GRI Launch of the US external assurance study with G&A Institute & BloombergPresentation Transcript
GRI Sector Leader Webinar Series Enhancing quantity and quality of reporting The launch of GRI’s US external assurance study Rina Levy, Bloomberg (GRI Sector Leader) firstname.lastname@example.org Louis Coppola, G&A Institute (GRI Data Partner) email@example.com Mike Wallace, Marjella Alma, GRI Focal Point USA firstname.lastname@example.orgVenue, Date email@example.com GRI webinar with Bloomberg and G&A Institute, 3 April 2013
OutlineIntroduction Mike – GRIUS trends in sustainability reporting Louis - G&A PresenterThe launch of the US external assurance study Marjella – GRI PresenterThe value assurance (data) Rina – Bloomberg Moderator
Summing up the State ofSustainability Reporting in the U.S.A. April 3, 2013 Louis D Coppola – Executive Vice President GOVERNANCE & ACCOUNTABILITY INSTITUTE, INC. (GRI Data Partner for the US)
Our Findings: About Corporations and Their Sustainability and Responsibility (“S&R”)Leaders in S&R Enjoy Competitive Advantages Greater access to capital - attracting patient, long- term investors – asset owners using ESG screens Can dramatically lower operating costs Create clear product & service differentiation Reduce regulatory or litigation issues Better enhance and protect their brands, reputation Enjoy share price enhancement vs. peers Improve corporate risk management processes
Sampling of US Reporters
Growth in US Sustainability Reporting 2003 – 25 Reports 2004 – 37 Reports 2005 – 36 Reports 2006 – 45 Reports 2007 – 70 Reports 2008 – 118 Reports 2009 – 141 Reports 2010 – 187 Reports 2011 – 333 Reports – March of last year (358 today) 2012 - ~450 Reports
Submit Your Reports – PLEASE! Download the Submission Sheet: www.sustainabilityhq.com/reports Send the completed form to firstname.lastname@example.org Visit the GRI Global Database database.globalreporting.org
Trends – Characteristics We See Leadership companies set pace for peers investment peers and sector or industry peers Reporting is becoming “more than annually” Formats are diverse – print, on-line, hybrids “Integrated” reports – pacesetters like Clorox (2nd) Integration of key corporate documents Reports are end of process – GRI Framework provides rigorous process – enhances company operations, marketing, finances, performance Being used like a Six Sigma or TQM process Assurance Slowly Being Acquired by Leaders
Corporate ESG /Sustainability Reporting Does It Matter? Available at www.ga-institute.com
Are Sustainability Reporters More Likely to be Included in Leading Indexes?Some Answers: NASDAQ OMX CRD Global Sustainability Index ® (QCRD) Yes Dow Jones Sustainability Index World® Yes Dow Jones Sustainability Index North America® Yes
NASDAQ OMX CRD Global Sustainability Index ® (As of June 30, 2011) 97% are reporting 86% of those use the GRI Framework
Dow Jones Sustainability Index World® (As of September 2012) 98% are reporting 85% of those use the GRI Framework
Dow Jones Sustainability Index North America® (As of September 2012) 85% are reporting 77% of those use the GRI Framework
What Impact Does Sustainability Reporting have on Selection for Third Party Reputational Lists?Some Answers: Yes for Newsweek Greenest Companies in America® Ranking Top 100 and 500 Yes for CRO 100 Best Corporate Citizens® Yes for Ethisphere’s World’s Most Ethical Companies®
Newsweek Greenest Companies in America® GRI Reporters on Average Rank The Highest Not Reporting – Lowest Average Score
Newsweek Greenest Companies in America®GRI Reporters on Average – Most Favorable Scores Not Reporting – Lowest Average Score (NOTE: Higher is Favorable except Envtl_Impact)
CRO 100 Best Corporate Citizens (As of March 2011) 53% are reporting 72% of those use the GRI Framework
Ethisphere’s 2012 World’s Most Ethical Companies (As of March 2012) 76% are reporting 90% of those use the GRI Framework
Does Sustainability Reporting have an impact on Sustainability Ratings and Rankings?Some Answers: Yes for Carbon Disclosure Project (CDP) Disclosure Score + Performance Score Yes for Glass Door Rankings (4 Rankings Analyzed) Yes for CSRHub Company Ratings Yes for BrandLogic/CRD Corporate Sustainability IQ Matrix Yes for Bloomberg ESG Disclosure Score
Average CDP Disclosure Score 2012 (As of September 2012) GRI and GRI Reference Score Most Favorably
Average CDP Performance Score 2012 (As of September 2012) Most Common GRI Reporting Score is an A
Glassdoor Ratings (As of July 2012)GRI Reporting Companies Have Happier Employees And More Respected CEOs
CSRHub Company Ratings (As of June 2012)GRI Reporting Companies Score Higher Across the Board
Brandlogic CorporateSustainability IQ Matrix (As of June 2012)The Most FavorableQuadrant - LeadersIs Made up of 100% GRI Reporters
Average Bloomberg ESG Disclosure Score (As of September 2012) GRI Has the Highest Average Scores & The Top 32 (highest ranking) companies are ALL GRI Reporters
S&P 500 Report Conclusions GRI Reporting Companies Outperform S&P Index Peers Are Selected More Often For Leading Reputational Lists Get Rated Higher by Sustainability Raters Included More Often In Leading Sustainability Indexes
Keep up with G&A In 2012 we analyzed over 450 reports for quantitative and qualitative information. Launching our New Awards and Recognition services for corporate consulting clients next week with 3BL Media. Keep up with reporting at www.SustainabilityHQ.com/reporting • Interactive Sort/Search Database • Daily Announcements (also on www.Accountability-Central.com) • Sign up for our Newsletters (also on www.ga-institute.com) • Follow us on Twitter (@gainstitute, @GACRUSAReports, @GACRUKReports, @GACRIEReports) • Like us on Facebook (find the link on www.ga-institute.com) • Join our LinkedIN Group. Proud to help GRI Launch the publication on assurance today
GOVERNANCE & ACCOUNTABILITY INSTITUTE 215 Park Avenue South, 10th Floor (at Union Square) New York, New York 10003 Tel 646 430 8230 Web www.ga-institute.comLouis Coppola, MBA - Executive Vice President, Technology & GRI Strategies Tel 646.430.8230 x14 - Email email@example.com
Stats & Facts by Rina Levy
…over time, GRI reportersoutperform the benchmark
Assured reporters outperform
STANDARDIZE DATA? • 50% of GRI compliant companies have a Bloomberg ESG Disclosure Score of 40 and above vs • 3% of those not reporting according to GRI have a score of 40 and above
Key objectives GRIMore reports!Better reports!
