At Sustainable Brands' third annual #NewMetrics Conference at the University of Pennsylvania in September, the need for next-generation sustainability goals — which measure progress toward real-world goal-lines such as carbon budgets, water tables, and living wages — emerged as a key theme. To dig deeper, #NewMetrics channel co-curator Bill Baue discussed this question of “endzone” goals with prominent voices in the field, including Andrew Winston, author of the forthcoming book, The Big Pivot*; SustainAbility CEO Mark Lee, and Bob Willard, in the first installment of the #SustyGoals series last month.*
Here, Baue speaks with GISR's Allen White about the history, current status and future of goal-setting based on the Sustainability Context Principle.
You could call Allen White the Godfather of Sustainability Context*.* A Senior Fellow with the Tellus Institute, White co-founded (with Bob Massie, who headed Ceres at the time) the Global Reporting Initiative (GRI) in the late 1990s, and acted as CEO in its early years. He was largely responsible for the inclusion in early versions of the GRI Sustainability Reporting Guidelines of the Sustainability Context Principle, a concept he helped coin. Here's how the idea was defined at its inception:
Many aspects of sustainability reporting draw significant meaning from the larger con**text of how performance at the organisational level affects economic, environmental, and social capital formation and depletion at a local, regional, or global level... For some users, placing performance information in the broader biophysical, social, and economic context lies at the heart of sustainability reporting and is one of the key differentiators between this type of reporting and financial reporting... Where relevant and useful, reporting organisations should consider their individual performance in the contexts of economic, environmental and social sustainability. This will involve discussing the performance of the organisation in the context of the limits and demands placed on economic, environmental or social resources at a macro-level.
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Hear more from Ford's Director of Community Development, Pamela Alexander — on setting goals and measuring performance around justice, equity, diversity and inclusion — at Integrate '20, Nov. 9-11.
Now, a dozen-odd years later, White is heading up the Global Initiative for Sustainability Ratings (GISR), a project that seeks to bring the same kind of rigor and consistency to the field of sustainability ratings that GRI seeks to bring to sustainability reporting. That includes the integration of the Sustainability Context Principle into the GISR Standard, which is slated for its first iteration release this month. As with the early GRI definion, GISR frames Sustainability Context in terms of assessing a company's impacts across multiple capitals (natural, social, human, etc) in order to determine sustainability performance at the corporate level. Interestingly, as the GRI definition of Sustainability Context evolved in G3 and G4, it dropped reference to impacts on vital capitals, precisely as emerging standards in the field — including the International Integrated Reporting Council (IIRC) and Sustainability Accounting Standards Board (SASB) as well as — are embracing the multi-capital framing.
Bill Baue: GISR is essentially advancing a new articulation (or re-articulation) of GRI’s notion of Sustainability Context, and in particular you are envisioning corporate sustainability target-setting that takes a context-based goal line into account. So, first off, can you explain why GISR is incorporating this into its protocol, and describe how GISR does so?
Allen White: From the outset, we at GISR felt that any standard defining what excellence in sustainability ratings means should have an element that reflects the notion of boundaries, thresholds, and limits — otherwise known as Sustainability Context. As discussions amongst the GISR Technical Steering Committee — plus a vast amount of public input over the last eight months — have evolved, the Context idea has survived many rounds of comments and debates to emerge as one key element of our standard, alongside the more traditional assessments of performance, such as backward-looking, peer-related, and internally defined goal-related performance metrics. As a result of this intense vetting, Sustainability Context is now one of the twelve Principles finalized for release in a full GISR Principles Version 1.0 document in November.
Bill Baue: You mention the historical view of looking at corporate sustainability, but I want to take a quick step back to the genesis of Context — my understanding is that you played a prominent role in the original articulation of that concept, and the embedding of it into the GRI’s initial framework in the early 2000s. Can you give us some background of what went into that and in particular why it's important — why do we need to assess corporate sustainability in the context of these thresholds, limits, and boundaries?
Allen White: The genesis of the Principle in GRI’s history began in the late '90s, prior to the release of G1 in 2000. At that point, we had considered what role principles should play, as they did in many other sustainability standards and frameworks at that time, such as the Earth Charter. But the precise principles relevant to a reporting framework that GRI proposed to develop were unsettled. We believed the principles had to be an under-girding, a scaffolding, if you will, around the disclosure framework. They would serve as a beacon for all reporters when they inevitably came to decisions regarding which indicators to use and how to communicate performance. As head of GRI at that point, I felt very strongly that an initiative that purports to be a sustainability initiative could not simply frame its work along the lines of, shall we say, incremental performance assessment. That is, companies that were improving each year in regard to water management, energy management, living wages and occupational health and safety should be recognized in the evolving GRI framework. But incrementalism alone, at the end of the day, was insufficient to be faithful to a sustainability reporting framework. We would have to take a further step and include a principle that would call for assessing — in addition to disclosures on backward-looking benchmarks, peer group comparisons, and improvements against a company’s own goals — performance against thresholds and limits.
So that Principle appeared for the first time in 2002 in G2, the second iteration of the guidelines, which we released amidst an enormous amount of attention at the World Summit on Sustainable Development in Johannesburg. It was a turning point for GRI, which was one of only two initiatives of any kind specifically mentioned in the official statement of the conference. It was an historic moment for reporting principles in general, and for the Sustainability Context Principle specifically, in that a worldwide audience was exposed to Sustainability Context for the first time, as far as we knew. I was realistic — I knew it would be a struggle from day one to bring Sustainability Context to life in an operational sense. But that was no reason for us to defer our commitment, to put a stake in the ground and say, Context matters.
Part 2 ...