Business Impact Review Group, which tested a set of social and environmental indicators previously identified in Business in the Community’s ‘Winning with Integrity’ report published in November 2000.

Phil Hodkinson, CEO Insurance & Investment, HBOS and Chair of the Group, says: ‘Our work sets the process of reporting and impact measurement in the context of understanding material impact. We thus provide a practical means for companies to improve their reporting and to respond to proposed changes to company law. The extensive public testing of the reporting framework has created a unique position for Business in the Community in the current debate on materiality.’

The key findings are presented in a practical model that enables a company to prioritise indicators by taking into account:

• its visions, values and objectives,
  
• the risks and opportunities to the business associated with its environmental and social footprint; and
  
• the views of shareholders and other key stakeholders.

• ‘Core’ indicators - 27 basic indicators on which all companies are encouraged to report – or know why they have not done so; and a further six ‘advanced’ indicators judged to more difficult to measure
  
• A total of 17 ‘Specific’ indicators not relevant to all companies.

Phil Hodkinson concludes: ‘Reporting on social and environmental performance as part of the Operating and Financial Review is likely to become a requirement for all large UK companies. The reporting framework tested by the Group offers valuable learning in anticipation of these proposals. The framework has been road-tested by companies of different sizes and from different industries.

‘The outcome is that those participating in the Group recognise more than ever before that the benefit of active reporting goes way beyond the obvious reputational credit to be gained from a more open and balanced dialogue with stakeholders. The discipline of reporting creates a shared understanding around the board table of the central role that corporate responsibility issues can play in determining their company’s success.

‘It is the attraction of this competitive advantage, not the threat of regulation or prescription, that drives businesses to develop best practice and ultimately inspires others into action.’

Business in the Community is recommending the revised set of indicators to all its 700 members. It will also play a role in our objective to widen membership to include all the 1,000 most economically significant companies likely to be required to publish an Operating & Financial Review as part of their statutory reporting cycle.

‘Indicators that Count’ is available free of charge from Dawn Tomlinson, on 020 7566 8793 or reporting@bitc.org.uk.

Media enquiries to:

Vicky Gashe, Communications Manager, Benchmarking & Reporting on 020 7566 8704 or mobile 07786 415 448
Elizabeth Forbes, Head of Media, on 020 7566 8769 or mobile 07831 253 616
Katherine Sharp, Senior Manager, Benchmarking & Reporting, on 020 7566 8700 or mobile 07950 644 135

Editors notes:

1. The report is relevant to the publication [on June 27] of the consultation paper from the government's working group on materiality, set up to examine issues raised in the White Paper on Company Law.
2. Companies represented on the Business Impact Review Group are: BAA, BUPA, Cap Gemini Ernst & Young, Carillion, Coca-Cola GB, CIS, EDF Energy (formely LE Group), Flag, GUS, HBOS, Jaguar, Marks & Spencer, Nestle, Orange, Powergen, Sainsbury’s Supermarkets Ltd, Severn Trent, Thames Water, United Utilities and Zurich UK.
3. ‘Responsible business practice’ means that a company is behaving in a way that is accountable, ethical, honest, law-abiding and trustworthy. The term encompasses all of its business operations and all of its relationships with all of its stakeholders. By continually improving its responsible business practice a company will improve its business and its positive impact on society.
4. Business in the Community is a unique movement in the UK of 700 member companies. Our purpose is to inspire, challenge, engage and support business in continually improving its positive impact on society.
Together, our member companies employ over 15.7 million people across 200 countries. In the UK, our members employ over 1 in 5 of the private sector workforce.
Membership of Business in the Community is a commitment to action and to the continual improvement of the company’s impact on society. Our members commit to:

• Integrate responsible business practice throughout their business
  
• Impact through collaborative action to tackle disadvantage
  
• Inspire, innovate and lead by sharing learning and experience.

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