It seems to be that each week is busier than the last. Here are some of the things we blogged about this week- as well as some other pieces that caught our attention regarding internal investigation, human resources and ethics:

Monday:

• Blog Post- Integrating Ethics and Compliance Into the Entire Organization

“There’s no point investing in and implementing an ethics and compliance program unless the time is spent integrating the program into every aspect of an organization. The need for companies to develop effective ethics and compliance programs has been acknowledged by several government agencies- examples are the SEC in the US and the government in the United Kingdom. Both groups have recently passed legislation or made amendments to existing guidelines, focusing heavily on the importance of ethics and compliance at all levels of an organization- especially at the top. Employees at each level contribute to the success of a company’s ethics and compliance program. Integrating ethics and compliance at each level helps ensure the message from the top makes it all the way down to the lower levels of the organization. Training, messages and other ethics and compliance initiatives must be developed to evolve with employees as they move through the company. That being said, employees at various levels need to be prepared to address different ethical issues they may encounter based on the role they play in the organization.”

Tuesday:

• Blog Post- Reducing the Opportunity for Workplace Fraud

“The values associated with workplace fraud continue to rise- especially during economic downturns. Preventing workplace fraud begins on the inside of an organization. One of the largest fraud risks companies must address is the opportunity for fraud to occur. There are a number of anti-fraud techniques and systems that are easy to implement within any organization. When fraud grows out of control within an organization, reputations and public trust are destroyed. To reduce the opportunity for fraud to occur, accounting and money handling responsibilities must be divided. Monitoring and enforcement of anti-fraud programs is necessary in order for the program to be effective and for employees to take it seriously. When employees know they are being watched, their work is being reviewed on a consistent basis and punishments are administered to those who violate anti-fraud policies, there’s less room for fraud to go undetected.”

Wednesday:

• Blog Post- Recovering From Ethical Lapses and Investigations: Siemens

“The $1.6 billion fine handed down to Siemens in 2008 was much more than a record breaking fine, it was a lesson for other companies to learn from. Prior to the bribery scandal, Siemens had an ethics and compliance program in place, however, there was a missing link between leadership and the enforcement of the program. The company’s cooperation during the SEC investigation lead to a reduced penalty, but also gave way to a complete re-design of the company’s internal ethics and compliance controls. There are many lessons learned from the Siemens charges, the reaction to the investigation and the actions taken by Siemens to position the company as an ethics and compliance leader in the post-scandal era.”

Thursday:

• Blog Post- The Importance of Investigation Interview Credibility

“In order for a workplace investigation to be credible, investigators must deploy certain tactics to verify the accuracy of interview responses. In a previous post, Investigation Interview Questions to Determine Credibility, we reviewed the EEOC’s 5 factors to consider when determining statement credibility during investigation interviews. One of the toughest challenges to overcome during investigation interviews is the fact that witnesses may withhold or modify their responses to protect the subject- or the complainant and possibly even themselves. As investigators are often pressed for time when conducting internal investigations, they cannot afford to get hung up on determining who is correct in the “my story vs. their story” battle. We have compiled a list of simple tips and techniques investigators can use to determine investigation interview credibility.”

In order for a workplace investigation to be credible, investigators must deploy certain tactics to verify the accuracy of interview responses. In a previous post, Investigation Interview Questions to Determine Credibility, we reviewed the EEOC’s 5 factors to consider when determining statement credibility during investigation interviews. One of the toughest challenges to overcome during investigation interviews is the fact that witnesses may withhold or modify their responses to protect the subject- or the complainant and possibly even themselves. As investigators are often pressed for time when conducting internal investigations, they cannot afford to get hung up on determining who is correct in the “my story vs. their story” battle. We have compiled a list of simple tips and techniques investigators can use to determine investigation interview credibility.

Please note: It’s unlikely that the occurrence of a single deception indicator means that the interviewee is lying. Therefore, investigators should carefully observe for multiple deception indicators during interviews when determining statement credibility.

