#02 Business
Teresa C. Fogelberg

Can Reporting Help Sustainable Development?

Companies in developing countries are reporting on their sustainability performance more than ever before, according to figures from the Global Reporting Initiative (GRI) Reports List[1]. The figures suggest that sustainability reporting in non-OECD countries increased by a third last year, while the number of reports from OECD countries increased by 22 percent. But can reporting pave the way to sustainable development?

Guiding the reporting process

GRI provides the world's most widely-used framework for producing sustainability reports. The GRI Sustainability Reporting Guidelines enable large and small companies, non-profit organizations and government bodies worldwide to assess their sustainability performance and disclose the results in a similar way to financial reporting. Transparency through reporting on environmental, social and governance (ESG) factors drives the sustainability of individual organizations and, ultimately, the global economy.

GRI has been working with a focus on developing countries, and launched its Sustainable Development Strategy in the summer of 2010, with the involvement of stakeholders in the GRI network. The Strategy aims to increase ESG reporting in the Global South, to strengthen the sustainability performance of local businesses, to empower stakeholders and to encourage multinational companies to be more transparent about their social and environmental performance.

Emerging evidence

Research has suggested a correlation between sustainability reporting and poverty alleviation. Companies have made improvements to their practices as a result of disclosing economic, environmental and social policies and performance, for example, where potentially harmful incidents have been avoided. At GRI, we have heard from companies that have changed their policies and practices in concrete ways, making a positive impact on people's income, environmental conditions, health and knowledge.

One of GRI's goals is to make sustainability reporting mainstream. The GRI Guidelines are currently available in 25 languages, enabling organizations around the world to produce sustainability reports, including companies in developing countries. Companies and other organizations can help to promote and work towards sustainable development by being more transparent about their economic, environmental, social and governance performance, and GRI works to give all organizations access to guidance on how to do this.

Sharing the knowledge

GRI Learning Services offers guidance and support on producing sustainability reports. The Department produces publications to guide new reporters through the reporting process, which are available in many different languages. GRI staff run Introductory Workshops, and GRI's Certified Training Partners run Certified Training courses all over the world. Currently, GRI has 48 Training Partners, located in 16 countries including Brazil, South Africa, India, Republic of Korea and the Hispanic Americas.

GRI also helps multinational enterprises offer sustainability reporting support to their suppliers, many of which are located in developing countries. The Global Action Network for Transparency in the Supply Chain (GANTSCh) Program focuses on multinational enterprises such as Puma that want to embed sustainable practices and reporting within their supply chains, offering training and workshops to suppliers. GRI has been working with Puma since 2006, enabling more than 30 of its suppliers to report on their sustainability performance.

Local connections

GRI has several 'Focal Points'; national representatives of GRI in different countries. The Focal Points engage with people who produce sustainability reports, as well as encouraging those who do not to start monitoring and reporting on their sustainability performance. The Focal Points represent GRI in different regions; currently there are five, located in Australia, Brazil, China, India and the USA.

In addition to the five Focal Points, GRI is exploring opportunities for increasing GRI's presence in Sub-Saharan Africa and Spanish speaking America. This responds to one of the goals of GRI's Sustainable Development Strategy, to promote sustainability reporting in the Global South, as well as working towards GRI's mission, to mainstream sustainability reporting worldwide.

Informing policy

In order for the world to foster sustainable development and move towards a green economy, governments need to encourage companies to be more transparent about their economic, environmental, social and governance performance. GRI works closely with policy makers and international organizations to drive this process, and there were some major developments in policy around sustainability reporting in 2009/10.

The Institute of Directors in Southern Africa (IoD) formally unveiled the King Code of Governance Principles and the King Report on Governance (King III) in Johannesburg on 1 September 2009. In December 2009, India's Ministry of Corporate Affairs launched the country's first voluntary CSR guidelines, Corporate Social Responsibility Guidelines 2009, which aim to contribute towards the long term sustainability of businesses in India. As well as helping businesses focus on, and contribute to, the interests of their stakeholders and society, the guidelines also aim to help Indian companies make CSR an integral part of their overall business policies.

Gesellschaft für Technische Zusammenarbeit (GTZ) played a supportive role in this process. GRI also works closely with its Governmental Advisory Group. Established in 2008, the Group is a high-level advisory group whose function is to provide the GRI Board and the GRI Executive team with a direct source of advice from governments. In addition, the Group functions as a platform to exchange ideas and experiences between the members themselves. The Group includes representatives from both OECD countries (Australia, Denmark, France, European Parliament, Germany, Netherlands, Norway, Spain Sweden) and non OECD countries (Brazil, South Africa, India, and China), as well as from UNEP.

Sustainable future

We need to manage the change to a green economy, on the path to sustainable development. By encouraging the disclosure of environmental, social and governance performance, we can identify the gaps we need to close to achieve this goal. Companies that follow the GRI Sustainability Reporting Framework, including those in developing countries, are transparent about their impact on society, paving the way to a green economy and ultimately sustainable development.

Footnote

[1]The GRI Reports List is updated every week and GRI tries to make it as comprehensive as possible. The list includes GRI reports that GRI is made aware of, through the process of checking Application Levels, through GRI's Data Partners, who share information on GRI reports, and through internet searches. The list includes reports with a GRI content index that are in Latin script and published online. Not all GRI reporters publish reports on an annual basis. Many reportingorganizations use the GRI Guidelines as a tool to guide their ESG reporting without actually making a reference to GRI. Therefore, the total number of GRI reports per year may not necessarily correspond with the total number of GRI reporters in that year. The GRI Reports List can be accessed at www.globalreporting.org/ReportServices/GRIReportsList/