Future directions for sustainability reporting

After ten years of sustained growth that made the Global Reporting Initiative (GRI) the world standard in sustainability reporting guidelines, the number of new companies reporting is falling off.  As Mehrdad Nazari, an experience sustainability reporter points out in a recent blog, reporting may have hit a glass ceiling.

I highly doubt this apparent stagnation has anything to do with a lack of excellent reasons to report, but it is clear the GRI guidelines meet the needs of multi-national corporations best, although new sector supplements for non-governmental organizations and other groups are starting to change that. However if the GRI and reporting in general are ever to become truly mainstream, they will need to be tuned to the needs of the small and medium organizations that make up 80% of businesses worldwide.

I see this both as a challenge and as an opportunity.  For one thing, it creates space to adapt reporting guidelines for small and medium organizations, understanding that their needs are intrinsically different from the needs of multi-national companies.  Some purists will shudder at the thought, but it is essential to streamline the reporting process by cutting out the steps that are essential for large organizations but less relevant for smaller ones.

Secondly, it provides an opportunity to rethink the reporting process with a focus on creating strong internal, even horizontal links within organizations.  SME's may lack time and money, but they tend to have a much better grasp of what makes their organization tick as managers tend to be directly involved in multiple aspects of the organization and its people. This enables internal communication in ways that larger companies can only dream of, making it much easier to determine what is important (materiality) and what needs to go into a report.

Last but not least, reporting will only become mainstream once readership increases, and one way to make that happen is to produce targeted and engaging reports.  Readership from your key stakeholders is a must.  Here again, smaller is an advantage since SME's tend to have more direct links to some crucial stakeholders such as employees and partners and may already know how to engage them effectively.  For an interesting article on how one company succeeded in getting key stakeholder to read its report, click here.

If you're part of an small or medium organization that is thinking about measuring and communicating sustainability, I'd love to hear your thoughts on reporting.  What does your organization need, and how can reporting help you get there?