Global Reporting Initiative

Author: Shireen Naidoo - Director Climate Change and Sustainability Services: KPMG

( Article Type: Explanation )

The Global Reporting Initiative (GRI) is a multi-stakeholder non-profi t organisation that develops and publishes guidelines for reporting on economic, environmental and social performance (sustainability performance).

The guidelines are now in their third generation, referred to as the GRI G3 Guidelines. More than 75% of the world’s largest 250 companies and nearly 70% of the Top 100 companies surveyed in 22 countries have indicated that they use the GRI Guidelines as the basis for their reporting framework. Currently the GRI G3 Guideline and sector supplements are the most widely recognized and comprehensive guide to sustainability reporting. It represents best practice in sustainability reporting and clearly indicates what and how to report through the standard disclosures and principles set out in the Guidelines. This is underpinned by stakeholder engagement. The Guidelines consist of principles for defining report content, ensuring the quality of reported information and promoting transparency throughout the reporting organisation by ensuring that reports are inclusive of the following aspects:

• Material issues facing the company

• Stakeholder inclusiveness

• The wider sustainability context and

• Completeness in reporting on the material risks

Companies using the Guidelines are required to self-declare their report’s application of the GRI Reporting Framework at one of three application levels,( C, B or A). The Application Levels are tiered on the amount of content required from the GRI Reporting Framework criteria with ‘C’ having the least requirements and ‘A’ having complete coverage of the Guidelines and Sector Supplements. These serve to incentivise beginners and recognise advanced reporters. If this information is subjected to external assurance the declaration level receives a ‘+’ symbol, indicating the emphasis the GRI places on assurance, for example C+, B+ or A+. 

The mistake that many companies make is reporting on a large set of GRI indicators in their report but providing very little information on sustainability strategy, context and material issues. The King Code for Governance in South Africa 2009 (King III) addresses this issue in particular by the following statement: “A key challenge is for leadership to make sustainability issues mainstream. Strategy, risk, performance and sustainability have become inseparable”. In putting together a framework for an ‘Integrated Report’, as discussed in King III, this issue will hopefully be addressed in future reports, looking holistically at the identifi cation of material sustainability issues and how these impact the organisation’s strategic objectives. This should empower stakeholders to make informed assessments of a companies’ environmental, social and economic performance which is expected to be presented in a manner that is balanced, comparable over time and to other peer organisations, accurate, clear, reliable and timely.  

In addition, a number of South African and international member organisations have adopted the Guidelines into their own membership reporting requirements. The International Council on Mining and Metals (ICMM) requires their members to report in line with the Guidelines, together with independent assurance indicating that their ICMM commitments have been met. For organisations embarking on the process of sustainability reporting, the Guidelines are certainly a very useful starting point. However, focusing on materiality and stakeholder engagement is important in getting this right.