12/12/2013 12:55 pm ET Updated Feb 11, 2014

Corporate Responsibility Reporting: Is It Really Worth It?

Let us be honest, corporate responsibility (CR) reporting is not without its critics.

Some people say these reports are a waste of time and money, believing them to be so dense and so dull that no one could possibly bother to read them. Others see them as vehicles for corporate greenwash, an opportunity for companies to exaggerate their social and environmental credentials without any genuine intention to change. Some in the corporate world see the production of these reports as too complex and too costly and with dubious return-on-investment.

While I understand the concerns behind accusations like these, I think such views are fortunately fast becoming outdated.

Yes, CR reports are often not an easy read and companies should seek to communicate the information in more digestible and engaging ways. However, that is not an argument for not reporting at all.

Yes, greenwash can be a risk but as time goes on, stakeholders -- from NGOs and pressure groups to customers and investors -- are all becoming more adept at knowing the difference between PR spin and CR performance. It is not so easy to pull the proverbial wool over people's eyes anymore.

Yes, CR reporting done properly does require financial and human resources, but so do all forms of corporate reporting.

The point that is being missed by many people who make these criticisms is that, in the 21st century, CR reporting is -- or should be -- an essential business management tool. It is not -- or should not be -- something produced simply to mollify potential critics and polish the corporate halo.

We are all living, and some of us are running businesses, in a world undergoing unprecedented environmental and social changes. Rampant population growth is fueling ever-increasing demands for limited resources. Unpredictable extreme weather is affecting supplies of key commodities. Changing social conditions and expectations are driving both increased spending power and social unrest.

CR reporting is the means by which a business can understand both its exposure to the risks of these changes and its potential to profit from the new commercial opportunities. CR reporting is the process by which a company can gather and analyze the data it needs to create long-term value and resilience to environmental and social change. CR reporting is essential to convince investors that your business has a future beyond the next quarter or the next year.

What encourages me most about the findings of this year's KPMG Survey of Corporate Responsibility Reporting are the signs that many of the world's largest companies are using the process of CR reporting to bring CR and sustainability right to the heart of their business strategy, where it belongs.

Almost all the world's largest 250 companies report on CR. Of those that do, nine in 10 use their reports to identify environmental and social changes that impact the business and its stakeholders. Eight in 10 report that they have a strategy to manage the risks and opportunities. Seven in 10 report that these changes bring opportunities for the innovation of new products and services. An enlightened, but I suspect growing, minority of around one third also report opportunities to grow their market share and cut costs.

Where these companies lead, others will follow. The direction of travel is clear. I believe that the debate on whether companies should report on CR or not is dead and buried. As this survey finds, CR reporting appears to be standard business practice the world over -- even in those geographic regions and industry sectors that only two years ago lagged behind.

The questions companies should ask themselves now are "what should we report on?" and "how should we report it?"

And, most importantly, "how can we best use the process of reporting to generate maximum value both for our shareholders and for our other stakeholders?"