The demand for sustainability services
remains stable in a lot of major European countries despite the
effects of the credit crunch, according to industry leaders and new
Services related to sustainability reporting,
such as assurance, continue to flag interest among the largest
companies although there has been a slowdown in other CSR-related
areas. Certain sectors are showing less appetite for sustainability
services in the current climate.
Professional services firms are not
perturbed by momentary spikes and troughs in demand and continue to
build their sustainability practices in line with medium- to
long-term strategies. For example, this publication recently
reported that PricewaterhouseCoopers UK has grown its
sustainability and climate change practice to 100 professionals,
the majority joining in the past few years.
Another global firm that has its hand on the
CSR pulse is KPMG. Sustainability services global head Wim Bartels
said KPMG will continue to develop the firm’s capability in line
with a global strategy.
Despite the recession, he said there has not
been drop in demand for the assurance of sustainability
“There are a few companies though that have
further developed their reporting strategies – such as integrating
sustainability reporting in the annual report and/or putting more
information on the web,” Bartels said.
“Some decline in demand takes place with
regard to advisory services, such as strategy development and
climate change. Here the credit crunch is seen as one of the
factors. Mostly companies still talk about postponement though –
“At the same time, the interest for
sustainability keeps growing and this puts it on the agenda at
other levels in the organisation. It is expected that with a year
or two the demand for sustainability services will increase
PwC sustainability and climate change
chief executive Malcolm Preston explained that demand for
sustainability services had waned in certain sectors, such as
retail and consumer goods, due to companies adopting short-term
But in financial services, one of the sectors
hardest hit by the credit crunch, companies were lining up for
services that helped them assess risk, among others. Sectors
regulated on carbon use and the public sector are examples of where
demand remained steady. Companies are also looking at ways to
reduce costs such as energy and water bills.
An annual study of sustainability reporting in
16 European countries, by the European Sustainability Reporting
Association (ESRA), found the number of company sustainability
reports remained stable or increased in 11 countries, including the
more progressive nations in this field.
Although accounting firms generally do not
prepare these reports, they provide related services such as
assurance and strategy advice. Therefore, the popularity of
reporting is a litmus test for how the sustainability services
industry is progressing.
ESRA research found more companies in
Portugal, Denmark, France, Sweden and Switzerland issued
sustainability reports in 2008 than in 2007.
Reporting in Austria, Germany, Belgium,
Russia, Spain and the UK remained stable while fewer companies in
Finland, Ireland, Italy, Hungary and Poland prepared reports.
Industry figures continue to debate the extent
global economic conditions could lead to a decrease in
non-financial reporting as companies cut resources.
Vicky McAllister, social and environmental
projects officer at the Association of Chartered Certified
Accountants, prepared the UK ESRA report. She believes the
recession will weed out the companies that never took
sustainability reporting seriously.
“Those companies will obviously be the first
ones to cut costs in terms of reporting and do away with it,
whereas the ones that do consider it a strategic priority would
obviously carry on,” she commented.
McAllister said there could also be a greater
drop in sustainability reporting in countries where there is no
government regulation. She believes there should be regulation in
areas such as carbon, and accountants should be at the forefront of
“The more that it is regulated, the more
[accountants] are going to have to be involved in collecting and
auditing the data, especially in the UK in terms of climate
change,” she added. “The fact is that carbon data is no longer a
non-financial issue, it is a commodity in its own right now that it
has been put into a market trading scheme.”