Transparent communication: Who's leading the way?
A number of companies are in the spotlight for corporate transparency. Overnight, leaders can become laggards and vice versa. Here are three to watch.
Unilever
In its recently announced 10-year Sustainable Living Plan, Unilever aims to achieve three significant outcomes by 2020:
- help more than one billion people improve their health and wellbeing
- halve the environmental impact of Unilever products
- source 100 per cent of agricultural raw materials sustainably.
These big goals carry with them high degrees of uncertainty in the way they can be delivered. Unilever recognises that, for example: “We know that the last 20 per cent of our agricultural raw materials will be complex to source sustainably. These are ingredients where our volumes are small and our market leverage is weak.” On another issue like water, they recognise: “We will develop products that make it easier for consumers to use less water . . . but we will only succeed in our target if we are able to persuade consumers to change their habits and join us in conserving water.”
Whereas for other companies, these uncertainties would have prompted a much more cautious approach to commitments and communications, Unilever has taken up the challenge and should benefit from more meaningful dialogue as a result.
BP
For BP, previously hailed as a leader in corporate responsibility disclosure, responding to the Deepwater Horizon accident has become all pervasive. Its website now details how BP is changing and how it will go about “re-earning and keeping the trust of society”. For a company criticised not only in relation to the accident, but also for its communications in the immediate aftermath, clearly a new approach was needed. But recently the company’s sustainability reporting has come under fire for not including an accurate determination of the amount of oil spilled into the Gulf of Mexico.
In addition to the information on the Gulf of Mexico restoration, the company reports on risk management in distinctly different terms. It notes: “There is significant uncertainty in the extent and timing of costs and liabilities relating to the incident, the impact of the incident on our reputation and the resulting possible impact on our ability to access new opportunities.” The company also recognises: “Given the nature of the challenges we take on, BP can never eliminate risk, but we can work with others to better understand, limit and manage risk.” These are uncharted waters for BP.
Siemens
Transparency and compliance are firmly embedded in the governance of Siemens after it was fined more than €800m for bribery and corruption in a case that cost it an estimated €2.5bn including lawyers’ and accountants’ fees of around €850m.
Siemens has introduced a new anti-corruption programme, changes in leadership culture and structure, and new ways of embedding values and rules. It now states that it is “drawing necessary consequences from identified problems”, and is committed to “making the company a role model in matters of compliance and transparency”. A wide-ranging new compliance programme has been introduced based on three pillars: prevent (incidents), detect (issues) and respond (to suspicious circumstances).
Transparent communication – internal and external – is vital. A secure website allows employees to report concerns confidentially. Meanwhile, Siemens is publishing data on its compliance programme. The company has also launched a $100-million global ‘integrity initiative’ to fund organisations and projects that fight corruption and fraud.
