Transitioning to Global Reporting Initiative (GRI) Standards

Transcription

1 Transitioning to Global Reporting Initiative () Standards September 2017 kpmg.com/ae kpmg.com/om

2 Sustainability is an approach that creates long-term stakeholder value by managing risks and embracing opportunities through optimization of the economic, environmental and social bottom-lines With the increasing need for organizations to showcase their commitment towards sustainable development and disclose on their business impacts to their stakeholders, increasing number of organizations have started reporting on their performance across all three pillars of sustainability, i.e., economic, environmental and social aspects. Sustainability, as a holistic concept, is providing businesses the opportunity to identify and incorporate innovative solutions across all their policies, procedures and decisions in support of sustainable development. The Global Reporting Initiative () is an international independent organization that helps public and private entities worldwide to understand and communicate the impacts of their business practices, including environment, economic and social impacts, such as climate change, human and labor rights, corruption, community etc. About the Standards The first global Standards for sustainability reporting were developed by the Global Sustainability Standards Board (GSSB) and launched in October 2016 by. These latest reporting Standards have been designed with a modular structure so that they can be kept up-to-date and relevant as required. The Standards will be effective for reports published on or after 1 July 2018; however, early adoption by organizations is encouraged by. Evolution of the Standards The new modular structure includes 36 standards, including 3 universal standards that are applicable to all organizations, and 33 topic-specific standards divided across three series (Economic, Environmental and Social). The topic-specific standards are applicable depending on the material topics identified by the organization G G G G G Standards 1. Corporate Sustainability. ROBECOSAM, 2. About,, 3. s History,, s%20history.aspx 4. Reporting Process,,

3 The flow diagram below depicts the approach to be adopted by any organization intending to report on its sustainability performance using the latest Standards: Starting Point 101 Apply the reporting process throughout the reporting process Identify your material topics Choose an option for reporting in accordance with the Standards Report contextual information about your organization and its reporting practices, using 102 Report the management approach for every material topic identified using 103 Report on each material topic identified, using the corresponding topic-specific Standard Core Comply with all reporting requirements for a selected number of disclosures, as per 101 Comply with all reporting requirements in 103, for each material topic For each topic-specific Standard, comply with all reporting requirements in the Management approach disclosures section and all reporting requirements for all at least on topic-specific disclosure Comprehensive Comply with all reporting requirements Comply with all reporting requirements in 103, for each material topic For each topic-specific Standard, comply with all reporting requirements in the Management approach disclosures section and all reporting requirements for all topicspecific disclosures Sustainability disclosures Transitioning to Global Reporting Initiative () Standards 3

4 How are the Standards different from the G4 guidelines? Revised terminology and numbering- Indicator -> Disclosure (covers both qualitative and quantitative disclosures) Aspect -> Topic (refers to all economic, environmental or social topics, whether covered by the Standards or not) Disclosures on management approach (DMA) -> Management Approach Disclosures and the Management Approach is presented as a separate standard now, i.e., 103: Management Approach The disclosures have new unique identifiers based on the number/ series of the Standard. For example, Disclosure G4-10 is now 102-8, as it is located in 102: General Disclosures Clarification in Materiality Principle - The following concepts with respect to the Materiality Principle have been clarified further in the Standards: The term impacts refers to the effects an organization has on the economy, the environment, and/or society which in turn can indicate its contribution (positive or negative) to sustainable development. It does not refer to an effect upon an organization, such as a change to its reputation. To apply the materiality principle, organizations are required to identify material topics based on the two dimensions, i.e. the significance of the organization s economic, environmental, and social impacts (as per the definition of impacts provided), and their substantive influence on the assessments and decisions of stakeholders Organizations are required to identify and report on all material topics, which can include topics covered by the existing Standards as well as other topics not yet covered within the topicspecific standards 4 Changes in the concept of Boundary - The topic boundary now requests a description of where the impacts occur for each material topic, and the organization s involvement with the impacts. For example, whether the organization has caused or contributed to the impacts, or is directly linked to the impacts through its business relationships. New Disclosure formats - A new format has been stated inside each Standard with clearer requirements. This includes: 8 Reporting requirements These are mandatory instructions. In the text, requirements are presented in bold font and indicated with the word shall. An organization is required to comply with all applicable requirements in order to make a claim that its report has been prepared in accordance with the Standards Reporting recommendations Actions that are encouraged by for organizations to report on, but not required. has been prepared in accordance with the Standards Guidance Typically includes background explanations and examples to help organizations better understand the requirements. 5. Transition to Standards,, 6. Standards Materiality Concept,, 7. Materiality and Topic Boundary,, :Foundation,,

