By Nancy Mancilla
Though we often struggle with interpretive guidance of the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines, we can easily say that overall, the world has done a fairly good job of embracing the majority of the protocol. Nevertheless, there are a few gray areas that reporting organizations continue to struggle with. Out of the 590 submissions (not representing actual participant numbers) during the G4 development public commentary period some of the highest concerns were related to the following:
Accordingly, these are just some of the issues where multi-stakeholder development committees focused a great deal of attention over the last few years.
As number two in our five part series leading up to the G4 launch in Amsterdam, we’re dedicating this write-up to the ever challenging Disclosure on Management Approach (DMA). So what are DMAs anyway? When we think of "Management Approach," it all seems quite easy; it’s a statement describing the approach taken to manage specific issues. So…why do we struggle to pull together a simple disclosure or align key points to our Content Indexes as a last ditch effort to tie up loose ends on final report drafts? Could it be that we just don’t understand where they should be placed in the document or that we frantically scramble to hit all the key points required for the DMAs?
According to the GRI G3.1 Guidelines:
The Disclosure on Management Approach should be a brief overview of the organization’s management approach to the Aspect (sub-topics to the lay) defined under each Indicator Category (Social, Environmental and Economic pillars) in order to set the context for performance information. The organization can structure its DMA to cover the full range of Aspects under a given category or group its responses on the Aspects differently. However, the Disclosures should address all of the Aspects associated with each category regardless of the format or grouping.
The challenge for reporters really lies within the final point highlighted above. If an organization has effectively applied the "materiality principle," then it should have a basic understanding as to why it has omitted certain "Aspects." Ideally, it would be beneficial for organizations to justify their reasons behind issues determined to be non-material. Of course, the discussion would require even more space when technically, our goal is to prepare a concise report that focuses solely on "material issues."
Furthermore, the DMA has been developed with the intent of providing a deeper discussion on how the organization detected risks and opportunities within a particular issue area, policies implemented to combat related challenges, interventions and training efforts, achievements, and goals for moving forward. Unfortunately, various formats for different Aspects were prescribed in the G3.1, which made for a writer’s labyrinth when determining where exactly to plug these into a story-based narrative.
Up until recently, only Level C reporters were exempt from this reporting requirement. As the GRI application levels we’ve long confused with scholastic grading will give way to an “in accordance” system, we have yet to see who will be exempt from this extra step in the process. What we do know is that a combination of generic format and specific format were proposed in the G4 exposure draft. We now have an indication that a general format will be consistently applied when drafting DMAs.
Additionally, DMAs and Indicators will be required only for material Aspects - and only where the Aspects are material. There will be one simple format prescribed by GRI and no disclosure or explanations will be required for "non-material" Aspects.
In less than a month, we will all have our answers as to what the changes will actually be! Are we ready to take sustainability reporting to the next level?
In an effort to bring everyone up to speed, we will be reporting LIVE from Amsterdam with 3p and will be following up with a free one-hour webinar to brief everyone on those changes. We’ll also be tacking on a G4 bridging module to all ISOS scheduled courses through the remainder of 2013.
Disclaimer: The thoughts shared here should not in any way be taken as factual evidence supporting expected G4 changes. They are based on the thoughts of affiliates of GRI in the U.S. who are worthy of sharing perspectives of how possible changes may be implemented upon the release of the final G4 document at GRIs Amsterdam Global Conference on Sustainability & Transparency May 22-24, 2013. This piece is part 2 in a series of weekly postings leading up to the global conference and will be revisited after the release of the G4.
[image credit: pinprick: Flickr cc]