Friday, June 12, 2015

Will GRI's new strategy work?

GRI has taken on a big role: "Empowering Sustainable Decisions." The new tagline of GRI's 2015-2020 strategy is rather broad brush. GRI is aiming to reach beyond the way organizations collate and report sustainability information to the place where the market actually thinks about what to do with the information that's ordered into neat performance indicators and creatively designed into sustainability reports. At first glance, this is a bit of a wishy-washy strategy, far less concrete and quantitative than we might have expected GRI to deliver, especially since other organizations in this space are driving forward in very measurable ways, pushing the uptake of reporting and disclosure in different forms, whether it be emissions, water or supply chain (CDP), 10-K or 20-F disclosures (SASB) or value creation (IIRC) and more. GRI, who has always been about driving the uptake of reporting, is now re-purposing itself to drive the uptake of using reporting. 

What pushed GRI in this direction? Clearly it has something to do with GRI's new leadership. Michael Meehan, who is just a couple of months short of completing one year at the helm of GRI. In my conversation with Michael earlier this week, he told me: " I come from the technology space. When I came to this market, some things were glaringly obvious. One was the lack of collaboration. In fact, there was more of an adversarial approach. Many organizations working in the same space but not getting along. It's understandable up to a point, there's competition for funding, resources, attention.  But this was not serving the market best. The corporate world and the policy world needs us to get along. There is going to continue to be fragmentation down the road, we are not going to stop seeing new frameworks, new approaches, new ways of working. What we have to do is change our frame of reference to help organizations and markets move forward more effectively in this context."

The new strategy has four pillars:

Enabling smart policy: More advocacy work and collaborative work with policy-makers, policy influencers and organizations around the world to embed sustainability-based factors into how things get decided and done.
More reporters, better reporting: The communicated elevation of GRI to "standard setter" and its continued uptake among the potential reporting community.
Moving beyond reports: New ways of using the report output as input, with a little help from technology, Big Data, integrated and accessible information flows.
Innovation and collaboration: Driving greater innovation in the area of sustainability disclosure and use of sustainability information.

These pillars build on the heritage of GRI as "the pioneer of the sustainability reporting process" and express an expansion of the scope of the role that GRI sees itself playing moving forward. But actually, it's more than expansion. It's more than "more of the same but different". It's different. It's a rebirth and it's as risky as it is bold. In essence, in plain language, I believe the GRI might be saying something like this: Hey folks, despite the fact that almost all we have ever talked about is reporting, we have now seen the light. Reporting is not the end-game. What you do with reporting outputs is the end-game. Now we have realized this, we are going to transform what people do with reporting outputs. This is an end to the era of asking who reads reports. This is a new era where we ask how can we use the reporting process and disclosures to make better decisions. We can help transform public policy, markets, and the way everyone makes decisions. Come with us. Use us. Work with us."

This is a paradigm shift and it's actually quite clever. Other organizations have not really claimed this empowering space. Other organizations have, like GRI, been providing tools, helping to get disclosures out there, relying on the inevitability of transparency as a catalyst for change, which it is. And it works, up to a point. Many times, just by asking the questions and analyzing the data for sustainability reports, companies start to change. But at the same time, catalysts need reagents (I did an Open University course once in basic chemistry, believe it or not.) GRI's new strategic focus adds the reagent. No-one else is doing this systematically, as far as I am aware.  I believe GRI's new strategy may just be one of those things that you hear and say, hmm, that's so obvious. But for GRI, it's quite a shift. 

In recent years, GRI has been outpaced by a dynamic market that pulled companies in many, often conflicting directions in terms of sustainability disclosure. The fragmentation of the market has intensified, and according to Michael Meehan , it's not going to stop. Rather than try to dominate the reporting space, GRI now wants to harness and grow the energies in that space to deliver better outcomes. GRI calls this Empowering Sustainable Decisions. 

But, to empower implies full trust in GRI as a leader in understanding how we can not only measure, quantify and report sustainability impacts but also improve them by integrating sustainability into all processes. Empowering sustainable decisions implies that ultimately, it's the GRI reporting process and framework that is key to all that we might be able to decide in our sustainable world. The trick is what you do with it after you reported it. But where does GRI get it's legitimacy to claim this empowerment platform? 

