Glossary

Accountability An obligation to account for one’s responsibilities, often accomplished through some form of reporting process; to answer for one’s actions.
Accurate A description for information or indicators that are free of errors and that fairly represent the activities of an organization.
Achievable A description of an activity or indicator that can be accomplished.  To be achievable, an activity (and its related indicator) should be controlled by management; linked to someone’s responsibilities; and require action by someone.
Assurance A provision of confidence or certainty given by an independent assurance provider to a party in relation to a certain subject matter.
Assurance engagement An agreement between an organization and an assurance provider whereby the organization contracts an assurance provider to express an opinion about the reliability of some aspect; also called assurance service.
Assurance statements A short report providing an opinion about the credibility of information about an organization’s activities.
Auditor’s report The means of communicating audit findings to users.
Balance Reporting both accomplishments and challenges; providing information on both positive and negative activities.
Balance Sheet A listing of an organization’s assets, liabilities, and owners’ equity; also known as a statement of financial position.
Benchmark A point of reference or standard used to place performance in context.
Cash Flow Statement An accounting of an organization’s cash transactions classified into three categories:  operating, investing; and financing.
CERES The Coalition for Environmentally Responsible Economies is a group of environmental, investor, and advocacy groups coordinating efforts to promote sustainable development practices.
Certain subject matter The processes and procedures incorporated in an information system or an environmental management system; reporting according to a certain standard; the accuracy of certain indicators; or other substance that the organization wishes to be assured.
Comparable The ability to judge an organization’s performance against others; benchmarks are beneficial for comparability purposes.
Complete A description for information that includes all material activities, provides balance, and compares performance to that of other organizations.
Confidence level The extent to which an assumption, number, or statement is likely to be true.
Control system All of the integrated processes and procedures that an organization has implemented to achieve an objective.
Corporate scandal A questionable, unethical, illegal or alleged illegal action in which a person in a corporation engages; the action is also widely publicized.
Cost effective A description of an activity that can be achieved with the least cost, thus combining effectiveness and efficiency.
Decision making Logical thought processes that stakeholders, as well as stockholders, use to gather information to take action in the future.
Eco-efficiency Activities that achieve both economic and environmental performance.  Indicators of eco-efficiency have one dimension related to the environment and the other related to the economy (one as a numerator and the other as the denominator); also called cross-cutting.
Economic The production of economic goods and services.
Economic dimension One of the three dimensions of sustainability: economic, social and environmental.
Effectiveness metrics Indicators that determine if an objective is met, regardless of cost, such as ratings for employee satisfaction.
Efficiency metrics Indicators that measure output related to input; product or services produced (output) are divided by resources used to produce them (input), such as emissions per barrel of oil produced.
Environment A system of maintaining the integrity of the ecosystems to enable them to continue to produce and function.
Environmental dimension One of the three dimensions of sustainability: economic, social and environmental.
Environmental reporting A means of providing information about an organization’s environmental performance, similar to sustainability reporting; however, the focus is only one of the three dimensions of sustainability (environment, economic, and social).
Environmental, social & financial governance The structure within an organization to oversee and administer sustainability activities.
External assurance A statement about the accuracy of information or adequacy of performance made by an independent third party. It involves the engagement of a qualified person outside the organization to comment on, and provide opinions about, the report.
External auditor An independent person who audits or reviews the company’s accounts.
External readers (audiences) Individuals or groups outside of an organization at whom its communications and promotional efforts are aimed.
GAAP Generally Accepted Accounting Principles are a set of guidelines used to prepare financial statements that are required by regulatory commissions and recognized by the business community.
Green glossies Early reports prepared by companies to report their environmental performance that were attractively designed but contained little of substance.
Greenwashing Performance or reporting that appears environmentally responsible on the surface but further investigation suggests that it is actually superficial, not showing depth.
GRI The Global Reporting Initiative is an international organization that has prepared guidelines to be used for organizations in preparing their environmental, social, or sustainability reports.
