Thursday, July 3, 2014

GRI: the standard setter

It may have skimmed under your radar, but GRI is proposing what could be one of the most significant changes in the history of the organization. No, it's not G5. Yet. It's the way we use the GRI guidelines. That means, instead of the GRI framework being a set of guidance documents, it could become a formal standard. GRI is setting itself up to be recognized as a "public reporting standard setter". Doing so, it is proposed, will involve a complete overhaul of GRI's governance structures, and include new things like a firewall, an IAC, a DPOC, an SRSB, and wow, total transparency. As with all GRI big-news changes, there is a Public Comment Period. We are asked to read a 12 page explanatory document, and four other documents that contain the terms of reference for the new governance bodies and due process. I just did all of that, and it took me quite a long time to trawl through the usual GRI techno-babble and actually understand what's being proposed, how it will work and what it means for me, a teeny-weeny stakeholder.  

In plain English, then, this is how I see it. It's time for GRI to take control of the dissonance that is caused when, on the one hand, the GRI framework is clearly the leading framework for sustainability reporting, but on the other hand, GRI no longer shows up as the sole leading voice in sustainability disclosure. Events of the past couple of years have catapulted other organizations into leadership discourse for sustainability disclosure and they have claims to fame that go beyond diverse multi-stakeholder backing. With the IIRC having the clout of the world's money, and SASB having the backbone of an official certified standards body (ANSI) and two new financial powerhouses at its helm,  the UNGC having Ban Ki Moon and Co, and even CDP claiming the support of $92 trillion in assets represented by institutional investors, GRI's voice risks getting lost in the cacophony. What could change that? Officialdom. Become a standard, not a framework. In order to do this, GRI needs to get itself ready for standardness. This means removing potential areas for organizational conflict of interest, institutionalizing due process in everything that affects the way standards are set, ensuring funding is correctly appropriated and ultimately, shattering any potential glimmer or doubt that GRI Sustainability Reporting Standards might not be created with integrity, relevant consultation and in order to serve the Public Interest. 

Perhaps being a recognized standard setter will put GRI on a better footing as it participates with other recognized standard setters in yet another fuzzy initiative to get people talking to each other, called the Corporate Reporting Dialogue, launched this month by the IIRC. Its aims are more-of-the-same more-of-the-lame communicate zzzzzzzzzz, identify ways to improve zzzzzzzzzzzz and share information zzzzsnorezzzzzz. You couldn't give a new collaborative initiative less teeth if you were a dental technician who ran out of bridges. Come on folks, ever heard of a SMART target? Will the CRD actually help achieve alignment and convergence of reporting frameworks and standards?  Or is this another nail in the coffin of complemetarity dressed up as good intentions? But membership of the club apparently requires being standardful. 

In its new proposals, the GRI Board states its objectives as:
  • To ensure that GRI is globally accepted as a public reporting standard setter in all relevant forums. 
  • To demonstrate that GRI meets all the requirements and responsibilities expected of a publicly referenced standard setter.
So what are the proposed measures? In a nutshell, the key features:
  • Separation of standard setting activities (formerly overseen by the Technical Advisory Committee) and all other activities in the organization (that will continue to be run by the Secretariat), resulting into two distinct organizational pillars.
  • A new Sustainability Reporting Standards Board (SRSB), a Due Process Oversight Committee (DPOC), and an Independent Appointments Committee (IAC).
  • The establishment of an independent public funding base for standard setting activities.
  • Transparency of all standard development processes including open SRSB meetings, published protocols and an annual report to the general public on progress made. 
This is how the new structure will look:

Is this a good thing? Do we want a sort of ISO G4? Is G4 tight enough to become a standard? And what do the implications of being a standard setter mean for companies using the framework? Will the new output of the proposed GRI Sustainability Reporting Standards Board (SRSB) be certifiable standards? The public comment we are asked to provide doesn't relate to any of these questions, it ask us only if we think the measures proposed will help GRI strengthen its reputation and voice as a "recognized standard setter". 

