Revision of GRI Universal Standards: An Overview of the Main Changes and their Implications

Dr. Thijs Willaert CSR & Responsible Sourcing, News, Revisions

If your organization relies on the GRI Standards for its sustainability reporting, you will want to keep a close eye on current developments: GRI is revising its universal standards, which apply to organizations of any type and size. While many of the proposed changes are minor, there are a number of modifications that will require some reporters to rethink the content of their sustainability reports.

As you probably know, the GRI framework comprises two types of standards:

  • The so-called universal standards, applicable to all reporting organizations (101, 102 and 103)
  • Topic-specific standards, focusing on distinct sustainability topics like human rights, waste, emissions, … (the 200, 300 and 400 series).

The current revision, which is currently in a consultation phase, only affects the universal standards.  However, because the universal standards describe the principles and framework, changing them has far-reaching implications for the topic-specific standards. In this article, we will walk you through the most significant changes.

Impact and Materiality

One of the key concepts of sustainability reporting is “materiality”: the idea that reports should focus on the topics that are the most relevant to the sustainability performance of the reporting organization. Many reporters include a materiality matrix in their report, which indicates the relevance and priority of the specific sustainability topics. For example, companies in the oil and gas industry are likely to have emissions as one of their most material topics, whereas companies in the service industry may focus more on social aspects, like employee wellbeing.

However, there are many different approaches to defining materiality. Many companies still rank the topics on two axes:

  • relevance to stakeholders and
  • relevance to the company.

We should point out that this approach is not compliant with the GRI standards. The definition provided in GRI 101 also has two axes, but different ones:

  • influence on the decisions of stakeholders and
  • significance of economic, environmental and social impact.

The graphic below is taken from the 2016 version of GRI 101:

The revised version, however, focuses on the horizontal axis only. According to the revised definition, a material topic is a “topic that reflects the organization’s most significant impacts on the economy, environment, and people, including impacts on human rights”.

So what does that change in practice? It means the focus shifts entirely to impact: reporting organizations will need to ensure they understand their actual and potential impacts on the economy, the environment and society. Of course they still need to involve their stakeholders to gather their input, but not in order to understand what their priorities are, but rather to get a better understanding of the impact of the organization.

Impact and Due Diligence

This focus on impact means that reporting organizations need a process to identify and manage their impacts. This is where the concept of due diligence comes into play. The term, almost entirely absent in the first version of the standard, now takes center stage. It is defined as “the process through which an organization identifies, prevents, mitigates, and accounts for how it addresses its actual and potential negative impacts on the economy, environment, and people.”

One of the key topics for which reporters will need to disclose their due diligence approach is human rights. Frequent readers of our blog will know that many countries are in the process of making human rights due diligence mandatory (Link, Link). As such, the update to the GRI Standards ensures a better alignment with the UN Guiding Principles on Business and Human Rights.

Distinction between Core and Comprehensive disappears

Another noteworthy change is that the distinction between reporting only the core disclosures and reporting comprehensively disappears. This means that for all topics that are judged to be material, reporting organizations will need to report appropriate disclosures from the topic standards, instead of reporting at least one or all disclosures as per the existing Core and Comprehensive options.

Sector specific Standards

Besides the universal standards and the topic-specific standards, GRI is also developing sector-specific standards. These will not contain new disclosures, but will help companies in determining their material topics. The sector-specific standards will identify and describe the main economic, environmental and social impacts of a sector, thereby setting the context for reporting. 

The first sector-specific standard will be for the oil and gas industry, to be published in the course of 2020. A second standard for the agriculture sector should follow soon.

HOW DQS CAN SUPPORT YOUR Sustainability Reporting:

As an independent audit and assurance provider, we can support your sustainability reporting processes with the following services:

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Dr. Thijs Willaert Administrator
Dr. Thijs Willaert is Director of Marketing & Communication at DQS CFS GmbH
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Dr. Thijs Willaert Administrator
Dr. Thijs Willaert is Director of Marketing & Communication at DQS CFS GmbH
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