Companies can become stronger by showing their weaknesses

May 28, 2010

Many organisations today produce sustainability reports or integrate sustainability information on their website and annual report. Thanks to rating agencies, reporting guidelines and many benchmarking initiatives, the quantity of information given by corporations is increasing. Next to the essential strategic themes and goals on sustainability, there is a lot of background information and stories. A lot of companies are seduced to give as much information as possible about all the good things they are trying to do for the world. But that is not at all the same as being transparent about sustainability.

Being transparent also means showing the weaknesses of the company and being honest about it. Because what if your company is being praised for its sustainability report in one year, and the other year it is responsible for one of the biggest oil leaks in history? Will you be credible if you avoid this topic or mention it briefly? Of course the answer is no. The public knows that companies aren´t saints. A lot of things go wrong, there a lot of dilemma´s, trade-offs etc. Running a company in a decent way is complex and no company is perfect.

How are Dutch companies dealing with their weaknesses? Do they hide them or do they communicate about them? When we look at the AEX listed companies, we see that only few of them elaborate about their dilemma´s. A good example is AEGON that gives information about allegations of misselling and about their view on the Ethical Equity Fund in the United Kingdom that invests in the global extractives industry. DSM has a chapter in its Triple P report called “What still went wrong” which elaborates on the accidents and fatalities that have occurred during the year. And Shell has devoted a paragraph of its sustainability report to the challenges of doing business in Nigeria. However, most companies with publicly available information on sustainability focus on good news and the only bad news that can be found are figures on HSE related accidents.

Companies still seem to think that communication about dilemma´s will make them weaker. In fact, it is the other way around. It makes them stronger because they take responsibility for their choices and actions. It also makes them more resilient against possible accusations from NGOs or the broader public, because they are pro-active in presenting their dilemma´s which can include explanations for choices and considerations for the future. It will also take away the image of sustainability communication being a means of PR or greenwashing. Dutch multinationals have always been frontrunners in the field of sustainability. By being more open about dilemma´s they can show the rest of the world what real transparency is all about. Be stronger by showing weaknesses!

 

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