On May 18-20 in Amsterdam, 1200 corporate Sustainability professionals, government representatives, NGO’s, and loads of consultants attended the fifth annual Global Reporting Initiative (GRI) conference. Besides the privilege and thrill of sharing experiences and views with such a fantastically international group, I took away a number of mind boggling lessons and ideas.
This is truly an interesting time for businesses and other organizations trying to create value for a wide range of stakeholders, including of course investors who came up several times during the conference as THE most important stakeholder group for driving change.
For a good summary of the wider topics and key conclusions from the conference, check out this piece by Liam Dowd at Ethical Corporation. Below, I share a few of my own reflections from this year’s GRI conference.
Investors and governments will drive the merger of business interest and Sustainability
Interestingly, investors seem to become the middle men between corporate interests and the long term sustainability of the planet! At least institutional investors who have a longer term perspective than the next quarter earnings, will force businesses to take a good hard look at themselves and convincingly account for how they will manage their risks and reap the opportunities in a world that must deal with the consequences of population growth, increased global inequality, resource scarcity, extreme weather and natural disasters, to mention a few.
Will companies be part of the problem or part of the solution? And can they reasonably and credibly argue for their contribution? It’s fairly simple. The ones, who can effectively demonstrate that they are part of the solution, will win. Sustainability or ESG (Environmental, Social and Governance) reporting is here to stay. And perhaps in a few years it won’t even have its own acronym but, but simply be referred to as VALUE.
Governments are already in the process of making it mandatory for companies to disclose how they work to mitigate climate change. It’s not a ‘nice to have’. Carbon emissions are everyone’s business. So don’t hesitate, dare to be transparent and make sure you secure the rights to share your story. If you don’t do it others will, and misrepresentation is a real risk. This actually happened to one of the conference participants!
Building the airplane while flying
So, where are we as businesses and organizations today on reporting our impacts? It was clear from the sessions at the GRI conference that, despite the fantastic work done by GRI and others, we are still far from a consistent and comparable global framework which ensures data is actually used for better decision making. Discussions quickly end up focusing on technicalities and the only common position seems to be that different requirements need different standards! A number of collaborations were announced to take that challenge on, but in the meantime we have businesses to run, requirements to meet and reports to write.
I am full of admiration and support for the huge amount of work going on. But sitting there, I couldn’t help but think that as an organization, we can't wait for the one and only framework to be developed. We need to build the airplane while flying, refining it constantly in an iterative process with our main stakeholders. Quantifiable metrics will certainly continue to be a core element of disclosure. But even more importantly, we should spend the time and energy on engaging our stakeholders, present what we have and our thoughts behind, and that process will create a framework that adds value.
We need to dare to ask for the underlying interest behind the questions for more disclosure and deliver the responses in a format that suits our audiences. I once believed it would be possible to create one sustainability document/report that catered for all stakeholders. I don’t anymore. The continuous investment in reporting platforms, nice websites, beautifully designed documents and infographics will need to be matched by at least the same investment in real stakeholder dialogue. The notion of purpose – why are we here and what is our contribution? – must be explicable for critics, supporters and future generations alike and must be fine-tuned constantly. The organizations that dare to introduce that level of transparency are the ones that will set the standard for others. This is the silver bullet if any.
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