10 October 2012: From CSR Hub, by Bahar Gidwani: “Big Data” should be a useful tool for rating corporate social responsibility (CSR) and sustainability performance. It may be the answer to dealing with the rise in new ratings systems (it seems there is a new one announced each month) and with the disparities in scores that occur among these different systems.
In 2001, Doug Laney (currently an analyst for Gartner), foresaw that users of data were facing problems handling the Volume of data they were gathering, the Variety of data in their systems, and the Velocity with which data elements changed. These “three Vs” are now part of most definitions of the “Big Data” area.
Ratings in the CSR space appear to be a candidate for a big data solution to its three “V” problems.
- Volume: There are many sources of ratings. CSRHub currently tracks more than 175 sources of CSR information and plans to add at least another 30 sources over the next six months. Our system already contains more than 13,000,000 pieces of data from these sources that touch more than 80,000 companies. We hope eventually to expand our coverage to include several million companies.
- Variety: Each of these 175 sources uses different criteria to measure corporate sustainability and social performance. A number of comprehensive sustainability measurement approaches have been created. Unfortunately, each new entrant into the area seems compelled to create yet another system.
- Velocity: With hundreds of thousands of companies to measure and at least 175 different measurement systems, the perceived sustainability performance of companies constantly changes. Many of the available ratings systems track these changes only on a quarterly or annual basis.
Most systems for measuring the CSR and sustainability performance of corporations rely on human-based analysis. A researcher selects a set of companies to study, determines the criteria he or she wishes to use to evaluate their performance, and then collects the data needed to support the study. When the researcher can’t find a required data item in a company’s sustainability report or press releases, he or she may try to contact the company to get the data.
Some research firms try to streamline this process by sending out a questionnaire that covers all the things they want to know. Then, they follow up to encourage companies to answer their questions and follow up again after they receive the answers, to check the facts and be sure their questions were answered consistently. An NAEM survey showed that its members were seeing an average of more than ten of these results in 2011, and some large companies say they receive as many as 300 survey requests per year. Read the whole story