GRI: How to report your sustainability performance

Reporting is an integral part of any successful business organisation. And in the case of any successful transformation of a business to become sustainable, it has a key part to play. In any business that aims to integrate ESG or SDGs, as described through the SDG Compass, reporting is an important step.

There are already several internationally recognised standards and frameworks for reporting. Auditors and analysts routinely make use of data that has thus been reported to study, dissect, and improve the performance of companies. 

Similarly, as companies look to integrate ESG concerns into their business and look for ways to improve their sustainability, the need for a reporting standard for sustainability data comes to light. There are many organisations, independent and otherwise offering standards and guidelines for reporting ESG data. 

One such important organisation is GRI (Global Reporting Initiative), an independent non-profit organisation that provides the world’s most widely used sustainability reporting standards. It also refers to the UN Sustainable Development Goals (SDSs) in its standards. 

Why your business needs GRI to be sustainable

The organisation describes part of its mission to be to “help organisations be transparent and take responsibility for their impacts so that we can create a sustainable future”.

Whether you are a sustainability professional, a business owner, an auditor, an analyst or even an entry-level employee at an organisation, there is value to be had from learning and understanding GRI. Apart from being the most widely used sustainability reporting standard, there is, there is also the advantage of all of their standards are available to the public as free goods. 

This eliminates one of the more significant barriers to sustainability in business – additional costs. By eliminating the costs associated with using a standard for reporting, GRI encourages businesses to take action. 

Sustainability cannot be achieved by a singular action. Rather, it takes a process that involves several steps, each one bringing the organisation one step closer to being sustainable. Data are important in this transition, and the standards for collecting, processing and reporting sustainability data are also important. 

This is why anyone with an interest in sustainability, even if they are not a reporting professional themselves, has a strong reason to learn and understand GRI.

Who is the GRI for?

Any organisation that intends to integrate sustainability into their business have the need for reporting sustainability data, and thereby also need GRI standards.

While the standards have so far been adopted mostly by large organisations in over 100 countries, there is an initiative to have them adopted by SMEs as well. The intention is to use sustainable business practices to gain a competitive advantage. 

How to use GRI standards to achieve corporate sustainability

The GRI standards offer the value of being a standardised language for reporting sustainability data. This is key, as it allows for easy understanding and analysis of the data by stakeholders. 

Businesses can use the standards as a whole and report all kinds of sustainability data. Alternatively, they can choose to use selected Standards only, to report the most relevant sustainability data. This flexibility is useful, as companies have different requirements when it comes to reporting. For example, a Software as a Service (SAAS) is likely to have social or governance data to be more important than environmental data, unlike a paper bag manufacturer. 

Companies that use GRI standards to report their sustainability data can present the data to stakeholders for their review, increasing transparency about the business practices and earning key points in trust.

There is also the advantage of reducing risk. By identifying ESG issues through the reported data, companies can make improvements or changes to their business practices. As practices related to employees, environmental impact and governance are all contributors to the reported data, a company can identify risks as wide-ranging as potential lawsuits and regulatory action to cost savings.

What are the GRI standards for sustainability reporting?

GRI standards refer to reporting principles that refer to the selection and quality of the content that is included in the report. There are two types of standards:

Standards for defining Sustainability report content

These standards help decide what information to be included as report content. They include guidelines for choosing what data is to be included, and what parameters to consider before making the decision to include any information. These standards are as follows :

Stakeholder Inclusiveness

The report must be inclusive of the information on how the company may affect its stakeholders. The organisation shall include information about the stakeholders, how and why these stakeholders were chosen and the outcomes of the stakeholder engagement efforts.

These stakeholder engagement efforts could be those undertaken by the company as part of its routine activities, or the specific activities that are undertaken for the purpose of this report. The report is to also include information on how these engagement activities were carried out by the organisation and what ESG impact they may have.

Sustainability context

The report must present the performance of the company in the context of sustainability. 

For example, it may include information on how the wages it offers in a specific location compares to the regional or national average. Another example would be the amount of pollution that is caused by its activities, and what measures are needed and/or done to remedy any negative impacts. In some cases, large amounts of pollution may call for the organisation to invest in solutions like carbon offsets.

The organisation must also relate its strategy for sustainability and how it may contribute toward achieving broader sustainability goals that may have been set by other parties (like governments).

Materiality

The sustainability report must cover topics that are considered material to the organisation, in the context of sustainability. 

Materially of a topic comes as a result of two things – its wide range of impacts (ESG impacts) and its influence on stakeholders’ assessments and decisions. The factors that are reported upon must have a reasonably significant impact on at least some ESG factors, or influence the stakeholders, or both. Any information that is considered relevant enough to impact a stakeholder decision is considered material and may be reported upon.

These factors may come from broader areas like laws and regulations, as they may have a significant impact on the stakeholders’ decisions. There should also be clear prioritisation of these material issues in the report. Not all material issues are significant enough in their impact to be reported, and only the most relevant information is to be included in the sustainability report.

