GRI Standards and their benefits to companies

Aug 18, 2022
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GRI Standards and their benefits to companies | Blog | Report Yak

Global Reporting Initiative (GRI)

The Global Reporting Initiative (GRI) is an international independent organization that helps businesses, NGOs, governments, and other organizations better understand and communicate the impacts of their activities on the economy, environment, and society, including key challenges such as climate change, human rights, corruption, etc.

GRI was founded in Boston in 1997 in the aftermath of the Exxon Valdez oil spill to address the public outcry. With the intention of creating a mechanism for companies to adhere to responsible environmental principles, the organization grew to include social, economic, and governance issues as well.

The GRI moved its headquarters to Amsterdam, Netherlands in 2002. The GRI Secretariat facilitates standardized reporting for thousands of organizations globally across sustainability metrics and helps companies report in a transparent, clear, and comparable format. GRI has an additional 7 regional offices to enhance the support and services it provides to organizations and stakeholders worldwide.

GRI Standards

The GRI Standards are widely used across the world. Thousands of sustainability reporters from across 100 countries use GRI Standards to enable organizations and their stakeholders to assess the impact of their activities and create economic, environmental, and social benefits.

These standards were developed by working with businesses, investors, policymakers, civil society, labor organizations, and experts. GRI has been promoting the use of these standards with the intention of creating a benchmark for sustainable reporting that allows companies to compare their impacts, actions, and results from one year to the next and between peers.

GRI Standards – The what, why, and how of it

What:

  • GRI is the global standard for impact reporting.
  • It follows an independent, multistakeholder process to ensure that the standards are efficient and achieve the desired results.
  • The GRI standards are very comprehensive.
  • The standards were developed for the greater good and are free and open to use by any individual or organization.

Why:

  • While we will go into further detail regarding the specific benefits of using the GRI standards for organizations, fundamentally, GRI exists to help companies and organizations become more transparent and take ownership of the impacts their businesses have.

How:

  • Although not all countries or companies have made it mandatory, there is a push to make GRI standards the sustainability reporting norm to normalize sustainability reporting across regions and companies. The idea is to have one common language of sustainability reporting that will enhance dialogue and decision-making.

Reporting principles of GRI Standards

The principles are divided into two categories:

Reporting principles for defining report content

  • Materiality –It is significant that the report has information and disclosure on topics and indicators of corporate economic, environmental, and social impacts of the business. This will help stakeholders analyze the company and take appropriate decisions.
  • Stakeholders Inclusiveness – It is imperative that stakeholders' interests and concerns be taken into consideration. For this, the reporting organization must first identify its stakeholders and explain how it has responded to their specific concerns and queries.
  • Sustainability Context – This principle is about the sustainability report being presented in a manner that indicates what the company's current situation is vis-à-vis economic, social, and environmental factors and what the company plans to do in the future. This should include both – the way the company contributes to these areas and the company’s actions that negatively impact these areas.
  • Completeness –The boundaries of the scope of the report (information on significant social, economic, and environmental impacts) must be clearly presented to give readers the necessary information to assess the company’s performance during the period in question.

Reporting principles for defining report content

  • Balance –It is imperative that the report be impartial, objective, and balanced so that the positive and negative performance results are stated.
  • Comparability –Comparability is a core aspect of a GRI- compliant sustainability report. A company or reader must be able to compare reports from one year to the next or with reports of competitors, different industries, sectors, economies, etc.
  • Accuracy –The qualitative and quantitative measurements used in the report must be sufficiently accurate to allow readers and stakeholders to make reliable assessments of performance.
  • Timeliness –Your report must disclose the information in a timely manner for stakeholders and readers to make well-informed and well-thought-out decisions. The information disclosed will only be of any use if released in a regular or periodic manner.
  • Clarity –The information reported must be understandable and accessible to stakeholders.
  • Reliability –The information must be gathered, recorded, compiled, analyzed, and reported in such a way that it is easy for stakeholders and other readers to examine it and make decisions.

Benefits of implementing GRI Standards in your report

  • Sustainability Reports that are based on GRI Standards will act as a tool for comparing non-financial disclosures across borders of countries.
  • Due to the international nature of GRI, reporting using the standards will give them further credibility in foreign markets.
  • GRI Standards will help companies align themselves with the Sustainability Development Goals of the United Nations.
  • With discussions ongoing to develop the Integrated Reporting framework along with GRI principles, companies can potentially use the learnings from GRI Standards even when creating an integrated report.
  • Creating a sustainability report as per GRI standards makes reporting and disclosure methods more seamless.
  • It can help corporations consolidate their market position in the long term.
  • A GRI-based report will enhance investor and stakeholder confidence in your company by providing transparent and comprehensive disclosures, thereby highlighting the long-term value-generating potential of the company.
  • Once companies have gotten into the practice of collating information, assessing material data, and reporting in a clear and transparent manner, this can be an established process of corporate governance.

A company that is starting its reporting journey using the GRI Standards can find it overwhelming. Planning and collection of data must begin several months prior to when an organization wants to launch its report. Some organizations start collecting information and undertake materiality assessments as early as a year prior to releasing their report.

In addition, the creation of content and visual designs in a manner that enhances GRI’s suggestions on sustainability would require specialized design agencies with content teams that have experience and expertise with GRI standards. One such agency is Report Yak – we conceptualize, consult, contribute compelling content and create visually stunning designs to create a sustainability report that is transparent, clear, and gets the company’s message across to stakeholders.

Check out some of our award-winning work here or feel free to reach out to us and we’d be happy to strategize your next report with you!