More and more companies publish environmental, social and sustainability reports in addition to annual reports to show the importance of the communication of environmental efforts.
With the spreading of sustainability ideas companies realized the importance of the integrated evaluation and publishing of economic-environmental-social areas. Having this insight, leading companies (e.g. Hungarian Power Companies, Denso Manufacturing Hungary Ltd., Budapest Power Plant, MOL) decided to issue sustainability reports. Following EU directives* companies are encouraged to communicate their social and environmental activities and impacts in reports like these. The company and the report is more credible if it is verified by an independent organization. If you decide to publish a sustainability report, we recommend you to take into account the GRI guidelines.

Who do we recommend the követ verification?

For companies who:

• already published environmental, social or sustainability reports;
• saw other companies’ reports, but have not published one yet;
• maintain an environmental management system (e.g. ISO 14001, EMAS) and would like to announce their results in a report;
• would like to catch up to companies who’s reports are mentioned among world’s best reports;
• would like to meet the requirements of green organizations and the society;
• evaluate their performance not only financial but in an environmental and social way too;
• would like to improve their report based on suggestions from NGOs, suppliers, stakeholders etc.;
• would like to validate their report by an independent organization or do not have enough resources to prepare such a report;
• wish to publish a sustainability report and accept the guidance of GRI guidelines, which make the report complete, transparent, comparable, reliable, auditable.
  

What is a plus in the követ verification?

KÖVET’s verifying methodology is different from consultants validating: Our association assumes an obligation to verify the report and create the sustainability ranking of the company with the involvement of the stakeholders as a professional, independent, non-profit organization. This verification is more complex and gives an overall picture of the company’s performance. We take into account GRI-guidelines and give operational and strategic recommendations in accordance to be more sustainable.

References

KÖVET has the following references in verifying environmental, social and sustainability reports

Budapest Power Plant Plc.

• Verifying Environmental Report 2000 with the involvement of stakeholders. Ranking the company with KÖVET’s “Environmental Merit for Companies” method (2001)
This report won Deloitte’s Central-European Environmental  Report Award in 2001.

• Verifying Sustainability Report 2001 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Environmental Merit for Companies” method (2002)

• Verifying Sustainability Report 2003 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2004)

Denso Hungary Manufacturing Ltd.

• Verifying Sustainability Report 2001 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Environmental Merit for Companies” method (2002)
This report won Deloitte’s Central-European Environmental Report Award in 2003.

• Verifying Sustainability Report 2002 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2003)
The company won the EU’s European Business Award for the Environment in the environmental management category in 2004.

• Verifying Sustainability Report 2003-2004 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2005)

British American Tobacco Hungary Ltd.

• Verifying Sustainability Report 2003-2004 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2005)

• Verifying Social Report 2003 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2004)

Hungarian Power Companies Ltd.

• Verifying Sustainability Report 2003 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2004)
 
• Verifying Sustainability Report 2004 according to GRI (Global Reporting Initiative) criteria. Ranking the company with KÖVET’s “Strategical Sustainability Audit” method (2005)
The report won Deloitte’s Central-European Environmental Report
Award in 2006.

Corporate sustainability evaluation system of KÖVET

When evolving the Sustainability Ranking of Organisations, we tried to determine the steps of becoming a sustainable company. Our main aim during the development of the system was, that the ranking

• should involve, but go beyond the implementation of ISO 14001 or eco-efficiency;
• should take into account the forgotten sustainability aspects;
• should deal with the question of environment in relation with economic sustainability and social responsibility;
• should be credible, but at the same time simple, easy to be understood for non-experts as well;
• should make general judgement and mass use possible.

The organisation is evaluated from 15 aspects on a 5-grade scale (see the table below). It can be seen, that in all three dimensions, only four are fix, the fifth is subjective, based on the impressions and the reliability of the information.

Ranking an organisation without visiting it or collecting data is possible, but a responsible approach requires more caution. Information needed for ranking is gained above all from interviews with the managers and employees of the company, site visits and data collection as well as random control. This all is then compared with the best practices within the industrial sector, and finally, ranking is carried out by involving stakeholders or experts knowing the company.

Neutrality is an important question. Since the ranking has been applied as part of the verification procedure of environmental and sustainability reports, the company assigned KÖVET to rank it. Based on our value commitment, the clear categories, and the involvement of external stakeholders, we believe that the result of the ranking does not depend on our relation to the company or how much we charge, but reflects reality.

Util present, five Hungarian companies (a power plant, a car parts manufacturer, an electricity company, an airport, and a tobacco firm) have been ranked multiple times by KÖVET. According to our opinion, based on the results most of these companies can be considered as leaders in the sustainability reporting field. We also made recommendations for further development, that can be implemented on the long term, and that require great determination. KÖVET verified reports of companies that have shared the first places in the CEERA (Central European Environmental Reporting Award) in 2001, 2003 and 2006.  Denso Manufacturing Hungary Ltd., which was first ranked with the new system, won the prestigious EU Award for the Environment in the management category, out of 100 enterprises from whole Europe, who all qualified as the most pioneering at the national level.

Steps of the KÖVET verification project

0. stage – Kick-off meeting

Project start discussion about the project: what to know and to do, clarifying expectations of the company and the verifier, timeline, contract.

1. stage – Preliminary examination

Examine the sustainability report of the company-group. Compare with benchmark data: reports of companies in this industrial sector, other publications, and previous reports of the company.

2. stage – Interviews

Make interviews with managers and workers of the company. Mainly: top-management, who is involved in strategic decision making, finance-manager, HR-manager, EHS-manager, TQM-manager, PR/communication manager, logistics manager, maintenance staff, technicians, 2 employees. Expected duration of an interview is 40 minutes. Choosing the people for the interviews will be in accordance to the organizational diagram and the kick-off meeting.

3. stage – Data controlling

On a random sample method we will control and check the data and information of the report: to assure the reliability of the published data and data collecting methods (the company has still chance to make corrections in accordance to our Evaluation letter before finalizing the report).

4. stage – Stakeholder forum and Evaluation letter

• Evaluation of the report with the involvement of stakeholders of the company group. The evaluation is based on the environmental policy of the company, and seeks the correspondence to other sustainability aspects.

• Preparing the evaluation letter (KÖVET): contains the professional evaluation of the report (taking into account the GRI guidelines); and the summary of the interviews and stakeholder forum.

• The evaluation of the company group (performance in economic, social and environmental field) with the methodology “Strategic Sustainability Audit”.

5. stage – Continuous consultancy

During the program the colleagues of KÖVET will be available (e-mail, phone etc.) gladly for further consultancy if the company has questions or problems.

6. stage – According to the evaluation letter and its recommendations KÖVET will report on the modified report

7. stage – Verification letter and sustainability ranking

Preparing the Verification letter (KÖVET). Beyond the verification of the sustainability report the document contains the sustainability evaluation of the company group and recommendations how to be more sustainable - in Hungarian and English.