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Reviled firms lead responsibility list logo

• Nestlé and Shell praised despite controversies
• Porritt claims inclusion of BAT is ‘a sick joke’

  • The Guardian, 
  • Tuesday October 28 2008

Some of Europe’s most commonly criticised companies, including British American Tobacco and Royal Dutch Shell, have been named as leaders in the field of corporate responsibility reporting.

Royal Bank of Scotland, one of the banks bailed out by the government, Nestlé, which was boycotted for years over the marketing of its baby milk, and mining groups BHP Billiton and Xstrata are also among 11 companies named as the best of the 50 biggest publicly listed firms in Europe.

The report from Salter Baxter, a corporate social responsibility consultancy, to be published on Friday says leading companies have moved on to a new phase of corporate responsibility – which it dubbed CR 2.0 – in which businesses went beyond “housekeeping” to tackle issues that were “complex, full of paradoxes and beset with conflicting agendas”.

However, the choice of European leaders is likely to reignite controversy over the CSR movement, which has recently been attacked by Sir Jonathon Porritt, the chairman of the government’s Sustainable Development Commission, as “an increasingly empty and illusory notion”.

Nigel Salter, Salter Baxter’s director, said the company had reservations about BAT, which it would not work for. But he defended the report’s wider intentions: “What we are not trying to do is judge whether they are a good or bad business. Based on their communications they are talking about real actions and real activities they are involved in. It would be very difficult for a big multinational to put in an action it wasn’t doing. We have to take as read what’s put in those documents.”

But Porritt told the Guardian: “Any case of so called leading companies in CSR that includes BAT is a sick joke.”

He added: “Central to sustainability and business models is fully priced risks and fully allocating capital properly. When any company is systematically mispricing risks and systematically misallocating capital it makes no sense to talk about corporate responsibility. We’re going to have to face the fact some of the measures used to judge relative CSR performance are useless. They don’t help shareholders. They don’t help citizens. They don’t help the companies themselves.”

Salter Baxter’s eighth annual study of the sector, titled Sustainability Gets Tough, assessed the 50 biggest listed companies in Europe in March 2008. It found a “two-speed” approach: four out of five companies had integrated sustainability into their business strategy, but only 11 of the 50 had passed all of the other three tests set by the company’s experts for measuring up to CR 2.0: engaging with stakeholders outside the business, having a system to identify important issues “over the horizon” and being able to integrate wider issues into their CSR work before regulatory or public pressure.

GlaxoSmithKline was identified as one of the 11 CR 2.0 leaders because of its work on primary health care. The other top 11 companies were Volkswagen, BASF, Vodafone and Telefónica.

Top-50 companies missing from the leadership list, despite high-profile environmental policies, include HSBC and L’Oréal, which two years ago bought green pioneer Body Shop.


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