My response to the question in the Public comment questionnaire: "Does the proposed governance structure meet the criteria you / your organization/government would expect a public reporting standard setter to apply? was as follows: 

"I am no expert in standards and what is required of standard setters. However, I would have thought that a standard is only as good as adherence to it. This structural proposal does not refer to the measures that will be undertaken as part of the establishment of the GRI Framework as a standard to ensure greater quality in adherence to the standard. While GRI has had great success in disseminating and encouraging the use of the Sustainability Reporting framework, it has always completely disregarded the way it is used. As such, there has been a great framework but its use has often been abused for different reasons. I see nothing in these proposals that suggest anything will be different in the future".

So, apart from having three great new acronyms to add to my list, SRSB, DPOC and IAC, to help me mystify my clients so they will think I am really intelligent, I am a little ambivalent about whether this structural change is going to help us get higher quality sustainability disclosure. However, if it helps keep GRI at the table, recognizing GRI's de facto leadership in sustainability disclosure today, even if the perception is clouded by bells and whistles in a competitive landscape, it may have some advantage. 

The public consultation period is open through July 9, 2014. Links here to all you need to have your say:

All the documents that form part of the proposal: GRI website page
The position paper: "Intended changes to GRI’s governance in order to achieve its role as a standard setter in sustainability reporting, and its suitability for official reference in public policy."
Questions asked in the consultation platform: Questions document
Comments: Consultation Platform

elaine cohen, CSR consultant, Sustainability Reporter, HR Professional, Ice Cream Addict. Author of Understanding G4: the Concise guide to Next Generation Sustainability Reporting  AND  Sustainability Reporting for SMEs: Competitive Advantage Through Transparency AND CSR for HR: A necessary partnership for advancing responsible business practices . Contact me via   or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm

1 comment:

Anonymous said...

Firstly Elaine the key rhetorical question .i.e The public comment we are asked to provide doesn't relate to any of these questions, it ask us only if we think the measures proposed will help GRI strengthen its reputation and voice as a "recognized standard setter".
GRI is a standard even if it goes under the name of guidelines as it used to measure sustainability by many reputable companies reporting and accounting in this particular area of activity , so in my view this is not what is being asked .
The transformational issues here lie with GRI as an operating entity and not with the products ie the guidelines, at its core how it " owns ", markets and distributes its work not what it produces . I have always had difficulties with the idea that it moves companies to report on its standards freely and once it is done there is no mechanism to say YES and you qualify as a sustainability reporter The old abc rating was a night mare of confusion as companies navigated against the common sense of A being the best .The assurances by the accounting companies a very dysfunctional step which is costly and unattainable to most companies .unfair advantage in the world on investment attraction and unbalanced and contrary to the GRI " free for all " stance in providing guidelines in the first place .
GRI lives in a complex world of business with a mentality of a civil society organisation (NFP) and structure to boot .The Board would do well to seek a way of operating that brings better financial outcomes that can sustain the " business " and indeed the survival of the organisation beyond the " evangelical mind set " and its reliance on government funding .
More stakeholder consultation and smoke screens of accountability whilst retaining an organisational structure and ineffective business model is not going to help .
They have a good product ie the guidelines and totally agree that this is a recognisable leader in sustainability reporting but beyond that the organisation needs better and less convoluted model of reporting and a better business model to sustain its own survival .
As to the others ie IR etc mentioned in your article , the market has a way of speaking for itself and filling the gap of knowledge and functionality for its "buyers "
GRI needs a culture of business's as a core function to show it understand the market where it operates in my view not another "highway "of internal reporting .
It has produced great products , it was a pioneer in this field but it lacks the people and resources to sustain it , relying heavily on an outdated civil society/ social club operating business model in my view .
The transition to standard and the new structure will be interesting to watch .

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