GRI Walks the Talk on Sustainability Reporting

GRI Walks the Talk on Sustainability Reporting

The Global Reporting Initiative has published its first sustainability report for the year 2003-4. GRI, the institution that develops sustainability reporting guidelines for corporations worldwide calls its report, “It’s not enough to just BE.”

The theme of the report emerged from the GRI’s realization that though it was dedicated to sustainability reporting, it had neglected to ensure the development of the organization itself involves what it calls a “systematically sustainable” system.

So, while the GRI’s guidelines on sustainability reporting preach reduction in emissions by companies, the group felt it was not doing enough itself.

As a result, GRI says it has now been prompted to think about why it has thus far ignored telephone conferencing as a substitute to air travel for meetings.

“We (were) less focused on GRI as an organization. We were and still are, externally focused,” Ernst Ligteringen, chief executive of GRI says.

Ligteringen says that the Global Reporting Initiative has to be much more rigorous with itself in its approach to measurement and management of social and environmental issues in order to produce an exemplary report in future.

Two Kinds of Reports

This, Ligteringen says, is the reason why the organization has not been able to report in accordance with all its 97 key performance indicators in the areas of sustainable development.

The Global Reporting Initiative framework allows companies to report either “in accordance with” or “with reference to” their indicators.

GRI has been proactive in engaging members of its international multi-stakeholder network in the production of its first report.

These stakeholder groups include NGOs, companies, trade unions, inter-governmental organizations and consultants in the ethical business field.

In August last year, GRI issued a call to its stakeholders to comment on their expectations for the organization’s first attempt at reporting.

GRI also employed the services of three independent assurance providers mid-way through the report to review the process.

Mark Line from U.K.’s csrnetwork, Jennifer Iansen-Rogers from KPMG Sustainability and Vic Thorpe from Switzerland-based Just Solutions spent two days analyzing the draft report and providing their input.

Some of the observations made by them at the midway stage were:
  • The Global Reporting Initiative needed a more formalized sustainability policy and related management and reporting systems.

  • The draft report was “extensive” and “ambitious” and covered what GRI “could” report than what it “should” report.

  • Future sustainability reports should be more “closely linked to stakeholder information needs.”
Assessing the report after its completion, the three assurance providers concluded that GRI has taken on board most of their suggestions but has scope for much improvement.

For example, they say, GRI might try and report less extensively but focus on key issues, such as those expected from other small and medium-sized enterprises.

The GRI intends to put their report in a handbook they produce on sustainability reporting for SMEs.

Lacking Some Numbers

Adrian Henriques, professor of accountability at Middlesex University, points out that the GRI’s first sustainability report lacks some of the hard, environmental information related to water and energy.

Henriques was involved in preparing the 2002 GRI guidelines for companies and other organisations.

He notes that the report could have done better in laying out more clearly the opinions of the various stakeholders that contributed to the process.

Mr Henriques points out that stakeholder views on GRI’s governance are “hidden.”

He also comments on the navigation of the report, which, he says, makes it impossible to access all sections of the report with ease.

But despite these criticisms, Henriques commends the Global Reporting Initiative’s first attempt at sustainability reporting.

“They (GRI) are honest about the state that they are at. People shouldn’t expect them to be reporting experts simply because they provide the guidelines,” Professor Henriques concludes.

The GRI has seen the number of corporate sustainability reporters who use its guidelines increase hugely in the last few years.

So far over 600 companies have made reference to the guidelines in their corporate ethical and social/environmental reports.

However, some companies have referred to the GRI guidelines in a vague and inconclusive way in some past ethical reports.

Critics have suggested the rules may need tightening to prevent companies that do not use the guidelines significantly, from claiming that they do.

In response to criticisms from some companies that the 2002 guidelines are too complex and time consuming to report “in accordance with,” the GRI aims to simplify them in future.

The organization is also gradually introducing sectoral-based guidelines for reporters, as many industries share common indicators.

So far such supplements have included the mining and metals industry, automotive, financial services, and telecommunications.

Forthcoming sector supplements include sectoral guidelines for public agencies.

The new, revised GRI guidelines are due out in 2006.