Corporate social responsibility practices are such a sensitive issue to most companies, it’s with a remarkable amount of caution that they approach the reporting process. Most employ advisers to help guide them through the process, but it’s infrequent that they actively pursue critics. Yet Coca-Cola Canada (Coca-Cola Ltd. (CCL) and Coca-Cola Bottling Company (CCB)) did after releasing their first joint sustainability report - to students at The Schulich School of Business. This was just one step in a series of engagements that were important in the development of their report.

Coca-Cola Bottling Company has no requirement to create a sustainability report of its own - its numbers and actions are reflected in the report of its corporate parent, Coca-Cola Enterprises Inc. But as Sandra Banks, VP in charge corporate responsibility at CCB explains, the company has been on a journey for some time with its business partner here in Canada, CCL, for a while, and the report solidifies that movement toward sustainable growth.

The bottling company is the moving parts of the organization in Canada - producing the beverages, transporting them, and selling them through retail and foodservice customers and vending machines - while Coca-Cola Ltd. handles marketing and product innovation.

"The bottling company is well grounded in Canadian communities," notes Banks. "In total, the two businesses include 6,000 people across Canada in nine production centres and over 60 sales and distribution centres."

Defining the scope
The company’s corporate responsibility journey is still a comparatively young one. Not to say that CCL or CCB haven’t been dedicated to community involvement in the past, but the new report defines the strategic focus that is at the heart of their collective future.

The report outlines five strategic focus areas:

• Water stewardship
• Sustainable packaging / recycling
• Energy conservation / climate change
• Product portfolio / Well-being
• Diverse and inclusive culture

"As a company, we call it CRS," says Banks. "Corporate Responsibility and Sustainability. That’s the right term for us because it really does capture our commitment to being responsible and sustainable environmentally as well as integrating it into our overall business. It’s part of our strategy, and that’s really the key."

The strategic focus areas make sense for CCL and CCB because they address the main impact areas of the company and "what stakeholders expect of us," says Banks.

Sandra Banks, VP, Coca-Cola Bottling

 

Initial engagement - NGOs
Some of those stakeholders were engaged early on.

"We’ve had quite targeted conversations with many non-governmental organizations (NGOs), both in preparation for this and after the fact as well," Banks explains. "We are on a journey to engage more with NGOs. One thing that happened recently was that Coca-Cola Canada announced our sustainability plan for the 2010 winter games. To develop that plan we worked very closely with both WWF-Canada and the David Suzuki Foundation. They challenged us and provided expert points of view and in some cases validated some processes that we weren’t familiar with.

"For example, what would be an acceptable way to offset carbon impacts in terms of purchasing offsets?" continues Banks. "Clearly we have a mitigation strategy to eliminate and reduce greenhouse gas emissions. These organizations were very helpful in explaining what would be acceptable for high-level carbon offsets."

Building reporting capabilities
As for the new report itself, it had its challenges. An initial CSR report generally does take more time, but this had an added twist - it was for two essentially separate companies.

"It was a big commitment of time and resources, and it’s also an exercise that we didn’t always have the processes in place to deliver," notes Banks. "We’re good at measuring formulas, but when it comes to measuring and setting a new system of benchmarks, that’s where it became key to set up a new process. What we have now, effectively, is five work streams that are set up to manage the needs of the five strategic areas. There is a champion in each that is responsible for the quality and validation of all the information that goes into the report."

It took the company about six months from the beginning to the end of that initial process — collecting data, validating it, determining how to prepare and share that information.

"While the world sees us as one company, we are two separate businesses. The process wasn’t complicated, but it was fortified with sometimes multiple different ways of looking at measurements that we had to combine in the report," says Banks. "It’s quite a commitment. We all want to be accountable for results, and for us this is our benchmark report, so it’s against what we will measure and show progress when we publish again in mid-2010."

The two companies are using the Global Reporting Initiative (GRI) standards to guide their process. Based on that standard, this first reporting cycle certainly isn’t perfect, says Banks, "but we thought we might be at a ’B’ level." And in reporting, there’s always room for improvement.

But they’ve had some great feedback so far — particularly on the information shared about the launch of the first fleet of heavy-duty hybrid electric delivery trucks. CCB launched 22 of the vehicles last year, which increase fuel efficiency by 37 per cent, reduce emissions by 32 per cent and create less noise and emissions when stopped in traffic.
 
The company has also been able to demonstrate a 22 per cent improvement on its water conservation efforts over a three-year span. The ultimate goal is to use one litre of water per litre of product produced - not as easy a goal as it may sound.

Risks and rewards of openness
As Banks says, the companies are learning as they go, and as part of that process, they have engaged the Schulich School of Business and invited students from the Corporate Social Responsibility Society to review the report and offer feedback, so that next time around they may have a yet richer report to share with stakeholders.

Schulich professors are equally enthused to have this real-world example to work with.

"I think that this is an opportunity that no professor in the classroom can ever offer," says Professor Dirk Matten, HP Chair of CSR at Schulich. "This project is part of a bigger ongoing process. We have close links (to other corporations), but I would say that this work with CCB is in some ways pioneering. It’s fantastic that the company has taken this rather bold step of exposing itself in an ongoing effort to live up to the responsible role it has in society.

"The area of CSR is quite sensitive, because it always has implications for the wider public, and the strength of a brand," Matten continues. "Being transparent and open is not without its risks."

Yet the reward that could come with this engagement isn’t lost on anyone involved. Both Banks and Matten are looking forward to what comes from the students in the next few weeks. That will be a test for both Coca-Cola and the students. In the best of worlds, both will gain a lot of valuable insight.

 

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