Sustainability reporting: background
Traditionally, sustainable development was limited to environmental issues, but there has been a significant shift to encompass economic and social issues. The triple bottom line, which emerged in 1997, introduced the concept that an organisation’s value should not only be measured by the financial bottom line but also by its social, ethical and environmental performance.[1]
Corporate reporting has evolved and in 2000 the Global Reporting Initiative (GRI) launched its sustainability reporting framework, which is now the most widely used by multinational organisations, governments, SMMEs, NGOs and industry groups in more than 90 countries.[2]
In 2013 the International Reporting Council (IRC) published the integrated reporting guidelines. The integrated report details how the organisation has created value for its stakeholders. It also details how the organisation will create value in the future with reference to its strategy, translating this strategy into its business model and how its business model utilises the six forms of capital (manufactured, intellectual, financial, human, social and relationship and natural capital) to create value.[3]
In 2017 the GRI launched guidance for corporate reporting on the SDGs in collaboration with the UN Global Compact.[4] Today, the GRI guidelines and the integrated reporting guidelines are the two guidelines in the forefront of sustainability reporting.[5]
In order to understand reporting on SDG 3 in South Africa and how you can help your organisation to report on it, we answer these key questions:
- What is the status of reporting on SDG 3 in South Africa?
- How can we improve our reporting on SDG 3?
- What is a good process to follow when reporting on SDG 3?
- How are companies reporting on SDG 3?
What is the status of reporting on SDG 3 in South Africa?
Reporting on health and wellbeing in South Africa has been largely neglected, even though it has a substantial impact on business success and sustainability.[6]
SAICA issued a comprehensive report in September 2019 which provides the results of a survey our Health and Wellbeing Advisory Group (HWAG) performed in order to establish a clear view of the current status of health and wellbeing management and reporting across corporate South Africa. The report also provides an outline of the evolution of sustainability reporting and a business case with guidelines on how to report on employee health and wellbeing.
You can access the report here and a podcast discussing the report here. The SAICA report states that: ‘Despite the enormous investment organisations make in relation to workplace health interventions, health and wellbeing reporting is largely absent from corporate reporting.[7]’
How can we improve our reporting on SDG 3?
South Africa has 553 425[8] registered companies of which 374 are listed on the JSE. A study conducted on the top 100 JSE-listed companies from a sample of 88 during the years of 2016 to 2018 found that many of South Africa’s top JSE-listed companies do not publicly report on their contribution to the SDGs. This is not to say they do not contribute to SDGs or SDG-related public health targets, but they are failing to align their activities and/or to report on them in the public domain. Thus, to improve reporting requires noting and subsequently reporting what has been conducted within the realms of SDG 3 to the broader public.[9]
As per the SDG Compass, these are examples of key themes linked to SDG 3 that business could report on to improve the quality of their reporting:[10]
- Occupational health and safety data
- Access to medicines
- Access to quality essential health care services
- Air quality
- Water quality
The Sustainable Development Report 2020: The Sustainable Development Goals and COVID-19 [11]
builds on the above themes and provides a ‘Six Transformations’ framework for the SDGs that are a very useful guide as South Africa rebuilds itself and works towards achieving SDG 3 after COVID-19. One of the six areas highlighted in the transformations framework is health and wellbeing. Businesses could also include reporting on the following health and wellbeing areas if they are now involved in working on them:
- Strengthening public health and disease prevention and surveillance (for both communicable and non-communicable diseases)
- Increasing the role of public authorities in the research for treatment and vaccines, and in providing access to treatment and vaccines
- Accelerating efforts to achieve universal health care
- Strengthening public health emergency preparedness (including building stocks of essential equipment and increasing flexibility to mobilise staff to respond to emergencies)
- Reducing dependence on other countries for key health supplies and equipment
- Expanding digital health solutions (such as telehealth) to reduce the burden on hospitals and increase access to care
- Increasing the quality and timeliness of health statistics
- Increasing the resilience of health systems to respond to respond to shocks/crises (for example increase capacity to build hospitals and other infrastructure in record time)
The SAICA report[12] also provides the following guidelines on the minimum components companies should include in their reporting (it should be noted that although the information is pre COVID-19, it is still useful to assist in gaining insight into how to report on SDG 3):
| Basic reporting components to include | Advanced reporting components to include |
| Occupational health and safety | Incentives (including financial) for health lifestyle programme participation |
| Provision of medical benefits for full-time workers | Nutrition/diet/healthful eating habits (for example access to healthy foods at the workplace) |
| Smoke-free workplace | Reducing alcohol consumption programme |
| Mental wellness programme (such as stress management, resiliency programmes, depression) | Tobacco usage cessation programme |
| Employee assistance programme (EAP) access for counselling and intervention for those already at high risk (such as stress, depression) | Sleep management |
| Family-friendly policies, for example flexible work schedules or working remotely | Health coaching |
| Access to healthy office design components based on special needs such as sit-stand desks in case of back pain | Making workplace health and wellness programmes available for family members and other dependants |
| Communal spaces where employees eat, relax, interact with co-workers, or hold private conversations | Physical activity/exercise (regular chances to stand up and stretch, walking routes on campus or immediate environment, bicycle racks, storage, locker/shower facilities, staircases that are clean/well-lit/properly maintained/easy to access) |
| Assessments of the health and wellness of its employees, such as health risk assessment (HRA) survey or biometrics screening assessment or the self-reported general health status of its employees using a confidential survey or assessment tool | Healthy eating, for example corporate cafeteria services, access to refrigerator and safe food storage for employees, and healthy food options in vending machines |
The Robert Wood Johnson Foundation (RWJF) is the largest philanthropy dedicated solely to health and is working to build a culture of health in organisations. It understands that a culture of health includes a number of social factors that influence health and wellbeing (which include factors such as where we live, work and play) and has worked with the GRI to integrate a Culture of Health for Business (COH4B) framework that they developed into the GRI sustainability reporting framework. This integrated framework provides tools for organisations to measure and manage how they create a culture of health in their organisations and communities and can be found here.
