Global Reporting Initiative Judy HENDERSON Chair, Global Reporting Initiative Australia

AN INTRODUCTION TO THE GLOBAL REPORTING INITIATIVE Dr Judy Henderson Chair Global Reporting Initiative

3 THE GLOBAL CONTEXT  Accounting failures have taken accountability from a business to a social issue: Enron, Xerox, WorldCom  Loss of public confidence in corporate governance  Global markets mean global accountability which needs global standards  New corporate value drivers need new measurement tools and information

REPORTING ON THE RISE Year Environmental And EHS Sustainability Number of Reports

BASIC PROBLEMS …AND OPPORTUNITY Companies receive diverse information requests Stakeholders receive incomplete information A globally-accepted reporting framework developed through a multi-stakeholder process

6 TRANSPARENCY: not OPTIONAL… ESSENTIAL Governments Investors Customers Community Rating groups Companies Pressure from...

7 Design and continually improve reporting guidelines reflecting the three dimensions of sustainability: economic, environmental, and social Revised 2002 Guidelines issued Elevate corporate sustainability reporting to be as routine as financial reporting Developing protocols and assurance guidance Build a global and independent institution to become steward of the Guidelines Incorporated as Foundation in Netherlands with new Board GRI MISSION

8 GRI: A BRIEF HISTORY  Conceived in 1997 by CERES in partnership with UNEP  Multi-stakeholder process rooted in principles of balance, transparency, independence  Funded by foundations through 2002, now diversifying  Moved from Boston to Amsterdam in Sept  Governed by multi-stakeholder Board, Stakeholder Council and Technical Advisory Council

9 The Guidelines Automotive Financial Tourism Mining The Guidelines foundation document upon which all other GRI documents are based Sector supplements additional guidance for specific sectors, addressing issues pertinent to those industries Technical protocols address a specific set of indicators, providing technical guidance on their measurement Issue supplements issue-specific supplements to provide additional models for organising the information Energy Water Child labour Diversity Productivity HIV/AIDS GRI’S PORTFOLIO

economic social COMPANY SECTOR CORE environmental REPORTING ELEMENTS 27 May, 2002

11 WHAT IS A GRI REPORT? Vision and Strategy Description of the reporting organisation’s strategy with regard to sustainability, with text discussion and a statement from the CEO Profile Overview of the reporting organisation’s structure, policies and management systems, including stakeholder engagement efforts Governance structure and management systems Description of organisational structure, policies and management systems including stakeholder engagement efforts GRI content index A table supplied by the reporting organisation identifying where the information listed in the Guidelines is located within the report Performance indicators Measures of the impact or effect of the reporting organisation divided into economic, environmental and social

12 SUSTAINABILITY REPORTING PRINCIPLES  Transparency  Inclusiveness  Sustainability context  Completeness  Relevance  Neutrality  Comparability  Accuracy  Clarity  Timeliness  Auditability

GRI & COMPLEMENTARY INITIATIVES Management Systems Standards GRI GRI seeks to harmonise and integrate GRI as a core platform for sustainability reporting 13 Intangibles Accounting Issue/ Sector/Nat’l Reporting Guidelines International Conventions Codes of Conduct Performance Standards Assurance Standards

14 WHY COMPANIES USE THE GUIDELINES  Benchmark and enhance efficiency  Internal management improvements  Stakeholder consultation  Attract employees and investors  Manage risk and protect reputation

15 EXPOSURE AT WSSD IN JOHANNESBURG Launch of 2002 Guidelines GRI reference in official documentation GRI reference by heads of government and UN Secretary-General GRI recognised mechanism for demonstrating adherence to Global Compact

GUIDELINES—WHAT’S NEW?  Reformulated reporting principles  Strengthened social and economic content  “Core” versus “additional indicators”  Clarity on flexibility  Guidance on assurance

BALANCING FLEXIBILITY & COMPARABILITY Transparency Coverage Structure INFORMAL IN ACCORDANCE Incremental Reporting

18 “IN ACCORDANCE” REQUIREMENTS 1.Report on vision, profile of organisation and governance and management systems 2.Include a GRI Content Index. 3.Report on the core performance indicators. Omission of each core indicator must be explained 4.Ensure that the report is consistent with the reporting principles 5.Include a statement by the Board or CEO as follows: “This report has been prepared in accordance with the 2002 GRI Guidelines. We believe that this report is a balanced and reasonable representation of our organisation’s sustainability performance.”

19 VERIFICATION & ASSURANCE  Key to strengthening credibility  2002 Guidelines encourage the independent assurance of reports and the development of standards and guidelines for the assurance process

20 CHALLENGES AHEAD  Strengthening/explaining linkages to financial reporting and financial industry  Strengthening harmonisation with key complements, e.g., ISO, EC CSR, AA1000S  Rolling out supplements and protocols  Expanding engagement: SMEs, sectors, regions,  Harmonisation with government initiatives

21 "Another important development is the growing support for the Global Reporting Initiative, which offers a coherent framework for reporting on environmental and social issues. It is a crucial complement to the Global Compact, and I am very pleased that the United Nations Environment Programme is a driving force behind both of them." Kofi Annan UN Secretary General 1 September 2002 GLOBAL REPORTING INITIATIVE