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Sector Reports - 15/10/2019

How are Publishers addressing the social and environmental challenges and opportunities of the digital era?

The strategies implemented by Publishers to responsibly manage reorganisation and to bridge the knowledge gap in society remain weak. Nevertheless, new achievements have been identified as all companies disclose formalised commitments to address the right to privacy.

This comprehensive new report presents Vigeo Eiris’ analysis, ratings and rankings of the ESG performance-related trends and impacts of 37 companies in the Publishing Sector.
The Report includes the Sector’s strengths, innovations and best practices as well as controversies, vulnerabilities and emerging challenges linked to the sector’s transition from analogue to digital technologies and formats. The Report analyses performance scores and advanced indicators on critical issues such as business ethics, due diligence on environmental risks in the supply chain, human capital and human rights, governance, executive remuneration, integrity of lobbying practices, the level of sustainable products & services, and contribution to the United Nations Sustainable Development Goals.

Sector Report Publishing

Key Findings:

  • The Publishing Sector can be divided into two categories depending on companies’ products and services. Traditional publishing companies specialise on the sale of printed products, including books, newspapers and magazines. These companies have a wide range of environmental impacts, including impacts from sourcing of paper and pulp, and impacts derived from printing and distribution activities. A second group of Publishers is composed by companies with significant activities in digital media and the internet, that sustain online listing or publishing activities. Emerging risks and challenges for this type of Publishers are mainly linked to the respect of privacy and related rights.
  • Vigeo Eiris awarded an average overall score of 35.6 to companies in the Publishing Sector, on a scale of 0 to 100. The Sector’s performance remains unchanged since our previous analysis (2017).
  • The Publishing Sector ranks 7th out of Vigeo Eiris’ 39 sectors, which cover a total research universe of 4,500 companies. Previously, the Sector ranked 8th.
  • Sector leaders are concentrated in Europe, with an average score of 38/100, whilst laggards are mostly located in Asia Pacific.
  • The Publishing Sector reporting rate is 65%, above the universe average (54%), with European companies communicating most comprehensively on their ESG policies, practices and performances.
  • ESG risk mitigation scores are limited in relation to reputation (39/100), operational efficiency (40/100) and legal security (34/100), which stand above the universe average score (32/100). In terms of preventing and managing risks related to human capital, Publishing companies display a weak average score (29/100), but still slightly higher than the universe average (27/100).
  • The willingness and commitment of Publishing companies to address climate change and support the transition to a low-carbon economy remains limited (37/100) and is lower than the overall universe average (22/100). European companies lead the sector in their efforts to support a low carbon economy.
  • The Publishing Sector faces 21 controversies, affecting 27% of the companies in the panel. 11% of Publishers are involved in high severity cases, 11% in significant cases and 5% in minor cases. The most recurrent controversies primary relate to anti-competitive practices and violations of fundamental human rights standards.

Key Takeaways:

