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Frank Longid

AS COMPANIES go to greater lengths to improve their annual reports, choosing the best is seldom easy.

However, the chairman of the Hong Kong Management Association's panel of adjudicators, Howard Gorges,  said CLP Holdings' reports had stood out from the crowd for the past two years.

'CLP had the best report last year and endeavoured to produce a better report. They were going the extra mile and we're fortunate some companies do that, because it makes it easier for other companies to improve,' Mr Gorges said.

CLP director and company secretary Peter Greenwood  said the objective was not to win awards but responsibly to report the company's activities in the past year.

'The overall objective is to provide the best, most complete, most accurate information to shareholders so they can take an informed view of the company.'

'One of the core values of this business is to conduct our affairs in an environmentally responsible manner. We have a duty to report on our environmental performance because our shareholders deserve to be told the impact of our activities on the environment. So do our other stakeholders - the community and government,' Mr Greenwood said.

An element of CLP's report covers shareholders' visits to its power plants. That such visits are reported suggests they are more than public relations exercises.

'Their feedback is extremely valuable,' Mr Greenwood said, adding that  visitors were escorted by a senior manager.

'They are surprisingly well informed and have clear views about what the company should and shouldn't be doing.

'Because we see the shareholders frequently, we are in close touch with them. Our annual general meeting is one of the best attended in Hong Kong.'

The value of the close contact could not be underestimated, he said.

'In a time of corporate scandals and malfeasance, they are a healthy reminder of whom we are accountable to. It's a very strong personal reminder of the people to whom we owe our very best to make sure their investment is safeguarded.'

Mr Greenwood said CLP was all too aware of the criticisms levelled at it by green groups. This was why the firm produced a social and environmental report, which was issued simultaneously with the annual report. Mr Greenwood insisted both reports were 'meant to be read together'.

The document is surprisingly forthright. It admits, without qualification, that CLP failed to meet two stated goals for last year: to 'continue our long-term improvement in overall energy efficiency and supply quality' and to 'continue our long-term improvement in environmental performance over and above compliance with all applicable regulations and licence limits'.

The direct involvement of senior management in the annual report and the social and environmental report is evident.

'We recognise that the annual report is probably the most important corporate communication we produce. It doesn't just report on the past, it speaks for what we intend to do. And to do this there must be significant involvement of senior management,' Mr Greenwood said.

While some might be surprised at CLP's willingness to admit its failures in a document that most companies used to trumpet their successes, Mr Greenwood said this was good management.

'Our shareholders are very clear about how they value honesty and integrity.

'They're extremely concerned about corporate scandals and place great value on reliability. They're prepared to accept occasional disappointments, provided we are honest in reporting. They want an honest account and we do all we can to provide it.'

He said the report showed how CLP had stuck to 'prudent financial management' as its shareholders supported incremental and steady growth.



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CLP Group

CLP stands out from the crowd