Each of the above themes, areas, components and tools can be linked to a specific SDG 3 target (refer to Tip 1 for the list of SDG 3 targets and South Africa’s status on achieving each of these targets).
As more and more investors look towards non-financial disclosures when performing a detailed review of company performance, companies need to realise the importance of demonstrating their commitment to longer-term sustainability by improving on their disclosures. By disclosing their contributions to SDG 3, this places them in a position that is more likely favourable not only with investors but also with their own key stakeholder group – their employees (both current and potential). The knock-on effect is beneficial both from a company perspective, to retract and attain great talent while increasing productivity and margins, and from a broader economic perspective, and to significantly contribute towards South Africans health and wellbeing which is fundamental to our sustained economic performance and growth.
What is a good process to follow when reporting on SDG 3?
The following process can be applied when reporting (it can be used for any of the SDGs):[13]
| STEP 1: DEFINE PRIORITY SDG TARGETS (related to SDG 3)
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| Step 1.1 | Understand SDG 3 and its targets (which is what our introductory article and the 12 tips have aimed to assist you with)
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| Step 1.2 | Conduct principled prioritisation of SDG targets (and determine which is most relevant to your business)
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| Step 1.3 | Define your SDG-related report content (by establishing adequate reporting criteria)
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| STEP 2: MEASURE AND ANALYSE
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| Step 2.1 | Set business objectives
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| Step 2.2 | Select appropriate disclosures
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| Step 2.3 | Collect and analyse data
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| STEP 3: REPORT, INTEGRATE AND IMPLEMENT CHANGE
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| Step 3.1 | Consider general features of good practice when reporting on the SDGs
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| Step 3.2 | Consider data users’ information needs
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| Step 3.3 | Report and implement change
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The following diagram provides a high-level overview of how to select an SDG 3 target, implement it and then report on it:[14]
In PwC’s ‘Tracking reporting against the SDGs by corporates in South Africa – June 2019’ report their concluding remarks state that: ‘In some cases it appears that companies simply are selecting SDGs that correspond to existing activities and metrics they are already capturing. As a first step this makes sense but it also suggests that organisations are viewing the SDGs as another reporting lens rather than an opportunity and responsibility for the entire business.’[15]
We agree that organisations should look towards existing initiatives and determine whether they align to an SDG 3 target and report on it but we also recommend organisations develop their SDG 3 work and reporting further. This is important to South Africa being able to achieve this goal by 2030.
How are companies reporting on SDG3?
Appendix 1 provides a high-level outline of how the Top 10 companies listed on the JSE are reporting on health and wellbeing. It should be noted that further work is required to specifically link this reporting into the SDG 3 targets and then collaborate with government on where South Africa is on achieving each of those SDG 3 targets and how the work the organisation is doing is impacting on the overall status of the national SDG 3 target.
We would also like to note here that the majority of large corporates in South Africa have compulsory medical schemes which employees are required to ascribe to. These usually have wellness benefits associated with them and this links in well with SDG 3.8 – looking at achieving universal health coverage and access to quality essential healthcare.
By understanding what the national targets are for SDG 3 (which we have assisted with in Tip 1), organisations have a sound starting point and base to track their contribution and performance against. Once again, collaboration is key as these results should be communicated to government and support the achievement of the SDG 3 target for South Africa as a whole.