GRI industry supplements A  Global Reporting Initiative standard which is customized for an industry.   Multi-stakeholder groups work with industry representatives to develop appropriate indicators for the supplement.
Guideline A source of reference for principles or rules on a certain topic.
IFAC The International Federation of Accountants is an organization which determines international accounting principles to be used by companies worldwide.
Independent assurance provider A firm or person who is not biased in his/her opinion regarding information provided by another organization. The provider (person or firm) has no interest in seeing information presented either favorably or unfavorably but rather is neutral.
Independent party A person or organization that has no interest in seeing information presented either favorably or unfavorably but rather is neutral.
Indicator A means of quantifying something. Even though performance can be presented in qualitative form, companies prefer quantitative information to easily and quickly assess trends, challenges, and accomplishments.
Input An activity or indicator which measures what is going into a process (such as dollars invested into a community), but it does not determine what result occurred with those dollars.
Internal assurance Internal controls and internal audits are carried out by employees of the reporting organization to monitor operating results, verify records, and assist with increasing efficiency and effectiveness of operations.
Internal audit department A unit within an organization that consists of internal auditors who perform on-going audits or reviews. The work of internal audit department is generally much more detailed than that of an organization’s external assurance provider.
Internal auditor An employee whose task is to provide unbiased auditing and assurance services.  Internal auditors report to the highest levels of management and the Board of Directors.
Internal audits Frequent reviews to evaluate internal controls, monitor operating results, and verify records to increase the efficiency and effectiveness of operations and to detect fraud.
Internal controls Procedures and practices that direct, motivate, or deter certain types of behavior to help meet an organization’s objective or goal.
ISO The International Organization for Standardization brings together standard setting organizations in 160 countries to develop and publish international standards that meet the needs both of business and broader society.
IUCN The International Union for Conservation of Nature is an organization whose intent is to help find solutions to environment and development challenges.
Lagging indicators Detective measures or metrics used after an activity happens.
Leading indicators Preventive measures or metrics used before an activity happens.
Legitimate A description given an organization that is producing a good or service in a manner that stakeholders and society demand and expect.
Limited assurance A review or audit having a narrower scope and less depth than a full audit. It is usually confined to certain accounts or operations; also called negative assurance.
Material Information that is important to a decision.
MD&A The Management Discussion and Analysis is a section of a company’s annual report in which management discusses numerous aspects of the company, both past and present.
Measurable A description of an activity or indicator which is specific; accurate; and replicable (will produce the same results if calculated again).
Multi-stakeholder process A course of action that includes opinions and expertise from a variety of organizations, groups, or individuals that have an interest in or are affected by the outcome.
Nested circle A means of illustrating the concept of sustainability in which the economic dimension of sustainability represents a component within the societal dimension, which in turn represents a component of the environmental dimension.
Objective An aim, goal or intention.  Objectives are the most basic planning tools underlying all strategic activities.
Outcome An activity or indicator which measures the impact or result of the input or output (such as health effects from the meals or satisfaction from eating the meals).
Output An activity or indicator which measures what is coming out of a process (such as number of food bank meals provided).
Performance An action that accomplishes an objective or goal. It is usually measured in the form of metrics or indicators such as predetermined standards of accuracy, completeness, cost, and speed.
Performance measurement system A complete set of indicators (metrics) used to quantify how well an organization fulfilled its responsibilities in terms of three dimensions: economic, social, and environmental.
PERI The Public Environmental Reporting Initiative was one of the first guidelines to help organizations communicate environmental performance information to its stakeholders.
Primary stakeholder A person, group or organization that transacts with a corporation, such as customers, employees, suppliers, shareholders, and financial institutions.
Provision of confidence or certainty The degree of accuracy to which the assurance provider reviews the data.
