listed companies. The absence of this information
from companies poses a cost, because it devalues
the information provided by others. Sustainability
reporting has come a long way in a short time, and
the latest generation of Global Reporting Initiative’s
(GRI) Guidelines, G4, offer a robust standard. This is,
however, only part of the solution.
Public policy has an important role to play, and this
report, prepared by CK Capital, presents a number
of compelling policy recommendations that will
inform thinking in the investment community. In
particular, the recommendation that policy-makers
can reference sustainability reporting standards
developed by transnational standard-setters
supports GRI’s long-standing call for a comparable
and consistent global reporting language to inform
markets. Stock markets regulators are uniquely
placed to drive change in this area by smart
regulation through listing requirements.
I’ve never met an investor who wanted less high-
quality, relevant company information at their
fingertips, nor one who craved to know less about
the long-term value prospects of a company.
And this demand for sustainability data is only
set to rise. The Rana Plaza factor disaster in
Bangladesh demonstrated just how critical far
flung supply chains are to the long-term viability
of an investment—damaging reputations and
hitting share prices. Moreover, those that contest
that climate change is a material concern are
now consigned to the margins, and pressure
on commodity prices, water and other natural
resources, in part due to the rising population,
have only just begun.
In the future, a company that chooses not to report
will be sending a message loud and clear to markets.
Its name will sit in the n/a category on electronic
trading platforms. Not applicable. Not accountable.
Subtext? Not a business to invest in. Be it supplied
in a sustainability report or a report that integrates
that sustainability information with financial
information, sustainability performance information
will not only become increasingly relevant to
investors; its use will become increasingly routine.
GRI and likeminded and aligned organizations such
as IIRC will continue to advocate smart policy from
stock exchanges and government. The investment
community needs to be part of that conversation,
and I hope they will support market regulators that
are taking a lead role to drive decision-making that
is better for investors, better for markets and better
for wider society.
Ernst Ligteringen
Chief Executive Officer
The Global Reporting Initiative
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