GRI and SASB are collaborating. Is that good information for fellowships? Joel Makower<\/a> Sun, 07\/12\/ 2020 \u2013 17:56<\/p>\n For times, corporate reporters \u2014 those inside firms responsible for creating sustainability reports and financial reporting environmental, social and governance data to many other organizations \u2014 ought to have disheartened by what many referred back to as an alphabet soup of standards and frameworks: CDP, GRI, IIRC, PRI, SASB, TCFD, UNGC and more.<\/p>\n And while they growled at how those various organizations\u2019 entreaties weren\u2019t matched, they dutifully be adhered to their requests and mandates.<\/p>\n Finally, facilitate may be on the way.<\/p>\n Today, two of those organizations \u2014 GRI, formerly the Global Reporting Initiative, and the Sustainability Accounting Standards Board, better known as SASB \u2014 are announcing a collaborative effort to help ease that embarrassment and , not insignificantly, stance their standards as \u201cthe worlds largest\u201d consequential.<\/p>\n \u201cOur basic SASB 101 tar that we give to everyone we speak to talks about SASB and GRI as being complementary, however never could break through into the public sphere with that content, \u201d SASB CEO Janine Guillot told me. \u201cIt was always this conflict narrative, which was extremely frustrating.\u201d<\/p>\n The \u201cconflict narrative\u201d wasn\u2019t without foundation. For years, the two organizations emulated for courtesy and preeminence among corporate reporters, NGOs and the mainstream investor community. Sometimes it get contentious. For sample, at a sustainability reporting seminar in Singapore last-place fall, the CEOs of GRI and SASB \u201ctraded barbs over whose was the superior standard, \u201c according to news reports<\/a> \u2014 a \u201cshowdown, \u201c<\/a> as sustainability reporting professional Elaine Cohen announced it.<\/p>\n For times, the two organizations rivalled for attending and reign. Sometimes it went contentious.<\/p>\n At the happening, SASB\u2019s then-CEO Madelyn Antoncic announced GRI too difficult for investors to understand and for companies to compare their performance with peers. GRI CEO Tim Mohin pointed out that its standard exploited by 75 percent of the world\u2019s largest firms. \u201cWith those amounts, I don\u2019t see how what SASB is saying can be true, \u201d he said.<\/p>\n But that was so last year. SASB has a brand-new CEO \u2014 Guillot \u2014 who joined SASB five years ago after a decade on the investing side with Barclays and CalPERS, and who comes down to her CEO job with a strong working relationship with Mohin. Now, the two are in lockstep \u2014 babe gradations for now \u2014 to help the customers of sustainability data \u201cunderstand the affinities and differences in the information made from these standards, \u201d according to a joint instruct document.<\/p>\n The time may be ripe for such a collaboration, for several reasonableness. One is the growing focus on sustainability and environmental, social and governance( ESG) metrics by the mainstream investment community, creating a greater need for a determine of reigning standards to surface. If there was any question about current trends, BlackRock CEO Larry Fink cast away all disbelieves in his annual shareholder letter<\/a>, which referenced SASB and TCFD, the reporting framework<\/a> created by the Task Force on Climate-related Financial Disclosures.<\/p>\n Such agreed metrics are needed even within corporations, where sustainability agencies are connected to far better stakeholders.<\/p>\n \u201cYou\u2019ve got a much broader base of people who are interested in talking about these topics, coming from a much broader array of self-disciplines, \u201d said Mohin, including \u201can investor relations being, a corporate secretary, a general counsel, a financial controller, a marketing communications being and an HR person. All of a sudden, you\u2019ve got to bring together these multidisciplinary squads within both companies and investors. And that goes all the way up to the board, since boards of directors are now interested in these topics.\u201d<\/p>\n Of course, outside the corporation is another small military of interested groups \u2014 clients, hires, regulators, etc. \u2014 seeking easily understandable and analogous data about companies\u2019 sustainability performance.<\/p>\n And then there\u2019s COVID.<\/p>\n \u201cIf the COVID-1 9 pandemic has showed us anything, it\u2019s that nonfinancial revealing is very meaningful from a world business perspective, and that the concept of what is financially material and what is considered not financially substance is a very dynamic thing, \u201d Mohin explained. \u201cWe led from the issues that are important in a pandemic being sort of down the directory to being front and center overnight. And now we have the issues of ethnic justice and inequality front and middle. We\u2019ve seen how the events of the world can change that interpretation for a company awfully, very quickly, which I think is one of the very important themes now of why GRI and SASB need to work together.