Puffery Opinions that are unsubstantiated by evidence, contain exaggerations, and use many positive superlatives. They are usually quite vague and considered harmless as long as they does not make specific false claims that could mislead the intended audience.
Reasonable assurance A review or audit having a broader scope and more depth than undertaken for limited assurance; also called positive assurance.  However, no audit or review can provide absolute certainty that an event will (or will not) occur or that data are absolutely accurate.
Regulator Part of a system which determines and maintains the operating parameters usually within specified limits or scopes. A regulator may be an electronic or mechanical device or a person which ensures certain actions are (or are not) undertaken.
Relevant A description of information or indicators that are significant, important, and useful for making decisions.
Relevant A description for an indicator which reflects a core value or strategy of the company and the expectations of the company’s stakeholders.
Reporting organization A business organization, non-profit organization or non-government organization that provide information in a report form on some aspect of its environmental, social, and economic performance, generally referred to as a sustainability report or a corporate social responsibility (CSR) report.
Results of Operations An accounting of an organization’s revenues and expenses for a period of time, usually one year; also known as an income statement or a profit & loss statement.
Risk strategy Plans, policies, procedures, and controls used to minimize the risks in an organization.
Secondary stakeholder A person, group or organization that is affected by, or can affect, the transactions and activities of a corporation, such as community groups, non-governmental organizations, governments, human rights advocates, and environmental advocates.
Securities commissions Agencies that establish and maintain standards for efficient, orderly, and fair stock, bond, and other financial instrument transactions by ensuring laws and regulations are followed.
Shareholder Any person, company, or other institution that owns at least one share in a company. Shareholders are the owners of a company. They have the potential to profit if the company does well, but have the potential to lose if the company does poorly; also referred to as stockholders.
SMART An acronym used for the following characteristics of indicators: Specific, Measurable, Achievable, Relevant, and Timely.
Social A system of living in groups or communities rather than in isolation.
Social dimension One of the three dimensions of sustainability:  economic, social, and environmental.
Social license A theoretical concept that suggests that an organization can operate if it provides some value to society.
Specific A description for an indicator that is valid and credible. It is clean and simple, easy to interpret, comparable with others, and understandable.
Spin Presentation of a situation or information in a biased or slanted, not a balanced or complete, manner.
Stakeholder A person, group, or organization that has a direct or indirect involvement with another organization. Stakeholders can affect or be affected by a business organization’s performance.
Stakeholder engagement Contact with an organization’s stakeholders to exchange ideas.
Stakeholder inclusiveness The involvement of stakeholders in the reporting process in some way.
Stakeholder panels A group of individuals who have a stake in an organization and are asked to provide observations and recommendations (also called third party commentaries) as to the adequacy of and improvements regarding the performance as reported.  The individuals might represent themselves or other groups/organizations.
Sustainability Something that is maintained, continued in existence, or kept going over the long term.
Sustainability performance The results of activities related to the environment, social, and economic impact of an organization.
Sustainability report A means of providing information about an organization’s performance in the three dimensions of economic, social and environment. Other common names for these reports are corporate responsibility, corporate social responsibility, environmental, corporate citizenship, and social.
Third party commentaries Comments, observations, and recommendations made by a panel that is comprised of a reporting organization’s stakeholders. The report by the stakeholder panel often appears in the sustainability report.  Then, the organization often responds to the panel’s report.
Timely A description for an indicator that is collected when data are needed, warns if corrective action is necessary, and is available to stakeholders when needed for their decision making.
Transparent An action, method, procedure or information which lacks hidden agendas and conditions.
Unbiased party Someone who does not have an interest in the organization and therefore would have no motive for an assessment to be too positive or too negative.
Venn diagram A means of illustrating the concept of sustainability whereas circles representing the three concepts of sustainability (economic, social, and environment) partially overlap each other.
WCED The World Commission on Environmental and Development was created to address growing concern about the accelerating deterioration of the human environment and natural resources and the consequences of that deterioration for economic and social development.