Global Reporting Initiative

The Global Reporting Initiative (GRI) is a project formed in 1997 by U.S.-based Coalition for Environmentally Responsible Economies and the United Nations Environment Program to develop guidelines for sustainability or triple-bottom-line reporting. Sustainability reporting is based on the value of sustainability, defined as supporting the continued existence and welfare of oneself and identified others, and transparency, that is, being accountable to stakeholders who have a legitimate interest in organizational performance related to sustainable behaviors. The sustainability reporting framework is an expansion of the financial reporting framework that includes an organization's broader economic, social, and environmental impacts.

The GRI's framework for reporting organizational performance is intended to bring greater uniformity and comprehensiveness to sustainability reports. Without a common reporting framework and standards, it is difficult to compare reports from different companies. The GRI is regarded as the most widely known, supported, and comprehensive set of voluntary reporting standards. The process for creating the GRI guidelines involves extensive comment and feedback from representatives of business, accounting groups, investor organizations, activist groups, and other stakeholder representatives. [Page 1021]Over time, it has created a multistakeholder consensus process to develop and pilot test standards before publishing a draft to seek broader input interested groups.

The initial set of GRI guidelines was developed in 2000, and 50 organizations used the guidelines for reporting 2000 performance. Feedback from reporting organizations and users of the initial reports led to the second set of guidelines issued in 2002, and more than 150 organizations used them to report 2002 performance. In that year the GRI became a separate nonprofit organization with headquarters in Amsterdam, the Netherlands. Over the next 3 years, sector-specific supplements were developed for several large industries, including mining and metals, financial services, logistics and transportation, and telecommunications. The number of reporting organizations increased to 325 in 2003, 500 in 2004, 750 in 2005, and at least 950 in November 2006. The third version of GRI guidelines was released in October 2006 after an extensive comment and review period.

Most of the organizations that use the GRI guidelines for sustainability reporting are large multinational corporations that are highly visible global competitors, such as BP, Chevron, Exxon, PEMEX, PetroBras, Shell, Statoil, and Total in the petroleum industry and BMW, Daimler-Chrysler, Ford, General Motors, Nissan, Toyota, and Volkswagen in the automotive industry. A small number of public sector organizations also use GRI guidelines in their sustainability reports, such as Australia's Department of Environment and Heritage, New Zealand's Department of Corrections, and the United Kingdom's Ministry of Defence.

A sustainability report according to GRI guidelines includes information on the organization's strategy, operating profile, and governance and management systems in addition to data on 50 performance indicators related to economic activity, environmental impacts, and social impacts. The social impact category includes human rights, community impact, and product responsibility. In addition to the three categories of performance indicators, two types of integrated metrics are encouraged. One relates to systematic indicators that demonstrate how an organization's activities contribute to the economic, environmental, and social systems in which it operates. For example, a company might report on net job creation as a proportion of total new jobs in a region in which it has operations. The second integrated metric is a cross-cutting indicator, which directly relates two or more dimensions of economic, environmental, and social performance as a ratio. For example, an ecoefficiency measure related to a new technology may indicate the change in air pollutant emissions per increase in production level.

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