Coalition for Environmentally Responsible Economies (CERES)

Formed in 1989, the Coalition for Environmentally Responsible Economies (CERES) brought together [Page 322]15 major U.S. environmental groups and a wide array of socially responsible investors and public pension funds. A set of goals and principles for environmental performance was developed by this alliance between business, consumer groups, environmentalists, and other stakeholders. The coalition emerged after the Exxon Valdez oil spill, which was not the largest in history but proved to be one of the worst in terms of adverse media coverage, disruption to local business and industry, and long-term environmental damage. However, several positive changes occurred in corporate accountability, shipboard responsibility, environmental cleanup procedures, and environmental awareness and reporting. Among the most significant of these was the development of CERES and its core principles.

The 10 CERES principles include (1) protection of the biosphere, (2) sustainable use of natural resources, (3) reduction and disposal of wastes, (4) energy conservation, (5) risk reduction, (6) safe products and services, (7) environmental restoration, (8) informing the public, (9) management commitment, and (10) audits and reports. All organizations that choose to become members of CERES must adhere to these 10 principles. By adopting the principles, member organizations acknowledge that they have a responsibility to the environment and that they must not jeopardize future generations to sustain themselves in the short run.

Today, more than 80 organizations stand behind the CERES principles. These firms include labor unions, environmental groups, public interest organizations, and investors. The coalition of investors is critical, as these firms explicitly consider environmental criteria in investment decisions. In addition, CERES partners with more than 70 corporations that have a significant commitment to the principles.

Over the years, the coalition has promoted greater corporate responsibility toward the environment and taken a leadership role in standardizing environmental reporting by organizations. CERES was founded with the belief that businesses should take a proactive stance on environmental issues, because their influence over human decisions and behaviors often surpasses that of governments, schools, or religious organizations. To control and provide accountability for environmental performance, however, companies need effective measurement and communication tools. This need brought about initiatives to establish benchmarks for environmental performance and to provide an easier way to report information about environmental performance.

In 1997, CERES launched the Global Reporting Initiative (GRI), which was designed to stimulate change for the companies by allowing them to track their progress and performance among competitors and peers who also adhere to high standards. Although both regulatory and nonregulatory factors are driving enhanced environmental reporting, there is no universally accepted method for reporting and comparison. Each year, more companies voluntarily report information about their environmental performance to the public, but firms may employ different formats, rendering comparison among reports somewhat problematic. These discrepancies in and issues with environmental reporting have generated calls for standardizing and verifying reports. CERES provides such a standard, but there are many different stakeholders in the environmental reporting process. More than 700 companies use the GRI guidelines, which means it has become the de facto international standard for corporate reporting on economic, social, and environmental performance.

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