Organisations who are more advanced in their employee health and wellbeing programmes are able to demonstrate how they promote mental health and wellbeing in the workplace and can track the impact these programmes are having through various methods such as regular surveys, health risk assessments and staff testimonies. These can all be reported on under the relevant SDG 3 target and once again collated with government.
The following are more examples of key business indicators that are being used by organisations for the SDG3 targets:[16]
- Access to Medicine Index, C.III.1: Portion of financial R&D investments dedicated to index diseases out of the company’s total R&D expenditures
- CEO Water Mandate’s Corporate Water Disclosure Guidelines: Percentage of facilities adhering to relevant water quality standard(s)
- GRI Sustainability Reporting Guidelines, G4-LA6: Type of injury and rates of injury, occupational diseases, lost days and absenteeism, and total number of work-related fatalities, by region and by gender
- Oxfam Poverty Footprint, PF-14.4 (B): Where the company has set up health services for workers, does it make the service available to the family and community members? If yes, how many people have benefited from this service?
As the above are only indicators; sufficient reporting criteria still need to be developed to be clear about which SDG 3 target the business indicator is helping to achieve and then link this in at a national level.
It is also important to clearly define how the indicator data is generated, prepared, consolidated and reported on, as this will assist with assurance reviews and help to establish credibility and consistency. These are a few areas for consideration when establishing SDG 3 reporting for your organisation:
- Clearly defining what specific SDG 3 target each indicator relates to
- Identifying and defining the reporting boundary associated with the indicator (is it company-wide, does it apply to permanent and temporary staff, are family members covered)
- Developing a procedure manual/guide for generating the information, including standardisation, frequency of reporting and level of review
- Determining whether the information is comparable with other companies in the same industry and establishing a benchmark for performance
- For indicators of a non-financial nature, incorporating the use of financial proxies in order to associate a rand value with the benefit, thereby reflecting the impact in financial terms
Further examples of global organisations’ reporting on SDG 3 are NovoNordisk, Unilever, Danone, Safaricom, Maersk (links waste and spill impact to SDG 3), Eastman (linking its emissions and waste impact to SDG 3: see content index) and Iberdrola.
We hope you have found the information in this tip useful and we look forward to seeing your organisation’s reporting on SDG 3 going forward.
[1] SAICA report: Reporting on Health and Wellbeing, 2019, page 30, https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[2] https://www.globalreporting.org/about-gri/mission-history/ and https://en.wikipedia.org/wiki/Global_Reporting_Initiative#:~:text=First%20launched%20in%202000%2C%20GRI’s,in%20more%20than%2090%20countries.
[3] SAICA report: Reporting on Health and Wellbeing, 2019, page 30, https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[4] https://www.globalreporting.org/about-gri/mission-history/ and https://en.wikipedia.org/wiki/Global_Reporting_Initiative#:~:text=First%20launched%20in%202000%2C%20GRI’s,in%20more%20than%2090%20countries.
[5] SAICA report: Reporting on Health and Wellbeing, 2019, page 31, https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[6] SAICA survey:
https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[7] SAICA report: Reporting on Health and Wellbeing, 2019, page 10, https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[8] https://tradingeconomics.com/south-africa/total-businesses-registered-number-wb-data.html.
[9] https://www.google.co.za/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwjNv92gnqTrAhUfSBUIHQgzBCkQFjAFegQIBRAB&url=https%3A%2F%2Fwww.sajs.co.za%2Farticle%2Fview%2F6452%2F8882&usg=AOvVaw0dS0r8T5xTMCNaW6-H5LJ5.
[10] https://sdgcompass.org/sdgs/sdg-3/.
[11] https://s3.amazonaws.com/sustainabledevelopment.report/2020/2020_sustainable_development_report.pdf.
[12] SAICA report: Reporting on Health and Wellbeing, 2019, page 24, https://www.saica.co.za/Portals/0/documents/H_and_W%20Reporting%2026%20September%202019.pdf.
[13] https://www.globalreporting.org/public-policy-partnerships/sustainable-development/integrating-sdgs-into-sustainability-reporting/ (refer to Integrating the SDGs: Practical Guide).
[14] The GRI has developed useful tools to support this process which can be found on their website: https://www.unglobalcompact.org/take-action/sdg-ambition. The UN Global Compact has also developed tools which can be found at https://www.unglobalcompact.org/take-action/sdg-ambition.
The Prince of Wales’ Accounting for Sustainability (A4S) also provides a number of useful tools to assist with this work: https://www.accountingforsustainability.org/en/index.html.
[15] https://www.pwc.co.za/en/assets/pdf/pwc-tracking-reporting-against-the-sdgs-2019.pdf
