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GE: Leveraging Best Practices and Core Strengths

By Michelle Bernhart (True Blue Communications) on September 09, 2009 at 3:13pm.


Content:

GE’s 2008 citizenship report comprises a detailed microsite and a 46-page print and PDF version. The website provides much more detail - not to mention a wonderfully interactive experience via user-controlled graphs, the ability to see both tabular performance results and graphical displays simply by mousing over a data point, and user-controlled access to additional information - but the print report has its place. For starters, it aids in making sense of GE’s enormous and diversified business and accompanying citizenship priorities, which websites naturally make more difficult. From the print report, it is also easier to conclude that GE’s integrated approach to citizenship leverages the company’s considerable strengths and leadership in talent, technology, and sustainable investment. To this end, the report illustrates some of the positive ways in which a big company can take big, bold steps, such as partnering with national governments to accelerate clean industries or support developing economies in addressing climate change.

The report is comprehensive (meeting GRI application level A), but noteworthy is its coverage of climate change. The report makes clear that addressing climate change requires action on many fronts: policy, technology, emission reductions, dialogue, and both mitigation and adaptation strategies. Unfortunately, the GHG and energy table does not link easily back to GE’s measurable targets, which are housed in a separate area, making it unnecessarily difficult to compare progress against goals. In fact, the 2009 goals listed with the performance overview simply state, “continue to reduce GHG emissions and improve energy intensity”.  Water use reduction goals are similarly relaxed in this section - “reduce water use”  - despite GE’s 2008 announcement of a 20-percent global water reduction goal. The tables otherwise appear identical. It is also unclear why the print report includes GHG data for 2007, while the online report does not.  If GE identified problems with the 2007 data after printing the report, this should be noted plainly on the website to avoid harming transparency and credibility.

Both the online and print reports place front and center a series of “expert perspectives”: brief and often interesting statements by corporate responsibility/sustainability thought leaders on various topics (e.g., rule of law, role of metrics, rights of indigenous peoples). One wonders, though, what readers are to make of these and why they are given so much prominence. A web disclaimer explains that the perspectives “do not imply an endorsement by the individual or organization of [the] report or of GE’s policies and practices more generally. Moreover, their inclusion does not constitute an endorsement by GE or the individual or organization’s opinion or position.”  If so, why are they included? Do they correspond to GE’s material issues? Do the voices belong to GE’s key stakeholders? Does GE plan to act on these assertions in any way? These questions go unanswered.

Communication:

The print report opens with the customary information about the report and the company itself. A two-page overview of “GE around the world”  acquaints readers with the tremendous diversity of a company holding significant market share in the consumer products, technology, energy infrastructure, finance, and media businesses, and provides a helpful snapshot of each unit’s citizenship priorities. Additionally, this year’s theme, “Resetting Responsibilities,”   is consistently carried throughout the report, enhancing both reader understanding and report integrity. Nicely written, the print report is full of clear prose throughout, but that’s also one of its chief obstacles: it’s simply too prose-heavy in many sections.  Numerous pages are dense with text, lacking visuals to elucidate key points or prevent readers from becoming text-weary. For instance, the bulky “Resetting Responsibilities”  section, which serves as a report introduction, albeit seven pages in, instead disrupts the overall flow with paragraph after paragraph of text that left this reviewer wondering about its purpose.

Clean and user-friendly, the website features several best practices (such as the ability to see both tabular and graphical data without so much as a click) that should be standard in all online reports. The site also makes it easy to see how GE’s major citizenship themes fit into the larger context of citizenship company-wide through an interactive matrix located on key pages - a user-friendly tool that serves double-duty as a regular reminder of GE’s efforts to integrate citizenship throughout the sprawling organization. Likewise, its generally web-smart (limited) text strikes the right balance between content and length.

In both versions, GE reports in welcome detail on its “commitments and highlights”, providing 2008 commitments and progress as well as 2009 objectives.  Missing, however, is any sense of whether all the commitments were fully met, which would be unusual for any company. This level of transparency and commitment to report any shortcomings alongside successes would be a useful improvement. 

Credibility:

GE relies on a five-person expert advisory panel instead of a formal assurance provider and in this report, responds to the group’s 2007-2008 letter with an overview of the ways in which the company has implemented the panel’s recommendations in this reporting cycle. While this is a small group, GE’s overall commitment to “embedded” stakeholder engagement is a positive development. The sections on compliance and governance, which are especially strong, help readers understand how these both drive and incorporate effective citizenship principles. Also included is detailed information about GE’s ombudsperson concerns—fair employment practices, business records, theft, privacy, and many others—that underscore the company’s pledge to strong governance.

The print report also makes clear that each of GE’s five main businesses has its own citizenship priorities, which further enhances credibility. In response to stakeholder feedback, the company promises to provide detailed information about key geographies in the next report and through a series of fact sheets. Throughout, the report provides valuable nuggets of transparency and indications about the lengths to which GE is willing to go to support responsible practices. For example, the discussion of supplier responsibility highlights GE’s supplier assessments, noting that the company terminated some 200 suppliers in 2008 for poor responsibility performance.

Recommendations:

1. Allow for easier assessment of progress against targets by displaying the targets and performance results side by side.
2. Clarify the materiality assessment process. Selected outcomes of GE’s engagement are presented, but the process is not well-documented except for mention of a 2008 meeting in Brazil.
3. Consider adding a feedback function  that asks questions to better gauge responses to the report, gain further stakeholder insights, and collect feedback on issues of specific interest to GE.

Michelle Bernhart is the founder of True Blue Communications LLC, which helps organizations strengthen sustainability performance, achieve strategic objectives, enhance brand, and manage risk through credible and engaging communications. http://www.truebluecomm.com