The Global Reporting Initiative’s sustainability reporting guidelines
are undergoing their most radical revision since being released six
years ago.
A draft of the revised guidelines, which is out for comment until 31
March, for the first time includes sections known as ‘technical
protocols’ that specify in considerable detail how companies should use
social and environmental performance indicators in their reports. The
present guidelines confine themselves to short statements – sometimes
only one line long – on what form the 47 core and 32 optional
indicators should take.
The development of the protocols, collectively running to scores of
pages, has greatly increased the length and detail of the guidelines,
although they are published separately from the main body of the
document, which itself runs to 28 pages. The draft is referred to as
G3, being the guidelines’ third revision.
Mark Line, director of csrnetwork consultancy, which helped the GRI
draw up the protocols in conjunction with triple innova and Just
Solutions, said they should make requirements much clearer. ‘Hopefully,
they’ve clarified a lot of the areas of uncertainty,’ he told EP. ‘In
the current guidelines all you generally get is one sentence saying
what the indicator is and one line after that saying what you ought to
do with it. So it’s left completely open to interpretation.
‘Now you will get at least two or three pages explaining the purpose of
the indicator, its scope, compilation, methodology, useful references,
and pointers towards relevant international standards. So it’s much
more obvious what you need to be doing.’
Another significant change in the draft is tougher demands on reporters
to show not only that they have policies in particular areas, but that
they have management systems to implement them. The GRI hopes this will
stop some companies merely stating they have a policy and taking no
action.
Work on the G3 guidelines, which was funded by Alcan, BP, Ford, General
Motors, Microsoft, Royal Bank of Canada and Shell, took 18 months. GRI
is holding one-day events in more than 20 cities to publicize the
changes. A second draft will be produced by mid-2006 for submission to
the GRI’s governing bodies and is due to be released in October.
G3 also features an expanded section on the crucial issue of
materiality – how companies should decide what to report on and what to
leave out. The more detailed version may not please critics who believe the
guidelines are already too prescriptive. Line warned that the GRI needs
to ensure companies new to sustainability reporting are not deterred by
the length and detail of the new guidelines.
‘A reporting virgin looking at G3 is going to be pretty daunted, so
it’s important GRI communicates its message that you have to report
only on the indicators that are important for your business,’ he said.
‘That’s going to be a challenging message to get across.’ Indicators on
company pension plan obligations and on climate change are among the
draft proposals.