1. Consistent Statements

When asking questions related to the timeline of events involved in an incident, watch for inconsistencies or vague responses. This can be done by asking the interviewee to repeat or recall the order of events at different times throughout the investigation. Ask interviewees to go into greater detail about the incident-related events.  In the “Black Book of Lie Detection,” author Martin Soorjoo states that “when digging deeper, do so in an ‘interested’ manner rather than accusatory. Lying about detail requires a lot of thought and concentration.”

2. Body Language

Controlling physical actions is extremely difficult- hence the phrase “actions speak louder than words”. Pay attention to the physical tendencies displayed throughout the interview. Observe facial expressions and listen to the variations of pitch and tone in their voice. Body language that signifies lying varies across different cultures. Some of the common physical gestures exhibited by someone who is lying include: nail biting, touching their face- usually rubbing nose or covering mouth, avoiding eye contact, stroking the back of their neck, sweating, turning red in the face and fidgeting. In the “Black Book of Lie Detection,” author Martin Soorjoo states that “if an investigator believes the interviewee to be lying, don’t let on about it. Innocent people may become defensive if accused of lying and will demonstrate signs of stress through nonverbal and vocal cues- which can be mistaken as lying.”

3. Consider Your Own Bias

Investigators must remain neutral and refrain from making prior judgments in any investigation. Biases not only shape the attitude an investigator has towards the individual being interviewed, but can also influence the types of questions asked during investigation interviews. In the Business Management Daily article “Assessing Witness Credibility in Workplace Investigations,” they recommend bringing an additional investigator into the interview so that there’s an extra person to compare impressions and notes with. If personal bias is too difficult to overcome, consider asking an investigation manager to reassign the case to someone else to avoid sacrificing the accuracy of the investigation.

4. In the Eyes

Martin Soorjoo, author of the “Black Book of Lie Detection,” provides great insight into how an interviewee’s eyes can give them away. According to Soorjoo, an increased blink rate is often consistent with telling lies. Looking away and avoiding eye contact is tricky, as it may not always signal a lie is being told. When people lie, their pupils tend to dilate, which can be a useful indicator, as the body has no control over pupil dilation.

The free guide below includes an interesting “eye” test that can be used to decipher whether or not a lie is being told.

5. Incorporate Background Questions Into Interviews

At the beginning of an investigation interview, it’s beneficial to ask general background questions as a way to ease the interviewee into the environment. It’s likely that the person being interviewed will expect the questions to be based solely on the incident, therefore, background questions can be used to gauge the ‘normal’ responses and physical tendencies of the respondent. When investigators begin asking difficult, case-related questions it’ll be easier to accurately measure and monitor behavioral changes that indicate lying.

Investigators must be cautious during investigation interviews. People often mistake physical manifestations of stress as being indicators of lies being told. This sometimes happens to innocent people standing trial in a criminal case for a crime they didn’t commit. The irony is, the guilty defendant will have had plenty of time- sometimes years, to rehearse their lie. The innocent person will not have rehearsed because they are telling the truth and are scared because they have a lot to lose. Take this advice into consideration throughout ALL investigation interviews.

The $1.6 billion fine handed down to Siemens in 2008 was much more than a record breaking fine, it was a lesson for other companies to learn from. Prior to the bribery scandal, Siemens had an ethics and compliance program in place, however, there was a missing link between leadership and the enforcement of the program. The company’s cooperation during the SEC investigation lead to a reduced penalty, but also gave way to a complete re-design of the company’s internal ethics and compliance controls. There are many lessons learned from the Siemens charges, the reaction to the investigation and the actions taken by Siemens to position the company as an ethics and compliance leader in the post-scandal era.

Bribery Investigation

An amnesty plan had been worked out with Siemens, as employees willing to come forward with information pertaining to the bribery scandal and identifying key players, would be free from prosecution. In a report from the Wall Street Journal, the amnesty program was offered to all Siemens employees (110 of which came forward with information), with the exception of the 300 employees who made up the company’s top executive team. One particular employee who provided inside information was indicted employee Reinhard Siekaczek. He reported that he managed an annual budget worth $40-50 million, which was considered to be a “bribery budget”. As reported in the New York Times article “At Siemens, Bribery Was Just a Line Item,” salepersons and managers within the company used this money- “slush fund”,  to maintain relations with corrupt government officials.

