The engine that powers sustainable organisations
The GRI Standards is one of the most commonly used sustainability reporting frameworks in the world. This article gives an introduction to the Standards, their structure, application, and usage. We also cover the seven key steps for reporting in accordance with the GRI Standards.
GRI is the Global Reporting Initiative, an independent standard setter with the mandate to develop guidelines for sustainability reporting. Established in 1997, its goal is to drive accountability for the impacts created by organizations in all sectors and countries through a standardized, unified language for communicating those impacts.
GRI was formed to help organizations report their impacts transparently - a necessary component of a sustainable economy. The GRI sets the global standards for sustainability reporting through a comprehensive set of guidelines called the GRI Standards.
The GRI Standards is a framework for sustainability reporting that covers the environmental, social, and governance (ESG) aspects of an organization’s footprint. It is comprised of three modules: the Universal Standards, Topic Standards, and Sector Standards, all freely accessible to the public. These standards are continually being developed and maintained in consultation with topic experts and the public. The multi-stakeholder process ensures technical rigor and subject-matter accuracy for all the reporting topics covered.
The Standards have been significant in shaping sustainability reporting requirements and approaches. Its relevance to corporate sustainability has been a source of guidance for regulators and investors to benchmark a company’s sustainability performance. The GRI Standards have informed reporting legislation, with many national laws citing the GRI or building off it as a benchmark or reference framework.
The Standards are used in more than 100 countries worldwide, by businesses of varying sizes, governments, investors, and other stakeholders. For reporting organizations, the Standards serve as a credible benchmark of their performance compared to other reporting organizations. For report users, GRI-aligned reports provide the disclosures needed to make informed decisions and judgments about the performance of an organization, often to understand the ESG risks and opportunities faced by the organization.
The Universal Standards are applicable and relevant to any organization in all sectors. It covers general disclosures relating to the entity’s business information including the size and scale of operations, the organization’s activities, and the list of material topics including the process of determining materiality and management approaches. For a reporting organization to qualify as reporting in accordance with the GRI Standards, it must report on all the required disclosures specified under the Universal Standards.
The GRI Sector Standards explore the material topics identified as most relevant to a particular industry. GRI is developing Sector Standards for 40 sectors with the highest impact. As these are released, descriptions of the industry and its impacts are provided. This can serve as a good starting point for reporting organizations to narrow down their list of material topics.
The GRI Topic Standards outline the disclosures for each material topic, covering the metrics and indicators that are either required or recommended. Organizations that wish to comply with the GRI Standards must at the minimum report the required disclosures.
If the minimum requirements for reporting in accordance with the GRI Standards are unmet, either due to partial disclosures or omissions without explanations, reports can be said to be prepared with reference to the Standards. To qualify as GRI-aligned, reports must include a GRI content index that identifies what disclosures are made in the report and where. This provides a quick overview of the contents of the report and the completeness of the disclosures at a glance.
There are essentially seven steps for reporting in accordance with the GRI Standards:
GRI will remain relevant in the future as sustainability reporting grows in importance. The pressure on organizations to demonstrate their management of ESG issues is the focus of much regulatory and investing scrutiny. With reporting being a key driver of the sustainable economic, finance, and policy framework that the EU and other regions are promoting, the GRI Standards are expected to maintain their leadership as a standard setter and will continue to evolve to reflect the most relevant reporting approaches. It is one of the top choices for organizations embarking on sustainability due to its modular system and relative ease of use. Yet, it also has the ability to grow with an organization’s reporting fitness. It is universally applicable to so many sectors and types of organizations, while also being compatible with many other reporting frameworks.