Responsible Investment and the Disclosure of ESG Information …
455
Novo Nordisk (Health Care), and L’Oréal, Truworths, Coca HBC, Diageo and Nestlé
(Consumer goods). These companies were chosen for the representativeness in their
segment and also for having issued the Integrated Report or at least the Sustainability
Report in its absence. Initially the search for the Integrated Reports of these companies was done in the database of the IIRC website. When not available, the websites
of the companies themselves were searched.
For the Takeda company’s analysis, the sustainability report for 2017 was used,
which was only available on the company’s website. Bayer and Chugai’s integrated reports for 2016 were only available on their websites. The Mediclinic and
Novo Nordisk reports for year 2017 and 2016 respectively were already in the
IIRC database. Regarding companies in the automobile segment, only sustainability
reports were available on their websites and only for the year 2016. Integrated reports
were not available.
Ching et al. (2016) sustainability reference model was chosen as the proxy due
to its comprehensive structure, which allows for a coherent analysis of the various
aspects of sustainability adopted by an organization. As mentioned before, the model
is divided into three levels: Dimensions (environmental, social, economic and corporate governance), 23 themes and 60 subthemes that make up each dimension. The
main objective of the model is to facilitate the decision-making process of investors
because it recognizes the heterogeneity of the ESG data, fully addressing all aspects
of sustainability and, through its structure, allows the comparison between organizations and sectors.
Thus, in order for a theme of a respective dimension in a given segment to be
considered relevant, it should have half or more of the sub-themes reported by at
least three companies in each segment. For example, Environmental Dimension, Air
theme in the consumer goods segment, three or more companies reported two of
three subthemes. An irrelevant theme is that in which the majority of subthemes
were reported by none or until two companies. Likewise, in relation to the subthemes, those that were reported by at least three companies in each segment were
considered relevant, and consequently an irrelevant subtheme is that in which the
majority of subthemes were reported by none or until two companies. The reading
of the integrated reports or sustainability reports of the selected companies in the
sample was based on the definitions in the chosen reference model. For illustration,
in the consumer goods segment, in the Social dimension, Working Practices and the
sub-theme Training and Education, the following information was extracted from
the reports: Diageo: “We support our employees through clear policies, competitive reward programs and development of opportunities”; Coca-Cola HBC: “Our
new learning support application will enable us to make the knowledge even more
available to employees by democratizing learning by accelerating development and
helping them realize their potential”; Truworths: “more than R107 million in 2016
was invested in developing internal talent and creating opportunities for unemployed
apprentices”; Nestlé: “Through the training and learning strategy, we ensure that
learning goes hand in hand with career development and our approach 70-20-10 (in
which 70% of development is on the job, 20% is via feedback and 10% is through
courses and reading)”; L’Oréal: “The learning teams around the world offer technical
455
Novo Nordisk (Health Care), and L’Oréal, Truworths, Coca HBC, Diageo and Nestlé
(Consumer goods). These companies were chosen for the representativeness in their
segment and also for having issued the Integrated Report or at least the Sustainability
Report in its absence. Initially the search for the Integrated Reports of these companies was done in the database of the IIRC website. When not available, the websites
of the companies themselves were searched.
For the Takeda company’s analysis, the sustainability report for 2017 was used,
which was only available on the company’s website. Bayer and Chugai’s integrated reports for 2016 were only available on their websites. The Mediclinic and
Novo Nordisk reports for year 2017 and 2016 respectively were already in the
IIRC database. Regarding companies in the automobile segment, only sustainability
reports were available on their websites and only for the year 2016. Integrated reports
were not available.
Ching et al. (2016) sustainability reference model was chosen as the proxy due
to its comprehensive structure, which allows for a coherent analysis of the various
aspects of sustainability adopted by an organization. As mentioned before, the model
is divided into three levels: Dimensions (environmental, social, economic and corporate governance), 23 themes and 60 subthemes that make up each dimension. The
main objective of the model is to facilitate the decision-making process of investors
because it recognizes the heterogeneity of the ESG data, fully addressing all aspects
of sustainability and, through its structure, allows the comparison between organizations and sectors.
Thus, in order for a theme of a respective dimension in a given segment to be
considered relevant, it should have half or more of the sub-themes reported by at
least three companies in each segment. For example, Environmental Dimension, Air
theme in the consumer goods segment, three or more companies reported two of
three subthemes. An irrelevant theme is that in which the majority of subthemes
were reported by none or until two companies. Likewise, in relation to the subthemes, those that were reported by at least three companies in each segment were
considered relevant, and consequently an irrelevant subtheme is that in which the
majority of subthemes were reported by none or until two companies. The reading
of the integrated reports or sustainability reports of the selected companies in the
sample was based on the definitions in the chosen reference model. For illustration,
in the consumer goods segment, in the Social dimension, Working Practices and the
sub-theme Training and Education, the following information was extracted from
the reports: Diageo: “We support our employees through clear policies, competitive reward programs and development of opportunities”; Coca-Cola HBC: “Our
new learning support application will enable us to make the knowledge even more
available to employees by democratizing learning by accelerating development and
helping them realize their potential”; Truworths: “more than R107 million in 2016
was invested in developing internal talent and creating opportunities for unemployed
apprentices”; Nestlé: “Through the training and learning strategy, we ensure that
learning goes hand in hand with career development and our approach 70-20-10 (in
which 70% of development is on the job, 20% is via feedback and 10% is through
courses and reading)”; L’Oréal: “The learning teams around the world offer technical