Global Reporting Initiative's New Sustainability Reporting Guidelines
By Bill Blackburn and Ira Feldman*

The Global Reporting Initiative’s (GRI) Sustainability Reporting Guidelines and related Framework have been developed through an extensive global multi-stakeholder process. The GRI Guidelines, the most popular of their type, provide guidance to organizations of all kinds and sizes on the public reporting of their sustainability performance.

In early October 2006, at a major international conference in Amsterdam , GRI launched "G3"—the third version of its guidelines. The event, which drew over 1,000 attendees, provided a comprehensive view of the state of play in sustainability reporting through plenary sessions and separate parallel tracks on topics including public policy and capital markets. The event not only introduced the new G3, but also served as the vehicle for announcing a new relationship between GRI and the Global Compact (see below); the release of a number of significant new reports and studies; and the introduction of a new generation of information technology tools designed to support sustainability reporting. A stellar collection of keynote speakers—including former U.S. vice president Al Gore, the EU's Margot Wallstrom, and UNEP's Achim Steiner—affirmed that sustainability reporting is here to stay and that the GRI, in Steiner's words, had become a unique instrument, "facilitating the interface between markets, government and NGO's." The panels underscored the value of sustainability reporting as a communication and management tool.

The move to "materiality-based reporting"—the core of the new G3—is seen by many as the key challenge going forward. "Focusing on the material sustainability issues that matter to the business and demonstrating better linkages between an organization's business and sustainability strategy would go a long way in getting the mainstream investment community interested in sustainability." And, hopefully, materiality-based reporting will lead to more focused reports rather than the long, exhaustive ones that have come from the "carpet bombing" of issues by some writers. Further information on most of the plenary and break-out sessions can be found at http://www.globalreporting.org.

The Guidelines call on organizations to include five major components in their reports: a strategy and analysis section; an organizational profile; a section on governance and commitments; a discussion of management approach; and performance indicators.

Model indicators are provided under economic, environmental, and social categories—the latter comprising four categories covering labor practices, human rights, society, and product responsibility. Reporters are urged to provide contextual management information, termed "Disclosure on Management Approach" for each of the six categories. The indicators likely to be of interest and material to most reporting organizations are classified as "core indicators;" the "additional indicators" represent emerging practice or address topics likely to be material to some but not a majority of organizations. Each indicator is supported with an explanatory indicator protocol. To complement the general guidelines, the GRI Reporting Framework also includes an evolving set of sector supplements providing additional indicators and more focused guidance for particular industries and other groups.

In addition, the GRI Guidelines provide general guidance on building the reporting process and communicating about it. Reporting principles are offered for helping reporters decide what to report (materiality, stakeholder inclusiveness, sustainability context, completeness) and how to achieve a good quality report (balance, comparability, accuracy, timeliness, reliability, and clarity). These principles can assist organizations in selecting from among the indicators offered by GRI as well as aid them in developing others appropriate to their operations, products, and services.

In addition, guidance is provided on the role of stakeholder dialogue in the reporting process, on external assurance and on setting report boundaries (determining, for example, what organizations within the supply chain should be covered). Different levels of application of the guidelines are defined to help new reporters get started and, over time, progress to more sophisticated stages of reporting. These levels are also used to classify reports that are registered on the GRI web site.

Whether or not an organization prepares a social responsibility or sustainability report for the public, it may find the GRI Reporting Framework to be a useful tool for driving performance through internal reporting. In an effort to improve the compatibility between the GRI sustainability reporting guidelines and the UN's Global Compact, the most popular code of organizational sustainability behavior, the two groups have formed a recently announced alliance. Organizations endorsing the Global Compact are expected to report their progress toward fulfilling their Compact obligations, and the UN is encouraging the use of GRI-based reports for that purpose. Further collaboration between the Global Compact and GRI is planned to make their two frameworks even more complementary in the future.

NOTE: This update is excerpted from an earlier version an article which first appeared in the Sustainable Development, Ecosystems and Climate Change Committee Newsletter, Vol. 10, No. 1, December 2006, Section of Environment, Energy, and Resources, American Bar Association.

ABOUT THE AUTHORS: Ira Feldman is the immediate past chair of the ABA/SEER Sustainable Development, Ecosystems and Climate Change committee. He is president and senior counsel of greentrack strategies (ira at greentrack.com) and currently serves as US expert to the ISO 26000 process.

William (Bill) Blackburn is a vice chair of the ABA/SEER committee. He is the former vice president and chief counsel for EHS at Baxter International and current president of William Blackburn Consulting, Ltd. (WRB at WBlackburnConsulting.com), a consulting firm focusing on the management of environmental, health, safety and sustainability issues, and crisis and emergency response. Bill is on the management committee of the GRI stakeholder council and represents GRI in the ISO 26000 process.