Select Committee on Environmental Audit Minutes of Evidence

Annex 3


  The fourth annual European Environmental Reporting Awards were presented on 19 April by the European Commissioner for the Environment, Margot Wallström, in the presence of HRH Prince Laurent of Belgium and Caroline Jackson, president of the European Parliament's Committee on the Environment, Public Health and Consumer Policy.

  Neste Fortum Group of Finland was judged best overall winner. The broad scope of the environmental report, the inclusion of financial information, the clarity of the report and the extensive verification were important characteristics of this report. The runner up for best environmental report was United Utilities Plc. This report covers a broad scope and shows clear links between the global, national and local context of the relevant environmental aspects. United Utilities was the winner of the ACCA's UK environmental reporting awards.

  The best first time reporter was Grundfos A/S of Denmark. The clarity of the report and the links between environmental aspects and indicators were impressive characteristics for a first time report.

  A special commendation was made to DaimlerChrysler AG of Germany for their innovative way of communicating their environmental policies and performance. Together with the more typical reporting section, a magazine-style section was included in the environmental report presenting background information in the form of interviews and journalistic reports.


  The national winner from each country's environmental reporting scheme was submitted into the European Award scheme. In most cases, a second winning environmental report was also submitted. The full list of reports that were submitted into the 1999 scheme is:

    Belgium—Cimenteries CBR SA

    Denmark—Grundfos A/S; DONG

    Finland—Nokian Tyres; Neste Fortum Group

    France—Elf Atochem; Renault

    Germany—Axel Springer Verlag AG; DaimlerChrysler AG

    Italy—ACEA Spa; FALCK Group

    Netherlands—ING Group

    Portugal—Opel Portugal

    Switzerland—Credit Suisse Group; Sulzer

    UK—United Utilities Plc; Bovince Limited

  The judges were greatly encouraged by the inclusion of two environmental reports from the banking sector. They were: ING-bank, (The Netherlands) and Credit Suisse (Switzerland).

  The banks attempted to address their "indirect" impacts via the services they provide such as the banking activities, their asset management and their assurance activities. Examples include the consideration of environmental aspects in providing credit facilities, loans, leases and offering opportunities to invest in green funds. The more obvious "direct" impacts of any business such as energy, waste, transportation and building issues were also addressed.


  The environmental report published by Bovince Limited (UK) is an excellent example of showing what an SME can achieve. With only 57 employees, Bovince has implemented both ISO 14001 and EMAS environmental management systems, ISO 9001 quality standard and the UK Government's Greenhouse Gas (CO2) indicator (published by the Department of Environment, Transport and the Regions—DETR). Bovince Limited's report also includes information on stakeholders and their complaints.

  (a)  Integration: Evidence should be provided to show how a company has incorporated environmental issues throughout the core of business management and operations, including all company policies and corporate strategy. Other evidence includes the assignment of a Director with responsibility for the environment and case studies from different parts of the business (for example: transport, finance, procurement, corporate planning), commenting on how the environment impacts on their decision-making processes.

  (b)  Use of internet: The internet is a medium that enables users of information to obtain relevant and detailed information when required. Companies should begin to use the internet as an additional and quick method of disseminating environmental information in a paperless format. The increasing use of the internet should lessen the demand for hard copies of reports and thus in itself be environmentally friendly. Use of the internet also facilitates communication with different categories of stakeholders, and the website should be referred to in all corporate publications.

  (c)  Dual approach: The judges agreed that those environmental reports which adopted a tiered approach to their environmental performance reporting added value to the report and set in context a clearer picture of how the company impacted on its environment at both the micro and macro level. United Utilities, for example, addressed their key impacts in the regional, national and corporate level contexts. By linking the local, national and global issues, readers of environmental reports obtain an overall view of the implications of the company's environmental impacts.

  (d)  Beyond environment: Pressure is mounting for companies to widen their scope for corporate public accountability, and many are responding by including social data in their environmental reports, preferably through a well managed process of stakeholder dialogue. Examples of social measures include: employee statistics and conditions and community support and involvement.

  The next step beyond environmental and social reporting is sustainability reporting which involves integrating environmental, social and economic performance data and measures to produce one report. The Global Reporting Initiative (GRI), launched in March 1999 to provide globally applicable guidelines for companies preparing sustainability reports, will issue revised guidelines in summer 2000.

  (e)  Accounting principles: Generally, very little information on the underlying accounting principles is included in the environmental report. In order to be able to make accurate interpretations of the data provided an explanation has to be given in relation to the underlying accounting process and the assumptions made. Also, explanations of variations in environmental performance can be further improved.

  (f)  External verification: The scope of verifications differs. In general, the quality of external verification is poor. Verification statements with a limited scope that enhances only the trail from accounting records to environmental reports do not add much assurance. The lack of site visits and therefore the lack of assurance on whether the accounting records at the sites are an accurate reflection of actual performance is a main omission in existing verifications. Some reports include "independent views" (for example, from non-governmental organisations) but these views are not a credible replacement for verification statements.

  It should be noted that the judges do not only assess whether or not the environmental report has been verified, but also the scope of the verification statement.

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Prepared 9 January 2001