Posts Tagged ‘CSR reporting’
Timberland recently announced its Q2 2012 CSR performance. You’ll find highlights from our second quarter’s performance below, organized by our four CSR Pillars: climate, product, factories, and service. For complete Q2 2012 performance data and analysis, please visit the Goals & Progress section of our Responsibility website.
- Greenhouse Gas emissions for Timberland owned and operated facilities, as well as air travel, decreased 18% compared to Q2 2011, primarily due to new clean energy purchases in the United Kingdom and a slight reduction in air travel.
- We continue to reduce the environmental impact of our products by focusing on chemicals management in manufacturing. In Q2 2012, our global average grams/ pair of volatile organic compounds (VOCs) used in footwear production was 63.2, which is near constant vs. Q2 2011. We anticipate improvements in VOC reductions as early as Q1 2013, as we are now evaluating new products during the development stage and targeting additional support and training for factories that are most challenged with VOC consumption.
- Our parent company (VF) conducted 68 audits of Timberland suppliers in Q2 2012. 19 were Accepted (28%), 45 were Accepted to be Upgraded (66%), and 4 were Rejected (6%) – an improvement vs. Q1 2012 results. Action plans are in process for all factories that are Accepted to be Upgraded. Primary issues at Rejected factories are lack of social insurance contributions, proper hours/wages recordkeeping, adequate fire alarms and machine guarding, and transparency. If improved ratings are not achieved with re-audits, these suppliers will be dropped.
- Timberland employees served a total of 55,189 hours as of the end of Q2 2012. The Hours Utilization Rate (HUR – the percentage of employee service hours used compared to total available according to the Path of Service program) year to date at the end of Q2 2012 was 28%, which is up 7% vs. Q2 2011.
Earlier this week, Timberland announced its CSR performance results for the first quarter of 2012. Highlights from each of our four CSR pillars (climate, product, factories, and service) are below. Specific Q1 2012 performance data and analysis can be found on the Goals & Progress section of Timberland’s Responsibility website.
- Our Greenhouse Gas emissions decreased 8.5% compared to Q1 2011, primarily due to new clean energy purchases in the United Kingdom, as well as Italy and Germany. Other factors were slight reduction in air travel and a warm winter (whereby we used less heating throughout global facilities).
- We have successfully upgraded our product lifecycle management software to better automate Green Index® scores for our footwear. During 2012, we are working towards our goal to have all footwear scored by the end of this year.
- Timberland continues to prioritize the use of environmentally-preferred materials in our products. In Q1 2012, 34.6% of materials in our apparel production were recycled, organic, or renewable (ROR). Timberland’s International Design Center continues to drive improved ROR use across our apparel production. We are also working with our Licensee partners to further incorporate these materials.
- In Q1 2012, our new parent company (VF) began assessing Timberland suppliers. Consistent with VF’s commitment to promote best practices and continuous improvement throughout its factories, Timberland’s Code of Conduct team (renamed to Supplier Sustainability Team in 2012) will continue to engage suppliers by providing remediation assistance, capacity building and “beyond compliance” efforts. For more information about changes in our Compliance & Supplier Sustainability program see http://responsibility.timberland.com/factories.
- Timberland employees served a total of 23,555 hours as of the end of Q1 2012. The Hours Utilization Rate (the percentage of employee service hours used compared to total available according to the Path of Service program) year to date at the end of Q1 2012 was 11.8%, which is up 3.8% vs. Q1 2011. This is primarily driven by significant increases in hours served by our employees in the Dominican Republic and North America.
Looking for more? Additional details about our quarterly performance, goals and progress can be found on our Responsibility website. If you have thoughts, questions or comments about our CSR performance, we’d love to hear them. Email us at email@example.com.
Last week, Timberland announced progress against our annual corporate social responsibility goals. Detailed information about our 2011 results can be found on our Responsibility site; highlights of our progress in 2011 include the following:
- Product: Innovate Cradle-to-Cradle Design
Timberland experienced continued growth of Earthkeepers® – our most eco-conscious line, now comprising one-third of total sales. Earthkeepers® products best represent our use of environmentally preferred materials – such as recycled, organic or renewable materials – and this is driving improvements across all product lines. In fact, for the 58.6% of footwear we measured in 2011, over half the materials were recycled, organic or renewable.
- Service: Engage Employees
2011 produced our best employee participation rates ever in the Path of ServiceTM employee volunteer program, which celebrates its twentieth year in 2012. We’re proud to have met our Hours Utilization Rate goal of 42%, which measures total volunteer hours used vs. available Path of Service hours. In total, our employees served more than 92,600 hours this year.