  • The digitalisation of the Publishing Sector creates several challenges for companies in ensuring that the right to privacy is respected, which is considered as a fundamental human right. Due to the Sector’s transition to digital services, new risks related to the acquisition, handling and use of personal data have emerged. Publishers involved in content, media and other advertising supported websites that manage personal information are expected to ensure that collected data is being properly managed and protected.
    Even though the Sector’s performance has improved compared to the previous assessment, Publishers’ strategies to address human rights issues are considered limited (46.9/100). All companies in the Sector have issued formalised commitments to respect and promote human rights addressing the right to privacy; however, only a few appear to implement effective measures to support such commitments. Informa, Lagardère, Solocal Group, GEDI Gruppo Editoriale, Wolters Kluwer, RELX and Dai Nippon Printing display advanced performances. Informa is considered the best-in class (77/100) and reports on a formalised commitment to respect and promote human rights in society, covering the right to privacy, with supporting measures that include a permanent system entailing training programmes, grievance mechanisms and human rights impact assessment, in addition to third-party involvement through external investigations of allegations. In addition, around 24% of Sector controversies are related to violations of human rights standards, of which 60% are linked to privacy breaches.
  • The digital transformation of the Sector has triggered significant layoffs and personnel readjustments at company and industry level, testing Publishers’ ability to sustain employment and manage reorganisation responsibly. Around 49% of companies in the Sector have undergone reorganisation processes with an impact on employment, which highlights the importance of the issue for Publishers. The Sector’s average performance is considered weak (20.8/100) and has deteriorated since our previous analysis, mainly due to an overall lack of transparency on Publishers’ strategies to address this issue, which is transversal in all zones under analysis. Only RELX displays a robust performance in the domain (51/100), followed by Lagardère (48/100). RELX reports that it aims to minimise the impacts of restructuring processes by basing employee redundancies decisions on factual assessments and considering alternatives to avoid dismissals. In addition, the Company reports on significant measures to minimise the impacts of reorganisation, such as internal mobility programmes and re-training.
  • Publishers have the potential to use their knowledge, products and services to promote access to information and bridge the knowledge divide in society. In this context, companies in the Sector can contribute to the achievement of the United Nations Sustainable Development Goals (SDGs), such as SDG 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. Given the Publishing industry’s primary activity, companies in this Sector are expected to play an important role in bridging the knowledge divide by providing access to information and/or capacity building through education, which are considered as sustainable goods and services contributing to the achievement of the SDGs.
    The Sector’s average performance is considered weak (21.4/100). Publishing companies appear to focus on making charitable contributions and supporting general interest causes, showing an overall lack of transparency on commitments and measures aimed at addressing the societal impacts and promoting accessibility of products and services. Informa is the leader of the Sector with an advanced performance (65/100). The Company discloses efforts to address the accessibility of its products and services and to manage its societal impacts, including the publication of information aimed at raising awareness on societal and sustainable issues and the development of specific products for low-income population.
  • The main environmental impacts of the Publishing sector are related to book printing and impacts from paper and e-waste production, including hazardous materials and toxic substances such as chlorine, mercury and lead. The transition process to a more digital marketplace can allow Publishers to decrease the environmental impacts derived from printing activities; however, there are significant concerns on how the Sector is managing the production of e-waste, especially considering the increasing demand for technological and digital products. Companies are expected to properly manage its hazardous and non-hazardous waste production, and to engage with suppliers of components and materials to mitigate environmental impacts at supply chain level.

In terms of Publishers’ strategies to manage their waste production and related environmental impacts, the Sector displays an overall limited performance (30.2/100). Dai Nippon Printing, Toppan Printing and RELX display advanced performances in the domain. RELX is the leader of the sector (65/100) and has set up quantified targets with regard to its non-hazardous waste production, which appears to be supported by measures that include monitoring systems, end-of-pipe technologies and optimisation measures, such as a recycling and composting system and incineration measures to generate energy.Regarding Publishers´ ability to integrate environmental factors in supply chain management, the Sector’s performance is considered limited (30.9/100). Even though 86% of companies have made references or issued formalised commitments to integrate environmental factors in supply chain management, only 21% address subjects related to the management of hazardous components, such as clean printing processes and the use of clean glue and ink. Lagardère is the best performer (68/100) and has established a formalised commitment to including environmental factors in supply chain management, addressing issues such as the use of clean printing processes and the use of special glue and ink. The Company reports implementing comprehensive measures to support this commitment, including the integration of environmental issues into contractual clauses, non-compliance procedures and risk assessments for suppliers.

Best performing areas:

  • Board of Directors
  • Audit and Internal Controls
  • Fundamental Human Rights

Worst performing areas:

  • Societal impacts of products and services
  • Reorganisation
  • Responsible Lobbying

Top performing companies:

  • Europe: Lagardère (57/100)
  • North America: Transcontinental (38/100)
  • Asia Pacific: Dai Nippon Printing (41/100)

Companies making best progress since 2018:

  • Europe: Euromoney Institutional Investor (+8)
  • North America: Tripadvisor (+5)
  • Asia Pacific: No progress

To view an excerpt of our 2019 Publishing Sector Report, download the document below.

To enquire about accessing our sector reports, please contact the relevant team below:

If you are an investor: investorcustomer.service@vigeo-eiris.com
If you are a corporate entity: corporatecustomer.service@vigeo-eiris.com
If you are an NGO or a university: contact.academique@vigeo-eiris.com
If you are a journalist: news@vigeo-eiris.com

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