Environmental Engineering Reference
In-Depth Information
SUSTAINABILITY REPORTING
Sustainability reporting is a voluntary tool used by companies to disclose their sustainability
efforts to stakeholders. Among others, the main objectives of sustainability reporting are creating
public awareness of the sustainability initiatives, promoting transparency, rebuilding trust when
problems arise, enhancing employee recruitment and retention, strengthening brands, reducing
operating costs (e.g., by lowering energy, water, and raw materials consumption), and increasing
profits (Bernhart, 2009). Reports do not only include the efforts in the period of time covered,
but also goals for the future; in that way, they become a benchmark to assess the progress in time.
Usually, sustainability reporting is not an isolated document, but is instead part of a report on
corporate social responsibility (CSR) that includes “efforts” in the environmental and social
dimensions as well as financial performance. Furthermore, a CSR is a tool to communicate actions
taken to address factors (social and environmental) that correlate negatively with financial perfor-
mance or to enhance initiatives that correlate positively with financials (Cochran and Wood, 1984).
Because a CSR is a voluntary initiative, there are no official or legal requirements, yet, on
how to prepare the report; however, guidelines that make CSR more efficient do exist. Many
standards around the world have been developed by governments, nonprofits, advocacy
groups, trade associations, and industry groups (Coyne, 2006); but, the most well-known
standards are the Global Reporting Initiative (GRI) and the AccountAbility 1000 series
(Bernhart, 2009). ISO launched the ISO 26000 in 2010 to provide guidelines on social respon-
sibility reporting for the public and private sectors. The ISO 26000 does not include require-
ments, so it is not a certification standard.
The major advantages of using well-known standards for the production of CSRs are
increasing transparency and accountability. Independent of the guidelines used to create a CSR
report, the key principles that govern report preparation are accountability of practices, accuracy
of the information, transparency in the process, completeness of information (including bad
news), comparability that tracks progress over time, reliability of the data used in the report,
responsiveness to stakeholders' concerns, and stakeholders' inclusiveness (Bernhart, 2009).
Besides adopting a standard, to start with a CSR for the first time, it is recommended to
develop a cross-functional team, establish a deadline, recruit a high-level champion (e.g., the
CEO, who eventually will sign the CSR), involve internal approvers (e.g., compliance offic-
ers) early in the process, involve stakeholders, and identify and engage an independent verifi-
cation organization (“How to create …,” 2006).
Global Reporting Initiative
The Global Reporting Initiative is a leading network organization that has created one of the
most well-known guidelines for corporate responsibility reporting. The current guidelines, the
G3 or third generation, were launched in 2006 and can be downloaded at no charge at the GRI
website (http://www.globalreporting.org). GRI guidelines prescribe principles on what and
how to report environmental sustainability efforts, indicators of social responsibility, and
economic performance.
The environmental dimension lists impacts on “living and non-living natural systems”
including inputs (water, energy, and materials), outputs (air emissions, wastewater, and solid
waste), impact on ecosystems (negative [e.g., lost of biodiversity] and positive [e.g., ecosystem
restoration]), and the impact of transportation of goods and personnel. This section also
includes compliance aspects, such as fines paid or nonmonetary penalties, for failing to
comply with current regulations (GRI, 2006a).
