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www.globalreporting.org
Mark A. CohenMark A. Cohen
Senior Associate DeanSenior Associate Dean
Justin Potter Professor of American Competitive BusinessJustin Potter Professor of American Competitive Business
Owen Graduate School of ManagementOwen Graduate School of Management
Vanderbilt UniversityVanderbilt University
Sustainability Reporting and the Sustainability Reporting and the Global Reporting InitiativeGlobal Reporting Initiative
www.globalreporting.orgwww.globalreporting.org 22
Outline of Talk…Outline of Talk…
History of Sustainability ReportingHistory of Sustainability Reporting Important drivers of reportingImportant drivers of reporting GRI’s MissionGRI’s Mission History & Organizational Structure of GRIHistory & Organizational Structure of GRI ““Products” available on GRI websiteProducts” available on GRI website Growing acceptance of GRIGrowing acceptance of GRI Value to Librarians…Value to Librarians… Questions?Questions?
www.globalreporting.orgwww.globalreporting.org 33
Origins of Sustainability Reporting…Origins of Sustainability Reporting…
• Toxic Release Inventory (TRI)Toxic Release Inventory (TRI) Effect of TRI on Stock Price of FirmsEffect of TRI on Stock Price of Firms
• Responsible Care/Chemical IndustryResponsible Care/Chemical Industry• Coalition for Environmentally Coalition for Environmentally
Responsible Economies (CERES)Responsible Economies (CERES)• Investor Responsibility Research Center Investor Responsibility Research Center
(IRRC)(IRRC) Emissions Efficiency Index (S&P 500)Emissions Efficiency Index (S&P 500) Collected Government Penalty Data, etc. Collected Government Penalty Data, etc.
www.globalreporting.orgwww.globalreporting.org 44
Growth in reporting…Growth in reporting…
1988 first US report (Polaroid)1988 first US report (Polaroid)
• By 1994 => over 100 in USBy 1994 => over 100 in US
• By 2004 => hundreds…around worldBy 2004 => hundreds…around world
www.globalreporting.orgwww.globalreporting.org 55
Growth in demand…Growth in demand…
Growth in demandGrowth in demand
• NGOsNGOs
• GovernmentGovernment
• Financial Community (esp. SRI)Financial Community (esp. SRI)
www.globalreporting.orgwww.globalreporting.org 66
Need for standardization…Need for standardization…
Financial Data Financial Data • GAAP Accounting standardsGAAP Accounting standards• Securities and Exchange CommissionSecurities and Exchange Commission
Sustainability DataSustainability Data• Difficult if not impossible for average Difficult if not impossible for average
investor to decipher & compare.investor to decipher & compare.• Difficult for companies & NGOs to Difficult for companies & NGOs to
benchmarkbenchmark
www.globalreporting.orgwww.globalreporting.org 77
Investor demand for CSR data…Investor demand for CSR data…
Dow Sustainability IndexDow Sustainability Index• www.sustainability-indexes.comwww.sustainability-indexes.com
Calvert GroupCalvert Group• www.calvert.comwww.calvert.com
Innovest Investment AdvisorsInnovest Investment Advisors• www.innovestadvisors.comwww.innovestadvisors.com
Sustainable Asset ManagementSustainable Asset Management• www.sam-group.comwww.sam-group.com
www.globalreporting.orgwww.globalreporting.org 88
Carbon Disclosure Project…Carbon Disclosure Project…
95 Institutional investors (> $10 95 Institutional investors (> $10 trillion in assets)trillion in assets)
Info Request to FT500 Global IndexInfo Request to FT500 Global Index• Risks & Opportunities from Climate Risks & Opportunities from Climate
ChangeChange http://www.cdproject.net/http://www.cdproject.net/
www.globalreporting.orgwww.globalreporting.org 99
GRI’s missionGRI’s mission
a generally accepted a generally accepted global framework for global framework for
sustainability sustainability reportingreporting
www.globalreporting.orgwww.globalreporting.org 1010
Elevate economic, environmental and social reporting to routine practice, at the highest standards of rigour and comparability.
Design and continually improve reporting guidelines reflecting the three dimensions of sustainability: economic, environmental, and social.
