Few large Swedish companies practice what they preach
The report was published in October 2015 and commissioned and supervised by Misum. The main objective was to explore the sustainability communication of companies listed on the Nasdaq OMX Stockholm Large Cap Index, representing the largest companies in Sweden from seven different sectors. More specifically, the team wanted to understand what information external stakeholders can access about companies’ sustainability strategies and initiatives and to which extent these companies report on implementation. A number of indicators, based on research and practitioner best practice research, were defined and the data was collected and coded.
- By comparing the corporate communication of different companies, we hope to support the development of clearer and more coherent S/CR* communication across different sectors, and to identify companies that can serve as role models to others, says Elisabet Ålander.
The report concludes that the majority of listed Swedish companies do not seem to practice what they preach. 88% of the companies talk more about sustainability in general terms (the "talk") rather than about completed activities, monitoring and implementation (the ”walk"). Further results of the study show that 10 percent of the companies communicate sustainability goals beyond 2016, 25 percent have representatives with formal responsibility for sustainability matters in the executive management team, and 11 percent have gender balanced boards of directors.
- We were surprised and discouraged by these results, as we are convinced that long-term sustainability work create value for both businesses and society. Misleading communication can be devastating, says Uta Hönemann.
There was also a clear variation between sectors. Companies classified as Basic Materials, scored on average double the walk points compared to those classified as Financial Services. Furthermore Technology companies scored three times higher on average in the walk section compared to companies in the Oil and Gas sector.
- What struck us was the performance gap between sectors. Some have come very far in this area, while others report very little on implementation. We also found a considerable variation among companies in the same sector, says Uta Hönemann.
Uta Hönemann and Elisabet Ålander examined corporate websites, sustainability reports, and annual reports for the financial year 2014.
- Publicly available information is often the only way stakeholders can analyze a company’s S/CR work. This reporting has also become a way to achieve legitimacy, says Elisabet Ålander.
The two students also operationalized S/CR through 26 key performance indicators (KPIs) that cover the areas economic, environmental and social sustainability.
- We scored each company on what they say that they will do and what they say that they have done with regards to S/CR. KPIs from the talk section relate to corporate communications on sustainability while KPIs from the walk section assess the information that is available on the follow-up and the actual sustainability work, says Uta Hönemann.
Uta Hönemann emphasizes that companies both in Sweden and Germany, where she is from, need to have a S/CR policy and clear action points related to the policy in order to achieve a sustainable market. She notes the similarities between the countries.
- Large Swedish and German companies are often global, often facing the same challenges and opportunities. Both Germany and Sweden are in the forefront in areas such as renewable energy and ICT technologies within sustainability, says Uta Hönemann.
In spite of the partly discouraging results of the study, the authors look to the future with great confidence.
- All companies can make a difference with regard to sustainability, especially large companies operating globally. We hope this report will inspire companies to see the opportunities in making a change and contributing to a more sustainable world.