Introduction

GRI is an independent body that created a multistakeholder approach to sustainability management and reporting. The GRI Standards enable an organization to publicly disclose its most significant impacts on the economy, environment, and people, including impacts on their human rights and how the organization manages these impacts. The GRI approach considers sector and materiality in its disclosure framework. According to a 2020 KPMG study on sustainability reporting, GRI remains the dominant global standard for sustainability reporting.

GRI has released a revised set of standards that will be put into effect on January 1, 2023, with early adoption encouraged. You can download the revised standards here. The below information reflects the revised standards.

GRI Standards puts forth a modular system of three series of Standards to be used together: Universal Standards, Sector Standards, and  Topic Standards.

Source: GRI

Aligned GRI reporting would use the full Universal Standards, sector standards that apply (GRI plans to grow this list to 40 sectors over time) and material topic standards.

A short introduction to the GRI updates can be found here.

This GRI Standards use the full list of Universal Standards for completion by all organizations, sector specific guidance, and a series of topic standards. Organizations completing the universal standards will identify material topics. Those material topics will guide which of the Topic Standards an organization should disclose.

Universal Standards [GRI 1-3]

• GRI 1: outlines the purpose of the GRI Standards, clarifies critical concepts, and explains how to use the Standards. It also provides compliance requirements and principles on how to report in accordance with the GRI Standards.
• GRI 2: disclosures relating to details about an organization’s structure and reporting practices; activities and workers; governance; strategy; policies; practices; and stakeholder engagement.
• GRI 3: explains the steps by which an organization can determine the topics most relevant to its impacts, and its material topics, and describes how the Sector Standards are used in this process.

GRI Sector Standards

• GRI has defined a set of high impact sectors for sector specific reporting. A list of 40 sectors will be developed over time. Status of 40 sector standards.

Topic-Specific Standards

• Report on each material topic identified using the 31 topic-specific standards

Handling Omissions

GRI does allow omissions when reporting and provides guidance on the four acceptable reasons for omission and how to report them:

1. Not applicable – explain why the disclosure or the requirement is considered not applicable.
2. Legal prohibitions – Describe the specific legal prohibitions.
3. Confidentiality constraints – Describe the specific confidentiality constraints.
4. Information unavailable/incomplete –
   1. Specify which information is unavailable or incomplete. When the information is incomplete, specify which part is missing (e.g. specify the entities for which the information is missing).
   2. Explain why the required information is unavailable or incomplete.
   3. Describe the steps being taken and the expected time frame to obtain the information.

Additional guidance can be found in GRI, Part 3, Requirement 6.

To report in accordance with GRI Standards, there are nine requirements:

1. Apply the reporting principles
2. Report the disclosures in GRI 2: General Disclosures 2021
3. Determine material topics
4. Report the disclosures in GRI 3: Material Topics 2021
5. Report disclosures from the GRI Topic Standards for each material topic
6. Provide reasons for omission for disclosures and requirements that that the organization cannot comply with
7. Publish GRI content index
8. Provide a statement of use
9. Notify GRI

If the organization does not comply with all nine requirements, it cannot claim that it has prepared the reported information in accordance with the GRI Standards.

An organization can report with reference to the GRI Standards if it cannot comply with all the requirements for reporting in accordance with the GRI Standards. GRI references this as a step hoping that organizations referencing would build to become “in accordance with” GRI.

An organization can also report with reference to the GRI Standards if it uses selected GRI Standards, or parts of their content, to report information about specific topics for specific purposes, such as complying with a reporting regulation on climate change.

The organization must comply with all three requirements to report with reference to the GRI Standards.

1. Publish GRI content index
2. Provide a statement of use
3. Notify GRI

What is the difference between GRI and SASB or TCFD? Can we report multiple frameworks?

• GRI Standards allow organizations to determine materiality through engagement with stakeholders. SASB materiality is based on a financially-oriented definition that is accepted by capital markets globally.
• Corporate Reporting Dialogue released a report in 2019 that maps TCFD to other frameworks, showing strong alignment in most areas.
• GRI provides standards linking documents to provide guidance on how to complete GRI and map to other reporting standards.

Are large institutional investors looking for GRI reporting?

• Large institutional investors are not calling out GRI. GRI is a multistakeholder developed sustainability reporting system. Large institutional investors more likely note SASB or TCFD reporting. GRI is a universal sustainability reporting and does have guidance on how to use GRI to complete their standards in line with GRI and TCFD.

Who’s using it?

• According to a 2020 KPMG study on sustainability reporting, GRI remains the dominant global standard for sustainability reporting.

• Leidos: 2020 CSR Report (Page 69)
• McCormick & Company, Inc.: 2021 Report (Page 109) – includes SASB and GRI
• FIS: 2020 Report (Page 71)
• Neiman Marcus Group: 2021 ESG Report (Page 49)
• The Hershey Company: 2020 GRI Report