Efforts to achieve greater consistency in global social reporting have reached a critical stage in development. But has the process overrun the capacity of companies to deliver?
A public consultation on the new draft GRI guidelines, the international initiative promoting triple bottom line reporting, is taking place between April 1 and May 26. The results of this third revision of the guidelines, last updated in June 2000, will be submitted to the new GRI board (see Briefing 62) for review and approval in June 2002. Most significantly, the revision includes the proposal to ‘clearly define exactly what constitutes reporting in accordance with the guidelines’. The move represents an attempt to improve the comparability and consistency of GRI reports.
Other new developments include:
Economic and social performance indicators, in Part C, which are now divided into core and additional categories. The section also includes refinements in definition and measurement.
GRI Content Index, a new feature of the revised guidelines, which aims to make it easier to access reported information relevant to the GRI framework.
GRI estimates that over 100 international companies have used the guidelines, either in whole or in part, in their public reporting. Contact Sean Gilbert, GRI, on 00 1 617 266 9384 (http://www.globalreporting.org)
All European enterprises with more than 250 employees, or a turnover of over four million euros, will have to undertake annual social and environmental reports by the end of 2003, should proposals from a European Parliament committee for a Europe-wide directive on CSR be taken up by the Commission. A draft report, issued on March 4, proposes that:
companies should be instructed to appoint a board member responsible for CSR;
all private and collective pension funds should be required to state their ethical criteria in their investment policies;
the Commission should investigate the possibility of creating a European Ombudsman for European enterprises operating in developing countries with respect to CSR.
The Parliament’s employment and social affairs committee will report its recommendations on the draft in late April and a final report by the full Parliament will be published in May. The discussions will feed into the Commission’s further Communication on the CSR Green Paper in June. Meanwhile the Commission is also planning a CSR European multistakeholder forum, which it is piloting with round tables for industry representatives and other relevant stakeholders between April and June. Contact Constanze Beckerhoff, EP, on 00 32 2 28 44302 (http://www.europarl.eu.int)
A pilot programme for the new Business in the Community corporate responsibility benchmarking and reporting initiative is underway, in preparation for the launch of the scheme at BITC’s 20th Anniversary Conference on July 10. Five areas of responsibility will make up the corporate responsibility index: workforce, marketplace, environment, community and human rights. Questionnaires for the index will be sent out in conjunction with those for the Business in the Environment Index later this year. Contact Elizabeth Forbes, BITC, on 0870 600 2482 (http://www.bitc.org.uk)
The French government is following Denmark by introducing a new law, passed on February 21, that obliges companies to include details of thier social and environmental impacts in their annual reporting and accounts. The New Economic Regulations law overhauls France?fs wider corporate law structure, and for the first time requires social reporting in three categories: human resources, community and labour standards. Contact Jacky Prudhomme, ARESE, on 00 33 160 39 50 10, (http://www.arese-sa.com)
Editorial Comment
So the GRI is up and running, as a separately constituted organisation with its own board of directors. And now its updated reporting guidelines are out for external comment, the fruit of an exhaustive process in specialist working groups. They contain some welcome changes – starting to recognise customers as an important stakeholder in the business, for example. And some unwelcome changes – like relegating community engagement programmes to ‘additional’ (i.e. optional) indicator status. Some issues remain as “promises to come” – extra detail on key issues such as water and also industry specific measures. And there are some continuing lacunae – adequate measures of impact on local stakeholders, for example at country level in the developing world. The overall effect is to increase the burden on reporting companies and reduce their scope to ‘pick and mix’ by insisting on a high level of compliance with the approach before you can claim to be “following GRI guidelines”. That’s good if the top priority right now is to ensure greater consistency among those already committed to reporting. But it’s bad news if the real need is to get many more companies to take social reporting seriously. It’s crunch time – greater rigour could cause the effort to falter.
In parallel, calls for mandatory social reporting are growing. The UK Company Law Review has proposed going someway towards this. Now the European Parliament is getting in on the act, with the proposal under debate specifically naming GRI as a standard to follow. Thankfully that won’t get into European law, or at least not yet: it would be hugely damaging to force social reporting into a straight-jacket of a compliance mentality following just one model at such an infant stage of its development. But the trends and pressures are clear. Few large companies can afford to ignore the call to give a better account of their impact on society.
Corporate Citizenship Briefing, issue no: 63 – April, 2002
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