The Benefits and Disadvantages of Sustainability Reporting
Given that sustainability reporting is not currently required of companies, what do you see as the possible benefits and disadvantages of sustainability reporting? Using the information in the case, the summary data reported in Tables 4 and 5, and Johnson & Johnson’s most recent sustainability report (available at http://www.jnj.com/connect/caring/?flash=true), what aspects of sustainability reporting seem to be a priority for the company, and why? Provide examples from the 2008 sustainability report to support your answers. 1. How are various management systems such as human resource management, costs, capital budgeting, and performance measurement incorporated into Johnson & Johnson’s sustainability reporting process? Support your answer with specific references from the 2008 report (link provided in question 1). Compare your sources with those in the GRI’s reporting framework (http://www.globalreporting.org/ReportingFramework/G3Online/), and the performance measures with Epstein’s metrics presented in Table 3. 2. When compiling data for its sustainability reports, Johnson & Johnson does not request direct input from its managerial accounting staff. What should be the role of management accountants in collecting and reporting sustainability data? Could Johnson & Johnson’s sustainability reporting be improved with input from managerial accountants? Why or why not? (The Crawford 2005 article at http://www.managementmag.com/index.cfm/ci_id/2149/la_id/1 provides additional background material.) 3. Do you agree with the statement that Johnson & Johnson’s approach to sustainability reporting is beyond triple bottom line? Why or why not? 4. Johnson & Johnson cites concerns with determining materiality as one reason it does not declare itself in accordance with GRI guidelines. What is meant by materiality and why is materiality difficult to determine for social responsibility issues?