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Workday Inc: Starting to work

By Elaine Cohen (BeyondBusiness) on August 31, 2011 at 12:48pm.

 

Content:

Workday is a privately-owned company founded in 2005 by two partners and based in California employing 676 people in several different locations across the globe.  The company's core activity is the delivery of enterprise-class, software-as-a-service (SaaS) solutions for managing global businesses. The company has built a substantial business in a few short years, with 177 customers in 123 countries. This is Workday's first sustainability report, covering 2010.  SaaS solutions are all about computing in the ‘cloud’, one of the New Big Things in sustainable IT approaches, offering companies a route to lower resource consumption and carbon emissions through reducing the data-server burden and offering greater data- management flexibility. There is no doubt that the owners of Workday have identified this as the core of their sustainability mission, presenting what they do as a contributor to global sustainability.  The joint CEO introduction states: "So in a time when ‘going green’ is high on the priority lists of most organizations, Workday advances the cause by providing sustainable technology alternatives for our customers and demonstrating our commitment with practical programs internally."  This clearly aims to position Workday's sustainability approach and ‘social mission’ as one which helps customers run their businesses more sustainably.

The Workday report contains a Materiality Analysis, which appears to have been internally developed (though the real value of a Materiality Analysis is gained when its development involves external stakeholders). However, the core business impacts on customers' sustainability are not reflected in the Materiality Analysis. The top issue is noted as privacy and data protection, followed by customer satisfaction, business continuity, talent retention, innovation, integrity, employee satisfaction, community engagement and energy efficiency – all rather generic issues.  Given the discussion about helping customers run their business sustainably, I would have anticipated that Workday would prioritize reducing customers' energy consumption levels, as this represents Workday's single greatest area of impact.

However, the thinking about materiality is good practice and this has helped to inform the content of Workday's report.  All terms used in the Materiality Matrix are explained, which is another nice aspect. All too often, companies present a headline Materiality Matrix without really explaining what they mean, which leads to lack of clarity about expectations and deliverables. 

Workday makes a strong case for walking its own talk with several initiatives to reduce its own operational energy consumption and emissions. A comprehensive plan for virtual working, participation in the Climate Savers initiative to reduce total computing power consumption, purchasing of renewable energy credits, offsetting 100% office electricity usage, renting a LEED Silver certified building and pursuing Gold certification are good examples.  Unfortunately, the company has not yet measured Scope 3 emissions which include business travel, which must be a relatively important element of overall emissions for a non-manufacturing company operating globally. Workday recognizes this and commits to ‘evaluating potential ways to capture and report on Scope Three emissions’.  

Workday's employee-positive workplace practices show a range of supportive programs for employees and families (the ‘one-finger zinger’ is a great program! – look at the report to see what that means!). However, there is nothing on core Human Resources practices such as employee training and development, performance management, hiring practices, compensation practices, safety performance or  aspects of embedding a business-related sustainability culture beyond the corporate Green Team. Workplace diversity remains at a declarative level, with no details, including level of women in senior roles. Talent retention, a stated material issue, is not addressed in the report. Neither are talent attraction and hiring practices which, in a business with employees in several countries, as well as many remote employees, must be a challenge.  The report tends to leave an impression that Workday is a fun place to work, with a collegial team spirit and a host of non-salary benefits (Workday has been recognized as a ‘Best Place to Work’).  In future reports, I would recommend providing more depth about sustainable Human Resources policies and performance in areas such as employee attraction, development, retention, turnover, absenteeism and overall employee productivity.  After all, SaaS really is a knowledge business and people are key.

Communication:

The report is nicely designed with a fresh and not-too-crowded look. Graphics are non-intrusive and a good touch is the array of thumbnails of all the members of the Workday Green Team. However, other photos would benefit from captions, to help us from wondering if they are actually about Workday or just purchased images.

A problem with navigation in this report is the incomplete GRI Index – the indicators are referenced to a section title, not to a page number, which makes it tough to navigate to exactly what you are looking for in this report.

The report is an entirely internal affair – no 'stakeholder voices' from customers, suppliers or community partners, nor from independent members of the Workday Board. If stakeholder engagement is "built into our business model", as Workday claim, it would be nice to see some stakeholders express themselves in the company's Sustainability Report either in the form of a case study or quotations from key individuals.

Credibility: 

This report is well structured and makes for pleasant reading, being both informative and educational as well as providing a good range of sustainability policy and practice disclosures. Aspects of context and explanations of key concepts are provided and. For example, Workday references a report that assesses that 25% of corporate IT expenditure is spent on computing resources – this is the potential in a market that Workday claims to make more sustainable, followed by a detailed explanation of data-center efficiency calculations. This provides interesting background for the lay reader. However, even for a first report, at GRI self-declared Application Level C, this report is light on data. Even carbon emissions, one of the few data points reported, are "estimated".

A nice touch is the 'Areas for Improvement' sections, in which specific challenges are explained together with actions that Workday is taking to address them. No company can claim to be without challenges in sustainability, stating shortfalls and specific difficulties adds to the credibility of the report.

Workday's first report is a credible effort and a great start, especially for a medium sized private company.  As the company matures in its sustainability journey, the report should reflect more of the core processes which demonstrate that sustainability is truly embedded in the way Workday develops business plans, policies and delivers performance. A robust sustainability strategy with objectives, goals and targets would make sense.

 Recommendations:

1. Clearer representation of commitments and goals going forward.
2. Deliver more data about key environmental and workplace impacts.
3. Use the two years in the run-up to the next report to reevaluate sustainability strategy and materiality and involve stakeholders in the process.

elaine cohen is CEO of BeyondBusiness Ltd, www.b-yond.biz/en , a leading CSR consulting and sustainability reporting firm,  specializing in a wide range of consulting services for the development of social and environmental responsibility of businesses.