Small is beautiful for environmental awards

A DECADE ago, it would have been hard to credit that large organisations would expend much effort on assessing the effects of their activities on the environment. However, yesterday saw 40-odd entries for the annual environmental reporting awards organised by the Association of Chartered Certified Accountants.

Moreover, as Roger Adams, the Acca official behind the awards, points out, some companies are so dedicated to the task that they produce what amounts to "boxed sets" of material, on everything from exhaust emissions to work with local communities.

In such a context, it is perhaps not surprising that the judges went for something compact, so that Michael Meacher, the environment minister, ended up handing the top prize to Anglian Water, a company frequently on the shortlist but never before the outright winner. Encouragingly, another company in the utility sector - Eastern Group - was named runner- up, while the car company Vauxhall Motors took the prize for "best first- time report".

Apart from the "less is more" argument, there is a significant message in Anglian's victory. According to Mr Adams, now that the notion of reporting on something other than financial performance has become accepted, there is a need for it all to be made relevant.

Just as traditional company reports and accounts have in recent years been made more accessible - at least in part as a gesture towards the increased numbers of individual shareholders - so environmental reports and related documents on ethical and social accounting will have to be more reader-friendly. Though the awards generally throw up one or two well-designed and easy-on-the-eye reports, many are dense packages of arcane expressions and difficult-to-understand figures that must mean little to those outside a fairly select group.

Indeed, this is perhaps the main reason why the Body Shop, though a pioneer in this area, has not lately been among the winners. It has become more difficult to identify the specifically environmental issues from the many other social and ethical concerns dealt with in its publications, Mr Adams says.

No doubt conscious that they would have been among the key targets of early proponents of environmental reporting, oil companies have also been in the vanguard of wide-ranging reports. Both Shell and BP (now part of BP Amoco) have in the past year produced weighty reports that Mr Adams describes as "all good stuff" but of limited value as a communication tool.

That said, the judges acknowledged the move towards social and ethical reporting, and the whole "inclusive" approach to sustainable business performance espoused by the Centre for Tomorrow's Company, by commending the "partnership report" produced by the Co-operative Bank

But even though there is so much material, many organisations are - in the view of Acca - paying insufficient attention to measurement. In particular, Mr Adams says, there is "not very much evidence of financially-related eco-efficiency indicators". In other words, there still appears to be a tendency for companies to regard reporting on the environment as a "good thing" to do rather than to regard it as something that can have a financial impact,

His wish-list for the future also included a desire to see greater explanation of why things were reported, "some idea of the priorities" in the scores of objectives that companies dutifully set out in their reports, as well as more discussion of the direct and indirect effects of their activities and a greater attention to what happens in this sphere if operations are bought or sold.

On the positive side, there were signs that companies had responded to Mr Meacher's call last year to pay attention to the "global warming indicator" that is increasingly seen as a vital element in any environmental reporting effort.

Some companies were even allowing observers to compare one of their locations with another. BAA, the company that runs Gatwick, Heathrow and other leading airports, won a commendation from the judges for achieving a balance between group and site reporting by producing separate reports for each of its main airports.

Moreover, organisations were becoming less inclined to ask readers of their reports to take their word for the accuracy of the claims they made. About two-thirds of the entries had been externally verified in some way - whether by the large accounting firms that audited their accounts or by one of the specialist consultancies that have sprung up in response to this growing activity.

However, an area of concern for government must be the apparent reluctance of public sector bodies - along with the small and medium-sized enterprises that play an increasing role in the economy - to put their activities up for scrutiny in this way. The Environmental Agency has issued a report but, Mr Adams says, there are not many others of its type.

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