Voluntary (or market) disclosure reporting presents beneficial social and environmental impacts on a company, compared to pressure-oriented one. Market disclosure reporting is on the rise (Peiyuan 2005, p.1). The content of market disclosure is designed to justify social values held by the company, keep pressure groups at bay, integrate the corporate social responsibility components as well as build the corporate image (by enhancing brand benefits) (Buniamin 2010, p.117; Peiyuan 2005, p.3).
This form of reporting can be the bases upon which a company achieves certification (such as ISO 14001) that proves environmental best practices are observed during company operations (that is, from cradle to grave of product life), particularly on pollution matters (Buniamin 2010, p.117).
Annual company reports that supplement financial statements allow pertinent stakeholders to access environmental information. According to Peiyuan (2005, p.3), most companies in China increasingly prefer corporate annual reports. While the annual reports are accessible to investors, corporate boards (decision makers) as well as the larger public, the disclosure index is strictly under check since they are the main information tools for the company.
The other channel of reporting is social and environmental impact assessment (SEIA). These reports are highly technical and professional. These reports disclose comprehensively the outcomes from public participation and consultation with the regard to the pollution causes and impacts. Such requirements are hardly needed for corporate annual reporting. Moreover, SEIA report presents a broad spectrum for the disclosure index.
Since the printing company has potential sources of adverse pollution of air, land and noise, competitors and pressure groups can use the SEIA report to the company’s detriment. Corporate annual reports are relevant but rarely subject to environmental audits. Moreover, annual corporate reports focus on initiatives made towards environmental sustainability and conservation, rather than environment degradation, in particular.
To a larger extent, corporate annual reports are marketing tools, thus, a wide range of media platforms can be used (Hooghiemstra 2000, p.56). As a company communicates directly to its investors (shareholders), environmental information can be packaged alongside financial statements.
Various media platforms allow diversified report setting: board member or conference meeting (use pamphlets and power-point notes), mass media (use radio and television commentaries and adverts) as well as journal publication for long-term reference purposes. It is highly likely that curious and/or keen audience will receive information, since the packaging of annual reports is public friendly (Hooghiemstra 2000, p.56).
Concerns raised by any audience on the state of the environment can form the bases for a comprehensive SEIA study reporting. It is evident that proponents incur high financial costs while undertaking SIEA studies and audits, thus, should be undertaken when necessary or when adverse impacts are unforeseeable (zero/ null alternative).
Since annual financial reporting is mandatory for any business, accommodating social and environmental aspects within the same report reduces cost of duplicating efforts. In other words, it allows for common budget planning and handling of different corporate annual report themes at a go. Printing services pollute less compared to coal ad fossil fuel combustion facilities or paper and plastic manufacturers.
The fact that the client has the option to discern (exercise due diligence) between the choice of paper (recycled or non-recycled) the blame for pollution shifts from the company to the next party. However, the company has the duty to inform, educate, and advocate for what is environmentally friendly. Legislations on and the enforcement of cleaner production may negate the need for SEIA reports.
References
Buniamin, S 2010, ‘The Quantity and Quality of Environmental Reporting in Annual Report of Public Listed Companies in Malaysia’, Issues in Social and Environmental Accounting, vol. 4, no. 2, pp. 115-135. Web.
Hooghiemstra, R 2000, ‘Corporate Communication and Impression Management– New Perspectives Why Companies Engage in Corporate Social Reporting’, Journal of Business Ethic, vol. 27, pp. 55–68. Web.
Peiyuan, G 2005, Corporate Environmental Reporting and Disclosure in China. Web.