The Body Shop has reclaimed its position as an innovator in non-financial reporting by issuing three separate social reports aimed at different stakeholder groups.
The cosmetics retailer is producing individual online reports for each of six stakeholder groups, rather than a single document for all.
The first three ‘stakeholder accounts’ are for employees, environmentalists and investors. They have a broadly similar structure and share common features, but contain messages from different heads of departments and use targets specific to the interests of each stakeholder group. Documents for customers, franchisees and suppliers will follow shortly.
The Body Shop says ‘personal and targeted’ reports offer ‘a choice of lenses’ through which readers can view the company’s performance. It points out that separate reports present information which directly addresses the specific concerns of individual stakeholder groups. At the moment, all interested parties have to trawl through a single report and pick out what is relevant to them, but the new approach should allow stakeholders to ‘gain a broader insight into how the company is managing an issue’.
Rachel Jackson, head of environmental and social issues at the Association of Chartered Certified Accountants, said: ‘This is an innovative and new approach. With the issue of materiality very much to the fore in reporting at the moment, perhaps going down this route is one of the ways that materiality can be addressed.
‘Of course, it will be interesting to see what the stakeholders themselves feel about the reports, and it is important they are involved in the process in some way.’
The Body Shop pioneered social reporting, but it last produced a non-financial report five years ago. Chief executive Peter Saunders said there had been ‘significant changes’ in the business, but claimed its new leadership team ‘is ready to recommit to a programme of sustainability reporting’. He conceded that the new management ‘have limited direct experience of disclosing sustainability performance information’, which ‘inevitably means that our systems may not be as developed as we would desire’. But the goal was to move away from ‘presenting extensive information on an ever-increasing range of performance measures’ to focus on ‘indicators we believe to be of most relevance and benefit to our business and stakeholders’.
The stakeholder accounts, which use the Global Reporting Initiative guidelines as a framework, but do not follow them closely, are unverified. However, The Body Shop will consider assurance in a strategic review of its approach to sustainability. The review will continue into 2004.
‘We are committed to spending appropriate time in exploring the most effective assurance approach for our business and our stakeholders,’ it said.