Which corporate social responsibility reports are rated most highly by the experts who produce them? Neil Gibbons asked the UK’s stakeholder communications agencies to nominate their favourites from the last year:

Cuddliness is the enemy of competition. Take corporate social responsibility reports – there’s something so wholesome, upstanding and, well, nice about CSR reports, it almost seems wrong to pit them against other in a battle to see which is best.
But what the hell. Every month, Communicate magazine surveys reporting agencies to unearth the finest in corporate reporting. After annual reports and internal magazines, we’ve turned the spotlight on CSR reports, surveying those in the know to gain an industry-eye view of what excels in CSR reporting.

Each agency was asked to nominate outstanding CSR reports (other than the ones they’ve produced themselves) and, after a surprisingly enthusiastic response, we were able to rank the top five. So which CSR reports are held in highest regard by the reporters themselves? Read on...

 1. Legal & General

“Our CSR report definitely involves the same rigour as the annual report,” says Graham Precey, group CSR manager at Legal & General. “It’s run along the same lines, to the same timetable and with the same checks and audits. But the bottom line is that you don’t have to do any of it.”

In what was almost a photo finish, Legal & General’s CSR report claimed a narrow victory and certainly doesn’t read like a publication squeezed out of the company to meet a legal obligation. It’s patently fuelled by a desire to inform and enlighten its many stakeholders.

“It makes a statement that what we publicly say is audited,” says Precey. “CSR reporting is essential. It’s an illustration of how you’re making big decisions in your business. If the annual report is what decisions you have made, the CR report shows how those decisions were made. e ‘how’ is under more scrutiny than ever these days, and companies need to report not just their results, but their ethos and approach.” Precey puts the choice even more simply. “Is CSR reporting the icing on the cake or what goes into the cake mix? We think its the latter.”

This year’s will be the company’s last printed CSR report. “We’re moving to a report that will be 100% online,” says Precey. “If you’re delivering a green message, a printed CR report doesn’t make sense. Besides, reporting on the web is easier to distribute and allows us to disclose more. A yearly printed report provides a snapshot of the company’s corporate responsibility. Online, you can react much quicker.”

Working with design agency Black Sun on the printed report, Legal & General began with a blank sheet of paper. “The first question had be, ‘What are you in business to do?’ You’ve got to be that fundamental,” says Precey. “If you can say, ‘This is where we make our money’, it means that you frame the report properly. If you then identify what your risks and reputation issues are, you can work out what your corporate responsibilities are.”

As well as a predominant focus on governance, the report includes group-wide environmental reporting and an account of its approach to communities, suppliers and investment management. “We hold around 5% of the FTSE,” says Precey. “This is how we use our influence.” As well as meeting the information demands of analysts, Precey has made sure that the report is digestible and useful to another audience – potential recruits. “They want to know that it’s a good place to work,” he says. “We need to show hard and fast numbers, as well as the culture. That’s the communications challenge – showing that balance.”

= 2. Ladbrokes

The gambling sector carries a higher burden of expectation when it comes to showing responsible behaviour. Tied on second place in our poll is a company that has emphatically stepped up to that challenge with its most recent CSR report. Since its demerger from the Hilton Group in 2005, Ladbrokes has worked with London-based agency Merchant on creating a yearly suite of reports that reflects its position in the market.

“Ladbrokes is absolutely committed to promoting responsible gambling,” says Merchant director Paula Cooper. “They have established themselves as a leader in that respect and that comes over in the report.” The report is structured around seven pillars of corporate responsibility – the promotion of responsible gambling being just one. Other chapters centre on customers and their satisfaction; employees; key third-party relationships; health & safety and security; environment; and community. “If you look through the report, it’s very boldly based around these pillars,” says Cooper. “The numbering is huge so that the structure is clear.”

More than that, the report could not be further from a blank bleating of the nuts and bolts. “It’s very much an editorial report, designed to be read cover to cover,” says Cooper. “Some CSR reports just bombard the reader with facts and figures and provide no commentary or context. Others are all commentary but don’t back up what they say with facts. I think Ladbrokes have struck a good balance here.”

The entire suite of reports is designed to reflect a uniform look and feel that’s “big, bold, colourful”. The design of the CSR report is dynamic, making good use of exciting sporting images. “It has the Ladbrokes brand all over it,” she says.

Merchant has around a dozen CSR reports on its slate but Cooper is pleased that this one has been singled out for praise. “I love this report. I look at a lot of them but I think this one deserves the attention. I’m so pleased that’s been recognise by other agencies.”