GRI missionGRI mission
www.globalreporting.orgwww.globalreporting.org 1111
the GRI way:the GRI way:
approachapproach triple bottom triple bottom
lineline globalglobal multi-multi-
stakeholderstakeholder
processprocess multi-multi-
stakeholder stakeholder consultationconsultation
learning forumlearning forum continuous continuous
improvementimprovement
productsproducts core guidelinescore guidelines protocolsprotocols sector sector
supplementssupplements resource resource
documentsdocuments
www.globalreporting.orgwww.globalreporting.org 1212
GRI brief history:GRI brief history:
conceived 1997 : CERES & UNEPconceived 1997 : CERES & UNEP 11stst draft Guidelines released 1999 draft Guidelines released 1999 formally launched 2002formally launched 2002 Official recognition at WSSD (Article 18 Official recognition at WSSD (Article 18
and 45)and 45) Amsterdam-based permanent Amsterdam-based permanent
Secretariat (Sept. 2002)Secretariat (Sept. 2002)
www.globalreporting.orgwww.globalreporting.org 1313
GRI governance GRI governance
www.globalreporting.orgwww.globalreporting.org 1414
stakeholderstakeholder council composition council composition
60 sc members:60 sc members:• 22 Business 22 Business • 16 Mediating Institutions16 Mediating Institutions• 16 Civil Society/Advocacy16 Civil Society/Advocacy• 6 Labor6 Labor
aacross 5 regions:cross 5 regions:• Africa Africa • Asia/PacificAsia/Pacific• West AsiaWest Asia• Europe/North AmericaEurope/North America• Latin America/CaribbeanLatin America/Caribbean
The Council
CSO AdvocacyBusiness
Mediating Institutions
Labour
www.globalreporting.orgwww.globalreporting.org 1515
global uptake: GRI reporters global uptake: GRI reporters (per country)(per country)
Austria , Denmark 3
Finland 9
Canada, Sweden 13
Germany 19
France 22
Spain 23
Japan 78
United States of America 46
Australia 20
South Africa 19
Netherlands 14
Italy,Switzerland 6
Brazil, New Zealand
4Costa Rica,
Malaysia,Thailand 3
Chile, China, India,
Hungary, Norway 2
United Kingdom 49
Argentina, Mauritius 1
Belgium, Ireland 2
Israel,Portugal 1
www.globalreporting.orgwww.globalreporting.org 1616 16 May 2003
GRI productsGRI products
GRI sector supplements-Tour operators-FS-social-Telecom -Automotive
GRI sector supplements-Tour operators-FS-social-Telecom -Automotive
GRI2002reportingguidelines
GRI2002reportingguidelines
GRI technical protocols:-Energy use-Water use
GRI technical protocols:-Energy use-Water use
GRI resource documents:-HIV/AIDS
GRI resource documents:-HIV/AIDS
if preferred
if available
all organisations
www.globalreporting.orgwww.globalreporting.org 1717
Economic Economic Performance indicatorsPerformance indicators
Total sales by marketTotal sales by market Goods, services purchased by Goods, services purchased by
countrycountry Total payroll & benefits by country Total payroll & benefits by country Taxes paid by countryTaxes paid by country Infrastructure spending (e.g. schools, Infrastructure spending (e.g. schools,
roads)roads)
www.globalreporting.orgwww.globalreporting.org 1818
Examples of Environmental Examples of Environmental Performance indicatorsPerformance indicators
Material usageMaterial usage Waste by type and destinationWaste by type and destination Energy consumptionEnergy consumption Renewable energy sources usedRenewable energy sources used Water usageWater usage Biodiversity indicatorsBiodiversity indicators Greenhouse gas emissionsGreenhouse gas emissions Discharges to waterDischarges to water Significant spills of chemical, oilSignificant spills of chemical, oil Penalties paidPenalties paid
www.globalreporting.orgwww.globalreporting.org 1919
Examples of Social Examples of Social Performance indicatorsPerformance indicators
Workforce by country, type of employmentWorkforce by country, type of employment Employment creation & turnoverEmployment creation & turnover Percent union representationPercent union representation Layoff notification policiesLayoff notification policies Health & Safety recordHealth & Safety record Hours training & education for employeesHours training & education for employees EEO policiesEEO policies Child labor practicesChild labor practices Policies to evaluate suppliers/contractorsPolicies to evaluate suppliers/contractors Political contributionsPolitical contributions Customer safety & healthCustomer safety & health
www.globalreporting.orgwww.globalreporting.org 2020
business recognitionbusiness recognition
“… “… the GRI and AA1000 are your best the GRI and AA1000 are your best bets, not only for reporting, but for bets, not only for reporting, but for building structured models for building structured models for transparency-driven stakeholder transparency-driven stakeholder engagement.” engagement.”