The level of cooperation in the investigation significantly reduced the cost of the settlement with the SEC. In comparison to other companies hit with scandals, Siemens responded quickly to put measures in place to detect and prevent future acts of bribery within the company. In the New York Times article “At Siemens, Bribery Was Just a Line Item,” they state Siemens was provided with additional leniency, only having to plead to accounting violations, “because pleading to bribery violations would have barred Siemens from bidding on government contracts in the United States.”

In the Ethisphere article “Prepared Remarks to Compliance Week 2010- 5th Annual Conference for Corporate Financial, Legal, Risk, Audit & Compliance Officers,” Assistant Attorney General Lanny A. Breuer states:

“In the end, the benefits Siemens received through its cooperation, even in the absence of a voluntary disclosure, were plain – the $450 million fine that was paid to the Justice Department, although quite substantial, was a far cry from the advisory range of $1.35 billion to $2.7 billion called for in the Sentencing Guidelines. Put another way, Siemens received a penalty that was 67 to 84% less than what it otherwise could have faced had it not provided extraordinary cooperation and carried out such extensive remediation.”

Ethical Recovery

An investigation was launched into the bribery scandal in 2006 and was completed in 2008. The cooperation exhibited by employees at Siemens allowed the investigation to be conducted in less time than originally predicted. Rather than replacing former executives with individuals from inside the company, Siemens filled the roles of major positions with outsiders- which was probably for the best. In 2007, Peter Solmssen was brought into to clean up the ethics and compliance disaster at Siemens.  Also in 2007, Siemens named Peter Löscher as the company’s new CEO.

Siemens has worked to improve their corporate reputation by ensuring that compliance is integrated into the furthest reaching corners of their business. Siemens hired Michael Hershman, of Transparency International, to help build a compliance and anti-corruption policy and training program. Similar to the actions taken by Ed Breen at Tyco, Löscher replaced many of the company’s top executives to start fresh. In most companies the ethics and compliance department remains fairly small, however, Siemens was determined to put their words into actions and created an ethics and compliance department consisting of 600 employees- one of the largest to date.

Since the Settlement, Siemens has divided the company into three divisions in order to clarify reporting lines and increase responsibility. In the New York Times article “Siemens’s Prosperity Doesn’t Obscure Bribery Scandal,” they discuss the reasoning behind the division:

“Mr. Löscher also put the leaders of those three sectors onto the central managing board in Munich. That puts an end to a system in which a leader of a major business, like power generating, had his own managing board and reported to Munich headquarters without being based there. Siemens officials say the old way allowed corruption to spread and inhibited accountability.”

Siemens has developed a training program, with employees at various levels receiving training in regards to issues faced based on employee role. The format and frequency of training also varies depending on level within the organization. On the Siemens corporate website, they communicate that training includes topics such as foreign laws and corruption risks. Employees are now required to sign a statement after reviewing the company’s code of conduct, in order to communicate their commitment and understanding of the code.

Here is a link to a slide deck I came across from a presentation prepared by Siemens titled “Compliance Program at Siemens,” presented at Strengthening Integrity In Private Sector Organized by UNDP, MENA-OECD. The slides contain specific information related to the ethics and compliance program currently in place at Siemens.

EEOC Releases Federal Work Force Report- EEOC

Yesterday, the EEOC released their Annual Report on the Federal Work Force for Fiscal Year (FY) 2009. According to the EEOC, the purpose of the report is to assess the current conditions of equal employment opportunity within the US federal workforce. The report looks at trends surrounding workforce composition and complaints of employment discrimination. The report for fiscal year 2009 concludes that complaints of discrimination- gender, race, religion, sex, etc., have increased. It has also been reported that the average time to conduct and investigation has increased.  The results of these findings can be used to help federal employers address issues of concern and provide guidance for implementing best in class equal employment opportunity (EEO) programs.

