EU company green reporting leaps upwards

Survey finds more large firms issuing reports than three years ago, but opposite trend in USA

The number of large European firms issuing annual environmental reports has increased substantially in the last three years, according to a report published in Brussels today by accountancy firm KPMG.

Based on a survey of the top 100 firms in each of 10 countries, half of them in the EU, KPMG finds that that environmental reporting increased significantly in all the European countries examined. In Germany, for example, the proportion rose from 28% in 1996 to 36% now. In Denmark it rose from just 8% three years ago to 29%.

A combination of new-found enthusiasm in industry for producing environmental reports and growing requirements to publish information, is responsible for the increase in European corporate reporting, according to George Molenkamp, chairman of KPMG's international environment network.

Particularly important, Mr Molenkamp said, were mandatory reporting rules in Denmark, the Netherlands and Norway. He also stressed that the EU's integrated pollution prevention and control (IPPC) directive, which is about to enter into force, will require large plants to publish information about their emissions levels (ENDS Daily 20 April).

In complete contrast to the European trend, the survey reveals that the proportion of top American firms issuing environmental reports fell from 44% in 1996 to 30% today. Mr Molenkamp said that the downward trend was due to resentment among American companies that they were suffering "over-regulation," plus fears that giving too much information they would leave companies open to legal suits.

Although KPMG has a vested interest in promoting environmental reporting as it claims to be the leading auditor of such reports, Mr Molenkamp insists that companies themselves benefit from examining their environmental performance by reducing waste, improving resource efficiency, improving compliance with environmental law and cutting down on workplace accidents and sickness. Environmental reporting can also improve a company's share price since an increasing number of institutional investors are selling "ethical" investment products and will only buy into companies that can show they are making an effort to limit their environmental impact.

Pressures on firms to produce environmental reports are likely to increase, Mr Molenkamp maintains, particularly once international trading in carbon dioxide emissions gets under way. Companies participating in emissions trading - one of the flexible mechanisms foreseen under the Kyoto Protocol on climate change - will need to provide reliable data on their emissions and firms already looking at their emissions will have a head start, he says.

Follow Up:
KPMG Environmental Consulting, tel: +31 30 658 1801. References: "KPMG International Survey of Environmental Reporting 1999," costs euros 30 and can be ordered by e-mailing: environment@kpmg.nl

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