IFC gets out vuvuzella for sustainability reporting

 Jointly with GRI, the International Finance Corporation (IFC, part of the World Bank Group) published a bridging document showing how strategies, system and data points developed to meet IFC Performance Standards can be used to generate GRI-type sustainability reports. About time to help capital project developers/sponsors to leverage expensive compliance reporting to create more shareholder value!

Capital project sponsors seeking project finance and political risk insurance from IFC, EBRD, Equator Banks and Export Credit Agencies (such as Export Development Canada or EDC) sometimes feel the need to reach for headache pills when they commit to meeting the IFC Performance Standards and, its derivative, the Equator Principles. Heartburn treatment is sometimes added when they try to meet the associated monitoring requirements for quarterly and annual monitoring reports. The associated systems and data cost lots of time and money to produce. Given focus (tunnel vision?) on compliance with loan or subscription agreements, the systems and data sets have not been recognized as a tool to create more shareholder value for the company. But this is about to change.

When asked, I jumped at the opportunity to lead a conference break out session on sustainability reporting during IFC’s Corporate Responsibility Forum on Strategies for a Competitiveness and Shared Value (held in mid June 2010 in Washington DC). IFC distributed the fresh-off-the-press guidance note on “Getting More Value Out of Sustainability Reporting” and we had an opportunity to explore concrete case studies with the help of IFC clients, a GRI approved trainer on sustainability reporting (yours truly), and other sustainability report makers and users. Some of the examples discussed included the following:

IFC investee Dialogue, which operates in the mobile telephony sector in Sri Lanka, leveraged the systems and information being collected based on the IFC Performance Standards to generate its A-level inaugural sustainability report. Dialogue topped the country’s corporate accountability ratings for the Year 2009, in its inaugural year of publication and is recognized as Sri Lanka's most coveted brand.

Manila Water, a public private partnership which provides water and wastewater services to 5.6 million people from 23 cities and municipalities in the Philippines, used its sustainability reporting process to better articulate its sustainability strategy and performance. In 2009, the Interfaith Center on Corporate Responsibility (ICCR), a coalition of nearly 300 faith-based institutional investors representing over $100 billion in invested capital evaluated the adequacy of environmental, social and governance (ESG) disclosure of 12 water utility companies and assessed how well they met investor needs. Manila Water outranked privately owned companies in the UK and US, coming third in the benchmark study -and collected other awards and recognition along the way.

Gold Reserve Inc (supported by Prizma) became the first pre-production, junior mining company listed in Canada to use and leverage its environmental and social impact assessment studies designed to meet IFC Performance Standards and Equator Principles to create an inaugural sustainability report.

Getting a ‘bigger bang for the buck’ creates shareholder value. Leveraging systems and data designed to meet IFC Performance Standards and Equator Principles can be used to produce sustainability reports. It may surprise you how little extra efforts is involved in this process…!

About the author: Mehrdad Nazari (MBA, MSc, LEAD Fellow) is a Corporate Responsibility, Sustainability Reporting & ESIA Advisor, and Director of Prizma. He was previously an environmental consultant with Dames & Moore, Principal Environmental Specialist at the EBRD and CSR Research Director at CoreRatings. Mehrdad is a GRI-approved trainer on GRI's sustainability reporting framework and a licensed AA1000 Assurance Provider.

9 Comments to IFC gets out vuvuzella for sustainability reporting

  1. […] This post was mentioned on Twitter by Kari Burks, Damir Tankovic. Damir Tankovic said: IFC gets out vuvuzella for sustainability reporting | Prizma http://bit.ly/bsS3sL […]

  2. […] of the Mining.com Magazine), and highlighting convergance of GRI with other frameworks (such as IFC Performance Standards/Equator Principles) used by a variety of investors and political risk […]

  3. This blog entry made it to my Top 10 for 2010. Full list posted here

  4. […] joint publication (Getting More Value Out of Sustainability Reporting  about which I blogged here: IFC gets out vuvuzella for sustainability reporting), sustainability reporting and the GRI framework have yet to be taken seriously by […]

  5. […] Sustainability Reporting – Misperceptions & Barriers […]

  6. […] Those who have discovered the business case of sustainability reporting have probably realized that they are half way there before they even started the reporting process. They see that, due to listing requirements, they have good governance and accountability structures in place. They also have accounting and human resources departments, policies and practices in place. ‘Tick off’ a bunch of GRI disclosure requirements and indicators. Many companies also have environmental, health & safety policies and management systems in place to support regulatory reporting and compliance, and support efforts aimed at continuous improvement. ‘Tick off’ a dozen or two additional GRI indicators. Add industry-wide stakeholder engagement initiatives, and company/project specific stakeholder engagement (well-developed in the extractive sector) and you have most – if not all – of the ingredients for a good inaugural sustainability report in place. However, this information and related context and stories are perhaps confined within departmental silos and disbursed throughout the reporting organization. Pulling this data together is typically not a major problem. This is perhaps why the IFC took out the vuvuzela in support of GRI reporting by its investees. […]

  7. […] Some of these MDBs have also been promoting the use of GRI as blogged earlier here: IFC gets out vuvuzella for sustainability reporting […]

  8. […] The International Finance Corporation (IFC), known as a leading sustainability standard setter in emerging markets, “sees sustainability reporting as an opportunity for a more dynamic engagement between investors and businesses” and “would like to see many more of [IFC’s] clients undertaking GRI-based reporting alongside and as part of their traditional annual reporting.” To this end, IFC partnered with the GRI and published a guidance note “Getting More Value Out of Sustainability Reporting”, which connects IFC’s Sustainability Performance Standards and the GRI Reporting Framework (see also IFC gets out vuvuzela for sustainability reporting). […]

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