- Climate: Protect the Outdoors
Our greenhouse gas emissions increased by 4.5% over 2010. While we didn’t meet our 2011 target, this is still a positive achievement in a year of strong business growth. The emissions increase was primarily due to increased air travel by employees; in 2012, we will experiment with carbon budgeting to alleviate emissions increases from air travel. In addition, we met our industry-leading 2011 goal to source 15 percent of energy from renewable sources.
- Factories: Improve Workers’ Lives
Global factory performance remained relatively static in 2011, with continuing business partners showing slightly improved performance. We were challenged to meet our 2011 target for factories’ environmental performance, as measured by the Global Social Compliance Program. In 2012, Timberland will promote the benefits achieved by those factories that did meet its target to demonstrate financial incentives to other suppliers.
We’re proud to continue our commitment to transparency and accountability by disclosing this information. How are we doing? Let us know your thoughts about our performance at firstname.lastname@example.org.
In December, Timberland announced its CSR performance results for Q3 of 2011. Highlights from this quarter’s performance are as follows, organized by Timberland’s four CSR pillars of climate, product, factories, and service:
Greenhouse Gas emissions increased by 13% compared to Q3 2010. This change is primarily due to increases in air travel as our business rebounds, and related to efforts to integrate our business with VF Corp (VF acquired Timberland in September 2011). With forecasted business growth this year, we are targeting static emissions for our owned and operated facilities (and employee air travel) as compared with our year end 2010 result.
Helping to drive reduced environmental impact of our products is a continued focus on chemicals management in manufacturing. In Q3 2011, our global average grams/ pair of volatile organic compounds (VOCs) used in footwear production was 59.0. We continue efforts to reduce VOC consumption by substituting high-VOC containing chemicals or reducing their use altogether if a substitute is not readily available. We are also continuing to prioritize the use of environmentally-preferred materials in our products. In Q3 2011, 16.4% of materials in our apparel production were recycled, organic, or renewable (ROR).
In Q3 2011, no factories that Timberland sourced from received a “High Risk” rating. 33% of our suppliers had High Priority scores in Q3 2011, which is relatively the same as our Q2 2011 results. Controlling working hours and effective wage calculation/payment processes were issues for 100% of the High Priority scores in Q3, and our sourcing managers are working closely with these suppliers to ensure that orders are not beyond realistic production capacity of the factories.
As of the end of Q3 2011, Timberland employees served a total of 78,241 hours (year to date) in their communities. The Hours Utilization Rate (HUR – the percentage of employee service hours used compared to total available according to the Path of ServiceTM program) year to date at the end of Q3 2011 was 36%, which is an improvement when compared to our Q3 2010 result of 28% HUR.
Additional Q3 2011 performance data and analysis can be found on the Goals & Progress section of Timberland’s CSR website.
Sustainability reporting is increasing at a fast pace here in the United States. Since the Global Reporting Initiative was launched in 1997, the number of reporting organizations in our country has increased tenfold. It’s true that multi-nationals reporting on environmental, social and governance (ESG) issues in the U.S. lag behind our global counterparts. However, it’s encouraging to see an increase in reporting uptake – not just because this allows stakeholders to better understand corporate impacts, but also because reporting in its best form should be a tool that aids strategy development, target setting, and business management.
Since the early days when standards were first created to guide corporations’ communication of ESG impacts and issues, the details, mediums, and audiences for sustainability reports have changed. What started out as backward-looking accountability statements primarily covering environmental impacts and corporate philanthropy has evolved into robust corporate evaluations of material impacts – which are now vetted through stakeholder bodies and include a balanced account of progress, challenges, and forward-looking and aspirational targets (in their best form).
Timberland has been experimenting with different mediums for some time. We issued our first CSR report back in 2000 – a short, printed document focused on community service, employee engagement, and overview information about our social and environmental programs. Fast forward to 2007 when we released our 2006 CSR report – our last annual, printed “accountability statement.” In today’s era of increasing information and stakeholder requests, I’m often asked “who’s reading these reports, and what are they accomplishing?” One could argue that our 19-page report in 2000 was accessible, easy to understand, and inclusive of many stakeholder interests (although light on data by today’s standards). By comparison, our 2006 report (which was 180 pages long and won several awards for best-in-class disclosure) was full of possibly too much information for different audiences to easily access what they had specific interest in.
