Getting the Most out of your CSR Report: Introduction to Reporting Guidelines

The first two articles in the CSR Reporting Series looked at five reporting best practices and five steps to get your CSR report off the ground; topics to help reporting rookies get the ball rolling. Today's post will continue to help first-timers by introducing reporting guidelines. While in the past CSR reporting was typically limited to larger businesses, the last ten years have seen an increase in SME reporting, and a more widespread use of formal guidelines.

Guidelines: To use or not to use?

Not using reporting guidelines can be very tempting. You can produce reports quicker, highlight only what you think is important, and avoid transparency and scrutiny in uncomfortable areas. But as enticing as these benefits may seem, using your own reporting methodology often proves to be a short sighted strategy. Besides helping you stay focused and organized, using established frameworks helps SMEs with the very common and serious challenge of establishing CSR credibility. If you're committed to using a widely accepted reporting guideline, it shows stakeholders that you're committed to being a responsible company.

Another major benefit of using recognized guidelines is that they allow for easier comparison with peers and competitors. Having the ability to compare your CSR performance to other organizations in your industry allows for easier critiquing, and can help provide more motivation to improve. Adopting these guidelines shows your stakeholders that you are serious about your CSR performance, and willing to be both transparent and accountable.

So now that we've touched on the benefits of adopting established guidelines, let's take a quick look at the most common. There are several guidelines in use today, but the following completely dominate the reporting world.

Global Reporting Initiative (GRI) G3

Based in Amsterdam, the Global Reporting Initiative released its first series of reporting guidelines in 2000. In 2006 the third and most recent version was released (the G3), containing 42 company profile disclosures and 79 performance indicators in 6 categories (economic, environment, human rights, labour standards, product responsibility, society). These CSR reporting guidelines are the most commonly used throughout the world, with an estimated 1500 organizations from 60 different countries using the G3 as of January 2009. The GRI allows you to report at different transparency levels (A through C, or U for 'Undeclared') based on how many indicators you adopt. 

United Nations Global Compact Communication on Progress (COP)

The Global Compact is a United Nations initiative that encourages businesses to adopt and report on ten principles of responsible business. Launched in 2000, the Global Compact's ten principles revolve around human rights, labour relations, environmental impacts, and anti-corruption. While geared more towards helping larger multinational corporations contribute to the Millennium Development Goals, small and medium sized enterprises can adopt the Global Compact as well. When a business joins the Global Compact, they make a reporting commitment to produce an annual Communication on Progress (COP). The Global Compact sets specific COP requirements that must be followed, including a statement from the CEO reaffirming the organization's support for the Global Compact, a description of all practical actions taken, and a measurement of all outcomes. 

Accounting for Sustainability Connected Reporting Framework (CRF)

Accounting for Sustainability, launched by The Prince's Charities in 2006, is an initiative whose mission is to help embed sustainability into the decision making and reporting process of public and private organizations. As part of its activities, Accounting for Sustainability has developed the Connected Reporting Framework, guidelines to help focus CSR reports on the long-term needs of investors and executive management. These reporting guidelines are meant to help identify the connection between an organization's social responsibility practices and its strategy, and highlights key performance indicators and progress in achieving objectives. The CRF is built on other reporting guidelines and standards (such as the GRI, the Global Compact COP, and AccountAbility), and can be used alongside these other guidelines or on its own. 

AccountAbility AA1000 Assurance Standard

AccountAbility is a not-for-profit organization based in London, England and governed by multiple stakeholders. The organization works to promote 'accountability innovations for sustainable development', and was founded in 1995. At the core of its offerings are its AA1000 Series, made up of the The AA1000 AccountAbility Principles Standard, the AA1000 Assurance Standard, and the AA1000 Stakeholder Engagement Standard. AA1000 is not actually a reporting guideline, but rather a standard used to provide a framework for measuring CSR reports against the principles of materiality, completeness, and responsiveness. However, since you use these principles to measure reports, you can also use these principles to design reports. The standard can be used on its own, or with reporting guidelines such as the GRI. 

While every organization has different needs, most CSR professionals typically recommend adopting the GRI G3. The Global Reporting Initiative has seen a large increase in users over the last few years, and out of the twenty-four reports nominated for in the 'Best First Time Report' category of the 2008 Corporate Register Reporting Awards, only two did not use the GRI guidelines. By providing different transparency level options, special resources and support, and free use of its guidelines, the GRI G3 is very SME friendly. However, it's important to get to know the most applicable guidelines better in order to chose what works best with your organization.

If your organization is considering adopting the GRI guidelines but not sure what reporting level to begin at, I would highly recommend reviewing Elaine Cohen's Reporting Levels 101.

One last thing to leave you with, as mentioned in What Should Your Company Call CSR? 5 Principles to Help Your Communication, do not get stuck with analysis paralysis. Instead of over-analyzing pros and cons, you should simply discuss, select, commit, and report. It's almost certain that your first report won't be perfect, but it will provide you with a solid starting point to improve on. Now stop reading and get reporting! 

What reporting challenge does your organization face? How did you decide whether to adopt a reporting standard or not? Leave a comment below!