– By Patrick Browne and Joe Monfort
Shortly after our 2012 sustainability report was published in July 2013, the UPS sustainability report team gathered to debrief and plan for the following year. High fives were administered, too much sugar was consumed, and when it was all said and done, a questionable decision was made. With the new Global Reporting Initiative (GRI) “G4” guidelines hot off the press, we resolved to make every attempt to migrate directly to the most rigorous option available under the new framework, “In Accordance-Comprehensive.” The results of that 10 month effort will be published on July 30th, 2014.
To provide our stakeholders (but mostly that small cabal of sustainability reporting aficionados) with insight into our journey, we present three challenges we faced adapting to GRI G4 and how we addressed them below. If you’re looking for corporate platitudes about our reporting philosophy, this isn’t it. This is the nitty-gritty for fellow sustainability reporters interested in how we approached several of the pivotal elements of G4.
1. We Are Living in a Material World
While we haven’t seen Madonna at a sustainability conference in a few years, we suspect the multi-stakeholder group that developed the G4 guidelines spent a lot of time in windowless rooms getting down to her 1984 hit. We don’t blame them; it’s a catchy tune and in our first pass at G4 we did our best to sing along.
The Challenge: G4 defines materiality clearly. An issue is material if it reflects the organization’s “significant economic, environmental and social impacts” or “substantively influences the assessments and decisions of stakeholders”. We have always sought stakeholder input in our materiality process but have not explicitly used “significant economic, environmental, and social impacts” to guide past assessments. Instead, we opted for a definition that emphasized strategy – “Influence on business success” – over impact. Our first challenge came early: deciding whether or not maintaining our historical approach conflicted with the spirit of G4.
Our Solution: After careful consideration, we chose to retain our definition (Influence on Business Success) in order to focus the materiality process on our overall sustainability strategy, rather than on simply identifying impacts. This approach allows us to maintain consistency with our previous assessments and ensures that UPS specific material aspects stand out clearly for our management and stakeholders. Just as importantly, we believe that the highest purpose of G4 is to elevate sustainability reporting as a strategic lever in company decision-making. So, while our materiality lyrics might differ from GRI, we believe we’re singing the same song.
2. The UPS Sustainability Rosetta Stone
Before Rosetta Stone was a language software packaged in a bright yellow box, it was an ancient key inscribed on a big stone block. The original Stone provided a decree issued by King Ptolemy in three different languages. It allowed translators to use the known language inscribed on the Stone to decipher the Egyptian hieroglyphs that also appeared. In our 2013 report, we offer neither a yellow box nor a big stone block, but we do present the UPS sustainability Rosetta Stone.
The Challenge: A key question at the outset of our 2013 materiality assessment was whether to match the issues under consideration directly to the list of potential G4 Material Aspects. The benefit of doing so, we reasoned, would be a 1:1 relationship between our materiality matrix, G4’s framework, and our report content. On the other hand, using only G4 terms would limit the ability of our external and internal stakeholders to truly define what they believed to be our most material sustainability issues.
Our Solution: We believed it was more important to give our stakeholders free reign to define UPS’ material sustainability issues than to adhere strictly to the G4 nomenclature. As a result, our disclosures on management approach often group, add, or subtract G4 Aspects in a way that is most meaningful for UPS and our stakeholders. To solve for any potential confusion, we present a table immediately following our matrix which maps our UPS-specific material aspects to those provided by G4, and then also describes the aspect boundaries both inside and outside the organization. It won’t help an Iowa farm boy find love in Italy like the software claims, but we hope it helps explain our process.
3. Boundary Issues: It’s Not You, It’s Me (Or Is It You?)
There is little doubt that G4 has serious boundary issues. Not only are organizations asked to define the boundary of significant sustainability issues inside and outside the organization, they’re also expected to change how they think about the entire boundary decision. It left us feeling a bit dumped at times.
The Challenge: Before G4, organizations were asked to define the scope and boundary of their sustainability issues based on control and influence. If an organization directly impacted an entity or contractual relationship, they were expected to report on it. The game changed with G4. Now the only filter that excludes an entity from a company’s boundary is lack of impact. And that’s more of a faucet than a filter.
Our Solution: We took the boundary discussion aspect by aspect. For some, like emissions, the question of boundary outside the organization led us down an unproductive slippery slope. So we reverted to the old filter: what do we control? For other aspects, we did our best to identify and describe impacted entities over which we have no control or influence in a productive way. The real utility our stakeholders will derive from this information remains to be seen, but we welcome that feedback. While we have some concerns that once clean waters have been muddied, it’s nothing to break up over.
Patrick Browne manages the global data collection and analysis process for the UPS sustainability report, including primary responsibility for assuring UPS’ comprehensive greenhouse gas reporting and assurance efforts. Joe Monfort manages the UPS materiality assessment process and is responsible for the development of the annual sustainability report, including primary editorial responsibility. For questions related to the report, please contact him at email@example.com
|Category:||Community, Environment, Sustainability, Today's UPS|
|Tags:||community, Environment, green, sustainability, UPS sustainability report|