Sean Gilbert Technical Director

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THE GRI AN INSTITUTION
AND EMERGING STANDARDTaiwan, August 17,
2003

• Sean Gilbert Technical Director
• www.globalreporting.org

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SUSTAINABILITY REPORTING

• Many names, similar concepts
• Corporate Sustainability
• Corporate Social Responsibility (CSR)
• Corporate Citizenship
• Common point
• Information about contributions to sustainable
  development
• Economic, environmental and social

www.globalreporting.org
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GRI MISSION

• Elevate economic, environmental and social
  reporting to routine practice and to the highest
  standards of rigour and comparability.
• Facilitate a multi-stakeholder process to design
  and continually improve sustainability reporting
  guidelines.

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GRI A BRIEF HISTORY

• Convened in 1997 by CERES in partnership with
  UNEP
• Funded by foundations through 2002, now
  diversifying
• Registered non-profit organization based in the
  Netherlands
• Governed by multi-stakeholder Board, Stakeholder
  Council and Technical Advisory Council (to be
  formed)
• 2,500 Stakeholders from 50 countries and all
  regions of the world
• Employees from 10 countries, speaking 16
  different languages

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GRIS GLOBAL ENGAGEMENT

• Events/Activities in
• Hong Kong, Malaysia, Japan, India, Brazil, South
  Africa, Australia, Sweden, Germany, France,
  United States
• Reporters from
• 26 Countries
• Working Group Members from
• Over two dozen countries
• Governance Bodies
• Board Members
• Stakeholder Council

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GRI A PROCESS AND A PRODUCT
Process
Products
GRI Framework
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CSR system of complementary initiatives
codes of behaviour e.g. Global Compact, OECD
Guidelines
assurance standards e.g. AA 1000
reporting standards e.g. Global Reporting
Initiative
performance standards e.g. SA 8000
monitoring and management systems e.g. ISO
standards
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GRI FAMILY OF DOCUMENTS

• Framework Documents
• GRI Guidelines
• Technical Protocols (e.g. Child labour, energy,
  water)
• Sector Supplements (e.g. financial services,
  tour operators, telecom, automotive)

• Support Documents
• Resource Documents (e.g. HIV/AIDS)

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GRI REPORTERS (305)
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EXAMPLES OF GRI REPORTERS
ABB ABN AMRO ATT Baxter Biffa Waste Services
Ltd. Body Shop Bristol-Myers Squibb British
Airways British Telecom Dow Electrolux Eskom Ford
Motor Company Fuji Xerox General Motors ING
Bank
SASOL Scandiflex Shell Severn Trent Siam Cement
Group South African Breweries Suncor
Energy Sunoco Swedish Meats Thames Water
Triodos Bank TXU Europe Umgeni Water Vauxhall
Motors Ltd VAW Aluminium Waste Recycling Group
Johnson Johnson Kirin Brewing KLM Konica MTR
Hong Kong Natura NEC Nike Nissan Nokia Nutreco
Philips Electronics Procter Gamble Rabo Bank
Ricoh Royal Sun Alliance SAS
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REPORTING ON THE RISETHE PURE NUMBERS

• A recent survey by KPMG found that 45 of the
  worlds largest 250 companies now produce reports
  on environmental and social issues.
• This figure is up from 35 in 1999.
• Financial Times, 23 August, 2002
• 600 Environmental Reporters in Japan
• Japan Ministry of Environment

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DRIVERS OF INCREASED REPORTING

• The Public employees, unions, NGOs
• Governments World Summit call for increased
  corporate transparency and responsibility (and
  encourages use of the GRI Reporting Guidelines)
• The Market and Stock Exchanges large and small
  investors, risk analysts, all want more data
• Business Partners customers, joint ventures,
  etc.
• The Business Case sustainability practices can
  help boost business performance

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GOVERNMENT INTEREST

• Governments agree to encourage industry to
  improve social and environmental performance
  through voluntary initiatives taking into
  account such initiatives as the Global Reporting
  Initiative Guidelines on sustainability
  reporting.UN WSSD Plan of Implementation,
  para. 17
• The guidelines developed by the GRI are a good
  example of a set of guidelines for reporting that
  could be the basis for such a consensus.
• European Commission Communication on CSR

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MULTILATERALS ALSO TAKE NOTE

• United Nations
• Strategic alliance with the Global Compact
• Official UNEP Collaborating Centre
• OECD GRI complements the MNE Guidelines
• World Bank Charter Group member
• International Finance Corporation investment
  planning
• World Economic Forum
• G8 GRI referenced in official statements

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INVESTORS AND GRI

• Changing sense of risk
• Intangible assets are worth more than tangible
  assets
• Environmental and social factors matter!
• Brand, reputation, license to operate, human
  capital
• Investors want more non-financial information
• Demand for standard reporting framework
• Overall, we view the GRI as setting the global
  benchmark for disclosure and encourage companies
  to produce reports which are in accordance with
  the GRI guidelines." Hendersons Global
  Investors

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CORPORATE GOVERNANCE DEMANDS

• companies no longer act independently from the
  societies and the environment in which they
  operate.
• social, ethical and environmental issuescan no
  longer be regarded as secondary to more
  conventional business imperatives
• South Africa King 2 Report on Corporate
  Governance, 2002

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THE MARKET REACTS

• Stock exchanges
• Redefining disclosure requirements
• Johannesburg Stock Exchange
• Governance codes
• Australian Standard 8000
• Rating agencies and indices
• Cross-referencing GRI (i.e., SAM, IRRC)

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WELCOME RECOGNITION

• The result of this global effort GRI isthe
  most comprehensive and credible set of
  sustainability performance disclosure standards
  ever produced
• Charles O. Holliday Jr, CEO/DuPont Jr,
• Stephan Schmidheiny/Chairman, ANOVA
• Phillip Watts/CEO, Royal Dutch/Shell
• Walking the Talk, 2002

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AUDIENCES FOR REPORTS

• Employees
• Providers of capital (banks, investors)
• Business partners
• Civil society
• Labour
• Media
• Academia

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BENEFITS OF REPORTING INTERNAL

• Enhances employees understanding of corporate
  sustainability vision and strategy
• Strengthens other environmental and social
  management tools
• Connects sustainability strategies with business
  strategies
• Helps to assess the sustainability footprint
  and associated business risks and opportunities
• Informs long-term, strategic decisions
• Provides early warnings of trouble

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BENEFITS OF REPORTING EXTERNAL

• Competitive advantage in the marketplace
• Information channel to create new business
  opportunities
• Strengthen partnerships and build trust
• Maintain licence to operate
• Attract investors
• Retain the best employees

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PERCEPTION OF GRI-BASED REPORTS

• There is a substantial difference between
  reports based on the GRI Guidelines and others.
• 60 of the reports ranked in the top 50 in Trust
  Us used the GRI.
• 46 of the Other 50 are listed as GRI reporters.
  Many of these companies are also first time
  reporters
• Trust Us, SustainAbility, 2002.

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SO WHY GRI?

• Global
• Multi-stakeholder
• Triple bottom line
• Open governance structure
• Complements other initiatives
• Design to learn and evolve
• Proven results