More listed firms reflecting 'green' issues in annual report

By Robert Ng

SOME Singapore-based companies are starting to come clean on environmental issues and are reflecting "green" issues in their annual reports.

Taking the lead are the oil companies like listed Singapore Petroleum Company (SPC) which has been including Segments on environmental issues in its reports.

Others like can manufacturer, Pacific Can Investment Holdings, said It will be highlighting environmental issues related to its core operations in its 1993 annual report due in January next year.

However, checks here by an international accounting ‘firm ‘showed that so far, only few listed companies here have mentioned environmental issues in their annual reports.

The accounting firm had recently completed a 75-page report on the environmental reporting performance of 100 of the world’s leading companies.

Its survey showed that the "head-in-the-sand" approach of- a few years ago, is being replaced by "a new mood that recognizes that a responsible approach can positively affect a company’s bottom-line."

A partner of the accounting firm involved told The Straits Times that there is currently no prescribed standards on "green" accounting here due to the difficulties of what to measure and what to disclose.

However, he is confident that "smart companies, being good corporate citizens, will report their environmental liabilities."

A random ST check of corporate annual reports here showed that one such company is Cycle & Carriage (C&C) which has, since 1991, been reporting actions taken directly by the group to protect the environment.

A C&C spokesman said, for example, it is selling only vehicles that meet Singapore’s stringent emission standards and that its Mercedes-Benz S class series uses material technology that encourages the use of recyclable plastics.

SPC is another model "green" citizen. In its 1992 annual report, the company said that it was building with partners British Petroleum and Caltex, a new $1.3-billion plant here to convert fuel oil into environment-friendly products such as unleaded petrol and low-sulphur diesel.

Electronics and electrical group, Acma, also regularly informs its stakeholders that it is constantly pursuing technology to produce CFC free air-conditioners, energy efficient heat pumps and radiators.

And listed IPC Corporation announced just last week that it has started manufacturing a new line of energy-saving "green PCs", which reset themselves into a lower power state of 25 watts when left in the idle mode.

Another leading computer manufacturer, GES Singapore, received its certification as an Ozone-Depleting Substance-Free manufacturer from Singapore Institute of Standards and Industrial Research in June this year.

Pacific Can is also reaping the rewards of producing 100 per cent recyclable steel cans. Chief operating officer Kevin Yap said his company persevered when some of its customers decided to switch to plastic containers. But many, including the oil companies, are now switching back to steel cans, he said.

But despite these examples, a public accountant said that generally, many companies are still driven by earnings alone and have little regard for environmental accountability.

He warned of potential dangers of such corporate non-disclosures, saying that US companies for instance face expensive lawsuits if they are found to have failed to warn shareholders about the liabilities they would face as a result of violations of state and Federal environmental laws.

Another danger relates to shareholders’ rights. By not disclosing potential environmental hazards that can be caused by products like asbestos, a company dealing in such materials may appear profitable to investors.

But stockholders’ interest will be affected if the stock price subsequently suffers due to law suits arising from environmental claims.

As the accounting firm’s report noted: ‘Pressure from stakeholders to learn more about the environmental performance of companies will dictate attitudes and commitment of corporate responsibility. Companies have to become more serious about making provisions for the liabilities in advance."

Source : The Straits Times, August 10, 1993

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