Next plc is apparently the second largest apparel retailer in the UK, according to the company's 2010 Corporate Responsibility Report, employing 37,200+ people, most of whom are in the UK and Ireland, in 525 stores and other operations for direct selling, warehousing and distribution. Next plc's products are manufactured by 492 third party suppliers in 40 countries, and 1,654 audits were performed by the Next audit team, now comprising a staff of 44. Next's mission is to provide "Exciting, beautifully designed, excellent quality clothing and homeware that reflects the aspirations and means of our customers” and indeed, Next's creativity, quality and service do appear to have a positive reputation, explaining Next's strong position in the marketplace.
That's why Next's 2011 Sustainability Report, the company's eighth, is a disappointment. It's basically one of those copy-paste reports where the amount of new, fresh, creative content could probably fit on about one page, plus another page with updated quantitative data. Everything from the 'Group Property Director – Main Board' Andrew Varley's opening message to details of policies, programs and actions contains large chunks of copy-paste from the prior year report and even the one before that. My bet is that Next plc has a report template. I assume that every year, they pull it out from a file somewhere, dust if off and mark the numbers which need to be updated and decide which colours to use for the new design.
The Next plc 2010 report contains no noticeable advancement in scope, content or reporting depth from last year, remaining mainly at the level of what was done rather than what changed. There are no case studies, no stakeholder voices, nothing which goes beyond policies and actions and nothing which illustrates the outputs and outcomes of the company's CR activities. For example, five and a half pages are dedicated to 'suppliers' and auditing systems in the supply chain. The section describes why Next plc audits suppliers, what's important in audits, why audits are not sufficient and how communication is managed, almost like a training manual. Aside from a couple of numbers (the total number of audits performed and sites audited) and the fact that 3 suppliers were disengaged for non-compliance, there is nothing that suggests the extent of the effectiveness of this massive investment in supply chain auditing, no disclosure of suppliers, no results of the audits. I would recommend that Next plc revises its approach to reporting in future years, to reflect more of the company's impacts and material issues which are important and relevant for the company's business.
Interestingly, one of the most significant sections summarizing 'Progress on opportunities' contained in the 2009 report is not replicated in the 2011 report. This makes continuity of progress difficult to discern.
Some nice data is reported, mostly in the environmental section. Next plc reports on Scope 1, 2 and 3 carbon emissions, and has achieved a 1% overall reduction since the previous year. Similarly, Next has achieved an 12% reduction in waste to landfill. Fuel consumption has reduced by about 2% due to several measures including an automotive 3 minute vehicle engine cut-out if idle – a great idea!
The Next plc report structure follows the five-point model with sections on Suppliers, Customers, Employees, Community and Environment. However, navigation is difficult because, beyond the section titles in the content index, there is no other keyword or GRI Index. The report does not follow the GRI or any other framework, so establishing whether all key data points have been addressed is difficult. There is no materiality assessment and no matrix, no description of the way Corporate Responsibility is managed in the organization and very selective mentions of targets (mostly environment). There is no evidence of stakeholder engagement, internally or externally. The report is written in a staccato-style disengaged language which makes for a difficult reading experience. The online report contains no additional information.
Unusually, Next plc has included a very long section (copy pasted) of ten pages (the longest section in the report) on Reporting Principles, Criteria and Methodologies, offering very detailed descriptions of how data has been collected and quantified. This goes into quite unnecessary detail, for example, we are told that the date and time of accidents are recorded and then entered into an online system. Most of this section would be best placed as a running appendix to all reports on the Next plc website.
I always like to find something positive to say about sustainability reports because any company which reports is already ahead of the game and should be commended. In Next plc's case, there is clearly some motivation to perform responsibility and several activities are reported which substantiate this. Aspects of environmental performance are positive and supply chain considerations are well-intended. However, in terms of reporting, this is way below what I would expect of a market leader and does not deliver an entirely convincing picture of Next's sustainability management processes for corporate responsibility. Assurance is provided for only a very small section of the data in the report. Motivations, policies and approaches are of little value unless they deliver change. I would like to see Next plc elevating its approach to corporate responsibility reporting as the output of a management process which is informed by business strategy rather than a series of data points and copy-pasted texts.
Andrew Varley opens the report with "I hope you enjoy reading this latest Corporate Responsibility Report, and you find it interesting, informative and useful." That was copy-pasted, of course, from 2010. And 2009. And 2008.
1. Reflect continuity more consistently in the CR Report by detailing an overall plan with objectives and annual progress.
2. Make a materiality assessment and report on material issues.
3. Collect most of the copy-paste texts and place them as a reference on the Next website, using the report to highlight new information.
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.