Checking Reporting Attitude

Each year, PWC, Deloitte, EY and KPMG check annual reports of their clients. As a part of this business, the “Big Four” also audit the increasingly important “sustainability” chapters of their clients’ reports. Here organizations assessed by the Big Four often present their “Corporate Social Responsibility” (CSR).

 When checking an organizations’ annual report, the EcoVadis Premium Report is an interesting source of information to auditors. The assessed client probably is proud to mention an EcoVadis “Gold” award in the annual report.

To auditors: Use the EcoVadis Premium Report to assess your client’s reporting attitude.

 Auditors can use the EcoVadis Report in at least two ways:

  • The content of the report gives auditors a good and well structured overview on how their audited client has presented the CRS mamagement to EcoVadis. That is the usual way to use the EcoVadis Premium Report.
  • The application of the report shows to auditors, which attitude their assessed client has to transparency. If the organization discloses the EcoVadis Premium Report to clients only, but refuses to disclose that report to the own employees, you as an auditor know, that there probably something is wrong with the report. As an employer, the assessed organization may want to avoid that employees scrutinize the report with their insider knowledge. That attitude of the assessed organization towards reporting also may affect what your client reports to you on other matters.

 Thus, not only the EcoVadis Premium Report itself but also the way how your client uses it, helps you as an auditor to assess the transparency and credibility of your client’s reporting.

 However, there may be legitimate reasons not to disclose an EcoVadis report. If your client claims to have a legitimate reason not to disclose at least the chapter “LABOR PRACTICES & HUMAN RIGHTS (LAB)” to the employees, let the client explain to you, which parts exactly of that chapter should not be disclosed and why these parts of the EcoVadis Premium Report should not be disclosed to the own employees, even though they obviously hold a stake in their employer’s CSR. There is a legitimate “need to know” on the side of the employees.

Cher Msr. Thaler, cher Msr. Trinel

Dear Pierre-François Thaler,
Dear Frédéric Trinel

 Your concept for the EcoVadis Premium Reports is excellent. There also is a chapter on “LABOR PRACTICES & HUMAN RIGHTS (LAB)”. In the chapter, employees of companies assessed by EcoVadis could find several pages on policies, actions and results.

 Regrettably, some companies disclose their reports to customers only, but not to their employees. They trust their customers more than their own employees.

 As long as an organization assessed by EcoVadis refuses to disclose their EcoVadis Premium Report at least to the own employees, these employees have to assume that there is something wrong in what their employer reported to EcoVadis.

 In Germany, works councils are legally obliged to supervise the implementation of OH&S regulations and environment protection regulations in their organization. Therefore hiding any reports describing
• the state of OH&S and
• the state of environmental protection
from employee representatives is an infringement of their rights and interfers with the works council’s obligatory tasks. In order to obtain the report, works councils would have to sue the employer. But often works councils are to weak to do that. Here support from EcoVadis would help to settle conflicts out of court.

 According to EcoVadis, “trade unions” already are legitimate stakeholders. Please describe the process which trade unions can use in order to obtain EcoVadis Premium Reports from those companies in which these trade unions represent employees. Understandibly, employees as stakeholders are curious about the chapter on “LABOR PRACTICES & HUMAN RIGHTS (LAB)”.

 Please develop and publish an EcoVadis policy which shows that EcoVadis compassionately encourages assessed companies to disclose their EcoVadis Premium Reports to all parties who have a legitimate stake in the CSR of that company.

Best regards,
Goetz Kluge