The values associated with workplace fraud continue to rise- especially during economic downturns. Preventing workplace fraud begins on the inside of an organization. One of the largest fraud risks companies must address is the opportunity for fraud to occur. There are a number of anti-fraud techniques and systems that are easy to implement within any organization. When fraud grows out of control within an organization, reputations and public trust are destroyed. To reduce the opportunity for fraud to occur, accounting and money handling responsibilities must be divided. Monitoring and enforcement of anti-fraud programs is necessary in order for the program to be effective and for employees to take it seriously. When employees know they are being watched, their work is being reviewed on a consistent basis and punishments are administered to those who violate anti-fraud policies, there’s less room for fraud to go undetected.

Fighting Fraud

An effective system of internal checks and balances greatly reduces and may even eliminate all opportunity for workplace fraud to occur. Here are 4 tips to help reduce the opportunity for fraud in the workplace:

1. Dividing Responsibility

Create a small team to handle the money handling and accounting responsibilities.  This makes it easier to identify any misallocated funds or errors that could lead to the discovery of a fraud scheme. Dividing responsibilities decreases the opportunity for fraud, as different employees are responsible for separate tasks, making it difficult to explain missing funds or expense forms. Make it known that all financial reports and corporate bank accounts are reviewed item by item- any expenses or charges out of the ordinary will be questioned and investigated. If employees are aware that bank statements and other documents are never reviewed, the opportunity to commit fraud is wide open.

2. Monitoring

Monitoring the anti-fraud program is one of the key success factors in reducing the opportunity for workplace fraud. Implementing anti-fraud systems to detect and deter fraud isn’t enough. Monitoring and assessing identified fraud risks must become an ongoing processes in order for employees to understand the company’s commitment to fighting fraud.  The article “The Importance of Antifraud Programs and Controls,” published by Deloitte Canada addresses the importance of monitoring anti-fraud programs:

“A final step for management and audit committees is the monitoring of the quality and effectiveness of an entity’s antifraud programs and controls. Monitoring can be done in two ways: through ongoing activities or separate evaluations. Separate evaluations can be performed by internal audit or other interested parties, such as business process owners. Monitoring activities can include timely reconciliations, confirmation of information by external parties, and periodic confirmations from personnel that they understand and comply with the company’s code of conduct.”

3. Anonymous Reporting System

A reporting system must be established in order to allow those who have observed fraud to report it. Reporting systems help reduce the opportunity for workplace fraud, as employees are less likely to commit fraudulent acts, knowing that their fellow employees are watching and are equipped with the proper resources for calling them out on their actions. Many companies receive tips related to workplace fraud through a whistleblower hotline or internal HR teams. Implement a system that provides the opportunity for anonymous reporting, as some individuals will be more apt to bring information forward if they don’t have to expose their identity. Opt for a case management software solution that can be easily integrated to work with existing hotline or reporting systems and platforms, allowing for simplified, multi-channel case entry.  A system that supports multi-channel case entry is important, as tips and reports of observed misconduct can be made via an Internet web form, company intranet and telephone hotline.

4. Effective Case Management

Effective case management reduces the opportunity for fraud within the workplace by providing managers with the ability to launch investigations into fraud-related incidents as soon as a new case is entered. i-Sight for Fraud Investigations uses automatic alerts to notify managers when a new case is entered. Reducing the time it takes to respond to cases, as well as conducting timely investigations, helps end fraudulent acts before they compromise the entire company.

i-Sight dashboards provide managers with the tools to identify common allegations or investigation types, analyze cases by geographic location or other relevant variable and spot patterns and emerging trends. Dashboards communicate complex information quickly. They translate corporate data into rich, graphical presentations using gauges, maps, charts, and other graphics to show multiple results together. Dynamic dashboards also let investigation managers drill-through to other data sources and reports for more detail about what the dashboard is communicating. This is useful for monitoring and tracking fraud related tips and investigations, as the ability to understand the frequency and location of fraudulent events within an organization allows managers to revisit these areas and make amendments to the anti-fraud program.

