Poor systems integration and the burden of proof veils the value of companies sustainability efforts

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"Due to poor integration, poor visibility of information, and lack of audit trail, companies battle to verify the value of their sustainability efforts. The old adage applies; 'if you cannot prove it, you cannot disclose it'.

"As a result, the company and its integrated reporting stakeholders don't know what the real value of the sustainability effort has been," said Hayden Green, head of sustainability of Metrix Software Solutions.

Information must be accurate, readily available, and have an adequate audit trail to be trusted so that it can be reported and acted upon. Key sustainability information must also be real time in order for operational executives to manage the initiatives to meet the organisations strategic objectives effectively.

"It is impossible to be effective with a once-a-year snapshot," commented Green.

Information lies trapped in disparate systems

A major obstacle in the way of effective audit trails and the delivery of accurate, real-time information is the siloed systems approach that prevails in so many businesses. Information lies trapped in disparate systems, which are non-integrated systems and often manual. This means that undue amounts of time and effort must be spent gathering, understanding, and reporting it.

Another factor is a lack of source documentation and evidence, particularly in manual systems where there are no mechanisms to prevent and control inconsistencies and oversights.

To overcome these obstacles, organisations need to determine what is material and relevant, and then ensure excellent information flows and systems are put in place for these aspects. Proper reports also need to be in place for managers to view and work with the data. This is only possible with an integrated systems approach. In an integrated system, all indicator information flows are readily available in a single information management system where the performance of each indicator is constantly assessed against business strategy and compliance conditions.

The integrated report is the primary means of conveying sustainability information to investors, and there is no shortage of guidance on what to include in an integrated report. The sustainability element included in the annual integrated report usually has a mix of the organisation's carbon footprint, impact area monitoring results, corporate social responsibility initiatives and some do-good and tree-planting initiatives. The various reporting aspect indicators are then laboriously categorised and collated in a slick, well-worded and colourful document.

However Green said that if companies simply tick the easy-to-tick boxes and pay lip service to the rest, then they are defeating the purposes of the exercise and efforts are wasted or ineffective.

"Organisations need to move away from simply including information that easily meets audit standards. An integrated approach with enabling technology must be adopted to ensure that material, relevant information is easy to access, verify and report on. This will enable companies to start reporting on issues that are material to the business case and ensure that the integrated report is an accurate depiction of the organisation's sustainability performance and value proposition."