The European Parliament’s adoption of the directive for disclosure of non-financial information and diversity information marks the most recent example of how governments are valuing corporate transparency. Deputy Chief Executive of the Global Reporting Initiative, Teresa Fogelberg, said:
“This agreement demonstrates the EU’s strong commitment to corporate transparency and sustainability – supporting smart, sustainable and inclusive growth, and paving the way for a sustainable global economy.”
In addition, the Environmental Protection Agency (EPA) recently released a new version of the Report on Environment (the Report), outlining indicators that help the EPA monitor trends in the condition of the United States’ air, water, land, human exposure and health, ecological systems and sustainability. It is interesting to note that the EPA added sustainability as a new theme in 2014, responding to growing international concerns. The sustainability theme only has one indicator as of now, but the EPA plans to develop this theme by collaborating with a variety of stakeholders and considering three important aspects of sustainability- intensity of energy use, water use and materials use.
The new version of the Report provides new features: a conceptual framework to show how indicators relate to EPA concerns, interactive graphing, statistical information, trends related to where you live, and information about what you can do to help. All of these tools and the Report itself demonstrate how the EPA values disclosure of sustainability information in order to manage environmental and human health concerns and to inform the public. The EPA invites public commentary on the new version of the Report until April 27, 2014.
What do these government initiatives for transparency mean for your company and its sustainability efforts?
- In general, government expectations for transparency will likely advance the sustainability reporting spectrum; newcomers will join the sustainability reporting bandwagon and advanced reporters will disclose more sustainability data and management approaches. Stakeholder engagement will likely incorporate government agencies and representatives as more regulations enforce transparency.
- In the United States, proactive involvement with the EPA through public commentary on the Report on Environment and other initiatives may become a source of competitive advantage. Companies can collaborate with government agencies to determine the trajectory of government sustainability initiatives going forward.
- For current sustainability reporters following the Global Reporting Initiative (GRI) framework, the Report on Environment may help inform materiality assessments, including:
- Prioritizing material topics, considering United States trends in environmental and human health issues.
- Measuring influence on stakeholders: Companies may want to interview more stakeholders affiliated with the government.
- Determing significance to companies: The role of government will become more significant to companies both in terms of risk and compliance to regulations and in terms of opportunities for government collaboration.
BrownFlynn is glad to see the international government support for and progression of sustainability reporting. Join several United States government agencies at our next GRI-Certified G4 Training Course: GRI Sustainability Reporting Process April 23-24, 2014 at the World Business Council for Sustainable Development in Washington, D.C.
By Brittany VanderBeek, Analyst