There’s no point investing in and implementing an ethics and compliance program unless the time is spent integrating the program into every aspect of an organization. The need for companies to develop effective ethics and compliance programs has been acknowledged by several government agencies- examples are the SEC in the US and the government in the United Kingdom. Both groups have recently passed legislation or made amendments to existing guidelines, focusing heavily on the importance of ethics and compliance at all levels of an organization- especially at the top. Employees at each level contribute to the success of a company’s ethics and compliance program. Integrating ethics and compliance at each level helps ensure the message from the top makes it all the way down to the lower levels of the organization. Training, messages and other ethics and compliance initiatives must be developed to evolve with employees as they move through the company. That being said, employees at various levels need to be prepared to address different ethical issues they may encounter based on the role they play in the organization.

Integrating Ethics at the Top

The tone of the organization is set at the top, therefore, a strong commitment and understanding of ethics and compliance must be instilled in top level executives and managers. Ethics and compliance must be built into a company’s corporate culture, as culture determines “the way things are done” within an organization. Top level executives serve as examples for fellow employees. Those at the top must frequently communicate and demonstrate to their staff  the company’s commitment to ethics and compliance, as well as ensure ethics and compliance are built into all company projects. Top level managers must adopt and act on the values and messages they communicate to be considered credible in committing to ethics.

If your company hasn’t done so already, establish the role of a Chief Ethics/Compliance Officer (CECO). This person will be responsible for maintaining and executing ethics and compliance related activities (policy development, training, policy enforcement, program monitoring) to ensure company compliance with laws and regulations. One of the areas many companies must improve on is providing the CECO with appropriate resources and authority to effectively carry out their mission. In many organizations, the ethics and compliance department is relatively small in comparison to the total number of employees at a company. With the recent economic downturn, a number of companies were forced to reassess budgets, cutting ethics and compliance spending at a time when it was needed most. Don’t create positions or policy documents for the sake of looking good in the eyes of the public- the public can tell if a company is faking it.

Integrating Ethics in the Middle

In many companies, employees report that the middle level is where ethics and compliance commitments break down. Since many of the lower level employees report directly to those in the middle, a commitment to ethics and compliance from middle managers is equally as important as it is at the top. Top level managers can use a number of techniques to assist mid-level managers in understanding the role they play in creating an ethical workplace. In the article “Ethics and the Middle Manager: Creating Tone in The Middle,” by Kirk O. Hanson, the author lists 8 ways top management can motivate middle level employees to reinforce an organization’s ethical culture:

“Top executives must themselves exhibit all the ‘tone at the top’ behaviors, including acting ethically, talking frequently about the organization’s values and ethics, and supporting the organization’s and individual employee’s adherence to the values.

Top executives must explicitly ask middle managers what dilemmas arise in implementing the ethical commitments of the organization in the work of that group

Top executives must give general guidance about how values apply to those specific dilemmas.

Top executives must explicitly delegate resolution of those dilemmas to the middle managers.

Top executives must make it clear to middle managers that their ethical performance is being watched as closely as their financial performance.

Top executives must make ethical competence and commitment of middle managers a part of their performance evaluation.

The organization must provide opportunities for middle managers to work with peers on resolving the hard cases.

Top executives must be available to the middle managers to discuss/coach/resolve the hardest cases.”

Integrating Ethics at Lower Levels

Lower level employees are usually the ones on the frontlines acting as ambassadors for a company/brand. Ensuring the commitment to ethics and compliance is as strong at the bottom as it is at the top is critical to the success of a fully integrated ethics and compliance program. One of the easiest ways to begin implementing ethics and compliance within lower levels is to provide new hires with extensive training on company expectations and ethics and compliance. During the interview process, ask questions related to ethical situations and decision making. This can be used as a way to ensure new hires are a proper fit with the existing corporate culture. It’s important to remember that ethics training and implementation doesn’t stop here- this is just the beginning.

