External reporting is a fundamental part of accountability. Sustainability reporting not only demonstrates transparency but, in our view, it is the basis of organizational learning, demonstrates our values and both reflects and drives outstanding economic, environmental and social performance. The following are central elements of our reporting strategy.
Materiality
Over the last several years, Ford has sought to continually refine its sustainability reporting to increase its materiality and responsiveness to stakeholders. A key part of our reporting strategy has been the development of a materiality analysis process, which has been a critical tool in helping shape the content of our report.
For our 2006/7 report, we are publishing a print report that focuses on those issues determined to be most material to Ford over the three-to-five-year time horizon. At the same time, this comprehensive, Web-based report provides information on a broad range of other sustainability issues of importance to Ford and our stakeholders. The Web report also includes detailed performance data, case studies, stakeholder interviews and other supporting information.
Assurance
In recent years, Ford has explored different external assurance models as a way to increase the report's thoroughness, transparency and utility to stakeholders. For our 2004/5 report, we worked with Ceres and SustainAbility, an independent think tank and strategy consultancy, to create a Report Review Committee made up of 13 external stakeholders to participate and advise on the development of the report. Their feedback on our process and the content of the report itself was included in the report.
For our 2005/6 report and the current report, Ceres again convened stakeholder committees to advise us (see www.ceres.org for more information on Ceres). The committee reviewing this report met twice: once to review and comment on the materiality analysis, and once to review and comment on a nearly final draft of the report. The process is similar to the one we undertook for our 2004/5 report, though streamlined to include fewer meetings of the committee, as well as to have those meetings take place primarily by teleconference, rather than in person. A statement from the committee is again included in the report.
External Guidelines
Since its 2002 report, Ford has reported "in accordance" with the 2002 Sustainability Reporting Guidelines of the Global Reporting Initiative (GRI). In 2006, the GRI issued updated guidelines, called G3. Ford supported and participated in the development of the process that produced the updated guidelines. Ford's 2006/7 report is aligned with the G3 guidelines at a self-declared application level of A+. (See www.globalreporting.org for more information on GRI and application levels.)
Targeted Reporting
Linked with our efforts to increase the materiality of our reporting, Ford has also taken steps to produce more targeted audience-, location- and subject-specific sustainability communications. For example, we have issued subject-specific reports on climate change and HIV/AIDS.
Also, several Ford facilities, brands and country operations produce their own reports detailing the sustainability issues they face within their particular regions or operations. For example, Volvo publishes an annual sustainability report. Several of our country operations, such as Ford China, and local facilities also produce public reports. We have also provided input to the Ceres Facility Reporting Project. (See www.facilityreporting.org for more information.)
Because we have identified employees as a key audience for our report, we have developed a sustainability intranet site to provide them with more tailored information. We have also identified mainstream and socially responsible investors as an important target audience and, in the future, we intend to develop sustainability communications tailored to their particular information needs. As a first step in this direction, we are working to align the publication of our Annual Report and Sustainability Report so that we are providing investors – as well as other stakeholders – with complete information on the economic, social and environmental performance of our Company at one time.
Benchmarking and External Feedback
Ford seeks formal and informal feedback on our report from a number of organizations with expertise in reporting. One of those was SustainAbility, which we asked to review our 2004/5 report according to their and the United Nations Environment Program benchmarking methodology. A summary of the benchmarking findings, which were consistent with other feedback we received, can be found at: http://www.ford.com/en/company/about/sustainability/2005-06/accTransparencyReview.htm.
Ford also commissioned SustainAbility to gather and analyze report feedback from Ford stakeholders directly. SustainAbility conducted in-depth interviews with more than 20 internal and external Ford stakeholders to get their feedback on our 2004/5 Sustainability and Climate Change reports. Overall, stakeholders interviewed had a favorable impression of our reporting, believing that it was strong and sophisticated. However, many also noted a lack of information on strategy, goals and performance improvements as areas for future attention by Ford.
Ford's 2004/5 report was placed in the top five of the 2005 Ceres/Association of Chartered Certified Accountants North American Awards for Sustainability Reporting. In particular, the judges commended Ford for its approach to materiality and assurance.