\u201d<\/p>\n The pandemic has put into sharper focus a number of aspects of corporate recital, including business contributions to biodiversity loss and the resulting increased potential for disease outbreaks; and the is necessary that more resilient ply chains, particularly for crucial goods such as food and prescription, as Guillot pointed out recently on GreenBiz<\/a>.<\/p>\n Harmony and collaboration<\/p>\n For now, the two organizations\u2019 work together will focus on going into the marketplace with harmonized, complementary messages. One aim, Mohin said, is to \u201cunderstand how the different standards are used by corporations. And then make the next step, which is to show in practice firms that are using both standards.\u201d<\/p>\n Another goal is to \u201cdemonstrate with real live companionships who are reporting to both sets of standards how the companies are doing it, why they\u2019re doing it and what type of information each provides for stakeholders, \u201d Guillot said. She also recommended the possibility of doing some \u201cmock disclosures, \u201d pulling together best traditions from across multiple companies.<\/p>\n For now, the two organizations\u2019 work together will focus on going into the marketplace with harmonized, complementary themes.<\/p>\n Beyond that is a world of other collaboration likelihoods, about which neither Mohin nor Guillot would speculate.<\/p>\n Can the GRI-SASB hookup change the game? Mike Wallace thinks so. Wallace \u2014 who ranged GRI\u2019s North America operation from 2009 to 2014, and who remains laser focused on reporting standards and ESG ratings approaches in his persona as a partner at the consultancy ERM \u2014 believes that greater collaboration could peculiarly cure those just beginning the reporting \u201cjourney.\u201d<\/p>\n \u201cIt is a confusing space for brand-new entrants when one considers the various options, seeks and suggestions for how to address the growing demand for ESG information, \u201d he told me, citing \u201cat least a half-dozen disclosure options.\u201d<\/p>\n \u201cWe are regularly integrating a range of the frameworks, guidelines and standards together for buyers, \u201d Wallace computed. \u201cFor those companies that are just getting started, the GRI and SASB collaboration will be greatly appreciated.\u201d<\/p>\n True, we\u2019ve seen this movie before. The two organizations have long discussed<\/a> the opportunities for collaboration. Two years ago, we reported<\/a> on a Bloomberg-funded effort to bring the GRI and SASB standards \u201cin line with each other wherever possible.\u201d<\/p>\n And then there\u2019s the proposed reporting framework announced<\/a> in January at the World Economic Forum\u2019s annual meet in Davos. Created by WEF\u2019s International Business Council in collaboration with the Big Four accounting firms and endorsed by the CEOs of 140 sizable companies, it recommends a plan of core metrics and exposures \u201cto be reflected in the mainstream annual reports of firms on a consistent basis across industry sectors and countries.\u201d<\/p>\n But it doesn\u2019t accurately recognize doing apart with SASB, GRI and their kin. As reported<\/a> by the Financial Times, the WEF framework \u201ctakes muse from existing revealing frames such as SASB, the Global Reporting Initiative and the TCFD and will also include the EU\u2019s brand-new taxonomy that defines dark-green instruments.\u201d<\/p>\n Confusing? It seems harmonization and simplification of corporate sustainability reporting may still has become a ways off.<\/p>\n Still, the SASB-GRI announcement is promising. Both companies believe that transparency \u2014 and especially conduct metrics and analogous knowledge \u2014 lead to improved societal outcomes.<\/p>\n Said SASB\u2019s Guillot: \u201cIf monetary and nonfinancial stakeholders have access to information and can compare fellowship accomplishment on issues, then our assumption of change is that companies will compete to improve performance and that at the end of the day leads to improved sustainability outcomes.\u201d<\/p>\n Which is, after all, the point.<\/p>\n I invite you to follow me on Twitter<\/a>, subscribe to my Monday morning newsletter, GreenBuzz<\/a>, and listen to GreenBiz 350<\/a>, my weekly podcast, co-hosted with Heather Clancy.<\/p>\n Pull Quote<\/p>\n For times, the two organizations rivalled for notice and reign. Sometimes it went contentious.<\/p>\n For now, the two organizations\u2019 work together will focus on going into the marketplace with harmonized, complementary messages.<\/p>\n Topics<\/p>\n Reporting<\/a><\/p>\n Finance& Investing<\/a><\/p>\n ESG<\/p>\n Transparency<\/p>\n Featured Column<\/p>\n Two Steps Forward<\/a><\/p>\n Featured in featured block( 1 essay with persona bragged on the front page or elsewhere)<\/p>\n On<\/p>\n Duration<\/p>\n 0<\/p>\n Sponsored Article<\/p>\n Off<\/p>\n GreenBiz Group<\/p>\n Read more: greenbiz.com<\/a><\/p>\n <\/p>\n![\"GRI](\"https:\/\/www.greenbiz.com\/sites\/default\/files\/2020-07\/SASB-GRI.jpg\" "\\"guillot\\"")
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