Don Tapscott and David Ticoll, The Naked Corporation – How the Don Tapscott and David Ticoll, The Naked Corporation – How the Age of Transparency Will Revolutionize Business, (2003)Age of Transparency Will Revolutionize Business, (2003)
www.globalreporting.orgwww.globalreporting.org 2121
official recognition by governmentofficial recognition by government
““The European Parliament … highlights The European Parliament … highlights the importance, as stressed by the the importance, as stressed by the Commission, of building trust and Commission, of building trust and consensus and support for internationally consensus and support for internationally accepted principles such as the OECD accepted principles such as the OECD Guidelines for Multinational Enterprises Guidelines for Multinational Enterprises and the Global Reporting Initiative (GRI).” and the Global Reporting Initiative (GRI).”
European Parliament Report on Corporate Social European Parliament Report on Corporate Social Responsibility (Final A5-0133/2003Responsibility (Final A5-0133/2003), April 2003), April 2003
www.globalreporting.orgwww.globalreporting.org 2222
“ “ Investors cannot make judgments about Investors cannot make judgments about the way business is managing the way business is managing sustainability and corporate responsibility sustainability and corporate responsibility issues unless companies disclose relevant issues unless companies disclose relevant information. … information. …
Overall, we view the GRI as setting the Overall, we view the GRI as setting the global benchmark for disclosure and global benchmark for disclosure and encourage companies to produce reports encourage companies to produce reports which are in accordance with the GRI which are in accordance with the GRI guidelines.”guidelines.”
SRI Annual Report, Henderson Global Investors, May 2003SRI Annual Report, Henderson Global Investors, May 2003
market recognitionmarket recognition
www.globalreporting.orgwww.globalreporting.org 2323
Increase GRI reportingIncrease GRI reporting
0
100
200
300
400
500
600
700
1999 2000 2001 2002 2003 2004 2005
380+
2005 Target 600+
As of 6 January 2004:380 reporters from 33 countries
www.globalreporting.orgwww.globalreporting.org 2424
““In Accordance With…”In Accordance With…”
Reporters who use GRI GuidelinesReporters who use GRI Guidelines• 380380
Reporters who are “In Accordance Reporters who are “In Accordance With GRI Guidelines”With GRI Guidelines”• Approx 80Approx 80• Must report or “explain” all key Must report or “explain” all key
indicatorsindicators
www.globalreporting.orgwww.globalreporting.org 2525
global : GRI reporters (per global : GRI reporters (per sector)sector)
0 10 20 30 40 50 60 70
Basic MaterialsConsumer Cyclical
Consumer Non-CyclicalDiversified
EnergyFinancial
Health CareICT
IndustrialNon-Profit
OtherServices
TransportationUtilities/Community
www.globalreporting.orgwww.globalreporting.org 2626
GRI non-business reportersGRI non-business reporters
Organisation Category Country
Australia Commonwealth Department of Family & Community Services (FaCS) Government Australia
International Institute for Sustainable Development General Canada
Landcare Australia Environment Australia
Manaaki Whenua Landcare Research Government New Zealand
New Zealand's Ministry for the Environment Government New Zealand
NHS Purchasing and Supply Agency Government U.K.
Reckitt Benckiser Academic U.K.
University of Florida Academic United States
www.globalreporting.orgwww.globalreporting.org 2727
GRI sector supplementsGRI sector supplements
Tour operatorsTour operators Financial servicesFinancial services TelecommunicationsTelecommunications Automotive (draft)Automotive (draft) Others in various stagesOthers in various stages
www.globalreporting.orgwww.globalreporting.org 2828
Value to LibrariansValue to Librarians
Corporate Corporate • Benchmarking of competitionBenchmarking of competition• Design of corporate reportsDesign of corporate reports• Screening of suppliersScreening of suppliers
Business School Business School • Classes in marketing, corporate social Classes in marketing, corporate social
responsibility, regulation/lawresponsibility, regulation/law Other ?Other ?
www.globalreporting.orgwww.globalreporting.org 2929
Questions?Questions?