Bloomberg’s strategic approach to sustainability paves the way for more balanced reporting in the future
Bloomberg’s 2012 Sustainability Report conveys a forthright and deeply convincing account of the company’s commitment to sustainability – as both an internal management imperative and a blossoming business opportunity (the company goes so far as to define sustainability as a “sector”).
Unlike many large companies that report on sustainability, Bloomberg is privately held and breaks stride with the minimalist disclosure approach taken by its peers. With no mandate to file an annual report with the stock market regulator, Bloomberg uses its sustainability report as a primary means of communicating the company’s strategy, performance and business trajectory to stakeholders.
And while the report does not claim to be formally “integrated” according to the IIRC reporting framework, it exhibits many integrative qualities: the identification of material issues; the use of a long-term strategic framework, “BSustainable 2020”, which merges business and environmental, social, and governance (ESG) priorities; and strong examples of quantified financial impacts resulting from ESG efforts.
The report content is organised into three main categories – product, planet and people – that generally align with the material issues identified and focus on the company’s key areas of ESG impact and influence. The report’s introduction also includes a thorough depiction of board- and executive-level governance of the company’s sustainability efforts, as well as the mechanisms used to engage each of Bloomberg’s key stakeholder groups.
Positive influence
Bloomberg is among a growing new school of businesses that are able to influence sustainability, organically, through their core product and services. In the “products” section of its report, Bloomberg describes sustainability as “a horizontal perspective in a vertical world” – elegantly capturing the relevance of ESG issues across its investment, news and research business units. Synergies achieved through this approach, the report explains, have allowed for greater interplay among Bloomberg’s service areas and will ultimately support the company’s mission to make “sustainable finance” a mainstream reality.
But these ambitions are kept in check by Bloomberg’s stakeholder feedback contributors, whose praise and constructive criticism are also included in the report. One stakeholder observation points to widespread short-termism as a prevailing issue in capital markets, challenging Bloomberg to leverage its influence in the investment community to encourage longer-term investment practices. A follow-up on this suggestion and other points from Bloomberg’s stakeholder feedback sessions would be welcome additions to Bloomberg’s next sustainability report.
Finally, while recognising that Bloomberg contributes quite powerfully to the availability of and demand for sustainability information, the tone of the product section and the presentation of internal performance metrics alongside market developments – as observed through Bloomberg data services– walks a fine line of attribution. Future reports should be careful not to conflate Bloomberg’s own successes with the broader goings-on in the sustainability “sector”.
Heavy on E, light on S and G
While Bloomberg’s sustainability ethos is cited, in the report’s introduction, as having sprung from philanthropic roots, there is no question that the company’s more strategic sustainability initiatives ultimately grew out of its environmental focus areas. Indeed, Bloomberg’s strengths in data collection and analysis really shine in the “planet” section of its 2012 sustainability report.
In its five thoughtfully contextualised environmental focus areas, Bloomberg brings together rich performance data; creative internal accountability systems, such as an efficiency scoring tool for its own data centres; openness around missed targets; and ample discussion of environmental risks and opportunities. Perhaps most impressive is a chart that neatly organises net CO2e savings and associated cost savings by department, which have created an opportunity for healthy, internal competition.
But for all the wow-factor of Bloomberg’s “planet” efforts, the “people” section of the report feels underdeveloped. KPIs cover typical measures of philanthropic giving, volunteerism and recordable incidents but are otherwise complemented mostly by descriptions of social policies – which, as Bloomberg well knows, are poor indicators of performance in themselves.
There is a disappointing dearth of specific, time-bound targets around diversity and inclusion – especially given broader trends in the IT sector towards improving female representation in engineering and leadership positions. Perhaps these will appear alongside new goals to be released in Bloomberg’s 2013 report. And the subsection entitled “corporate leadership” creates the false impression that a discussion of governance performance and objectives will ensue.
Nonetheless, Bloomberg’s “people” section not only acknowledges areas needing improvement, but also describes efforts in place to approach future social and philanthropic initiatives more strategically.
Bloomberg deserves a bullish assessment of its sustainability performance for two reasons. First, the company’s fundamental drive – and technical capacity – to manage for sustainability is clearly and intelligently conveyed in the report. Second, based on those underlying qualities, Bloomberg is poised to make continued progress on its sustainability performance, external impacts and transparency into the foreseeable future.
Snapshot
Follows GRI? Yes, at an A+ application level with a GRI check.
Assurance? Yes. Report content, GRI adherence, and Scope 1, 2, and 3 emissions are externally assured by Cventure.
Materiality analysis? Yes, process described and issues listed. No visual depiction or prioritization of material issues.
Goals? Performance on past goals is reported, but new goals were under development as of the report’s issuance.
Targets? Performance on past targets is reported, but new targets were under development as of the report’s issuance.
Stakeholder input? Yes, both positive and negative.
Seeks feedback? Yes, comments and suggestions on any aspect of Bloomberg’s sustainability programme are invited.
Key strength: Thoroughness; frankness; authoritative tone.
Chief weakness: Lack of quantitative, time-bound social goals.
Pleasant surprise: Written and visual depiction of sustainability governance structure.
Level of integration: 3.5 (on a scale of 1–5).
Disclaimer: Framework LLC is a Bloomberg professional service client. No enquiries to Bloomberg were made for the purposes of this review, and only publicly available information was used.
Alec Lager is manager, strategic services, at Framework.
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