= 2. The Royal Bank of Scotland

RBS’s 2008 CSR report – the bank’s fourth standalone report – finished joint second in our poll. Corporate responsibility manager Fay Hogg admits that, with CSR reporting still in its relative infancy, she and her team were “feeling our way a little”. But the bank has brought a discernible thoroughness to the report, using Global Reporting Initiative benchmarking guidelines to manage the content and gearing up to ensure that the 2009 report ascribes to the AA-1000 assurance standard. Hogg describes the CSR report as “a valuable window into the company” and takes great care to ensure that it addresses the concerns of the bank’s key stakeholders.

"Our approach begins with research,” she says. “We talk to the people who matter to us to identify the issues that matter to them. After a great deal of stakeholder engagement, we then we go back to the business and ask employees and managers how they plan to address these issues.” It was through this consulting process that Hogg and her team were able to identify that the stakeholders’ CSR priorities were distinct from the typical CSR concerns. “If you ask people what a large corporate should cover in a CSR report, most will say the environment,” she says. “But our stakeholders were more concerned with financial matters. A CR report should drill down into a company’s core services and address the concerns that relate to them. For us, that means reporting on financial responsibility.”

The top issue in the 2008 report was financial crime, but other issues of financial propriety – such as selling and lending practices – also figured prominently. Hogg believes that the report benefited from this streamlining of key considerations. “Honing in on the issues that are most relevant to your business makes the report more accessible,” she says. “The list of issues could go on and on otherwise.”

Lively in tone and with a design that mirrors that of the annual report, RBS has set out to create a corporare responsibility report that is far more than a dry compliance document. “Although CSR reports were original intended to satisfy socially responsible investors who liked tick-boxes, the content is also of interest to customers, employees and other audiences. So it’s important to make it readable.”

Above all, Hogg’s approach is characterised by an unfussy straight-forwardness. “Corporate responsibility reporting may be quite new but corporate responsibility isn’t,” she says. “RBS has been practising it for about 300 years.”

 4. Tesco

‘More than the weekly shop’ – was the overarching communication idea conceived by stakeholder communications agency 35 Communications to headline Tesco’s 2008 suite of corporate reporting publications.

“The theme attempts to communicate two key things,” says Thom Newton, managing partner of 35 Communications. “Firstly, Tesco is more than a UK grocer, it is now a diversified international retailer providing everything from canned soup to car insurance. And secondly, It’s about more than simply selling large quantities of goods at low cost. Tesco is fully aware of the impact that it has and its responsibility to ensure that it reduces the negative effects and increases the positive contribution that it can make to the people and communities within which it works.

With operations overseas, including China, the report sets out the differing corporate responsibility (CR) challenges that arise in different regions. Newton describes Tesco’s report as “a fairly all-encompassing version of how CR fits into the business’s overall strategy”. It details, he says, the company’s ambitions whilst providing measurable data to support achievements to date and targets for the future.

“Tesco wanted to ensure the clear communication of its integrated strategy - that places CR at the core,” he says. “The five-part strategy encompasses finance, people, operations, customers and community. So the report is far more than a pictorial celebration of big cheques and tree planting.” The report’s watchwords are simplicity and directness – in part, a reflection of the company it represents. “Tesco has a straight-forward offering,” says Newton. “choice and value. So we’ve made the report straightforward too. Information is clear, accessible and down to earth.”

That simplicity is echoed in its entire approach to CR reporting. “The Position, Progress, Promise reporting structure clearly sets out the broader mission, what steps have been taken, and what will be achieved.” This is all supplemented by case studies to highlight tangible measures being employed such as, in the report’s environmental section, a look at the way Tesco has introduced LED lighting into in-store freezers. According to Newton, showing evidence of current action or of proposed action is crucial.

The agency benefits from enthusiastic buy-in from the CR team. “They have an passionate CR reporting commitment that’s driven at board level,” he says. Often receiving rough treatment from commentators, “When it comes to CR reporting, it is important that their current achievements and progressive future strategy is understood.”

5. Waitrose

Hard on the heels of its fellow supermarket chain, Waitrose earns plaudits from several survey respondents for the zeal with which it discloses corporate responsibility material. But then with a reputation as a relatively ethical retailer, it almost stands to reason that the company would be committed to proactive CSR reporting.

Its 2008 CSR report, entitled ‘How we stack up’, was the work of John Lewis Partnership’s corporate responsibility manager Gemma Lacey and Cambridge and London-based agency Flag. Environmental considerations feature prominently towards the front of the report, with sections on climate change and the company’s policy on waste, packaging and recycling.

Picture-heavy and instantly identifiable as Waitrose literature, the report has a clarity of structure set within tantalising imagery of fresh food that cements Waitrose’s perception as a producer of sustainable, high quality produce. “We’ve been writing and designing the Waitrose report for three years now,” says Flag’s account director Vic Moutrey. “And we enjoy a really lovely working relationship with Waitrose. They not only have a lovely brand, but they’re committed to CSR reporting – they’re not doing it for the sake of it.”