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Date: 2024-05-18 Page is: DBtxt003.php txt00008766

Ideas
Josee van der Hoek

Josee van der Hoek ... Converting your material issues into a business development tool

Burgess COMMENTARY

Peter Burgess

CONVERTING YOUR MATERIAL ISSUES INTO A BUSINESS DEVELOPMENT TOOL In his new book on Integrated Reporting Harvard professor Bob Eccles looks for governance & value creation

Converting your material issues into a business development tool

Integrated reporting has changed dramatically since Harvard professor Bob Eccles described the concept in the much touted 'One Report' in 2010. Four years experience on the road of Integrated Reporting has resulted in new insights based upon own practises, adapted guidelines and rulings. In his new book 'The Integrated Reporting Movement: Meaning, Momentum, Motives, and Materiality' Professor Eccles emphasizes the importance of a well balanced materiality matrix that not only covers relevant business risks, but that also can be used as a driver for innovation.

Development of integrated reporting

Originally the materiality analysis was designed to map those relevant non-financial business risks that were of primary concern to a company’s shareholders. It was meant as an instrument to enhance the traditional fundamental analysis by focusing on intangible or externalized value drivers. By unveiling factors that often lie in investors’ blind spots and are therefore not yet priced in by the market, the materiality analysis –and its subsequent matrix- became a reporting tool for a comprehensive view of a company’s long term performance.

As a result of the rising importance of disclosure of material issues, initiatives such as The International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB) were formed. 'The International Framework' was published and Global Reporting Initiative's (GRI) G4 Guidelines were issued. Through such developments, integrated reporting became a powerful but still undervalued management process for developing and reporting on sustainable strategies that create value over the short-, medium- and long-term.

In the meantime legislation did not stand still. The EU agreed that non-financial reporting is vital for managing change towards a sustainable global economy by combining long-term profitability with social justice and environmental protection. Large companies with over 500 employees and public interest that will have to report as of 2017 on their social, environmental and governmental issues, as a consequence of the EU directive, that was adopted on 29th September of 2014.

Moving towards reporting of non-financials with the same rigorous assurance as financial data

In his book Professor Eccles recognizes the gap between the treatment of financial versus non-financial risks and opportunities. He concludes that the governance of material issues needs strengthening and that boards are ultimately responsible for the determination of top priority issues and stakeholders. Moreover he suggests Executive Boards to publish a “Statement of Significant Audiences and Materiality”, to clearly communicate the status of non-financial issues within the company strategy.

Value creation from materialities

One more conclusion is that the value creating opportunities of the materiality matrix are underleveraged. To stress the potential of material issues the concept of the Sustainable Value Matrix is introduced, which is designed to create value and distribute issues into the right business setting. This call to further mature the governance practises and value creation potential of material issues, directs towards the integration of sustainability into the business. A concrete example was recently presented by frontrunner Danish Biotech company Novozymes during our Insead case study on their sustainability strategy.

Novozymes, in 2002 the first company ever to publish an integrated report, not only uses materiality for reporting but materialities are translated into business opportunities. As a matter of fact, its entire sustainability department is located within business development.

The process approach called GLOBE-US that Between-us developed, perfectly matches the void that Eccles addresses. GLOBE-US finds its basis in the Business Model Generation-approach of Osterwalder and Pigneur, it comprises 7 steps and uses the relevant material issues to focus on value creation and ultimately disruptive business model design. Over the past two years, GLOBE-US has been successfully implemented with a number of clients in complex settings throughout Europe.

For more background on developing a solid materiality matrix please contact Josée van der Hoek, at josee@between-us.nl or call +31 76 522 28 17.

Photo credits: Richard Summers, Banalities


ABOUT JOSÉE VAN DER HOEK Passion for Sustainability and Strategic Issues Management | josee@between-us.nl

You can call me for... The development of CR strategy, strategic issues management and implementing your sustainability approach in the business.

Motivation: My personal motivation to work with Corporate Responsibility is use business as a driving force to strive for a liveable planet for our children and grandchildren.

Making a profit is a necessity for every company that wants to maintain continuity. If CR forms an integrated part of the business process, sustainability creates value for both the business as its stakeholders. As a result, sustainability becomes a unique characteristic that goes beyond adding a green leaf to your logo. It will inspire and engage employees and partners to join the journey and bring innovation.

How would colleagues describe you? Binding factor, involved, result driven, persevering, and a food lover.

What is your favourite dish? The Italian kitchen is my source of inspiration, since it focusses on the basis: products that taste good by themselves and therefore can be transformed in a great dish quite fast. For example: spaghetti with shrimps & rucola, Lamb chops with rosemary potatoes and spumante with citrus sorbet icecream. Of course, all of this needs to be accompanied with a nice glass of wine.

Which book should everybody read? 'SWITCH, How to change things when change is hard' by Chip and Dan Heath.It offers concrete tools to influence (consumer and your own!) behavior

What is the best advice you ever got? 'You had me at hello', the power of silence.

Tell something surprising about yourself. Since 1986 I have my truck drivers license.

Background:
Co-founder of Between-us
Lecturer Marketing at International Media & Entertainment Management NHTV
Client Services Manager at vdBJ/Communicatiegroep
Head of Marketing, Communication & Sales at Het Parool
International Sales Promotions Manager at Maildex
Product Manager at Algemeen Dagblad
Executive Masters Corporate Communications (MSc) Erasmus University: Thesis 'Burning fat! Ignorance or lack of urgency arount the issue of Obesity?' The thesis focusses on stakeholder coalitions to help children to become fit adults.
NIMA-C
HBO Tourism

What are your hobbies?
Slow cooking, enjoying food & drinks with friends
Hiking, running, skiing and gardening

You can contact me by:
E-mail: josee@between-us.nl
Telephone: +31 76 522 28 17
Let's connect on LinkedIn

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