In the past few years, it has become increasingly clear that the efforts of the public and private sectors are inextricably linked. To meet ambitious social and environmental targets like those outlined in the Paris Agreement and the Sustainable Development Goals (SDGs), progress must be tracked and evaluated by all the estates and actors of society.
It is clear in contemporary society that most stakeholders see companies as the actors that have the resources, know-how, and efficiency to achieve the social and environmental improvements necessary to realize the SDGs and goals of the Paris Agreement.
The central role of business was emphasized in a recent Boston College Center for Corporate Citizenship and GRI study on the future of reporting, Sustainability and Reporting 2025.
To measure both impacts and efforts most efficiently, many companies turn to reporting standards like GRI, which offers a consistent framework for companies to report on social, environmental, economic, and governance dimensions of their business. By making use of the standard, companies can better understand how their programs contribute to the bigger picture, determine where more work needs to be done, and align their efforts with those of other organizations.
In May, GRI held their 5th Global Conference in Amsterdam. Titled Empowering Sustainable Decisions, the event gathered together approximately 1,200 delegates from more than 70 countries to determine the most effective ways of implementing solutions for meaningful progress. There, business leaders, government officials, and nonprofit professionals offered insights and guided discussions to find answers to questions such as: What are the best ways to integrate technology into business processes to become more sustainable? How can companies use already identified issues to generate sustainable solutions to large scale problems? How can corporate sustainability data be better collected and used to drive change? What can corporate citizenship professionals do to ensure the true integration of sustainability into all business processes?
Such questions indicate that a new era in sustainability reporting has arrived. No longer is the conversation centered on enumerating why companies should report—but rather how they can do so in such a way that not only provides a framework for transparent disclosure, but also to manage performance better. As KPMG’s 2015 Survey of Corporate Responsibility Reporting finds, sustainability reporting has grown over the last two decades, with more than 90 percent of the Global 250 now issuing reports. It’s a trend that is only expected to continue. The Boston College Center for Corporate Citizenship’s 2014 State of Corporate Citizenship finds that the majority of executive respondents consider sustainability reporting to be a top priority, and expect resources allocated to conducting it to increase in the near future.
While the value of sustainability reporting has been widely accepted, the challenges that reporting helps companies meet continue to loom. In Amsterdam, conference attendees continually pointed to the dual roles of partnership and innovation in the fight to address global issues such as those outlined in the SDGs. As an example of these attributes in action, many pointed to the SDG Compass—created by GRI, the UN Global Compact, and The World Business Council for Sustainable Development (WBCSD).
The SDG Compass provides guidance that helps companies align their strategies and measure and manage their contribution to the realization of the SDGs. In addition to presenting five steps that can help maximize corporate contributions to these efforts, the Compass also catalogs existing business tools and reporting indicators that help guide and assess efforts to meet corporate citizenship targets.
Another topic of discussion was GRI’s Sustainability and Reporting 2025 project, which was launched in early 2015 as an effort to understand how sustainability reporting might help us understand progress on global issues. The project brought together leaders from around the world—including Center for Corporate Citizenship members—to discuss developments in sustainability, disclosure, corporate performance, and the use of information to drive positive change. Through these discussions, and by incorporating their own expertise, the GRI project established fourteen critical challenges to be addressed and three major trends that will define the context of the next decade of reporting and corporate action.
What was found through the analysis of interview questions related to these trends and challenges was also a topic for discussion at GRI’s conference. There, I moderated a panel of subject matter experts who had also participated in the project, including Nelmara Arbex of the GRI, Paul Boykas of PepsiCo, Rob Cameron of SustainAbility, and Jeanne Ng of CLP Power Hong Kong. Together, we discussed the findings of the final report, released in March, as well as the current issues and global challenges. Panelists also offered their own advice to businesses on effective reporting.
New Formats and Multiple Information Sources
The panel noted that—while most companies that report currently deliver an annual sustainability report online—innovative tools and technology have provided new formats to collect, analyze, and communicate data from multiple sources. In fact, many of the platforms—such as eRevalue, MSCI, and Bloomberg—offer stakeholders information beyond what is provided by the company directly. Shared platforms and increased public data will encourage companies to manage risks and improve performance throughout the value chains. There will be a transition from annual reports to near real-time disclosures through technological advances.
New Content and Focus
Rather than focusing on the social and environmental issues they traditionally prioritized, companies will delve further into shared global challenges by more comprehensively assessing and addressing their impacts—a process that will often lead them deep into their value chain. The integrated effects of the issues at hand, which impact social, environmental, and economic business objectives, will require that companies make greater use of data to provide a clear analysis of their comprehensive impacts.
New Role for Stakeholders
Empowered by corporate transparency and the myriad of near real time data available, stakeholders will be more engaged than ever. There is likely to be a virtuous cycle whereby companies engage with stakeholders and use that engagement to make meaningful business decisions—not merely ‘sustainability’ decisions. As a result, companies will need to adapt to react more quickly when relating to stakeholders. Stakeholder relations will move from a task within a job (or an activity to carry out for reporting purposes) to a full time position.
With these trends in mind, the panelists advised the following actions:
- Use your reporting process as an (at least) annual opportunity to review and revise the vision for the future of the organization and determine the goals that indicate progress toward them most effectively.
- Work with others (i.e. stakeholders) to create ambitious goals to improve performance related to your organization’s material impacts and issues. This way, goals won’t get lost along the way and they will be fundamental to the success of the organization, not just the sustainability department.
- Remember to reiterate the purpose of reporting as a tool for better decision-making, better performance, and the increased trust of stakeholders.
The overarching message of the conference was this: Sustainability reporting may be evolving, but it is definitely here to stay. Those companies that embrace the practice—and make use of available data to address their impacts and engage their stakeholders—will be better positioned to meet their business objectives, and change the world.
To learn more about how you can make use of reporting platforms to meet your goals, check out the Center’s GRI G/4 course, the Corporate Citizenship Frameworks course, and the CDP Reporting course. As a certified training partner for both GRI and CDP, the Center can help you understand and utilize two of the leading sustainability frameworks to drive both social and environmental progress—and business results.