There’s continued debate about whether or not a single sustainability report can satisfy the needs of multiple stakeholders – that is, employees, NGOs, issue experts, critics, partners, peer companies, investors, analysts, consumers, communities, workers, media, governments … the list goes on! Different stakeholders have different interests in EGS data, programs, and strategies. Being accountable to all of these stakeholders requires engagement, partnership, and dialogue – much more than simply producing a report. Yet the reporting process can inform these audiences, and I encourage companies to start by determining which groups are core to their business success. Target your reporting approach for these key groups, and ensure others can easily find information so they aren’t left out.
So how does a company balance the need for more information, while also maintaining credibility and relevance? At Timberland, we’ve continued our experimentation with different reporting formats. Our evolving reporting and communication approach reflects an evolving and improved sustainability strategy for managing risk, creating value and increasing consumer relevance – components that are necessary for our entire business model to succeed.
Whether you are a first time reporter or have been at it for years, here are my top 5 tips for effectively leveraging reporting as a management and communication tool:
- Ensure your report reflects material impacts – GRI advises that “the information in a report should cover topics and indicators that reflect the organization’s significant economic, environmental, and social impacts, or that would substantively influence the assessments and decisions of stakeholders.” A credible report should cover such impacts, and by engaging stakeholders in a materiality assessment process, you can prioritize resources and reporting topics. Ford Motor Company has been producing an excellent Materiality Matrix for years.
- Consider different stakeholders’ entry points and interests – different stakeholder groups read reports for different reasons. A detailed data set may appeal to a socially responsible investor, whereas a story about your program in action could be more relevant to an issue expert looking to understand supply chain management practices. Timberland issued our 2007-8 CSR report as a “suite” of communication tools – including a summary report (only 30 pages!), detailed “Dig Deeper” papers for those looking for more details, an online forum to engage stakeholders in dialogue on key issues, and a consumer-facing brochure.
- Tell the good and the bad – In today’s globalized society, if you’re not telling your own story in a truthful, credible, and engaging manner, others will simply tell it for you – and sometimes inaccurately! And yes, even if you are the most transparent company in the world, this still happens. But being open, honest and engaging can put you ahead of the curve when it comes to stakeholder engagement, campaigns, and trust-building. Dell has an open report, including discussion of tough issues like eliminating hazardous chemicals.
- Make it engaging – which will help attract different types of stakeholders, too. Timberland’s new Responsibility website aims to do just that. The site is much more than a report; it’s a comprehensive and interactive hub for all information about Timberland’s social and environmental activities. Viewers can read Featured Stories about topics such as our sustainable store design, work with tanneries to reduce their environmental impacts, efforts to empower factory workers, and community greening. It’s important to consider the best ways to reach targeted stakeholder audiences – as a footwear company, consumers are key and that’s why these stories are written in a news-editorial style and linked to CSR Stakeholder Calls, Voices of Challenge dialogue, blog and social media.
- A report is not the means to an end – Use the reporting process to build increased accountability for sustainability issues within your organization. Reporting efforts should be aimed at both internal and external audiences. And don’t forget to engage and share results with your own business units and internal leaders. It’s critical to build buy-in and ownership of ESG issues in order to successfully integrate sustainability into your business model.
This post also currently appears on the Boston College Center for Corporate Citizenship blog. Thank you, BCCCC, for sharing content with us!
Last month, Timberland announced its 2nd quarter CSR performance. Highlights from this quarter’s performance are as follows, organized by Timberland’s four CSR Pillars: climate, product, factories, and service:
Our Greenhouse Gas emissions increased by 11% in Q2 2011 compared to performance in Q2 2010. This change is primarily due to increases in air travel as our business rebounds, as well as the fact that we are no longer purchasing offsets for our Smartwool operations. With forecasted business growth this year, we are targeting static emissions for our owned and operated facilities (and employee air travel) as compared with our year-end 2010 result. We have prioritized several energy efficiency projects and renewable energy purchases to meet this goal.
Timberland continues to prioritize the use of environmentally-preferred materials in our products. In Q2 2011, 28.75% of materials in our apparel production were recycled, organic, or renewable (ROR). This result is consistent with Q2 2010 ROR use at 29.1%. Timberland’s International Design Center continues to drive improved ROR use across our apparel production. We are also working with our Licensee partners to further incorporate these materials.
