ACCG950-Analyzing the Global Reporting | Report

Over Weeks 11 to 13 you are required to meet as a group to choose two Australian companies that participate in either the Global Reporting Initiative (GRI) or Integrated Reporting (IR). You will then analyse the reports on their GRI or IR Output and Objectives. Specifically, as a group, students should identify the two companies, their sustainability or integrated reports for 2017, and collect any further published information on the company's approach to sustainability or nonfinancial reporting.

Using the companies identified by the group, students are required to draft a report individually that compares and evaluates the approach the two companies take.
Your report should:

1. Discuss each company’s purpose, or purposes, for providing a GRI or IR.
2. Identify key stakeholders with an interest in the report, and explain why each stakeholder is or could be interested.
3. Identify and analyse important similarities and differences between each report.
4. Critically evaluate each report. Your evaluation should consider:

i. The quality of information (e.g. is it reliable, relevant and comparable?).
ii. Consistency with the relevant standards or Framework (i.e. GRI or IR).
iii. How well the information would meet stakeholders’ needs.

Introduction:

The report is prepared for analyzing the Global Reporting Initiative taken by two companies that is listed on Australian stock exchange. Two companies that are selected for the evaluation of non financial or sustainability reporting are Wesfarmers limited and BHP Billiton Limited. Wesfarmers limited is a supermarket chain having a diversified business portfolio operating in hardware, supermarket, departmental stores, energy distribution, gas processing, chemicals, safety products and coal mining. BHP Billiton is a leading resource company of the world based in Melbourne, Australia and is engaged in processing and extraction of oil, gas and minerals. The purpose of providing integrated reporting is explained in context of the chosen companies. Differences and similarities between the sustainability reporting of each company is explained by critical evaluation in terms of quality of information, whether the needs of stakeholders are met by the information presented in the report (Sethi et al. 2017). Furthermore, analysis has been done whether the sustainability report is consistent with the frameworks or the relevant applicable standards.

Describing the purpose of each company providi

The sustainability report of BHP Billiton Limited is prepared by aligning with the lines of global reporting so that it provides support to all areas of organization. Assessment of materiality is done in accordance with the principles of Global reporting initiative that helps in defining the content of report through cycle of prioritization, identification, review and validation. Sustainability strategies are informed with the help of materiality assessment that helps in ensuring that stakeholders are provided with the transparent coverage of key topics. Strategy of organization and value of stakeholders are created by responding and identifying of the key sustainability issues. The criterion that is used for basis of sustainability reporting includes the standards of GRI that is published by GRI (Alonso et al. 2014).

The sustainability report of Wesfarmers limited is prepared according to the standard of Global reporting initiative. Purpose of adopting such global reporting standard is to provide stakeholders with transparent information about opportunities and sustainability risks. Performance of each of materiality issues are published and measured in the sustainability report of Wesfarmers limited. Sustainability at Wesfarmers is about managing and understanding the ways activities impact the environment and community for ensuring value creation in future. At Wesfarmers, sustainability is board level, critical, strategic issue and governance and the materiality process helps in guiding the content of report. The significant environmental and social impact that influences the decision and assessment of stakeholders is reflected in materiality issues.

Explanation of key stakeholders having an interest in the group:

BHP Billiton being a global company is required to interact with range of stakeholders that comprise of community based organization, business partners, regulator and government, contractor and employees, labor union, industry peers and association, media, local and indigenous communities, society partners, non government organization, suppliers and customers, investment organization and shareholders. The frequency and method of communication used to communicate sustainable information to stakeholders are diverse. Stakeholders such as contractors and employees are engaged through internal channels. Some of the channels that are used by organization for communication includes newsletter, intranet, e mail and town halls, inviting and comment through surveys of employee perception.

The stakeholder and customers of Wesfarmers are increasingly diverse and in order to understand the expectation of stakeholders, they engage with them on direct basis. Objective of board of Wesfarmers limited is to provide the shareholders with shareholders with satisfactory return by fulfilling the responsibilities and obligations of corporate governance in the best interest of stakeholders and company as a whole. The practice and regulatory framework of governance is regularly reviewed by organization to ensure that expectation of shareholders and market price is reflection on consistent basis. Recommendation of the task force is supported by Wesfarmers on financial disclosures related to climatic issues that inform shareholders about the information in relation to managing the risks on climatic change. Interest of shareholders such as customers, suppliers, employers and wider community is enhanced and protected by the management of organization.

