In a push to strengthen the quality of sustainability reporting in the corporate sector, the United Nations Global Compact and the Global Reporting Initiative (GRI) today announced an agreement to align their work in advancing corporate responsibility and transparency.
Under the terms of the agreement, GRI will develop guidance regarding the Global Compact’s ten principles and issue areas to integrate centrally in a next iteration of its Sustainability Reporting Guidelines. At the same time, the Global Compact will adopt the GRI Guidelines as the recommended reporting framework for the more than 5800 businesses that have joined its corporate responsibility platform.
The agreement is intended to provide companies in the Global Compact with a clear set of reporting principles and indicators to meet the initiative’s compulsory annual disclosure requirement, also known as the Communication on Progress. The GRI Reporting Framework is applicable to organizations of all sectors, sizes and regions and also offers a series of supplements developed to address sector-specific circumstances and challenges.
In addition to creating a reporting framework that will be implemented universally, the new collaboration is also intended to provide a benchmark for financial analysts and other stakeholders to better analyze and identify risks and opportunities as they relate to environmental, social and governance (ESG) issues.
“As corporate responsibility has moved into the mainstream of business strategy and operations, the convergence of the two corporate responsibility initiatives with the broadest reach is a crucial development,” said Georg Kell, Executive Director of the UN Global Compact. “Together, the Global Compact and GRI have a unique opportunity to provide a clear roadmap to sustainability and change business practices on a global scale.”
Today is the final day of the Amsterdam Global Conference on Sustainability and Transparency. This year’s conference is focused on how to reach GRI’s vision
that disclosure on environmental, social, and governance performance will be
as mainstream as financial reporting by the year 2020.
GRI advocates that by 2015 all large and medium-sized companies in OECD countries and fast-growing emerging economies should be required to report publicly on their ESG performance, or if they don’t, explain why.
Secondly, GRI proposes that ESG reporting and financial reporting need to converge over the coming decade. GRI advocates that a standard for integrated reporting should be defined, tested and adopted by 2020.
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