Completeness

Completeness refers to three factors that ensure the information that is presented in the report is complete and adequate.

The list of material topics covered in the report must be sufficient to encompass the organisation’s impact on ESG factors. 

Topic boundaries describe where the impacts occur in any material topic and how the organisation causes the impact. 

It covers the need for the reported information to be accurate and complete for the reporting period.

These factors, together, ensure that the report is accurate and presents information from all the relevant sources, so as to inform the stakeholders as well as possible.

Standards for Defining Sustainability Report Quality 

These standards ensure that the information that has been reported is of sufficient quality. They are vital to ensuring important characteristics to the report such as accessibility and comparability. These standards are as follows :

Accuracy 

The reported information must be accurate and include enough relevant detail for the stakeholders to easily assess the reporting organisations performance. This also refers to the fact that accuracy is different for different types of data such as quantitative vs qualitative. The report must be accurate in its info, regardless of the type of data that has been reported

Balance

The report must be unbiased, so as to ensure the stakeholders get a complete and accurate picture of the organisation’s performance. The report must include both negative and positive information, and there must be no omission of any kind of info to present the company in a biased light. The report must also distinguish clearly between facts and the firm’s interpretation of facts. Facts should be presented as what they are – objective truths, and interpretations of the facts made by the organisation should be clearly labelled.

Clarity 

The report must be reasonably easy for stakeholders to read and comprehend. It must not be filled with technical jargon that makes it inaccessible. Rather, there must be a focus on making the information that is in the report easy to understand through the use of tools like graphs. It should also include the right amount of detail, and avoid packing in any unnecessary and/or irrelevant data.

Comparability

The organisation must be consistent in the methods that it uses to report data. The format that is used and the information that is included must be consistent across the reports from multiple years. This allows for easy comparison of the data of the organisation from the report of a specific year against any other years. Also, being consistent with the overall standards allows the stakeholders to even compare the data of the company against other companies and organisations in the same industry, or against any benchmarks that are available. 

Reliability

 The report and its methodology for collecting and analysing information must be easily understood by professionals other than those who created the report. The organisation must also be able to provide the original sources of information when needed. Any data that appears in the report must be supported by factual evidence. 

Timeliness

Data is really only valuable when they are available at the right time. The organisation must have some sort of schedule for reporting and releasing the data so that stakeholders can make informed decisions. The info must be as recent as possible. 

How GRI will empower your business with sustainability reporting 

There are a number of necessary disclosures that an organisation is required to make for its report to be considered to be compliant with the standards of GRI. 

These standards are outlined in the GRI guide file that is freely available from their website. Following this comprehensive guide allows companies to ensure their sustainability reports are made in line with a widely accepted industry standard for the reports. It also means the stakeholders can easily access and understand the information that the organisation presents in their sustainability report.

Perhaps more importantly, this also means that the stakeholders have a complete, unbiased and fact-based outlook on the company and its efforts in the context of sustainability.

The goal of producing such a report is not to try and paint the organisation in a positive light in front of its stakeholders. If the organisation does well, this would only be a welcome side effect.

The real goal behind sustainability reporting is to make information accessible to the stakeholders. Information about how the company may be sustainable in some of its activities and how it may not be very sustainable in some others. An objectively crafted report that follows the GRI standards will also prompt a further dialogue among the company itself and its various stakeholders. This, in turn, can lead to the organisation becoming more sustainable over time.

And the best part about it is that this sustainability will be achieved as a result of active collaborative efforts among all the stakeholders of a company, internal or otherwise. This is how businesses can become truly sustainable, without affecting their bottom line.

For sustainability to make sense in the highly competitive economy today, these reports are necessary. 

They help the organisation understand the impacts of all its activities and how it may change some of them to undergo a sustainable transformation. Everything begins with transparency. Not only about how the organisation is doing well, but also about how it is not doing so great. It can also include updates on the progress of an ongoing sustainability effort within the organisation. 

When stakeholders can gather an unbiased and complete picture of an organisation’s performance, in the context of sustainability, that is when we know the reporting is effective. In the unlikely event that this does not happen, and there are gaps in the report that are not being met by the GRI standards, further help may be required. 

GRI has programs designed to help an organisation learn, understand and implement its standards in sustainability reports. Alternatively, for a small organisation that does not have the internal resources to create an adequate report, they may depend on a sustainability-focused organisation that offers such focused services.

How we can help use gri for your business

Sustinaro believes in sustainability that makes sense. Changes that do not require a significant sacrifice of resources are vital in driving sustainability in competitive businesses. In fact, sustainability should be a driver of competitive advantage, if done well.

We help businesses become more sustainable, and we begin with the optimisation of the communication efforts of your sustainability efforts. Connect with us today, and begin your transformational journey through sustainability.