European companies struggle to meet increasing demand for transparency on their corporate websites

By Freja Nilsson

Top European companies are failing to meet increased stakeholder demands for online transparency. Now in its 27th year, our Webranking survey of Europe's largest 500 companies (based on market cap) reveals a significant need for better online transparency and communication for key stakeholders, which include investors, analysts and job-seekers.

This year’s survey shows an average score of 47 out of 100 for the 500 largest European companies, indicating a general underperformance in meeting stakeholder expectations on their websites.

"This is concerning since a corporate website plays an important role as a trustworthy communication channel in today's environment, where businesses are expected to be reliable and transparent. It is clear that for businesses to maintain and enhance the trust placed in them by society, they need to address the shortcomings in digital communication."

Staffan Lindgren, Senior Advisor, Comprend.

Webranking found that 64% of respondents trust the company website as a communication channel and that 52% of respondents prefer to use the company website when looking for a job. When asked why the respondents prefer the company website, many mentioned that it is the most trustworthy source since it is perceived as a direct and reliable channel.

"I think it is a more direct and reliable channel."

"Not filtered content as on social media, but their own information."

"Everything about the company is accessible on one site and hopefully easier to navigate. Also hopefully not bombarded by advertisements."

The 2023 Edelman Trust barometer shows that the expectations of companies are at an all-time high. It shows that people view businesses as society's most reliable and ethical institutions rather than government organisations and the media. With this trust comes great responsibility and expectations on companies to act responsibly and ethically. It also highlights the importance of businesses being seen as a trustworthy source of information.

This context of heightened expectations and trust in businesses makes the results of the European Webranking even more relevant. As we evaluate the websites of Europe's largest companies, a key question emerges: are these companies living up to the elevated standards of transparency expected by their stakeholders?

When summarising this year's European Webranking results, we notice the following:

Detailed 'About us' sections: Companies excel in providing in-depth information about their business areas, reflecting a strong commitment to transparency in this aspect.
Effective financial reporting: Many companies successfully present detailed financial data and reports, showcasing their ability to communicate key financial aspects effectively.
Weak Investor Relations information: This area remains a significant shortcoming for most companies, with a low average fulfilment of criteria, highlighting a gap in communicating vital investor-related information.
Sustainability shortfalls: There is a notable gap in adequately presenting sustainability information despite growing stakeholder interest in environmental, social, and governance aspects.

Detailed company and business area presentations

One of the key strengths for companies is presenting information about who they are in the "About us" section. The average criteria fulfilment is 59% in this section.

Companies are generally good at introducing their business areas on a detailed level, where 88% present comprehensive information about their business areas. 44% of the companies also complement this information with key facts on, for example, customers, employees or locations. However, companies fall behind in complementing this information with financial results per business area (e.g. sales, revenue, profit), as only 18% offer this information.

Presenting financial results per business area helps investors and other stakeholders to make informed decisions since they often want to assess the financial health and growth prospects of specific business areas.

Best companies in About us

1. Snam

2. Terna

3. Eni

4. Sandvik, Givaudan, Generali

7. Vinci

Accessible and sustainable financial reports

To enhance their financial reporting, some companies are now focusing on creating versions of their reports that are both accessible and sustainable. By doing so, these companies are setting new standards in corporate reporting. They are addressing the twin challenges of inclusivity and environmental impact, showcasing a forward-thinking approach that aligns their financial disclosure practices with broader social and environmental values.

Sodexo presents a certified e-accessible (compliant with WCAG 2.1 and the ADA Law) online version of the annual report 2022. This ensures the document is accessible to individuals with disabilities, such as visual or auditory impairments. Accessible documents also tend to be more navigable and user-friendly for all users, not just those with disabilities, which can improve the overall user experience.

L’Oréal offer an energy-saver mode in their online report which is in dark mode. This reduces the energy required for display lighting. It also offers the user the choice to read content in videos in text versions, which not only saves energy but also makes their content more accessible to individuals who may have hearing impairments or prefer reading over watching videos.

Best companies in Reporting

1. Snam

2. Poste Italiane

3. Terna

4. Sandvik

5. BASF

A shift to digital-first Investor Relations is needed

For the 13th consecutive year, Investor Relations is the biggest challenge for the companies. They have, on average, fulfilled 29% of the criteria in this section. There has also not been any improvement in average performance over the past five years.

