What Happens in Practice?

What Motivated further Development of Sustainability Reporting?

In the early 1980s the debate of the economy vs. the environment became heated, as each camp had its champions. Economically, many countries, especially developing countries, were suffering from stagnant or depressed economies while at the same time incurring huge debt burdens. Then, several disasters occurred that changed the focus of the debate and motivated transparency through sustainability reporting.

1984: A gas leak at a Union Carbide plant in Bhopal, India that killed approximately 3,800 people and permanently or partially disabled several thousand more brought the practices of corporations regarding safety, community responsibility, and environmental contamination directly in front of the public’s eye.

1986: The Chernobyl nuclear power plant in the Ukraine malfunctioned. The effects from its radiation extended across large parts of Europe and Asia.

1989: The Exxon Valdez oil spill in Valdez, Alaska contaminated the waters, harming both wildlife and economic conditions for the fishing and tourism industries. The spill initiated considerable costs for the petroleum industry through greater regulation on the industry and restrictions on drilling in certain locations.

Who started the Sustainability Reporting Guidelines?

Some of the early reporting corporations felt standards or generally accepted guidelines would be helpful to follow for their reporting, similar to GAAP (generally accepted accounting principles) for financial disclosure.

PERI: The first guidelines were referred to as PERI (Public Environmental Reporting Initiative). They were the product of a group of multinational organizations who volunteered their time to develop some guidance useful in preparing their own reports and for other organizations wishing to begin reporting.

CERES: After the Exxon Valdez oil spill, a group called CERES (Coalition for Environmentally Responsible Economies) provided a set of performance standards that informed the current day Global Reporting Initiative (GRI), along with input from other stakeholder groups.

GRI: The Global Reporting Initiative (GRI) is fast becoming the best known, worldwide standard among sustainability reporters and users. Many organizations that produce stand-alone reports follow these guidelines to some extent. A multi-stakeholder group, representing a diverse collection of stakeholders, reviews the guidelines periodically. The current set of guidelines is known as the G3, as it is the third revision.