Identification and analysis of similarities and dissimilarities between each report:

From the analysis of sustainability report of both the organization, it can be inferred that Wesfarmers and BHP Billiton Limited prepares their sustainability report according to the guiding principles and standard of Global Reporting initiative. Both the organization takes into account the interest of their diversified group of stakeholders and it is believed by organization that for the implementation and delivery of strategies, they emphasize on maintenance of high standard of governance. Furthermore, the content of materiality is appropriately be explained on context of sustainability and hence materiality analysis is of considerable importance to reporting guidelines. Hence, the organizational strategy well aligns with the sustainability and governance standards.

Evaluation of report in relation to quality of information:

Analysis of sustainability report of Wesfarmers and BHP Billiton limited, the quality of information presented in the report of later is somewhat adequately emphasizes as against former company. This takes into account management of risks, approach towards sustainable development, sustainability framework, materiality analysis, boundary and scope of reporting (Junior et al. 2014). However, there is segmented presentation of different departments of organization in terms of sustainability. In addition to this, the supply chain of Wesfarmers is explained in context of their sustainability practices.

Evaluation of report in relation to consistency with relevant information:

At Wesfarmers, steps are taken to ensure consistency in policies and procedures of sourcing between Kmart and target. In order to ensure consistency across distribution centers and stores, organization takes steps for appropriate measures. The framework of management of BHP Billiton Limited intends to ensure consistency across concepts, terms and strategies (Lewellyn and Logsdon 2017). Analyzing the sustainability report of BHP Billiton limited, it can be seen that there is no mentioning of consistency in detailed manner.

Evaluation of report in relation to meeting the needs of stakeholders:

Wesfarmers intends to create value for stakeholders in a sustainable way in the communities and environment. It is expected by the stakeholders to adhere by conducting business in an ethical way so that it helps in fulfillment of goals. The supply chain of stakeholders and partners are diversified within the businesses of Wesfarmers. Stakeholder engagement is one of the important parts of sustainability analysis of the group. An open engagement with the external stakeholders is treated including relationship with suppliers and government. The commitment of business is to build collaborative and strong relationship with suppliers. In order to understand the human rights and ethical sourcing of suppliers, engagement stakeholders is given considerable importance (Vigneau et al. 2016). For BHP Billiton limited, the sustainability reporting is prepared for accounting to the diversified stakeholders. The forum of BHP on corporate responsibility is a key part of program of stakeholder engagement. Activities of stakeholder engagement are documented at a local and regional level (H?bek and Wolniak 2016). Efforts are taken by organization to engage with external and internal stakeholders and strategies taken by organization are consistent with the sustainable reporting.

Conclusion:

From the analysis of the sustainable reporting of selected organization from Australians stock exchange that is Wesfarmers limited and BHP Billiton Limited, both the organization places considerable importance on stakeholder engagement. The reporting is prepared in accordance with the standards and guiding principles of Global reporting initiative by well aligning with the strategy of organization. Needs of diversified stakeholders are addressed using the program of stakeholder engagement. There is no much detailed disclosure on the information consistency of both the organization as analyzed from their sustainable reports. Furthermore, the reports of both the organization delivers quality information that assist stakeholders in taking relevant decision.

References list:

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H?bek, P. and Wolniak, R., 2016. Assessing the quality of corporate social responsibility reports: the case of reporting practices in selected European Union member states. Quality & Quantity, 50(1), pp.399-420.

Junior, R.M., Best, P.J. and Cotter, J., 2014. Sustainability reporting and assurance: A historical analysis on a world-wide phenomenon. Journal of Business Ethics, 120(1), pp.1-11.

Lewellyn, P.G. and Logsdon, J.M., 2017, July. Global Reporting Initiative G4 Sustainability Reporting Guidelines: Do They Deliver?. In Proceedings of the International Association for Business and Society (Vol. 28, pp. 161-172).

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Wood, D.J., Logsdon, J.M., Lewellyn, P.G. and Davenport, K.S., 2015. Global Business Citizenship: A Transformative Framework for Ethics and Sustainable Capitalism: A Transformative Framework for Ethics and Sustainable Capitalism. Routledge.