5 5 Changes in reporting aspects- G4 Title Standards Title Number of Disclosures Changed 9 Revised Disclosure Minor clarification Discontinued No Revision General Standard Disclosures Specific Standard Disclosures: Category-Economic Specific Standard Disclosures: Category- Environment Specific Standard Disclosures: Category-Social 102- General Disclosures Economic- 200 Series Environment- 300 Series Social- 400 Series * *Discontinued Indicators: G4-EN27- Extent of impact mitigation of environmental impacts of products and services G4-EN30- Significant environmental impacts of transporting products and other goods and materials for the organization s operations, and transporting members of the workforce 9. For complete mapping of G4 guidelines against the new Standards: org/standards/resource-download-center/mapping-document-complete-excel/ Transitioning to Global Reporting Initiative () Standards 5

6 Key considerations for organizations adopting the Standards-based reporting For new reporters: Organizations planning to develop sustainability disclosures for the first time, should consider being early adopters of the Standards. This enables organizations to highlight their commitment to sustainability in a more effective manner with their stakeholders. Identify key material issues and sustainability information to be disclosed using the disclosures from Standards The disclosures in the Standards have been designed to enable organizations new to sustainability reporting, to structure relevant information for inclusion in a concise report or as a part of an existing communication, allowing organizations to gradually shift towards developing a detailed in accordance set of disclosures For existing reporters: Compare existing reporting processes and approach to align to Standards Organizations currently reporting using G4 guidelines, should compare their existing reporting approach and material issues to ensure they are in alignment with the Standards requirements. As most of the content from G4 has been retained in the Standards, transitioning would require relatively minimal effort for existing reporters. Organizations already reporting using G4 guidelines should take early steps to begin transitioning to the Standards, prior to the deadline for mandatory adoption of the Standards of 1 July Early adoption of the Standards is also being encouraged by.

7 What does KPMG offer? Working together: KPMG works alongside other KPMG member firm professionals from tax, audit and advisory including sector specialists, management consultants, tax accountants and experts in IT, supply chain, infrastructure, international development and more. Our clients benefit from a handpicked multidisciplinary team, instead of receiving one-size-fits all solutions. Experience in Sustainability: KPMG have extensive experience, both locally and globally, in sustainability, including developing sustainability strategies and sustainability reports for both public and private entities. This expertise is leveraged to provide leading solutions in sustainability for clients across all sectors. KPMG firsts in the UAE: Some of our local credentials and associations include: Year of Giving (CSR): Developing the technical criteria for CSR Index, CSR Mark, CSR Passport and PMO support for the Ministry of Economy Sustainability report advisory: First Standards sustainability report globally in the Roads and Public Transportation Sector, for the Roads and Transport Authority 2016 Sustainability report assurance: First ever Sustainability Assurance for Dubai Electricity and Water Authority s 2015 sustainability report. KPMG is the ONLY Big 4 Accounting firm in the UAE to be a licensed provider for AccountAbility s AA1000 sustainability assurance engagement standards. UN Global Compact: External Process Advisor for the first ever SDG Awards UAE network Training: First ever Standards certified training in the GCC In house training - G4 certified course at Roads and Transport Authority and Emirates National Oil Company For more details, please visit the Sustainability Services page Transitioning to Global Reporting Initiative () Standards 7

8 Contact us Raajeev B Batra Partner Head Risk Consulting E: raajeevbatra@kpmg.com T: Sudhir Arvind Partner Risk Consulting E: sarvind@kpmg.com T: Hanife Ymer Director Head Sustainability Services E: hymer1@kpmg.com T: Rahul Arora Sustainability Leader Sustainability Services E: rahularora4@kpmg.com T: Follow us on: The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation KPMG Lower Gulf Limited and KPMG LLP, operating in the UAE, member rms of the KPMG network of independent member rms af liated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. Designed by The Design Studio UAE Publication name: Transitioning to Global Reporting Initiative () Standards Publication number: J1244 Publication date: September 2017