sustainability reporting

G4 Sustainability Reporting: Why it’s great and how communication can help

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First, let me admit that I’m somewhat new to the nuts and bolts of sustainability reporting. I have been researching sustainability communication and CSR reporting, but last summer I spent a couple of days at Edelman in Chicago at training for GRI reporting using the G4 guidelines. At first, I worried that the training would be too dense, and I might not find much value in it. But, I was pleasantly surprised to find that the information was extremely interesting and relevant for communication research.

Here’s what I love about sustainability reporting with G4. It truly is a way to help corporations manage processes toward a sustainable economy. Unlike earlier iterations of the GRI report, G4 strips out all the fluff and really forces companies to focus on the most critical aspects of sustainability that will bring needed change.

Here are some great examples:
1. Outputs are divided into three categories – economic, environment, and social – and that means companies need to report in all areas. And, that provides great stories for companies to tell.

2. More is not better. Report quality is not judged on quantity of information, so companies are encouraged to be concise but thorough. Enter communication experts who do this for a living. Providing transparent and useful information (in a concise form) is an excellent way to build credibility and communicate effectively.

3. Each item needs to be measured using an approved method of collection. And, results need to be contextualized. As our trainer said, companies need to explain if their improvements are due to a “happy accident” or to management processes that lead to planned improvement. And, on the flip side, missing a goal should be contextualized because sometimes unexpected circumstances cause companies to miss their objectives, but the cause is reasonable. This is an ethical approach to reporting and builds credibility with audiences.

4. Awards are no longer a required disclosure. That means that companies do not need to disclose them (but they are free to do it). Why? Because, bottom line, awards to do not contribute to making a company more sustainable. The criteria for some awards is not known, so it’s hard to decide if the award is an indication of an important contribution. So, the decision was made not to require them. This decision makes an interesting statement about value of awards and how some may not be rigorous and really have important meaning.

5. Ethics & Integrity disclosures are required (the Arthur W. Page Center for Integrity in Public Communication is thrilled).

6. Stakeholder engagement is new to G4 – this means more communication and more promotion. This is my favorite change because it brings sustainability reporting squarely into the communication arena, and opens up a fascinating opportunity to study stakeholder engagement in sustainability.

7. And, here is the most courageous change  – in order for a company to be “in accordance” at the comprehensive level (which is the most thorough level), it must disclose the salary of its highest paid employee in a country and how that compares to the average salary in the company in that country (not including the highest paid employee). One of the goals of GRI is to fight poverty, and frankly, this is one of the most practical ways to identify income inequity.

My final takeaway is that companies that adhere to the G4 standards, and specifically those who reach the comprehensive level of certification, will have an amazing story to tell and will contribute to their reputation in a meaningful way.