34% of our suppliers had High Priority scores in Q2 2011, which is relatively the same as our Q1 2011 results. Controlling working hours and effective wage calculation/payment processes were issues for 85% of the High Priority factories. Our sourcing managers are increasing regular assessments of factories’ production capacities and making adjustments in orders (or securing additional suppliers).
Timberland employees served a total of 45,702 hours year to date, as of the end of Q2 2011. The Hours Utilization Rate (HUR – the percentage of employee service hours used compared to total available according to the Path of Service program) year to date at the end of Q2 2011 was 21%, which is slightly higher than our Q2 2010 result.
It’s that time of year where people in my position are busy compiling year-end social and environmental performance which will eventually end up in our Corporate Social Responsibility report. Timberland has been reporting on our impacts since 2000, and we’re proud to share our accomplishments and how we got there. What’s equally as important is communicating our failure to meet certain targets, why that may have happened and what we’re doing about it. We call this balanced transparency – and it’s critical for building credibility as a responsible business.
Why would we publish targets that might be aspirational? As a public company, we strive to make responsible choices every day for our business, communities and the outdoors. We vet our targets internally with business units who are responsible for implementing programs to meet these goals, and also externally with issue experts, NGOs, and other stakeholders who push us to reduce our impact and improve the places we live and work. This process holds us to a higher standard. For example, we recently achieved a 38% GHG emissions reduction at the end of 2010 – a huge accomplishment by corporate standards. Sure, we didn’t meet our target last year – but we would never have reduced our footprint by as much as we did had we not set an extremely aggressive goal to in the first place.
And now we’re at it again… at the end of 2010, we collected data to see how we fared against other bold goals. Below, you can find a sampling of our year-end 2010 results, organized by Timberland’s four CSR “pillars,” which are also available for download at http://community.timberland.com/Corporate-Responsibility. By analyzing our current progress and challenges, we can now look to a longer-term horizon to consider new and different ways we will reduce our impact. For the last six months, we have been working on new targets that push us even further. We’ll publish these goals externally so that stakeholders can track our progress – look for our new CSR report late this summer!
2010 CSR Results
- As already noted, we achieved a 38% emissions reduction in 2010. This achievement is for our owned and operated footprint and employee air travel, over a 2006 baseline. Our recently released white paper gives all of the details.
- Green Index® scores stayed relatively flat, which is an achievement because we scored a greater variety of products in 2010 (vs. mainly Earthkeeper product or “green” outdoor product in 2009), which included heavier leather styles that tend to score worse. An increase in recycled content, our phase-out of PVC, and continued reduction in VOC consumption helped improve scores.
- Of the cotton we purchased in 2010, 34% was organic. This is significantly higher than 2009 (18%), which is impressive given the sharp rise in the price of organic cotton and cotton as a whole.
- At the end of 2010, 32% of our suppliers had High Priority scores (compared to 32% at the end of 2009) primarily due to Wages and Working Hours issues. With the economic situation improving while labor shortages continued, working hours was a particularly challenging issue for many factories this year. Our sourcing managers are increasing regular assessments of factories’ production capacities and making adjustments in orders (or securing additional suppliers).
- Timberland employees served a total of 75,859 hours in 2010, which represents an 8% decrease in hours served compared to 2009. Continuing high demands on employees’ time at our manufacturing facility in the Dominican Republic along with our distribution centers in the U.S. contributed to a significant decrease in hours served as compared to last year.
As one of the only companies out there that’s currently reporting non-financial performance on a regular basis, I’m often asked “what value does Timberland get out of quarterly reporting?” Although it’s a pretty complicated question in itself, what often follows is a myriad of questions that take more than a few minutes to answer: How did you make this decision? Who’s using the quarterly reports? Does increased disclosure help with other parts of your CSR strategy?
Since Timberland began reporting our environmental and social performance on a quarterly basis in 2008 we’ve learned a lot. Our intent in issuing reports on a more frequent basis was to analyze, disclose, and integrate CSR information within the company in the same manner that we manage our financial performance. Our quarterly statements feature a dashboard of 15 key performance indicators, including analysis of individual progress towards our long-term goals. It’s our way of tracking performance in a more detailed manner, and also sharing the details of how we’re faring against our targets in a closer-to-real time scenario (as opposed to a backward looking CSR “statement” of the previous year’s impacts – often released long after we’ve made business decisions based on such performance). Note: we do believe such accountability statements are valuable and have published bi-annual CSR reports as an opportunity to share stories that illustrate our progress, successes and challenges in more detail. Our 2007-2008 CSR report was released in October 2009 and we will be issuing a new report later this year with 2009-2010 performance information.
