A Model Report
The gold standard for corporate sustainability reports is the Global Reporting Initiative (GRI). Developed in 1997 by CERES and the Tellus Institute, it is a framework for environmental reporting and an accountability mechanism for environmental conduct.
CERES spun the GRI off quickly as a separate entity. “We thought it was important to have a neutral reach,” says Augustine, noting that the GRI has taken off in popularity in the past four or five years. “Companies are realizing that it does provide a framework to disclose data that is becoming increasingly important to investors and other shareholders.” She says the GRI criteria will continue to be refined going forward.
The GRI is a good cross-reference even if you don’t follow it verbatim, says Hitchcock. It offers several levels of accountability, from audited to non-audited. The Swedish organization Natural Step also provides valid metrics to measure sustainability. Many of those metrics employ a “triple bottom line,” considering economic, environmental and social standards as intertwined concerns. “We strongly recommend using a credible framework for sustainability,” says Hitchcock. She warns that the downside with the triple bottom line is it “only tells you what the buckets are, it doesn’t tell you when the buckets are full.”
If it’s your first sustainability report, it’s not a bad idea to do the first one internally and work the kinks out before you go public, Hitchcock advises. Addressing smaller to medium-sized companies she says, “Figure out who your stakeholders are, what information they want and what’s your impact as an organization.” The degree of rigor associated with a sustainability report depends a lot on size, she says, and ultimately the effort might not be worth it for everyone. “If you are teeny tiny, maybe there’s not a lot of immediate value.”
For its part, Waste Management describes the process as a big team effort, with 100 people providing information or reviewing it. It can foster a team spirit, Briggum says.
It’s essential that the data presented be believable. “The best thing a company can do is have concrete performance metrics,” says Augustine. “Stakeholders have got to see relevant, credible data.”
The worst thing you can do with a sustainability report, all agree, is make it sound like a marketing piece. “It’s all glossy, all pretty, and there’s no information about anything bad they’re doing,” Hitchcock says. “That undermines your credibility.
“It’s so much more credible to say, ‘We’re doing pretty well here. We didn’t do as well here. We just haven’t figured it out yet.’” And don’t think that simply wasting less makes you fully sustainable. “You find a huge range,” she says, “from totally fluff to open and honest and transparent.”
Building on the Basics
About a year and a half ago CERES developed the CERES Roadmap, which establishes 20 expectations for sustainability for companies to implement. Augustine says it identifies four key areas for sustainability management: governance, stakeholder engagement, disclosure and performance. It’s a framework to help embed sustainability within a company’s business strategy.
It’s key to find out what the stakeholders believe is important. Do a “materialty analysis” to help determine what the key issues are for them, Augustine says. At Waste Management, Briggum says, they get feedback from investors, the community, legislators – a variety of sources. “If you’re listening, you’re getting feedback,” Brown says.
And it can help get things done. As the saying goes, “What gets measured gets managed, what gets managed gets done,” she points out.
Third-party review is a big help. Coke does it. “We have to be transparent and held accountable,” Park says. “Reporting allows our company to do that, especially where there’s a third party.”
Coke’s report has been evolving, Park says, to the point that now it is more than just an environmental report.
“I think it’s important to move from a report to reporting,” she says. Now Coke integrates announcements during the year to make the report more dynamic, so that it has become an almost monthly communication.