1. ©2012 William Blackburn Consulting, Ltd.

2. Background
Global Reporting Initiative Sustainability Reporting Guidelines = the international gold standard for public sustainability/CSR reporting— env., social, econ (Currently G3 or G3.1)
G4= the 4th edition, to be finalized May 2013
GRI seeks stakeholder input on G4:
Online survey (Nov 2011)
GRI Working Groups
September 25 Feedback on draft
NAEM letter (major/common issues)
©2012 William Blackburn Consulting, Ltd.

3. Developments Influencing G4
GRI 2015 Goal:
All large and medium companies from OECD (developed) and large emerging countries (BRICS, etc.) should publicly report their sustainability (soc., env., econ.) performance or explain why not (“report or explain”)
Mandatory integrated (financial + sustainability/ESG) reporting (S. Africa, UK, France, Denmark, Sweden, et al.)
Voluntary integrated reporting
Voluntary reporters (AEP, United Technologies, Southwest Air, et al.)
International Integrated Reporting Comm. (IIRC)
©2012 William Blackburn Consulting, Ltd.

4. G4 Objectives Create user friendly guidance Improve clarity
Harmonize with international standards
Strengthen “materiality” guidance
Link with integrated reporting (IIRC) (to be done later)
©2012 William Blackburn Consulting, Ltd.

5. G4 Objectives Address needed improvements (with Working Groups)
Application levels
Disclosure on Management Approach (DMA)
Boundary/materiality
Supply chain
Governance & remuneration
GHG and anti-corruption (coming in a few weeks)
©2012 William Blackburn Consulting, Ltd.

6. Application Levels
A, B, C Levels replaced with single “in accordance” criteria requiring:
All Profile Disclosure Items (now includes supply chain info)
DMAs and Core Indicators for all material Aspects (can group)
Material Aspects identified per Technical Protocol
All applicable Sector Supplement indicators
CEO statement on GRI conformance plus “report or explain”
GRI content index
©2012 William Blackburn Consulting, Ltd.

7. Defining Report Content and Boundaries
Step 1. Map Value Chain (entities and relationships where there may be significant sustainability impacts). E.g., :
Upstream Elements
Downstream Elements
Local
Communities
Company
Customers
Recycling
Facilities
Suppliers
Carbon Disclosure Project
Transportation
Transportation
Etc.
©2012 William Blackburn Consulting, Ltd.

8. Defining Report Content and Boundaries
Step 2. Identify Relevant Topics and Their Boundaries
Show which value chain elements may have which sustainability issues (a) with important impacts or (b) which may influence the decisions of the organization’s stakeholders
At a minimum, consider all GRI Aspects in G4 and applicable Sector Supplement as relevant
Carbon Disclosure Project
©2012 William Blackburn Consulting, Ltd.

9. Defining Report Content and Boundaries
Step 3. Prioritize Aspects (for materiality and depth of disclosure)
Material issues=
Significant economic, social and environmental impacts, or
Substantively influence the assessments and decisions of stakeholders
More in-depth disclosure for Aspects with greatest impacts on organization or its stakeholders
Need consistent, systematic, documented process
Carbon Disclosure Project
©2012 William Blackburn Consulting, Ltd.

10. Defining Report Content and Boundaries
Step 4. “Validation”
…to check the completeness of the material Aspects to assure the report will provide a reasonable and balanced picture of the organization’s positive and negative performance
Carbon Disclosure Project
©2012 William Blackburn Consulting, Ltd.

11. Question 1: Core Indicators for “In Accordance” Status
___A. The number and scope of Core Indicators (66 vs 49 for G3, plus sector supplements) are appropriate given the materiality process for prioritization and selection.
___ B. To make G4 less intimidating and more user friendly, Core Indicators should be trimmed based on an analysis of actual use and by abbreviating sector supplements. (Probably needed for integrated reporting anyway?)
©2012 William Blackburn Consulting, Ltd.

12. Question 2: Postpone G4 to Identify List of Core Indicators for Integrated Reporting
___A. We recognize that G4 may be further revised to add content for the International Integrated Reporting Committee project but believe G4 should be issued on schedule even if that content is not available.
___ B. To minimize confusion from repeated GRI revision, GRI should postpone issuance of G4 until after simplified list of Core Indicators is identified for integrated reporting.
©2012 William Blackburn Consulting, Ltd.

13. DMAs Generic DMA and some category- and indicator- specific DMAs
Generic DMA content for material topics
“Topic” (aspect, multiple aspects or category) and why it’s material
How impacts are managed
Policies, commitments, goals
Responsibilities, resources
Specific actions
Challenges and Dilemmas
How effectiveness of approach is monitored and evaluated; results from approach and related adjustments to it
©2012 William Blackburn Consulting, Ltd.

14. DMAs
Poor DMA conformance under A and B reports for G3 and G3.1 (300+ data points)
New DMA rules for added flexibility:
Only report for material topics
Can group by multiple Aspects or Categories if manage on broader basis (e.g., ISO for multiple environmental Aspects)
Less information for less significant material items
Need examples?
©2012 William Blackburn Consulting, Ltd.

15. Question 3: DMA Number and Scope
___A. The number and scope of DMA provisions are appropriate, even though DMAs are now required for “in accordance” status, because the new rules provide sufficient flexibility in trimming and grouping them.
___ B. DMA content should be trimmed because DMA guidance is still too long, complicated and intimidating. (Suggestions of items to cut:______________________________________)
©2012 William Blackburn Consulting, Ltd.

16. Question 4: Examples of Good Reporting
___A. G4 Guidance is sufficiently clear such that examples of good reporting text would not add much value and might reduce reporting innovation.
___ B. GRI should provide sample text of good reporting on:
__DMAs;
__Materiality/prioritization process
__Supply chain reporting
__Other (specify:________________________)
©2012 William Blackburn Consulting, Ltd.

17. Significantly Increased Content
Profile
Governance & remuneration
Supply chain
Boundary/value chain mapping (revised tech protocol)
Screening and assessment; remediation (added under several categories)
©2012 William Blackburn Consulting, Ltd.

18. Question 5: Overall Burden and Complexity
___A. The increased content of G4 improves the user friendliness and clarity of the guidance and offers reporters more choices, including more flexibility in selecting report content through the materiality process and DMA application rules, etc.
___ B. G4 is too long and complicated, and the way it is presented may well be intimidating to new and current reporters, alike. (Suggestions about content to cut or simplify:____________________________)
©2012 William Blackburn Consulting, Ltd.

19. Other major issues with G4?
©2012 William Blackburn Consulting, Ltd.

20. See GRI questions in G4 draft.
©2012 William Blackburn Consulting, Ltd.

21. Complete NAEM Feedback Survey
©2012 William Blackburn Consulting, Ltd.