How does GRI help?GRI MissionTo make sustainability reporting standard practice byproviding guidance and support to organizations.
95% of Global 250 companies issuesustainability reports – 80% use GRI 4
The GRI Guidelines – the Inventory GRI Principles: These guide the content and quality of your reporting. Materiality, boundary-setting, inclusiveness, stakeholder engagement etc. GRI reporting elements: 1. Profile Disclosures Strategy, About, Governance. 2. Disclosures on Management Approach EC, EN, LA, HR, SO, PR 3. Performance Indicators EC, EN, LA, HR, SO, PR
Sustainability Reports in the USA GRI G3 + G3.1 GRI reference Non-GRI sustainability reportUS GRI data partner 47 46% growth in absolute number of 23 GRI reports (w/ index) 2010 - 2011 269 187 141 119 71 2007 2008 2009 2010 2011
Launch of the US assurance paper Data Partner G&A Data Providers: Bloomberg KPMG
GRI and assurance• GRI recommends external assurance, but does not endorse particular providers nor approaches.• Report on external assurance: Profile Disclosure 3.13
GRI’s six key qualities(G3 GL, pg 38) External assurance should• Be conducted by external party competent in subject + assurance;• Be implemented in a manner that is systematic, documented, evidence-based, and characterized by defined procedures;• Assess whether the report provides a reasonable + balanced presentation of performance;• Utilize parties that come to an independent + impartial conclusion;• Assess the extent to which GRI framework was applied;• results in set of written conclusions that is publicly available.
Application levels and assurance• Sustainability reports based on G3(.1) Guidelines (w/ an Index) that seek external assurance can be illustrated with a “+” – (A+, B+ C+) when the reporting organization determines the 6 key qualities are met.• During the GRI Application Level Check GRI does not assess whether the external assurance for a report meets the key qualities for assurance identified by GRI, and offers no opinion on whether the “+” is justifiable.
Key FindingsThe report shows that in the USA, only 10percent (26 out of 269) of GRI-basedsustainability reports declared a “+” in 2011.
Key FindingsMost assured (+) reports in the USA in 2011 areApplication Level B+.
Key FindingsSome of the 26 assured reports contained morethan one assurance statement; 30 assurancestatements were identified.
Key FindingsThe 30 assurance statements were performedby different assurance providers: accountancy,engineering or professional service firms.
Who are these companies?
Scope of assuranceFor 16 out of the 30 assurance statements, awide range of sustainability topics were assured.- some engagements only covered KPI’s7 were performed for GHG emissions only7 statements were performed on environmentaltopics (water, carbon and waste)
Level of assuranceThe level of assurance was not specified in 11out of 30 assurance statements
StandardsA third of assurance statements (= 10statements for 8 organizations) did not makereference to any assurance standards.
Who should provide it?Considerations from interviewees:1) Interviewees looked at what value assurance could provide at a particular stage in the reporting process.2) Interviewees talked about the rigor and perceived credibility of the external assurance approach and provider.
Questionnaire• Why & perceived value• Understanding of GRI and of assurance• Composition of team providing assurance• Approach & process• Duration• Presentation of outcomes• Future of assurance
Quotes from interviewees
On the role of GRI
Quote from AICPAAmy Pawlicki, from assurance standard developer AICPA, says: “We are very pleased that GRI has conducted this research study to gain a better understanding of third-party verification on GRI -based reports. This research represents an important step in helping the preparers and users of sustainability disclosures better assess the diversity of assurance options available to them.”
Sustainability disclosure database
Data collection on assuranceNEW GRI data collectionEmphasis onThird party opinions/assurance/verification database.globalreporting.org
Bloomberg - Verification
More involvement with GRI?In addition to getting started with GRI reporting,you can:• Join the Organizational Stakeholder Program• Become a US Sector Leader• Participate in Working Groups• Participate in Governance Structures
Thank you! More information: www.globalreporting.org http://focalpointblog.org/usa http://database.globalreporting.orgVenue, Date