Corporate reporters rejoice: in a move aimed at making it easier for companies to report on their sustainability initiatives and progress, the Global Reporting Initiative today launched the GRI Sustainability Reporting Standards.
The GRI Standards — which facilitate corporate reporting on topics such as greenhouse gas emissions, energy and water use and labor practices — are the latest evolution of GRI’s reporting disclosures. They are based on the GRI G4 Guidelines, which are the world’s most widely used sustainability reporting disclosures. But, according to GRI, they are more straightforward, with a new format and modular structure that will make them more accessible to more businesses globally. They replace the G4 Guidelines, which will be phased out by July 1, 2018.
GRI interim chief executive Eric Hespenheide says while sustainability reporting isn’t always easy, the new GRI Standards will make it easier for companies to report nonfinancial information.
“Like all worthwhile endeavors, sustainability reporting takes time, effort and commitment of resources,” he told Environmental Leader. “But for those organizations that do sustainability reporting in good faith, the benefits outweigh the costs. With the new GRI Standards we have done our best to make reporting a more straightforward process, by clarifying key concepts such as the topic Boundary, the GRI content index, and terms such as ‘impacts’. Additionally, within each Standard, there is a clear distinction between reporting requirements, recommendations, and guidance. This will make it easier for organizations to know what they are expected to report, and how to report it.”
While GRI provides an online overview of transitioning from G4 to GRI Standards, sustainability consultants can also help firms analyze their currents corporate reports versus the new standards.
ISOS Group is offering one-day, customized GRI Standards transitional training and says using the new set of standards can help improve businesses’ performance.
“As long time practitioners and educators in this space, we believe the time couldn't be more ripe for a more comprehensive, yet inclusive, approach to non-financial reporting,” said Nancy Mancilla, ISOS Group co-founder and CEO. “By instituting GRI’s Standards, greater alignment to other reporting frameworks, deeper integration of solid management practices and more focused disclosure should result.”
The GRI Standards are a set of 36 modular standards. Three universal standards (GRI 101, 102 and 103) are applicable to all reporting organizations. These explain how to use the entire set of standards (GR 101), address contextual information about the reporting organization and its reporting practices (GR 102) and provide provide information about how the organization manages its material topics (GR 103).
In addition to the 3 universal standards, there are 33 topic-specific standards relating to separate economic, environmental or social topics such as procurement practices, environmental compliance, supplier environmental assessment, energy and water use and waste management. This allows organizations to determine what topics are material to their business and report on only those topic-specific standards that are relevant to those material issues.
While corporate sustainability reporting has become the norm for big companies in the US — 81 percent of S&P 500 companies published sustainability reports last year — it can be difficult and time consuming for smaller companies to publish these reports. With their new modular structure that allows corporate reporters to determine what topics are material to their business, the GRI standards will make reporting more accessible to more organizations, including smaller companies GRI says.
The new format also allows the Global Sustainability Standards Board (GSSB) to update individual topics without requiring revisions to the entire set standards.
“The new modular structure will facilitate faster response times for new reporting measurements,” Hespenheide said. “There are ever-changing demands for new and improved disclosures and, going forward, the GSSB will be able to update individual Standards, on a continual basis, without the need to revise the entire reporting framework. This means organizations that use GRI Standards will always be reporting using global best practice. This will put them in a better position to improve their sustainability performances.
This gives reporters a business advantage as well, according to Hespenheide.
“GRI reporting can also help organizations improve their financial performances, by giving businesses and their stakeholders a broader perspective on the risks facing the business,” he said. “The use of GRI Standards can help organizations identify topics before they become financially material. Early identification of these issues can make organizations more resilient and financially viable over the long-term.”
