POLICY AND PRACTICE REVIEW IOD Members’ Opinion Survey: Environment

IOD MEMBERS’ OPINION SURVEY: ENVIRONMENT Taylor Nelson Commissioned by: The Institute of Directors Policy Unit 1993, 45 PP

This report presents the results of an environmental opinion survey of 301 IOD members, in December 1993. An important feature of this report is that comparisons can and are made between these 1993 survey results and ones taken in 1991 and 1992.

Its purpose was to ascertain the knowledge base, views and motivation of directors of companies with regard to dealing with environmental issues. As key informants within a company, directors’ opinions are important indicators of company opinions. However, the reader must be careful not to generalise to the company level (inferred by this report) as top level espoused commitment does of course not transpose into company real commitment.

Several general questions were asked, such as, the amount of board time currently (and expected to be) taken up by environmental issues and the pressures inducing this environmental concern. Several specific questions were asked, such as, whether the company has a formal environmental policy and i f it is undertaking or considering environmental audits. Furthermore, the directors’ knowledge of current and future environmental legislation was analysed.

These questions were common to the previous 1991 and 1992 surveys, thereby enabling the respective answers to be compared. Additional information sought for 1992 and 1993 only, concerned‘ whom within the company holds environmental responsibility and the details of company environmental innovations and investments. The answers to these questions are in the form of a general statistical summary, followed by an industry sector breakdown and a company size breakdown.

The statistic which puts the future corporate environmental challenge into perspective is that 38% of directors interviewed thought that their company would be spending no board time on environmental issues over the next five years. The report’s general findings seem to indicate that the smaller, the more service based the company (where the environmental impact is inherently low, as opposed to large, heavy industry), the less environmental commitment is shown. The answer to the questions posed regarding the pressures on business inducing environmental concern, highlighted a possible reason for this. Only 8% of directors said that the company internal considerations such as efficiency, employee pressure and waste reduction are most important in inducing environmental concern. Possibly until internal variables are seen as fully part of the environmental impact, the environmental awareness and commitment of small (1-20 employees) and service-based

companies will remain low. It i s interesting to note that social responsibility contributed the most to inducing environmental concern (29% of directors). This factor was puzzlingly viewed by Taylor Nelson as companies viewing the environment as a threat (along with legislation pressure). Obviously, an ethical stance to environmental issues as opposed to an opportunistic stance is seen as retrogressive? Another striking feature of this report is that while 56% of directors reported environmental issues featured on their boardroom agendas, only 19% had tried something innovative!

Comparing annual results, there was a rise in environmental awareness in 1992, coinciding with the Earth Summit, dropping back in 1993 but in most cases to a level slightly higher than that of 1991. This appears to show that the response by companies to an international event such as at Rio has not been a short-term ’awareness blip’ but a more long term commitment to environmental issues. It would be interesting to make 1994/1995 comparisons in order to substantiate this optimistic view.

The problem with this report is that it promises conclusions, but i t provides several summary disparate results and statistics in the form of tables and graphs. What i t seems to need is a concluding descriptive summary report, in which all the points made within each question and answer are linked together. This would provide a more user friendly document with a greater impact, particularly on its more time-conscious IOD members.

David Raymond Jones Centre for Corporate Environmental Management

University of Huddersfield

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