Discss about the Global Reporting Initiative and Integrated Reporting?
In today’s scenario business are seeks to address their risks and opportunities. Because there are many benefits behind addressing sustainability for businesses, people, governments, economic, social and environment. The Sustainability concepts implies fulfilling the current needs without compromising the future generation needs (James ,2013) . This is based on the three areas of TBL which implies that for sustaining in the competitive world companies has to manage three areas effectively (Bohmholdt, 2014). Companies in the UK must Comply or explain their long term strategy regarding sustainability. There are a lot of issues relate to sustainability most important of them corporate and social responsibility (CSR) and Supply chain management (SCM). CSR is the concept which is deeply related to the Sustainability concept (lawrence& weber, 2011). If harm is caused to people or society it should be acknowledged and rectified if possible. (lawrence& weber, 2011). Increased consumer awareness is putting pressure on companies to be more responsible and conduct their business ethically (Law, 2015).
This paper will provide Critically compare the Global Reporting Initiative and Integrated Reporting in terms of their effectiveness at communicating with a business’ stakeholders. According to English and Schooley (2014) The Global Reporting Initiative (GRI)is the institution which into in the sustainability field and a collaborating centre of the United Nations Environment(GRI, 2013).
There are some similarities between this two reporting standard. Both standards are prepared to improve the quality of the organization. They give the guidelines for effective strategy formulation. They help the organization to achieve competitive advantage by gaining the confidence of investors (European Dept, 2013).
GRI encourage the usefulness of sustainability reporting by which an organization become more sustainable and engage them in sustainable development. The guidelines issued by GRI have become the most important international standard for reporting environmental, social, and economic performance (James,2013 ),(GRI, 2013), Where a report of sustainability which applied through an organisation or a company that explain a linkage between its strategy and its achievement towards sustainable global economy. The GRI’s guidelines for sustainability reporting are the most famous reports that used around the world that include different areas that explain the performance of social environment and economic performance within a business (English &Schooley, 2014) (James , 2013 ). Where businesses that not provide Managing and reporting on sustainability being viewed as less transparent than their peers because Managing and reporting on sustainability can build a company’s reputation for transparency (English &Schooley,2014) . The organization which pay attention to the environmental and social issues they must be in a suitable position to gain a positive approach from the investors (James ,2013) .
Integrated reporting is a newly developed reporting standard where the environmental, financial, corporate and social reporting requirements are bring together in a comprehensive manner. On the other side Global Reporting Initiative is a nonprofit organization which is used as a global standard for sustainability reporting (Lockwood, 2011).
The Global Reporting Initiative (GRI) encourage businesses to be sustainable where the mission of GRI is making standers of practice for sustainability reporting. It help organisations to report their performance of social, environment and economic within a business. GRI provide guides in how make sustainability reports as free.GRI is a not-for-profit, network-based organization (Global Reporting Initiative, 2013) .
Global Reporting Initiative is proved to useful because
As per the organization’s opinion it is not possible to control something if it is not measured according, so this approach provides a standard of measurement.
GRI provides indications of possible future opportunities and risks of an organization.
It helps to formulate strategies by which an organization is able to face the global risk and improve their sustainability standard.
It is helpful in building up trusts among the stake holders and improves the accountability.
With the implementation of GRI internal management system can be analysed properly and it smoothen the operation process and reduce wastage.
The companies which follows the GRI is in a better position to attract investments, enter into the new market and make new contracts. It will give them the benefit of competitive advantage (McBride, 2011).
It only considers about the sustainability reports but omits the retirement of other reports so sometimes it proves to be very misleading for the stakeholders.
GRI has created many guidelines which are very complex in nature and it is difficult to implement within the organization.
There are some barriers in making protocols and external assurance to the shareholders.
For implementation of this standard it requires advance knowledge and better understanding of the rules and regulations.
The benefits derived from the integrated reporting is stated as follows
It creates a linkage between financial and non financial reporting.
It enhances the clarity and transparency of the organisation.
Improve the communication and coordination among the different department.
It helps to calculate social return on investment.
Values can be created by this for the future of the organization.
It proved to be a well integrated approach for maximizing the stakeholder wealth.
There is a lack of accepted standard.
Clarity is missing.
This approach proved to be very complex in nature.
It requires more informed guidelines.
For example all this reports are giving benefits to different sectors like real estate, oil and gas, media etc. All these above must have to follow the guidelines of the GRI and IR standards and they have to prepare their sustainability report in order to ensure their social responsibility (Neimark and Mott, 2011).
From the above discussion it can be concluded that both these reporting standard is necessary for enhancing the reliability of the company but proper initiative should also be taken in order to remove the complexity so that it can be implemented in a better way.
Bohmholdt, A. (2014). Evaluating the Triple Bottom Line Using Sustainable Return on Investment. Remediation, 24(4), pp.53-64.
European Dept, I. (2013). France. Washington: International Monetary Fund.
Law, D. (2015). From Plimsoll Line to triple bottom line: adding value through partnership. Bottom Line: Mg Lib Finances, 28(1/2), pp.44-51.
Lockwood, T. (2011). What impacts the triple bottom line more than design?. Design Management Review, 22(1), pp.5-5.
McBride, M. (2011). Triple Bottom Line by Design: Leading as if Life Matters. Design Management Review, 22(1), pp.6-14.
Neimark, P. and Mott, P. (2011). The environmental debate. Amenia, NY: Grey House Pub.
English, D, &Schooley, D 2014, 'The Evolution of Sustainability Reporting', CPA Journal, pp. 26-35, Business Source Complete, EBSCOhost, viewed 20 July 2015.
James, ML 2013, 'SUSTAINABILITY AND INTEGRATED REPORTING: OPPORTUNITIES AND STRATEGIES FOR SMALL AND MIDSIZE COMPANIES', Entrepreneurial Executive, 18, pp. 17-28, Business Source Complete, EBSCOhost, viewed 20 July 2015.
Milne, M, & Gray, R 2013, 'W(h)ither Ecology? The Triple Bottom Line, the Global Reporting Initiative, and Corporate Sustainability Reporting', Journal Of Business Ethics, 118, 1, pp. 13-29, Business Source Complete, EBSCOhost, viewed 20 July 2015.
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