Scope and objectives
DNV Two Tomorrows Limited (Two Tomorrows) has undertaken independent assurance of The Co-operative Group (The Co-operative) Sustainability Report 2012 (the Report).
The assurance process was conducted in accordance with AA1000AS (2008). We were engaged to provide moderate level Type 2 assurance, covering:
- evaluation of adherence to the AA1000APS (2008) principles of inclusivity, materiality and responsiveness (the Principles); and
- the reliability of specified sustainability performance information.
The performance information included in scope was all key data and claims in the printed Report. We have not checked the collation of data for the financial information taken from The Co-operative’s audited annual report and accounts. We did not review the GRI table or GRI application level in the Report.
We were also engaged to provide high level assurance on the data and claims regarding the screening of potential business customers referred to the Ethical Policy Unit in the Responsible banking and finance section (pages 30–35).
We used the Global Reporting Initiative (GRI) Quality of Information Principles as criteria for evaluating performance information.
Responsibilities of the directors of The Co-operative Group and of the assurance providers
The directors of The Co-operative have sole responsibility for the preparation of the Report. Our statement represents our independent opinion and is intended to inform all of The Co-operative’s stakeholders in a balanced way.
We were not involved in the preparation of any part of the Report. However, having reviewed and provided feedback on drafts of the Report, in a number of instances changes were made to the final version.
This is the seventh year that we have provided assurance for The Co-operative. Some members of our team have acted as assurance providers to Co-operative Financial Services for the previous three years and to the Co-operative Bank for its Partnership Report for the six years prior to that.
Our team comprised Rachell Evans, Richard Evans, Adrian Henriques, Mark Line, Kate Martin, Anne Euler and Elvin Ozensoy. Further information, including individual competencies relating to the team can be found at: www.twotomorrows.com
Basis of our opinion
In our work, designed to gather evidence with the objective of providing the agreed level of assurance as defined in AA1000AS (2008), we undertook the following activities:
- Materiality review of sustainability issues that are of interest to stakeholders, could affect The Co-operative or were discussed with its management.
- Interviews with members of the Social Goals team and selected managers in the businesses responsible for sustainability issues.
- Review of The Co-operative’s approach to stakeholder engagement and the outputs of recent stakeholder engagement. We had no direct engagement with stakeholders other than staff.
- Assessment of information provided to us by The Co-operative on its reporting and management processes relating to the Principles and the Ethical Plan.
- Assessment of supporting evidence for key claims in the Report, working at Manchester headquarters.
- Review of the processes for gathering and consolidating data using the GRI Quality of Information Principles and, for selected samples, checking the data consolidation.
- Review of referrals to the Bank Ethical Policy Unit to support a high level of assurance that the data presented in the Report are accurate.
Findings and opinion
We have reviewed and provided feedback on drafts of the Report and where necessary changes were made. On the basis of the work undertaken, nothing came to our attention to suggest that the Report does not properly describe The Co-operative’s adherence to the Principles or its performance.
We believe the claims in the Responsible Banking section, on which we are providing high level assurance, are reliable.
In terms of data accuracy, nothing came to our attention to suggest that data have not been properly collated from information reported at operational level, or that the assumptions used were inappropriate. We are not aware of any errors that would materially affect the data reported.
The Co-operative has again maintained good levels of performance in many areas, commendable in the continuing difficult economic and trading conditions. The overall accessibility of the Report has also been improved.
Without affecting our assurance opinion we also provide the following observations.
Overall we have confidence in the level of accuracy demonstrated by the information in the Report. It is welcome to see the integration of the various systems within The Co-operative now bearing fruit.
The last few years have seen a continuing improvement in the quality of data available in a number of environmental areas, including waste and water. Environmental data collection processes and the comparability of data across years would be improved if the reporting protocols used were better documented. We have noted improvements in the methodology and calculation for the Fairtrade premium paid.
Inclusivity concerns the participation of stakeholders in developing and achieving an accountable and strategic response to sustainability
The Co-operative has pioneered extensive and appropriate member and customer consultation and involvement. One of the results has been the clearly focused Ethical Plan. However, to determine its approach for some non-member stakeholders, The Co-operative relies on its Values and informal stakeholder contacts, rather than formal direct consultations.
Material issues are those which are necessary for stakeholders to make informed judgements concerning The Co-operative and its impacts
We believe the Report describes the great majority of The Co-operative’s material impacts and, as a whole, provides greater transparency than most other reports. For example, it is welcome to see content on the horsemeat issue that has been prominent even since the end of the reporting year. There are however some areas for potential improvement such as the provision of additional detail on payments to suppliers.
We found the Responsible Banking assessment of potential new business, for which we provided high level assurance, to be thorough. This is an area in which The Co-operative leads the market.
In terms of campaigning, The Co-operative is far ahead of most of its competitors. The past year, for example, has seen continuing impressive work to promote the role of smallholder farmers overseas and to ban neonicotinamide pesticides. However there is still no strategy for the overall approach to public policy in general.
Responsiveness concerns the extent to which an organisation responds to stakeholder issues
The Co-operative has made progress on the vast majority of its targets, which is welcome. The work done on certifying the sustainability of fresh seafood products in its own-brand ranges is notable. Similarly significant reductions have been achieved in salt levels for some ranges. We recommend that future Reports describe plans for the extension of sustainable fish certification for frozen and other relevant own-brand ranges.
The Report covers progress on all Ethical Plan targets and whilst many of them are stretching, some could be better defined or more challenging.
We welcome the improved presentation of the complex area of Animal Welfare. We also understand that The Co-operative is preparing to report on the actual results of adhering to the various animal welfare standards. This will be a major step forward.
This continues to be a time of major change for The Co-operative and many of the industries in which it works. It is a credit to The Co-operative that it has maintained its excellent performance in so many areas.
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