Companies still seem to rely too much on traditional communication channels (such as reports and presentations) regarding Investor Relations information. This stands in sharp contrast to the stakeholder expectations, where the expectation is to be able to find information directly on the corporate website.

Modern stakeholders expect instant access to information. They are used to finding what they need online quickly and efficiently. If a company's Investor Relations information is not readily available on its corporate website, it may create a perception of the company being outdated or less transparent.

A respondent of our Capital Market survey 2023 elaborates on some of the most important aspects:

"Ease of navigation, precision of information (for instance, split of revenues by geographies), easiness of understanding of the businesses. Everything that helps understand the company, its businesses, their driving trends..."

Best companies in Investor Relations

1. Terna

2. Poste Italiane and Snam

4. Sampo

5. Fortum

Sustainability information doesn't live up to transparency requirements

One of the areas where transparency requirements for companies are at an all-time high is sustainability, including the environmental, social and governance aspects. On average, European companies fulfil 48% of the criteria related to sustainability information on their websites. Notably, their performance in this area has remained relatively static over the past five years, not keeping pace with the evolving requirements.

A significant component of ESG communication involves presenting various sustainability policies. While companies effectively showcase documents like codes of conduct and tax policies, they fall behind in other important areas.

A notable addition this year is the expectation for companies to include a statement on data ethics, viewed through a sustainability or governance lens, on their websites. This requirement extends beyond the traditional data privacy policy, reflecting the expanding scope of modern sustainability to include social and governance aspects, particularly the ethical use of data. Consumers and stakeholders increasingly prioritise privacy and ethical data practices in today's data-driven world. Transparently addressing data ethics can support trust among these groups. Currently, only 23% of the evaluated companies provide this information on their websites.

Going a step further, some companies are not just addressing data ethics but also diving into the ethical use of artificial intelligence. An example is Kesko, who outline their principles for the ethical use of AI, demonstrating a proactive stance in corporate governance and social responsibility. This approach highlights a broader, more holistic view of sustainability, integrating technological ethics into corporate transparency initiatives.

Best companies in Sustainability

1. Terna

2. Snam and Intesa Sanpaolo

4. Eni

5. Iberdrola

Terna, Snam and Eni the top performers

Terna: Terna are the best-performing European company for the fourth year in a row, receiving a score close to 95 points. They continue to be strong in Governance (receiving a full score), Sustainability and About us. Terna's position as the best-performing European company for four consecutive years indicates a sustained commitment to excellence in corporate communication and transparency.

Snam: Snam has kept second place for the fifth year in a row. Snam have a full score in About us and are also good at presenting Careers information. Maintaining the second place for five consecutive years shows a consistent commitment to high standards in corporate communication.

Eni: Eni are back in the European top three; the last time was in 2020-2021. They have climbed one place, from fourth place last year and have received a full score in the Governance, Share and Press sections. This showcases commitment to transparent leadership, effective shareholder communication, and robust media relations.

Redeia the best European climber

Red Eléctrica de España (Redeia) have significantly improved the content on the website, resulting in an improvement of 21.2 points since last year. This has resulted in them climbing an impressive 263 places, from 470th place to 207th place, which is a significant achievement.

Top 20 - Europe 500

Rank	Company	Country	Sector	Score
1	Terna	Italy	Utilities	94.7
2	Snam	Italy	Energy	93.9
3	Eni	Italy	Energy	88.3
4	Poste Italiane	Italy	Insurance	87.2
5	Sandvik	Sweden	Industrial Goods and Services	86.4
6	Generali	Italy	Insurance	85.1
7	Swisscom	Switzerland	Telecommunications	84.9
8	Wärtsilä	Finland	Industrial Goods and Services	83.3
9	Fortum	Finland	Utilities	83.0
10	Givaudan	Switzerland	Chemicals	82.9
11	Valmet	Finland	Industrial Goods and Services	80.1
12	Trelleborg	Sweden	Industrial Goods and Services	78.6
13	Kesko	Finland	Personal Care, Drug and Grocery Stores	78.2
14	Sampo	Finland	Insurance	77.2
15	Repsol	Spain	Energy	76.4
16	Vinci	France	Construction and Materials	76.0
17	Mediobanca	Italy	Financial Services	75.6
18	Essity	Sweden	Personal Care, Drug and Grocery Stores	75.3
19	Deutsche Telekom	Germany	Telecommunications	72.8
20	Intesa Sanpaolo	Italy	Banks	72.2