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A challenge that all organisations face is reporting results to their stakeholders.  Embarking on the sustainability journey presents new facets to that challenge.

The old adage that you “cannot manage what you cannot measure” is a good place to start.  It is difficult to be able to quantify the success of your actions to improve your sustainable performance if you are unable to actually say what you achieved, in concrete terms.

Of course, it’s great to hear that everyone’s PC was turned off at night, or that there were no lights left on after everyone went home.  But what does that translate to, in terms of actual outcomes?  For example, how many Kwh (Kilowatt hours) were saved?  Did the effort result in a reduction of greenhouse gas emissions, and if so, how much?  Did the company save money? This is always a useful argument in terms of future initiatives!  Did people feel better about the business (employees, customers, clients, the general public)?

The problem is, where do you start?  Establishing a baseline is a great idea, because it gives you something to measure from. For example:

“Last year we spent $this on electricity, and this month we spent $that.  Our project to reduce energy consumption saved $amount, and quantity Kwh.”

But how do you choose your metrics (the things you measure)?  I’ve indicated a few ideas already.  However, I recommend that you adopt a reporting framework to help guide you in your reporting choices.  I favour the Global Reporting Initiative (GRI) framework myself as it seems to be practical without being too onerous.

That wasn’t always the case, as the framework was originally established by large corporates, many of whom had intensive disclosure responsibilities, particularly those based in Europe and the United States.  However, the framework has matured and evolved.  In particular, levels of reporting have been established, which makes its use less of a chore for small and medium-sized entities.  Before I say too much more about that, let me first explain how the GRI framework is made up.

The first section is a set of standard disclosures.  These define the reporting entity, and allow the definition of boundaries, and where appropriate, the principles that have been used to develop your reports.  After that come the performance indicators, which range across a selection of topic areas:

• Environmental
• Human rights
• Labour practices and decent work
• Society
• Product responsibility
• Economic performance

Remember that this framework has been designed to operate in a global context – which means that the indicators in the human rights and labour practices sections (for example, use of child labour, or forced labour) don’t make much sense for reporting the performance of a New Zealand company.

On first reading, the framework is pretty intimidating.  There are 42 sections in the standard disclosure section alone, and almost double that number of performance indicators.  However, the introduction of “Application Levels” to the framework means that starting reporting under the framework has become much easier.  The lowest level (of 3) requires a relatively small set of disclosures, most of which should be at or near your fingertips.  And an organisation is only required to report on 10 performance indicators, which must include at least one from each of Social, Environment and Economic.

There are a few things I really like about this framework.  It has been in use for several years by thousands of organisations, so the kinks have been worked out.  In the standard disclosure section, there is a requirement for a statement from the most senior executive setting out the relevance of sustainability to the on-going operation of the organisation.  I think that this statement helps an organisation to sort out where sustainability sits in the priority list.  There is also a requirement to develop a list of stakeholders, and to state how and whether the organisation will engage with each group.  For many smaller organisations, this may be the first time they have thought about stakeholders beyond their shareholders, their customers and their employees.  That’s got to be a good thing.

The framework also includes a wide range of performance indicators, so no matter what your organisation does, there will be relevant (and useful) metrics for you to collect and report on.  Finally, as part of continuing development, a number of industry-specific supplements have been (and are being developed) to help flesh out those aspects which are not already covered by the framework.

There’s much more that could be said, but perhaps that’s enough to be going on with at the moment.

As always, I welcome your comments and feedback.



About David Laing

I run Sustained Consulting, which helps businesses to behave more sustainably.  I have an MBA, and fifteen years of leadership experience.  Amongst others, I’ve worked in a mining consultancy (!), for a software vendor, and for large technology services providers. I’m passionate about sustainability and climate change, and in 2009 decided it was time for me to take a more proactive role, and to help businesses become more sustainable. I’m involved with a range of different activities and projects.  Amongst other things I’m:

• helping to develop a voluntary carbon market in New Zealand,
• developing sustainability reports
  
• developing a number of waste to energy projects
  
• leading community projects (community garden, saving the local bowling club from property developers, reinstating civil defence)

I have a wealth of eclectic knowledge and experience, read widely and I enjoy making connections between different ideas and concepts.

Email me: [email protected]

Tags: Business, reporting, Sustainability