An Ethisphere article, “If Ethics Isn’t Everywhere, It’s Nowhere,” reviews some of the tactics deployed at Jones Lang LaSalle to ensure ethics is integrated into every level of their organization:

“We begin the process by mentioning ethics in our offer letters. We continue by having new hires read and agree to our Code of Business Ethics, which has been translated into 14 languages. And employees see ethics posters displayed in lunchrooms and receive wallet-sized reminders at meetings. To further entrench our ideals in the minds of employees, our Ethics Officers attend business meetings and lead discussions with employees about ethical dilemmas. These sessions require active participation because we don’t just want a ‘talking heads’ presentation with a forgettable PowerPoint. To receive a bonus, everyone, including me, is required to re-certify to his or her commitment to the Code of Ethics. The norm, as you can well imagine, is 100% compliance. When employees leave the firm, we send them a reminder about their on-going obligations regarding confidential client and employee information they received while employed by Jones Lang LaSalle.”

It seems to be that each week is busier than the last. Here are some of the things we blogged about this week- as well as some other pieces that caught our attention regarding internal investigation, human resources and ethics:

Monday:

• Blog Post- Investigating Workplace Bullying Allegations

“For many organizations, situations involving workplace bullying remain a growing concern. Whether the situation involves peers or superiors, all matters involving physical or mental bullying must be investigated promptly, with appropriate punishment administered. Like many forms of workplace harassment or discrimination, movements are being made to hold employers responsible for protecting employees from workplace bullying. In May, the Wall Street Journal published an article that discussed the signing of a bipartisan measure in the state of New York that would allow employees who have been abused in any form within the workplace, to place charges against their employer in a civil court. Following in the footsteps of the UK Bribery Act and US FCPA, the anti-bullying legislation proposed in New York states that employers may not be held liable in a workplace bullying case if they can provide sufficient evidence that a program is in place to prevent such incidents from occurring. ”

Tuesday:

• Blog Post- Best Practices in Supplier Responsibility: IBM

“IBM is committed to developing solutions to improve the transfer of information and providing businesses with solutions to simplify their business processes. In 2004, IBM became one of the founding members of the Electronic Industry Citizenship Coalition (EICC). IBM abides by- and helped to develop, the framework established by the EICC as guidance for their supply chain social responsibility program. In one of our previous posts, “The Importance of Supply Chain Ethics and Compliance,” I wrote about the importance of an ethical supply chain. As product parts are manufactured all over the world, it’s important that companies take responsibility to ensure all members of their supply chain act in a socially responsible manner. Companies are encouraged to review and implement their ethics, compliance and social responsibility policies within companies involved in the supply chain.”

Wednesday:

• Blog Post- i-Sight Investigation Software: Simplifying Case Management

“i-Sight Investigation Software is a customizable, centralized case management solution developed to help investigators, HR personnel and other members of a company’s investigative unit effectively manage case files. The above video provides a verbal and visual overview of how i-Sight Software works and the benefits it has to offer. Here are some of the topics discussed in the short video.”

Thursday:

• Blog Post- Global Reporting Initiative

“The Global Reporting Initiative is comprised of a very large group of experts who collaborate on the development of global standards for sustainability reporting. Joining the GRI is voluntary. With transparency and sustainability emerging as growing trends in the late 1990’s, the GRI was created to provide companies with a standardized sustainability reporting framework. Dissatisfied with the level of transparency in corporate reporting, the GRI works to make sustainability reporting mandatory, as opposed to voluntary. In a previous post, “Social Responsibility Reporting Best Practices: Allstate,” I discussed the application of the GRI reporting techniques at Allstate. The economic downturn has forced businesses and their leaders to make changes to their internal controls and business processes by adopting sustainable solutions.”

Anti-Corruption Work Booms as Business Grows Overseas- Silicon Valley / San Jose Business Journal

This article by Eli Segall discusses the implications of American companies conducting business overseas where bribery and corrupt payments are frequently made to gain business. These situations have resulted in an increase in FCPA related violations and enforcement. The article goes on to talk about the growth of firms, such as Deloitte and KPMG, which offer anti-corruption compliance services. As government regulators crack down on companies found guilty of violating anti-corruption laws, organizations are taking a proactive approach by seeking out services to help them avoid making mistakes that could land them in court next.

