The Global Reporting Initiative

By Steve Kellogg

Sustainability is not a new concept. In 1987, the United Nations World Commission on Environment and Development described sustainable development as meeting “the needs of the present without compromising the ability of future generations to meet their own needs.” (Our Common Future: Report of the World Commission on Environment and Development)

Global Reporting Initiative

The Global Reporting Initiative (GRI) was formed in 1997 in Boston, Mass, by two non-profits, Ceres (formerly the Coalition for Environmentally Responsible Economies) and Tellis Institute with the support of UNEP (United Nations Environment Program). GRI relocated to Amsterdam, Netherlands, and has since developed reporting guidelines in order to create a uniform set of standards upon which to measure sustainable goals and actions.

Simply put, GRI is an international independent standards organization. It works with businesses, governments and other organizations to understand and to communicate their impacts on issues including the economy, climate change, human rights and corruption. The Global Reporting Initiative is a pioneer of sustainability reporting and has produced reports in more than 100 countries.

United Nations Global Compact

Although the GRI is independent, it remains a collaborating center of UNEP and works in cooperation with the United Nations Global Compact.

GRI has produced the first global standards for sustainability reporting. The standards are divided into three primary categories:

•       Economic
•       Environmental
•       Social

Economic standards address economic and financial issues including economic performance and impacts, procurement practices and corruption.

Environmental issues involve material, energy, water, biodiversity, emissions, waste and compliance.

Social issues are wide-ranging and include employment, health and safety, labor (especially child and forced), human rights, privacy and more.

Corporate Social Responsibility

With pressure from stakeholder groups including governments, consumers and investors seeking greater transparency, many companies now publish a sustainability report, also known as a CSR (Corporate Social Responsibility). Notable companies, such as Apple, Ford, and Bank of America, to name just a few, are participants.

Looking more closely at Ford Motor Company, it has been reporting for 20 years via a variety of reporting framework indices, including GRI. Its program focuses on three areas: Enhancing People’s Lives, Advancing Our Planet, Innovating Future Motion. The company is clearly committed to sustainability and has numerous programs in place to enhance it.

For example, Ford has a stated goal of “aspiring to become the most inclusive and diverse global company.” This goal is further broken down to focus on gender diversity and equality and protecting human rights in the supply chain.

Efforts from Ford Motors

In 2019, Ford Motor Company received an A grade for its water security efforts from CDP, the environmental impact nonprofit that drives sustainable economies. This marks the fourth year in a row Ford has earned an A from CDP for its water management efforts.

It is clear that the act of reporting is creating not only greater transparency, but positive actions to achieve improved sustainability in a variety of areas.

GRI Standards are the first and most widely adopted global standards for sustainability reporting, with 93% of the world’s largest 250 corporations reporting on their sustainability performance. Such disclosers are believed to encourage accountability, resulting in improved environmental protection, improved governance and the betterment of society.

Voluntary Reporting

Although sustainability reporting in the United States is presently voluntary, corporations have increased their reporting on these issues. The Governance and Accountability Institute (GAI) reports that approximately 81% of S&P 500 companies issued a sustainability report in 2015, compared to less than 20% in 2011. By 2016, over 13,000 companies had produced more than 80,000 reports. KPMG’s 2017 survey reveals that sustainability reporting is standard practice for large and mid-cap companies worldwide.

As a side note, sustainability investing continues to grow in popularity, but the lack of standardization in reporting poses a challenge for investors wishing to maximize their social responsibility, and minimize the social damage, of their investments.  According to the CPA Journal, 60% of companies believe their sustainability disclosures facilitate investors’ comparison of companies, while 92% of investors do not agree. It would appear that more efforts are needed in this area.

Transparency is on the rise

While sustainability reporting is still in its infancy, improvements in consistency and transparency are slowly occurring. However, its impact is being felt as companies and other organizations are altering behaviors to become increasingly sustainable.

GRI is not the only organization in this space. Others include the International Integrated Reporting Council (IIRC), the Sustainability Accounting Standards Board (SASB), and the Global Initiative for Sustainability Ratings (GISR).

For additional information, the GRI website is www.globalreporting.org.

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Steve Kellogg is a consultant (working with start-up businesses), speaker, trainer, copy and content writer, and recovering architect/land planner.