With next month's release of the latest corporate Sustainability Reporting Guidelines from the Global Reporting Initiative (GRI), corporate sustainability management and reporting, encompassing the "triple bottom line" of economic, environmental and social accountability, should move to the top of executives' agendas. Though still voluntary, the guidelines take a giant step toward the Boston-based GRI's goal of making sustainability reporting "as routine and credible as financial reporting in terms of comparability, rigor and verifiability" -- and they've already captured a significant following.
More than 110 multinational companies from around the world now report sustainability performance using the GRI Guidelines, including Baxter International Inc., Ford Motor Co., and Nike Inc. Further, nearly 100 companies have taken an active role in drafting and testing the guidelines.
But that's only the latest indication that sustainable management and reporting is fast becoming a top priority of corporate management. To wit:
- Increasing company adoption: More than 200 companies have signed the United Nations Global Compact, an initiative that promotes corporate responsibility by advancing universal values in business operations around the world. The Compact requires signatories to voluntarily adopt and apply nine principles in the fields of human rights, labor standards and the environment. CorporateRegister.com, a site that tracks social reporting, notes that 531 companies published sustainability reports in 2001, up from 256 in 1996 and seven in 1991.
- Increasing shareholder demand: More than one-third (261) of the 2002 proposed shareholder resolutions address corporate responsibility, reports the Investor Responsibility Research Center, Washington, D.C. Topping the list, with 45 proposals, are those who seek to persuade companies to improve, monitor or report on their global labor practices. The fastest growing concern is global warming, with a total of 18 resolutions, up from seven last year.
- Increasing investor interest: The Washington, D.C.-based Social Investment Forum reports that assets in socially and environmentally screened investment portfolios under professional management increased by 36% from 1999 to 2001, topping the $2 trillion mark for the first time. The growth rate, it adds, is more than 1.5 times the 22% rise reported for all professionally managed assets in the U.S. during the same two-year period.
In sum, it's no longer just the bleeding heart liberals and tree huggers who are demanding that corporations manage and account for their social and environmental impact. Executives of some of the most respected companies in the world have embraced the trend.
It's time you did too.
Patricia Panchak is IW's Editor-In-Chief. She is based in Cleveland.
