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Disclosure rates vary substantially by sector
Disclosure rates for first generation sustainability
indicators vary significantly by industrial sector. In
many ways, this is an entirely expected outcome;
substantial differences exist across industries in
terms of the type and magnitude of sustainability
impacts. Moreover, each industry faces a different
pressure and incentive structure to (voluntarily)
engage in sustainability disclosure.
21
But beyond these conventions, the sector-specific
disclosure rates found in this year’s study present
a number of interesting findings. The data show
that the Materials sector, which consists primarily
of mining companies, is by far the world’s
most transparent sector. As shown in
Figure 4
,
the Materials sector has the highest sectoral
disclosure rate on five of the seven first generation
sustainability indicators.
22
23
This finding generally corresponds to the significant
environmental and community impacts associated
21 For instance, the extent of NGO monitoring varies significantly by sector,
and by country.
22 The highest disclosure rate for an indicator across sectors is highlighted
in green, while the lowest disclosure rate is highlighted in red.
23 These disclosure rates have been calculated as the ratio of the number
of large companies in a given sector (based on the Global Industry
Classification System – GICS) that are disclosing a given first generation
sustainability indicator to the total number of large companies as at
December 31, 2011.
with mining activities, the increasing sophistication
of NGOs focused on scrutinizing mining operations
(especially in emerging markets) and other factors.
It is noteworthy that almost half (46%) of the world’s
large Materials companies now disclose their GHG
emissions.
By contrast, the Financials sector, which consists
primarily of commercial banks and insurance
companies, is the world’s most opaque sector from
a quantitative sustainability disclosure standpoint.
With the notable exception of Payroll data,
24
which
is disclosed by 61% of the world’s large financial
institutions, first generation indicators are poorly
reported in the Financials sector. Only 16% of the
world’s large financial institutions currently disclose
their water use, only 13% disclose employee turnover
data and only 3% disclose their lost-time injury
rate. This compares to an average disclosure rate
across all large companies of 25% for water, 14% for
employee turnover and 13% for lost-time injury rate.
24 The disclosure of payroll data is in part regulated by financial reporting
standards such as IFRS, which may explain the notably higher disclosure
rate of that indicator compared to the other six.
Figure 4:
Large company disclosure rates by sector, 2011
GLOBAL INDUSTRY CLASSIFICATION
SYSTEM (GICS) SECTOR
FIRST GENERATION SUSTAINABILITY INDICATORS
EMPLOYEE
TURNOVER
ENERGY
GHGS
LOST-TIME
INJURY RATE PAYROLL
WASTE
WATER
Consumer Discretionary
8%
21% 27%
7%
59% 20% 21%
Consumer Staples
13%
34% 35%
17%
68% 27% 32%
Energy
14%
21% 24%
21%
39% 17% 18%
Financials
13%
18% 20%
3%
61% 12% 16%
Health Care
10%
28% 25%
13%
49% 23% 24%
Industrials
15%
30% 37%
14%
67% 27% 27%
Information Technology
11%
25% 27%
6%
42% 23% 23%
Materials
21%
47% 46%
33%
67% 38% 41%
Telecommunication Services
22%
33% 37%
10%
78% 25% 32%
Utilities
22%
35% 41%
21%
66% 33% 36%
Source: CK Capital, Bloomberg
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