The benefit of evaluating our performance quarterly is that this more timely information helps us to make changes to meet our goals more efficiently and effectively than we would if we relied solely on annual data. It also provides us with data that’s critical for internal stakeholder discussions and business decision-making. Our quarterly CSR performance metrics equip business leaders to better understand how trends (and challenges) in the “CSR world” are related to their regular activities and our company’s overall bottom line. This includes things like reducing our overall carbon footprint (for the benefit of reducing total energy costs across the company) and increasing organic cotton or other renewable materials to deliver sustainable products to consumers ((such as Timberland’s Earthkeepers product line, which is increasing rapidly and best demonstrates the inclusion of environmentally-preferred materials). We have a lot of work to do in this area – but it’s an important part of leveraging more sophisticated data as a means to create shared ownership and accountability, rather than simply sharing information among colleagues.
What will this frequency of reporting ultimately achieve? I believe we’re working towards a system where sustainability risks and opportunities could be evaluated in the current global market. If we can share information in ways that also highlight the need for long-term valuation of such priorities, that will serve as an opportunity to educate and engage different stakeholders in the process. Is our approach perfect? No. Does it take additional time? Yes (there, I said it). But it is helping us to create an integrated strategy for analysis, implementation, and accountability. Timberland CEO Jeff Swartz calls this commerce & justice — working hand in hand for the benefit of our overall company, not in separate silos.
We’re pleased to share the following story from Andy Friedman, a veteran Timberland account executive based in New York City:
On November 11th 2010, I had the pleasure of representing our brand at the 2010 Corporate Governance Awards dinner at Gotham Hall in NYC. I was accompanied by my personal governance officer — my wife, Elana.
We were surrounded by notable companies such as Microsoft, Coca-Cola, Ann Taylor, FedEx. All of us were making introductions, sharing what we do and, you never know how familiar your neighbor is with your company. I have learned, many times over, to “just take it from the top” and share all of the exciting things the Timberland brand is involved in, to share the vision of the company and to share why I have committed the past 20 years to working for the brand. Those who know me know that I don’t just tell a story, I tell the story.
People are always blown away by the product innovation, the community involvement, our brand’s staying power. Everyone has a favorite story to tell about their 1st pair of Timberland shoes or favorite jacket, and everyone looks down at my feet to see what I am wearing. I went against my personal governance officer’s advice and decided to wear my Abington boots with my tuxedo — a bold but proud move.
Unbeknownst to me, the gentleman to my right — a former Pfizer exec — happened to be on the evening’s panel of awards judges. This coincidence reminded me, once again, how vital it is for the story of our brand and our business to be able to flow out of all of us, with whomever we are engaged with. It can only flow smoothly if we are informed, if we are passionate and if we are committed. Earlier that evening I had shared with him that our Sales Team serves communities and schools in the Bronx—pre and post 9/11. I shared that our employees are paid 40 hours per year to serve their community.
The nominees for the “Most Innovative Reporting” award were announced, and from across the table I heard, “we know who’s taking this one home”- he was looking directly at me. The MC then announced that Timberland was, in fact, the winner. I stepped up to the podium, proudly accepted the award, and returned to a table of congratulations. I was extremely appreciative of the opportunity to represent Timberland in such good company, and proud to accept the award on our behalf.
The honor didn’t stop there: the next morning, all nominees and winners were invited to be part of the “opening bell ceremony” at the NASDAQ exchange. Wearing the same boots I wore the night before, I helped ring the bell to commence trading that day.
A truly amazing few days, wrapped around the recognition that Timberland strives for everyday – to be a responsible company that creates positive impact for our business, our consumers and our communities. Based on my experience, I’d say we’re on our way.
I really am grateful that I was given this opportunity to accept this award.
Please join Timberland CEO Jeff Swartz and Trees for the Future Founder David Deppner as they discuss tree planting programs that aim to create sustainable agriculture, environmental restoration, and socio-economic development.
DATE: Tuesday September 28, 2010
TIME: 9:30 to 11:00 AM EST
To register for the event, email email@example.com. You’ll receive a response within 24 hours that confirms successful registration.
This is the latest in a series of quarterly calls Timberland hosts with stakeholders to discuss topics and issues that are key to our efforts to become a more responsible, sustainable business. To listen to podcasts of previous calls, visit the stakeholder engagement calls page on Earthkeeper.com.