GRI has recently published an exposure draft document that introduces significant proposals and changes of their Universal Standards.
A quick recap: the GRI Standards consist of the Universal Standards, Sector Standards, and Topic Standards. The Universal Standards than are divided into 101: Information about how to use the GRI Standards, 102: Disclosures about the reporting organization, 103: To identify and report general information on the organization’s material topic. We would like to give you a heads-up of the main revisions that will be published, after feedback, in 2021.
Why did GRI want to revise their Universal Standards? Mainly, because of four vital elements. Further embed human rights, integrate reporting on due diligence, align key concepts with responsible business conduct, and clarify approaches and demonstrate compliance. In practice, this withholds the following revisions:
Core & Comprehensive reporting is revised to:
- Approach A: Reporting in accordance with the GRI Standards (This approach contains the new Core & Comprehensive reporting)
- Approach B: Reporting with reference to the GRI Standards (This approach contains reporting with reference to the GRI Standards)
New key concepts section, including revised concepts of ‘material topic’ and ‘stakeholder’ (GRI 101)
- Impact: the effect an organization has or could have on the economy, environment, or people, including on human rights, as a result of its activities or business relationships
- Material topic: topic that reflects the organization’s most significant impacts on the economy, environment, and people, including impacts on human rights
- Due diligence: process through which an organization identifies, prevents, mitigates, and accounts for how it addresses its actual and potential negative impacts
- Stakeholder: individual or group that has an interest that is, or could be, affected by the organization’s activities and decisions
New guidance on identifying material topics
- In line with the new definition of materiality, this reflect the most significant impacts on the economy, environment and people, including human rights.
- In order to prioritize its most significant impacts for reporting, the organization needs to assess the significance of the impacts.
- The significance of a negative impact is assessed based on its severity (scale, scope, and irremediable character) and likelihood. In the case of potential negative human rights impacts, the severity of the impact takes precedence over its likelihood
- The significance of a positive impact is assessed based on its scale, scope, and likelihood
- Following the prescribed procedure for identifying a material topic is not a requirement!
New disclosures on:
- policy commitments regarding Responsible Business Conduct (RBC), including respect for human rights, and how they are embedded in the organization (GRI 102)
- compliance with laws and regulations (GRI 102)
Revised disclosures on:
- reporting practices (GRI 102), organizational activities & employees and workers (GRI 102), governance (GRI 102), grievance mechanisms (GRI 102), stakeholder engagement & collective bargaining (GRI 102), material topics & management approach (GRI 103)
Soon, you can expect our own visionary blog on the proposed GRI Universal Standards revisions. It will comprise how we think that companies can best assess and approach these changes, where we are, of course, happy to help!