The Co-op’s latest report – Inspiring Through Co-operation – shows a group uneasy about admitting imperfections

Just as Oliver Cromwell apparently once asked for an accurate, “warts and all” portrait, the Co-operative Group prides itself on reporting both good and bad performance.

With diverse operations spanning food retail, banking, insurance, travel, farming, pharmacy and funeral care, this was always going to take the UK’s fifth largest retailer a little time and space. And it does: the printable version of its 2011 sustainability report is 116 pages long. The report is also available online and is summarised in a four-page review.

The Co-op, alongside Marks & Spencer and others, has set a high bar for sustainability reporting in the food and retail sectors. The Co-op remains proud of its business model, its history and its sustainability reporting record, and the opening sections of this report are far from diffident. Armed with a 47-target ethical plan and a clear goal to be “the most ethical retailer and financial services provider on the UK high street”, the company is clearly not prepared to lose ground to recent advances by competitors.

Both the company’s chair and chief executive summarise the Co-op’s unyielding commitment to its newly revised ethical plan, despite reduced revenues and profits. The chairman clearly sets out how member-ownership ensures the Co-op prioritises people before short-term profit, and doesn’t shy away from politically sensitive topics that others might balk at. But the chief executive provides several examples of progress without any mention of past or anticipated challenges – no warts detected so far.

Neatly tucked between the introductory messages and the core of the report lie an executive summary and an at-a-glance section, giving the busy reader a much-needed overview of the company, its strategy and past-year performance. The executive summary highlights achievements such as a 40% absolute reduction in greenhouse gas emissions since 2006 and 25% female board membership, but the warts are still noticeably absent.

Helpful structure

A simple graphic summarises the stakeholder influences and processes used to make decisions about material issues, and provides links to more detail later in the report or online. The remainder of the report is structured around 18 material issues squeezed into three categories: social responsibility, ecological sustainability and delivering value. The consistent layout helps readers navigate through the many layers with ease. Each section begins with a brief but useful background to the issue, plus a summary of why it is material and the Co-op’s strategy for addressing it. Numerous charts, stats and text boxes break the information into bite-sized sections, helping readers digest the overwhelming amount of information. Strangely missing in such a long, detailed report is a proper description of the ethical plan – instead a text box on page 7 provides an overview, and the targets within the plan appear with the coverage of each relevant topic.

The Co-op reports that it has reached, or is on track to achieve, an impressive 82 of its 104 long-term targets. The company is honest in identifying those targets it missed but rarely explains the reasons in any detail. One bold move is the inclusion of 40 performance benchmarks, which compare different aspects of the company’s performance with external measures, and in some cases against peers. Other instances of unusually high transparency include details of public policy engagements, political donations and amounts paid to individual membership organisations.

Despite the wealth of data provided, like many companies the Co-op could sometimes do more to define the actual impact of its activities. For example, we can assume it’s a good thing that half of members donate some of their profit share to a community fund, and that 10,000 community initiatives receive support, but what we really want to know is what sustainable difference this has made in people’s lives.

And given the title of this report – Inspiring Through Co-operation – and that it is published by the UK’s largest member-owned organisation, it lacks the personal touch. Including a stakeholder’s opinion on each issue would give a long report a lift and further increase transparency.

The report has received a G3.1 A+ application level, assurance from Two Tomorrows and a full page of expert commentary from Forum for the Future’s Jonathon Porritt. Both these independent statements provide little challenge to the Co-op’s approach and performance. This lack of challenge in the narrative from either the company or its stakeholders is inconsistent with the transparency of the data and benchmarks provided and fail to meet the “warts and all” standard. And while few people would question the value of transparency, readers might prefer this level of detail on the website only, with a slimmed-down report that focuses on telling a compelling story.

Lisa Leath is a consultant at Context.

Snapshot                     

Follows GRI?               Yes, A+

Assured?                      Yes

Materiality analysis?     Yes

Goals?                          Yes

Targets?                        Yes

Stakeholder input?       External view limited to Jonathon Porritt.

Seeks feedback?           Yes

Key strengths?             Large number of measurable targets and external benchmarks.

Chief weakness?          Limited discussion of challenges.

Pleasant surprise?        Continued commitment to Fairtrade.