HomeMore
Your Membership
Home
Your Membership
Reviews   About

Expert Reviews

Search   Tags   Author   Everything

General Motors Co: Fighting for street cred

By William D Alessandro on February 15, 2012 at 08:30am.

Content:

Give credit to General Motors — or curse them — for making the Global Reporting Initiative (GRI) guidelines what they are today.  More than any company, GM steered the international reporting standard in the general direction US industry wanted to go. 

GM was one of just five publicly traded companies (Ford Motor Co. is another) that contributed to GRI’s charter capitalization fund.  A GM executive, Judy Mullins, held a seat on GRI’s steering committee.  Mullins was the director of GM’s Public Policy Centre in the 1990s.  She was a mainstay of GRI meetings.  GM’s views permeated the multi-stakeholder drafting process.

GM argued, successfully, to allow plenty of room in the voluntary guidelines for corporations to tell their story in their own words.  The standard should not shackle companies to facts and figures reported with no embellishment.  

“To effect change and add value, data must have context,” insisted Dennis Minano, GM’s chief environmental officer in 1999.  The philosophy explains the company’s new 113-page “Sustainability in Motion”. 

The report is a concoction of the type of articles found in house journals and public affairs news releases.  It includes 17 pages of what can be fairly described as technical sales literature for various GM marques like the Chevrolet Equinox, the Opel/Vauxhall Corsa,  and the Buick LaCrosse.

GM’s table of contents is a tip-off about what readers should expect.  Each chapter has a title more likely to be found on a shelf of motivational business books than in a social responsibility report:  A Patent for Innovation; The Game-Changing Volt; A Model for Profitability; Putting the World To Work. 

Anything might pop up in a narrative report like this, and it does. 

Flip the pages and find talk about “one of the most impressive examples of commitment at GM.”   And what might that be?  Workers at GM plants get the keys to brand-new models.  They are allowed to joyride overnight and with their families and friends.  “Armed with a deeper understanding of the wide range of our vehicles, these employees are better prepared to share their passion about the vehicles we make.”  

A few hundred words, plus a picture, describe the solar canopies designed for some Chevy Volt sales offices.  Customers will be able to park underneath them and recharge their electric vehicles for free (assuming the owners are nearby and have the time to spare).  These Green Zones will be billboards for GM dealerships. 

Elsewhere in the report we learn that a Chevy engineer Joaquin Nuño-Whelan and “the people he works with every day” bought two burned-out house lots to rehabilitate the block where  his grandmother lived in Detroit. (No mention as to what may have caused the urban blight.)  We hear about an aerodynamic engineer and roller girl Suzy Cody, “a real team player” on the job as well as at the rink. 

GM tells us that celebrities from MTV are brought to headquarters to host seminars.  The staff wants them to explain what Millennials (11- to 30-year olds) think about.

Sustainability metrics are strewn among the stories, but always encased in a corporate narrative.   So, for instance, while revealing the number of notices of violations in 2010, GM points out that the typical vehicle assembly plant in Michigan is burdened by more than 1,200 legal requirements.  Also, violations are “often settled, even though GM may not agree that a violation has occurred.”  

The report features write-ups on each of GM’s propulsion systems, including all those in the R&D stage.  The company’s strategy is premised on the belief that no single solution can meet the needs of drivers around the world.

After 99 pages serving up this sort of information, GM finishes with a 14-page list of GRI performance indicators and the company’s responses.  The index is illuminating because it shows 28 core or additional measures that GM does not address.  

Communication:
This is General Motors Co.’s first sustainability report.  The year covered in the report ending 31 December 2010 will be the baseline going forward.  

Come again?

GM was among the first organisations to test drive the GRI exposure draft in 1999.  GM has followed the GRI guidelines since their inception.  GM endorsed GRI at the inaugural event when it was held in the UN headquarters in New York City on 4 April 2002.  When the guidelines were put up for renewal in 2005, as a member of a corporate consortium, GM gave GRI €100,000 more to support the revision.
 
Yet the legality is true.   GM Co. is a new entity, distinct from the 100-year-old GM Corp.  (“Old” GM is now called Motors Liquidation Co.  MLC is a creature of bankruptcy court to deal with liabilities, including environmental pollution and claims from workers’ asbestos diseases.)

GM does its best to maintain the facade throughout the report.  The position is a hard sell.  Just how tough is evident in the mortifying response GM dishes up for the GRI economic indicator EC4: “During 2010, GM did not receive any significant financial assistance from any government.”  

A cagey answer.  The $50 billion from US taxpayers that saved the car maker is out of sight, hiding behind door number 2009.   On the other hand, GM has no compunction about charting improvements made in environmental manufacturing performance in 2010 against restated data from prior years.  

Major after-shocks are to be expected in the wake of GM’s near-death experience.  However, GM seems to think the tumultuous transition justifies less than full-blown discussions of materiality, stakeholder engagement, and social impacts.
 
Credibility:

GM did not seek external assurance for the report, and says so.

Citing the desire to be transparent and accountable,  GM follows the framework of GRI as in past years.   But GM explains further: “Though we are not reporting to a specific application level this year, our goal is to do so in the future.”

A declaration of having met GRI’s A, B, or C level of disclosure is not compulsory.  But GRI “strongly recommends” using the system: “Application levels provide report readers with a measure of the extent to which the GRI Guidelines and other reporting framework elements have been applied… .”    Skirting the limits seems to be a GM hallmark.

In the formation of the new GM, a canyon of legacy gaps has opened up, which make the report even less convincing.  For example, waste reduction at GM facilities is a central theme in the 2010 report.  Not mentioned is GM’s withdrawal in 2009 from a nationwide program to take mercury switches out of cars before they are shredded.  More than half of all the switches are in pre-2003 GM vehicles.

Recommendations:

1. GM helped write the book on non-financial reporting.  No suggestion is going to change the way the company wants to do the job. 

2. For everyone else the GM report shows how far the GRI framework can stretch before it snaps.

 

William D’Alessandro is president of Victor House News Co., an independent agency reporting on law and the environment for trade publications and executive newsletters.  He also edits Crosslands Bulletin http://www.crosslandsbulletin.com covering strategic corporate environmental management and sustainability issues.