- Emily Drayton, Staff Writer
Canopy Growth's ESG Report Has Holes
The headline that caught my eye today is from the Canadian Cannabis Pub called Mugglehead:
"Canopy Scant on Equity Metrics in First ESG Report"
An ESG Report, in case a Dear Reader doesn’t remember, is just like a CSR Report, OK? Ha, just kidding, ESG stands for Environmental, Social and Governance, and CSR is Corporate Social Responsibility. You can split hairs, but they’re pretty much the same, they are a company’s way of explaining that:
they’re good corporate citizens
they behave well in the communities in which they operate, and of course
they do all this stuff better than their competitors.
Canopy Growth Corporation, #4 cannabis company in the world by market capitalization, just released their ESG report and it’s a mixed bag.
Canopy donated 75,000 pieces of PPE to hospitals, etc. and 14,000 CBD products to US hospitals and nursing homes, and 57 iPads at nursing homes so elderly people could stay in touch with their families
The company registered 23,000 patients for Compassionate Pricing
It has achieved near-gender-parity, with 48% of the employees being women, and 38% of those are in managerial positions
There were zero product recalls globally
Employee Resource Groups have been formed for those who are Indigenous, Black, LGTBQ and People with Disabilities
So about the E, for Environmental: "Commercial cannabis cultivation [in Canada], the vast majority of which happens indoors, is an energy hog" says Mugglehead.
The company said it consumed a total 405.8 million kilowatt-hours in 2020, the majority from electricity (179.2 million kilowatt hours) and natural gas (149.3 million kilowatt hours).” Over the same period, Canopy reported 58,982 TONS of Greenhouse Gases.
[For perspective, that’s equivalent to 12,822 cars operating for a year.]
THE DEEP DIVE
On to the S in ESG: Social. And here’s where Canopy can do better.
When it comes to diversity, " ... the company did not publish any baseline figures." The company essentially said “We only track gender, but we’re working on it.” I could give you the actual corporate language they used but it’s pathetic. No mention of equal pay for equal work, number of women’s bathrooms, benefits seems robust and parental leave is included.
They write checks to local organizations and publicize "employee-led giving campaigns" which bugs me especially because of what Mugglehead points out – Canopy defended the pay package of its CEO, David Klein, which at $45.3 Million is “… significantly higher than any other CEO of a Canadian firm in 2020. They claim that when he came over from Constellation Brands, he had to forfeit a sweet package, which Canopy had to match.
By comparison, Mugglehead compared Canopy to Brookfield Asset Management: Canopy had $546 Million in Revenue, Brookfield has $82 Billion … 160X the revenue and their CEO made $9 22% of the pay.
For a company with $546 Million in Revenue, Canopy only invested $120 and 1 day per employee in training.
THE LOOP BACK
Canopy doesn’t seem to care much about job security: the turnover in staff was 67% – 47% was involuntary and 20% voluntary. Meanwhile, the company accepted $11 Million in federal wage subsidies. I'll just leave that one there.
Expect all big cannabis companies to do this kind of reporting going forward.
IMAGE SOURCE: https://genuscap.com/what-is-esg-how-does-it-factor-into-your-sustainable-investing-strategy/