GRI sees itself as a launch pad for innovation, but so far, innovation has not been immediately recognizable as GRI DNA. In many cases, GRI has been left out of the running in the most innovative approaches in sustainability accounting today. The Integrated Reporting movement has entirely side-stepped GRI and new, sexy integrated reports are as far from GRI as they are from actually being integrated. The entire sector discussion has whooshed over the head of GRI. SASB has cornered that space, and the smart selection of Michael Bloomberg as the SASB Chair has brought SASB the very first practical application of a SASB standard in Bloomberg's  2014 Impact Report. The whole natural capital accounting world has moved beyond the GRI frame of reference and WRI/WBCSD/CDP have driven new sustainability approaches in several sectors. Becoming a launch-pad for innovation in sustainability decision making is therefore no small ask. And as for collaboration, it takes more than a strategy to make this work. It takes others who want to collaborate. Michael Meehan already hinted that the affinity for collaboration in this space so far is not terribly exciting and creating any sort of common ground will continue to be an uphill battle. And as for better reporting, well, don't get me started, as Billy Crystal said about 3,000 times in  Mr. Saturday Night. The diplomatic way of referring to better reporting is that there is an ocean of opportunity to improve the quality of disclosures and of reporting. GRI has skillfully avoided doing anything tangible to improve the quality of reporting, focusing only on the quality of reporting frameworks and the quality of reporters through GRI training. In terms of influencing policy, although some successes have been chalked up, GRI does not figure as the framework of choice in some of the leading policy declarations we have seen in the past few years, such as the European Directive on Non-Financial Disclosure.  

The new strategy, empowering everything, is therefore going to be a real stretch. But it's the right stretch. And let's face it, GRI has a few credits in the bank to give us hope, if not yet total confidence, that GRI can pull this off. After all, GRI has led the sustainability reporting movement, there can be no doubt about that. Even if the European Directive is a little vague, as was Paragraph 47 at Rio+20 before it, there can be no doubt that GRI has steered the agenda and positively influenced outcomes that achieved something if not everything. With G4, GRI placed material impacts in high-res, and that catapulted materiality to center-stage of the discourse, well beyond the leverage that had been achieved by AccountAbility some years earlier. Even if companies are still not quite comfortable with focus - relevant transparency as I call it - we can see an emerging shift toward material disclosures in favor of any and every and all disclosures. GRI has maintained the multi-stakeholder aspect of its approach for broad legitimacy, which, despite some wobbles, remains an achievement in this space, unlike, for example, the IIRC that is dominated by investment portfolios. As Michal Meehan told me: "The multi-stakeholder approach is so valuable. It ensures you have a very considered approach to what information is relevant and necessary. It leads to users believing that the data selection is trustworthy. It means that users of reported information can trust the process that defined how the data is created. We need to make sure everyone has a voice."

On balance, then, we can afford to give GRI a couple of years to see if the new focus is starting to shape up. Some elements are in place - a very strong advocacy team, an expansive network and increasing uptake of G4. Also, we all recognize a sense of underlying frustration that is sometimes expressed around the fact that, if reporting is actually mainstream, why have we not fixed the world? Perhaps GRI and the empowering piece is what's going to make the difference. I asked Michal Meehan how he expects to measure success. What will be different in 2020 when we have the "how did we do" conversation? Michael said: "I have  a whole load of KPIs that we could put in place - but to be honest, I want to shoot for a world where you don't have sustainability professionals and other leaders in organizations sitting in silos. I am hoping to see companies integrating sustainability into all business decisions. When GRI first started up, we had to convince everyone that sustainability is important. Now, people get it. What they need is better tools to integrate sustainability into the way they make decisions."

A word of caution, however, before we get too euphoric. Let's not get so caught up being empowering that we lose sight of where we came from: the need for organizations to account for their impacts on the lives of all stakeholders (and not just their bank accounts), as the key to creating positive and sustainable change in the world on the planet. Let's not get so empowered that we forget that, at the core, we have still got to grind through the task of delivering sustainability disclosures and/or reports that are robust, relevant and balanced. 

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 Twitter (@elainecohen)  or via my business website   (Beyond Business Ltd, an inspired CSR consulting and Sustainability Reporting firm).  Need help writing YOUR Sustainability Report? Contact elaine:   

1 comment:

eatehort said...

Hi Elaine,

As always a very good post. I´m just want to say that if GRI deliver better tools to integrate sustainability into the way organizations make decisions...I certainly see a good future for GRI.


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