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Stocking up on sustainability information
04 October 2011
​Photography: Aaron T. Goodman (CC License)

​GRI co-hosted an event with the Shanghai Stock Exchange in Beijing, China, on 20 September. More than 100 Chinese companies attended the event ‘Why listed companies should report?’, where they heard from Mr. Lin Yongfeng PhD, Vice Director of The Shanghai Stock Exchange and Mr. Ernst Ligteringen, Chief Executive of GRI, on why sustainability reporting is important for listed companies.
​In China, all State Owned Enterprises must produce reports, and China has seen a huge increase in reports, today at an estimated 700. This trend is likely to continue: the Shanghai Stock Exchange recommends sustainability reporting to listed companies, and China’s Five Year Plan has a focus on the environment – an issue central to sustainability disclosure.
 
There are more than 100 stock exchanges around the world, and they all operate differently. As major stock exchanges start paying attention to, and asking for, sustainability data, more regulators will follow. There are many reasons for a company to start reporting, and one of the new ones is getting listed.
 
In the USA, the two major exchanges – NYSE Euronext and NASDAQ OMX– are both acknowledging sustainability information. In May 2010, GRI attended the launch of NASDAQ OMX’s new sustainability index. In January this year, GRI’s Focal Point USA was launched at an event at the New York Stock Exchange, where Michelle Greene, Vice President and Head of Corporate Responsibility at NYSE Euronext, spoke about sustainability reporting. “Hopefully we’re heading toward a tipping point, where companies that don’t report have some explaining to do, rather than those that do being the exception.”
 
NYSE Euronext has more than 8000 listed companies and began exploring sustainability several years ago. NYSE went through its own reporting process and recently published its second sustainability report – Greene added, “there was no question: the gold standard was GRI.” NYSE, one of GRI’s Organizational Stakeholders, has since taken several additional steps in its own sustainability story, including developing a new online presence where its latest sustainability stories are showcased. NYSE’s leadership in sustainability was recognized recently when it made the Dow Jones Sustainability Index and the CDP’s S&P Leader Index.
 
Also an Organizational Stakeholder, BM&FBOVESPA has gone a step further with its Corporate Sustainability Index (ISE) in Brazil, launched in 2005. Through Novo Valor Corporate Sustainability, BM&FBOVESPA has also developed guidance for its listed companies on how to be more sustainable. The guidance recommends that companies look at GRI’s Framework for Aspects, Indicators and guidance on reporting.

Similarly, German exchange and GRI Organizational Stakeholder Deutsche Börse considers sustainability an important factor for its listed companies. In April 2011, Deutsche Börse announced a “new information portal for sustainable securities” – a tool to help investors factor sustainability performance into their decisions. It also provides several sustainability indexes, including the DAXglobal® Sarasin Sustainability Index for Germany.
 
In Asia, the Singapore Stock Exchange was the first exchange to encourage listed companies to start reporting their sustainability performance, by issuing guidelines in August 2010. According to the Guide to Sustainability Reporting for Listed Companies, “The Global Reporting Initiative (GRI) Sustainability Reporting Guidelines provides a valuable framework to assist listed companies with sustainability reporting. Companies may adopt an approach best suited to their industry and location.”
 
Other exchanges in the region are following suit: The Stock Exchange of Thailand is developing its Guideline for Social Responsibility and Guideline for CSR Report. The guidelines, which will be released at the end of this year, target all businesses, not only listed companies. The second publication – the Guideline for CSR Report – will include references to GRI and a translation of the G3.1 Guidelines.
 
Other stock exchanges are looking at integrated reporting – where companies report their sustainability performance information integrated with their financial data. In South Africa, the Johannesburg Stock Exchange has a ‘comply or explain’ listing requirement that means companies have to follow the King III Code or explain why not. The Code includes guidance on integrated reporting.
 
GRI is working with many of these stock exchanges to ensure they have the tools they need to encourage companies to report. Stock exchanges can work with GRI by becoming Organizational Stakeholders, like NYSE, and can get involved in the development of new Guidelines. GRI looks forward to seeing even more exchanges looking at sustainability data and encouraging listed companies to report.