Whether public or private, companies in the same sector have the same kinds of impacts, stakeholders and the same risks and opportunities associated with corporate responsibility. The only real differences are the number of owners (investors) and associated public disclosure requirements.
So why has all the attention been on public companies alone? We wanted to review CR reporting on a like-for-like basis, looking not primarily at the company’s type of ownership but rather how it compares with peers within the same sector.
We believe this gives a more interesting assessment of the state of CR reports, and also gives more insight into good and less than good reporting. The rest of this section describes our methodology for achieving our objectives.
The 689 companies
We created a long list of companies composed of FTSE 100, FTSE Mid-250 and top 350 private companies1. Excluding mergers, acquisitions and bankruptcies, there were 689 companies in this group. We divided these companies into 13 sectors, based on the FTSE industry classifications and ranked them based on revenue.
The 13 sectors are:
- Basic Materials
- Consumer Goods
- Financials
- Healthcare
- Industrials
- Media
- Oil and Gas
- Real Estate and Home Construction2
- Retail
- Support Services3
- Telecommunication and Technology4
- Travel and Leisure
- Utilities
1 The list of private companies was created from Fast Track in association with The Sunday Times’ Top Track 100 and Top Track 250 Companies in the UK.
2 We created this new sector by combining the ‘Real Estate’ companies from the Financials sector with the ‘Home Construction’ companies from the Consumer goods sector. We felt this increased the consistency of activities and impacts, making the sector more directly comparable.
3 We split out Support Services from Industrials as there was a significant amount of reports.
4 These two sectors had very few reports and so we merged them into one category.
The 113 reports
We identified the companies that had CR reports (147 out of 689 companies), and then selected 10 reports per sector. In order to get a mix of public and private, large and small, we chose the five companies at the top of the first quartile by revenue and the five at the top of third quartile. Five of the sectors had fewer than 10 CR reports, and in these cases we reviewed all of the reports available. This resulted in a list of 113 CR reports that we reviewed.
We only included reports whose scope covered both the full group (e.g. not just one country or business unit) and all CR issues (e.g. not just environment). The report also had to clearly indicate the time period that it covered. We reviewed the most recent report available from each company as of 13 May 2009. Where more than one report was produced (e.g. print, online, summary), we reviewed reports which had the most complete information regardless of format.