Attention to detail helps ensure good reporting

There is much to admire about the new sustainability report from Aviva, the global pensions, insurance and asset-management company. In a sector not known for clarity of communications, this is an attractive and clear report.

Opening as a micro-site, the report is inviting to browse, with intuitive navigation making it easy to explore. A tools function lets you add your own notes to pages, save a page, or send it as an email. Strangely, the print function is only by individual page so you can’t quickly print the whole report or a complete section. Maybe the company is thinking of the reader’s environmental impact.

The main sections – Customers, Environment, Our People, Communities and Suppliers – have a clear and consistent structure. This is made up of the previous year’s commitment, this year’s performance, next steps and longer-term goals.

A key performance indicator (KPI) table shows Aviva’s performance against 23 indicators and includes 22 targets. Commendably, most of these are quantitative. The relevant KPIs and targets are helpfully repeated in the performance data page of each section.

The report has added credibility because Aviva isn’t afraid of disclosing where performance has fallen short of expectations. For example, only 52% of employees gave a favourable response to the survey question on a commitment to “attracting, developing and training a diverse workforce”.

This also highlights one of the report’s few flaws. There is no discussion or explanation of why this KPI is so low – although the company does list follow-up actions. In another example, we are told that Aviva has 12,834 parking spaces. Without knowing if this is an increase, decrease or part of a push to encourage more employees to use public transport, the data is meaningless.

For a company that does a lot right, there are some surprising omissions. Aviva’s approach to employee engagement is strong and it is interesting to read that senior management pay is linked to employee survey results on leadership and engagement. However, there is no employee health and safety data. Workplace accidents might not be a significant risk for Aviva, but with more than 45,000 employees there will certainly have been some incidents or work-related illnesses to report.

Other areas could also do with fuller explanation. The stakeholder engagement section details how Aviva has engaged with its main stakeholder groups but falls short of explaining what stakeholders had to say about Aviva’s corporate responsibility approach and performance. The stakeholder quotes peppering the report are mainly from internal stakeholders and consequently are unchallenging.

These gaps are further accentuated by an awkward feature in the report structure. Aviva helped develop the Accounting for Sustainability connected reporting framework that seeks to integrate financial and non-financial data. The framework is a parallel reporting world, grafted on to Aviva’s original report structure – like The Matrix. Just like the film, the really interesting stuff is happening in the parallel world. That’s where performance is explained and the implications discussed. Unfortunately the framework is buried deep inside the report and not applied to all sections. It may be better used as the lead report structure.

Regional spotlight

Another element that does not work as well as it could is the regional spotlight section containing mini-reports from Aviva’s Asia-Pacific, European, North American and UK operations, as well as from the business division, Aviva Investors. They mainly consist of case studies that would be better integrated into the main report – which would benefit from the local colour. It would also emphasise the group’s consolidation under the One Aviva banner.

The exception is the Aviva Investors mini-report that contains some of the most compelling information in the whole report. With £250bn in funds under management this is where Aviva’s real impact lies. The mini-report is easily missed, housed as it is in a local reporting annex.

Aviva Investors engages with the companies it invests in to raise their corporate responsibility standards and the report provides details of the main issues it highlighted and the number of companies affected. It also reports its performance against the UN Principles for Responsible Investment.

While the investment function is well covered, Aviva’s insurance business is relatively neglected. As competitor RSA shows in its report, insurance companies can play an important role in encouraging more sustainable behaviour among clients. It would be good to hear more about this from Aviva.

Overall, though, this is a commendable and genuine effort with a few glitches that can easily be ironed out next time.

Tom Branczik is a senior consultant at Context.
thomasb@econtext.co.uk
www.econtext.co.uk

Snapshot

Follows GRI: No
Assured: Yes
Materiality analysis: No
Goals: Yes, included at the beginning of each section.
Targets: Yes, over 22 targets covering all sections.
Stakeholder input: Some quotes from internal and external stakeholders.
Seeks feedback: Yes
Key strengths: Look and feel, KPI table.
Chief weakness: Needs better analysis of performance.
Pleasant surprise: Aviva Investors mini-report.