GRI: a Tool for Benchmarking, Due Diligence and Positioning?
Despite challenges, GRI-type sustainability reports can support due diligence, benchmarking and positioning studies. A recent blog by
I came across similar problems to those described by Elaine when commissioned to compare a peer group of mining companies. Take the apparently straightforward example of lost-time injury frequencies (LTI). Most members of the peer group had reported this number. But the results of the benchmarking study provide surprising results and required adjustments: the ‘headline LTI statistics’ did not tell the full story.
One of the seemingly worst LTI performers turned out to be a peer leader. Another reporter was identified as a laggard despite statistics suggesting otherwise. Recognizing these important nuances required a more detailed review, some back-calculation and discounting of statistics. For example, the apparent peer laggard had actually normalized its LTI statistics using one million hours worked. Other peers normalized their LTIs using (the more commonly used) 200,000 hours worked giving them a five-fold advantage. Conversely, the superior stats reported by another company was out of sync when compared to its peers, not to mention its overall performance and reporting. Thus, I judged its LTI number to be simply wrong and misrepresenting the likely reality on the ground. – I found similar benchmarking challenges when looking at energy and water intensity, which may be interesting topics for future blogs.
Does this mean that GRI reporting can’t provide useful intelligence for benchmarking, due diligence or opportunity to explore positioning within a competitive context? Not at all! However, using the numbers blindly - in a simple 'spreadsheet dump format' or as a repackaged commodity provided by a data consolidators - could be very misleading. - The good (self-serving?) news: there is still plenty of value which can be created by understanding the nuances of CSR strategy and reporting, and more appropriately ‘slicing and dicing’ data within an appropriate peer context.
Have you come across similar challenges? How were you able to use GRI/sustainability reporting data to support due diligence, benchmarking and positioning reviews despite any shortcomings?
About the author: Mehrdad Nazari (MBA, MSc, LEAD Fellow) is a Corporate Responsibility, Sustainability Reporting & ESIA Advisor, and Director of