Table 2 Environmental
performance and reporting
standardization initiatives
Initiative
Scope
Participants
Global Reporting Initiative
(GRI)
Global, mainly large
companies
UNEP, accountancy
organizations, NGOs,
academics, business
National Round Table on
Economy and Ecology
(NRTEE)
Canada, large
companies
Business, government
International Organization
for Standardization (ISO)
Global, all companies Business, regulatory,
academic
UN-International Standards
of Accounting and
Reporting (UN-ISAR)
Global, all companies National experts
World Business Council for
Sustainable Development
(WBCSD)
Global, large
companies
Business
National Academy of
Engineering (NAE)
USA
Business, academic
measurement and reporting scene, there are multiple activities. They have
included initiatives promoted by government, industry, NGOs in cooperation
with industry, standard-setting bodies, and academic institutions. Table 2
presents a summary of the most significant initiatives.
These many standardization initiatives suggest that the demand for common
frameworks is widely felt. But the degree of cooperation between firms, regulators
and others is noteworthy. It suggests either that performance measurement and
reporting is still in a pre-competitive phase, or that clear benefits flow to firms
from cooperation. A number of different benefits have been proposed:
A ‘learning effect’. The production of management information and its
reporting may be more efficient using standard guidelines. There are costs
associated with developing the capabilities to measure and report on
environmental and social performance. These costs are likely to be reduced if
standard approaches are available.
An ‘accounting effect’. The credibility and accessibility of information, both
internally and externally, may be enhanced by cooperation over standards. An
accepted, verifiable and auditable set of performance measures, imitating
conventions in accountancy, is likely to generate greater legitimacy and trust in
the positive ‘green claims’ that firms may want to make on the basis of
environmental reporting.
A ‘benchmarking effect’. The value of information may be enhanced through
comparability between firms. Firms may gain greater credit from shareholders,
regulators and customers by presenting environmental performance information
in comparable form. Benchmarking may also provide greater internal benefits
by bringing clarity to the setting of environmental objectives.
A ‘coalition effect’. Self-regulation may pre-empt government regulation. Many
governments in Europe have encouraged firms to be more active in their
environmental and social reporting, with the implicit threat of regulation if
Corporate Environmental Performance
169
performance and reporting
standardization initiatives
Initiative
Scope
Participants
Global Reporting Initiative
(GRI)
Global, mainly large
companies
UNEP, accountancy
organizations, NGOs,
academics, business
National Round Table on
Economy and Ecology
(NRTEE)
Canada, large
companies
Business, government
International Organization
for Standardization (ISO)
Global, all companies Business, regulatory,
academic
UN-International Standards
of Accounting and
Reporting (UN-ISAR)
Global, all companies National experts
World Business Council for
Sustainable Development
(WBCSD)
Global, large
companies
Business
National Academy of
Engineering (NAE)
USA
Business, academic
measurement and reporting scene, there are multiple activities. They have
included initiatives promoted by government, industry, NGOs in cooperation
with industry, standard-setting bodies, and academic institutions. Table 2
presents a summary of the most significant initiatives.
These many standardization initiatives suggest that the demand for common
frameworks is widely felt. But the degree of cooperation between firms, regulators
and others is noteworthy. It suggests either that performance measurement and
reporting is still in a pre-competitive phase, or that clear benefits flow to firms
from cooperation. A number of different benefits have been proposed:
A ‘learning effect’. The production of management information and its
reporting may be more efficient using standard guidelines. There are costs
associated with developing the capabilities to measure and report on
environmental and social performance. These costs are likely to be reduced if
standard approaches are available.
An ‘accounting effect’. The credibility and accessibility of information, both
internally and externally, may be enhanced by cooperation over standards. An
accepted, verifiable and auditable set of performance measures, imitating
conventions in accountancy, is likely to generate greater legitimacy and trust in
the positive ‘green claims’ that firms may want to make on the basis of
environmental reporting.
A ‘benchmarking effect’. The value of information may be enhanced through
comparability between firms. Firms may gain greater credit from shareholders,
regulators and customers by presenting environmental performance information
in comparable form. Benchmarking may also provide greater internal benefits
by bringing clarity to the setting of environmental objectives.
A ‘coalition effect’. Self-regulation may pre-empt government regulation. Many
governments in Europe have encouraged firms to be more active in their
environmental and social reporting, with the implicit threat of regulation if
Corporate Environmental Performance
169