page
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Breakout discussion:
the seven first generation sustainability indicators
This report investigates the extent to which the world’s
large public companies are disclosing the seven first
generation sustainability indicators. These are metrics
that are a) broadly relevant for companies across all
industries; and b) among the most widely disclosed by
the world’s publicly traded companies.
Figure 1
shows
the proportion of the world’s ~4,000 large companies
that disclosed each first generation sustainability
indicator in 2011, and how each indicator is tethered
to financial materiality.
5
6
5 For a complete description of the GRI Indicators, see Appendix A.
For more information on these and other GRI Indicators, please visit
6 Large companies defined as those with more than US$2 billion in
market capitalization.
Figure 1:
First generation sustainability indicators
FIRST GENERATION
SUSTAINABILITY
INDICATOR
GLOBAL REPORTING
INITIATIVE (GRI)
INDICATOR
DISCLOSURE
RATE, 2011
MATERIALITY DRIVER
Employee turnover
LA2
14% Low employee turnover is often correlated with effective human capital management,
which is a well-established returns driver in many sectors.
Energy
EN3, EN4
27% Energy use can be an important proxy for firm-wide resource use efficiency, and an
increasingly important cost centre for companies in many industries.
GHGs
EN16
30%
The prospect of carbon regulation is leading to a growing monetization of GHG
externalities, with the concept of carbon shadow pricing an increasingly utilized
accounting tool.
Lost-time
injury rate
LA7
13% Workplace health and safety can be a useful proxy for management quality.
Payroll
LA3
59%
Pay equity is an increasingly visible sustainability theme, with tightening rules
around workforce and CEO pay disclosure, and greater vigilance of excessive
CEO compensation.
Waste
EN22
22% Waste generated per unit of revenue can be an insightful measure of operational efficiency.
Water
EN8
25% Water is an increasingly scarce global resource, and a firm’s water use practices can
reflect management foresight.
Source: The Global Reporting Initiative, CK Capital
This report comes at a critical juncture in the
evolution of corporate sustainability reporting, with
various groups calling for more disclosure that is
comparable across reporting entities and that is
more relevant for investment decision-making.
These trends have been the catalyst for a number
of recent innovations in the sustainability reporting
space. Notable developments include:
• The Global Reporting Initiative’s G4 Sustainability
Reporting Guidelines;
7
• The pilot reporting framework developed by
the International Integrated Reporting Council
(IIRC)
8
; and
• The Sustainability Accounting Standards Board’s
(SASB) sustainability reporting standards.
9
7 For more information, see
8 Information about the IIRC’s pilot reporting framework is available at
9 Details about the SASB’s forthcoming reporting standards can be found
at
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