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66 Experts Tell GRI: Enhance Guidance on Sustainability Context in G4
September 26, 2012
Earlier this week, 66 members of the Sustainability Context Group, an international community of corporate sustainability managers, academics, analysts and advisors, submitted a letter asking the Global Reporting Initiative (GRI) to enhance guidance on its Principle of Sustainability Context. This submission came at the end of the Second Public Comment Period for input on the Exposure Draft of G4, the next generation of sustainability reporting guidelines that are currently under revision.
“Although GRI’s Guidelines currently do advocate for the inclusion of Sustainability Context in organizational reports, they fail to provide specific guidance for how to do so,” the letter states in the Rationale and Background section required by GRI for open comments. “Because of this lack of guidance, very few GRI-based sustainability reports have ever actually included such context — and yet without it, there can be no true or authentic sustainability reporting, in our opinion. For the sake of the credibility — and usefulness — of sustainability reporting, it is vitally important that this shortcoming be resolved, and that GRI take steps to include specific guidance in G4 for how to implement Sustainability Context in contemporary reporting.”
Amongst the 66 signatories is GRI co-founder and former CEO Allen White, who originally proposed inclusion of the concept of Sustainability Context in GRI’s guidelines back in 1999.
“Today, I continue to argue that without such context, there can be no real, rigorous sustainability measurement, reporting, and performance assessment at all,” White says.
In keeping with GRI’s mission of providing non-prescriptive guidance, the letter provides suggested language in the form of functional specifications or criteria that organizations would need to follow in order to report their sustainability performance “in the context of the limits and demands placed on environmental or social resources at the sectoral, local, regional, or global level” (to quote GRI’s definition of Sustainability Context). The functional specifications/criteria, which the letter suggests be integrated in the Technical Protocol section of the G4 Guidelines, include:
- Impacts on Capital Stocks
- Allocations and Performance Standards
- Context-Based Metrics
For illustration purposes, the letter then provides a simple, 5-step procedure that fulfills the functional specifications:
- Identify Stakeholders
- Identify Relevant Impacts on Vital Capital Stocks
- Determine Normative Impacts on Vital Capital Stocks
- Determine Actual Impacts on Vital Capital Stocks
- Determine Sustainability Performance
The letter also includes two specific examples of this 5-step process in action, one involving carbon (that cites current practice by BT and Autodesk) and another involving water. The letter also makes it clear that many other examples exist, including those addressing the social and economic legs of the Triple Bottom Line.
“The preparation and submission of the letter itself represents a watershed moment in the mainstreaming of sustainability context,” said Mark McElroy, co-founder of the Sustainability Context Group and author of the book, Corporate Sustainability Management: The Art & Science of Managing Non-Financial Performance, which outlines how to implement context-based sustainability. “In the spirit of constructive input, we’re handing over first-draft language that GRI can pull ‘off the shelf’ or improve upon to integrate into G4.”
“The fact that 66 of the leading thinkers and doers in the corporate sustainability community rolled up their sleeves to draft and sign onto this letter creates a kind of arc of inevitability in the widespread adoption of this approach that actualizes the definition of sustainability,” added Sustainability Context Group Co-Founder Bill Baue. “Unlike current practice that looks at environmental, social, and economic impacts in isolation, sustainability context takes the necessary next step of measuring those impacts against the yardstick of time: Can those impacts continue in perpetuity, or are they, in fact, unsustainable.”