A recent report entitled The State of Green Business, 2008 is packed with facts and figures that make heartening reading for anyone concerned with governance.

I was particularly struck by the laggardly growth in CSR reporting, that despite:

Customers, investors, and stakeholders are demanding increasingly greater accountability and transparency from companies on environmental and social issues. They want to know what companies are, and aren’t, doing, warts and all.

The report says that even though the Global Reporting Initiative is now reasonably well established, growth in meaningful CSR reporting has barely grown 50 per cent among Fortune 100 companies in the US in the last five years. That’s around two-thirds of the total that could be reporting. Among those reporting since 2002: Intel, HP and Motorola. The report says that:

Initially, companies largely focused on environmental, health, and safety indicators because those were areas where regulations already required disclosure. But the GRI forced many corporations to look more broadly at other areas of corporate policy and performance, such as product responsibility, supply chain issues, sourcing, governance, diversity, and social issues.

When I survey the reporting scene, it is apparent that many companies find it very difficult to figure out how the framework applies. In Doing Good: Business and the Sustainability Challenge, companies are said to be “at the baby steps stage” as concerns sustainability issues because “business people recognize their importance, but when it comes to the practical question of what they mean to the organization, there is a lot of confusion”. Ever that was so. James Farrar put a more positive gloss on the report:

If I am to make one criticism of the EIU study it is that it did not go far enough to explore strategic value drivers by key industry to drive a more granular debate on strategic sustainability management…

So what does this mean for the tech sector? In many respects the sustainability pioneers of the private sector came from the extractive industry and often borne out of crisis. Sustainability 2.0 will be driven forward by innovation and market forces. Business models will be reinvented to tap into more environmentally efficient and socially inclusive markets. For sustainability 2.0 to be successful more will be demanded of the entire tech industry in serving as both exemplar and enabler.

I hope James is right but given the difficulties we are already seeing in operating a framework that has horizontal meaning, let alone in verticals, it seems there is a long way to go. The software industry could point the way, offering standard methods of arriving at certain measures. Right now that’s being tackled in an ad hoc manner and I would prefer to see the major players coming together and picking off relatively ‘easy’ measures as examples to pave the way. Whether we will see that kind of cross party meeting of minds is another matter.

What I am confident is that as a market, CSR and GRC combine could well be larger than the ERP market.