UK banking, food and retail lag behind utilities in environmental reporting

Accounting for the Environment, published by Oxera Environmental, looks at FTSE 100 companies active in four sectors: banking, food & retail, oil & gas and utilities. Rated against a ‘model environmental report’ the utilities companies earned the highest number of points, averaging 36 out of total 100. Banks clocked in at a miserable six out of 100.

“Companies in the FTSE 100 are aware of environmental reporting but are either still not yet producing one or are not covering the full range of issues,” Laura Merrill of Oxera Environmental told edie. Oxera’s study showed that even companies that do publish reports are selective in terms of the environmental impacts they measure and often do not set themselves specific targets to reduce impacts.

Like banking, the Oxera report showed that the food & retail sector is lagging behind in environmental reporting. “One or two food and retail companies do produce very good environmental reports – one scores 50% which is higher than the highest utility score – but that this is not enough to encourage other companies to produce substantial information,” says Merrill.

Oxera doesn’t believe that the UK will introduce compulsory environmental reporting in the near future, as Denmark has (see related story), but that pressure to report on environmental performance is increasing with each passing year.

“There are many changes which are encouraging the production of environmental and social reports in the UK as a voluntary activity – through legislation like the new Utilities Bill which will require utilities to address renewable and energy efficiency targets and social aspects of their operations,” says Merrill. “[Also] through changes in UK company law, requirements on trustees of pension funds to take an account of ethical, social and environmental considerations. Already ‘mandatory reporting’ takes place to regulators such as the Environment Agency – the point is making the information more accessible to the public.”