Europe’s major utility companies failing on GRI guidelines

Many of Europe's major electric utility companies are not following reporting guidelines for environmental and social performance, despite claiming to abide by the Global Reporting Initiative (GRI).

According to a study looking at the sustainability reporting of 19 European electric utility companies against 10 labour-related indicators, there are significant discrepancies between what companies claim they are reporting on within the GRI Framework and what they actually report on.

Carried out by Dutch independent non-profit Centre for Research on Multinational Corporations, SOMO, the report explained that these discrepancies diminish the accuracy and credibility of the system and its contribution to encouraging sustainable and responsible business conduct.

It also revealed that more than 60% of the claims for ‘full’ reporting against the 10 indicators are “at least partly false or misleading”.

“Some companies appear to be deliberately ‘gaming the system’ by taking advantage of the lack of clarity or irrelevance/immateriality of some indicators to give themselves ‘full’ credit (and thus receive a higher application level score) on indicators for which they are clearly not reporting fully,” it stated.

“The fact that so many externally assured and checked reports were found to have discrepancies calls into question the credibility of the assurance system associated with the GRI Reporting Framework”.

On this basis, SOMO stressed the need to improve the system of monitoring, verifying, checking and assuring the reporting and reporting scores of companies using the GRI Guidelines.

Through its findings, SOMO made a series of suggestions to improve the system, which includes making it “irrefutably clear” to companies using the GRI Framework that ‘full’ reporting on an indicator implies addressing each and every compilation point for the indicator.

It also proposed that the system should not allow companies to claim that they ‘report’ on an indicator without specifying whether they report ‘fully’ or ‘partially’.

Leigh Stringer

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie