Hidden Gems of King III and GRI plus 12 Report

Michael Rea's annual research on South African sustainability reporters contains hidden gems: what are commonly and rarely used GRI indicators?

Appendix III of Michael Rea’s (and team) latest research report (about which I blogged here) highlights the uptake of GRI reporting parameters. While GRI and non-GRI reporters both achieve 100% of possible scores available for reporting their organizations’ name (probably no reason to bring out the champagne bottles), other parameters show that adopting a ‘GRI discipline’ adds credibility and value to the report users – especially analysts.

For example, the cohort of South African GRI reporters received a score of over 60% for reporting the basis of measurement of indicators and other information in the report. This compares to about 4% (yes, four) achieved by non-GRI reporters. Essentially, this suggests that analysts (and other stakeholders) would have a hard time interpreting, benchmarking or assigning any credibility to the information/numbers presented by non-GRI reporters. Similarly, GRI-reporters are much better at disclosing the following issues:

• Governance structures (92% vs. 66%),
• Stakeholders concerns and how they were addressed (58% vs. 4%)
• Management approach on CSR/ESG issues (30%-50% vs. <5%)

With most GRI disclosures and indicators receiving scores exceeding 50% in Michael’s reserch, selected indicators stand out by their relative low scores in the GRI cohort:

• DMA HR Disclosure on Management Approach for Human Rights Indicators-30%
• LA14: Ratio of basic salary of men to women by employee category – 30%
• HR2 % of key suppliers and contractors screened on human rights – 18%

It would be interesting to find out the reason for this. What do you think: are these indicators not relevant to most reporters or are they too complex to deal with? Also, do you think that list will expand with GRI's introduction of new/changed indicators through GRI G3.1? I look forward to your comments.

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.