Along with the launch of the CDP 2014 Questionnaires, which greet us with holiday spirit, Corporate Sustainability Managers the world over are also officially welcoming the beginning of their broader Sustainability Reporting cycle. 

In addition to CDP, there is a complex array of sustainability reporting frameworks and rankings organizations which can be used to help guide reporting scope, disclosure and evaluate performance. One of these, namely the Global Reporting initiative (GRI) is well established, although evolving with its most recent iteration taking the form of the G4 Guidelines. Another framework, the Sustainability Accounting Standards Board (SASB) is much newer but is no less significant given its focus on SEC reporting by US publicly listed companies.

As companies seek to expand but also streamline their reporting efforts, and to link disclosure back to strategy and performance, there is a risk that these emerging standards will cause more confusion than focus, more noise than signal. Further, with each taking a different approach to defining materiality, disclosure and subsequently rankings, organizations that evaluate corporate performance are often left to their own, custom, devices. However, there is some good news.  Over the last 3 years, the various parties involved in developing the reporting frameworks have been working together to align their language and approach, and there are increasingly valuable synergies between the frameworks, which should make it easier for companies to evaluate and apply them while also reducing the amount of work and redundancy.

Getting Tactical on Alignment

For the last three years, CDP and the GRI have issued a linkage document which helps responding companies to identify the alignment between criteria, at the level of CDP question and GRI indicator. Looking ahead, this helpful resource should facilitate the transition by companies to GRI G4 reporting. The 2014 linkages document is not yet publicly available. Going forward, CDP and GRI have signed a Memorandum Of Understanding to jointly promote, harmonize and clarify their corporate sustainability reporting frameworks.

This follows a March 2013 announcement by RobecoSAM, the company behind the Dow Jones Sustainability Indices (DJSI), that starting in 2013, it will be asking some of the same climate change questions as those used by CDP, allowing for a simple copy/paste across the two reporting systems for a number of the GHG related questions. Unfortunately, its not yet a complete like for like question set so responders will need to tailor the data scope, boundary and format.

While alignment at a technical level continues to grow, reducing the reporting burden in certain areas, and particularly carbon footprint reporting, there remain many asymmetries between even the largest and most widely recognized reporting frameworks. In some cases this is for good reason, but it also runs the risk of ultimately slowing down the strategic focus and the feedback cycle of reporting disclosure and evaluating performance.  With so much variability between frameworks and rankings systems, comparison across companies even within sectors causes confusion.

In our next series on this subject (Part 2 of 3), we’ll dig a bit deeper in the primary reporting frameworks in use today, the GRI and SASB, explain the key differences and features between them, and then offer some insights into how to best take advantage and apply them in this upcoming reporting cycle. Stay tuned!