Bribery Act in Force Next April- Telegraph.co.uk

The British Government has announced that the UK Bribery Act will be in full effect as of April 2011. Originally, the Act was supposed to be in place by October of this year. The new laws are much tougher than existing laws in the UK, maximum prison sentences have increased to 10 years and there’s no limit as to how much a company can be fined for violating the law. Once the Bribery Act is in place, companies will only have three months to ensure they have the required policies in place to comply with the new laws. The article urges companies to begin implementing new anti-corruption policies and practices immediately.

The article states:

“Speaking in the House of Commons on Tuesday, Ken Clarke, the Justice Secretary, vowed ‘effective implementation’ of the Bribery Act, which for the first time will make companies liable for the corrupt activities of associated third parties as well as their own staff.”

The Global Reporting Initiative is comprised of a very large group of experts who collaborate on the development of global standards for sustainability reporting. Joining the GRI is voluntary. With transparency and sustainability emerging as growing trends in the late 1990’s, the GRI was created to provide companies with a standardized sustainability reporting framework. Dissatisfied with the level of transparency in corporate reporting, the GRI works to make sustainability reporting mandatory, as opposed to voluntary. In a previous post, “Social Responsibility Reporting Best Practices: Allstate,” I discussed the application of the GRI reporting techniques at Allstate. The economic downturn has forced businesses and their leaders to make changes to their internal controls and business processes by adopting sustainable solutions.

The GRI provides guidance for these companies, offering best practice reporting solutions, through the implementation of the G3 Guidelines, to increase transparency and emphasize the need for sustainable business practices. Breaking the reporting process down into various components and serving as a resource of best practice reporting examples, the GRI makes sustainability reporting far less daunting.

About the Global Reporting Initiative

The vision of the GRI is the desire that the disclosure on economic, environmental, and social performance becomes as common and comparable as financial reporting, and as important to organizational success. Through the GRI Sustainability Reporting Framework, the GRI works to increase the transparency and exchange of sustainability related information. In 2009, GRI released the Amsterdam Declaration on Transparency and Reporting, which calls on the government in each country to make the disclosure of environmental, social and governance performance mandatory for companies. In the article “First GRI-Certified Training on Sustainable Reporting in Canada” Rock Lefebvre, Vice President, Research and Standards, at Certified General Accountants Association of Canada stated:

“The GRI Guidelines represent the best approach for achieving the goal of standardized sustainability reporting.”

The GRI and the G3 Guidelines have formed collaborative partnerships with the UN Environment Programme, the UN Global Compact and the Earth Charter Initiative. A number of documents and agreements from other organizations- such as the OECD and ILO, have also been referenced for the purpose of creating the G3 Guidelines.

Reporting Framework

In an overview provided by the GRI, the G3 Guidelines:

“Provide guidance for organizations to disclose their sustainability performance. It’s applicable to organizations of any size or type, and from any sector or geographic region, and has been used by thousands of organizations worldwide as the basis for their sustainability reporting. It facilitates transparency and accountability by organizations and provides stakeholders a universally-applicable, comparable framework from which to understand disclosed information. The Framework is continuously improved and expanded as knowledge of sustainability issues evolves and the needs of report makers and users change.”

The reporting framework provides guidance on setting report boundaries, defining report quality and report content. When following the G3 Guidelines, companies must also include a company profile, sustainability strategy, management approach and key performance indicators for measuring sustainability initiatives.  The GRI is continually involved in projects identifying and influencing the future trends related to sustainability.  These projects help the GRI remain on top of current issues and make updates to the guidelines. Updates are made to the reporting framework by category, instead of overhauling all guidelines at the same time. Guideline updates are shaped by stakeholder input and the outcomes of the projects GRI is involved with.

Important Documents

The GRI publishes reports related to the progress made in sustainability reporting, government commitment to sustainability, as well as the achievements and progress made at GRI. Each year, the GRI publishes their own sustainability reports and last year, published their first Year in Review report, documenting the organization’s progress towards established goals. A series of “Learning Publications” have been developed to assist business leaders integrate sustainability into their workplaces, beginning with basic concepts in reporting, understanding the value of sustainability reporting and innovative reporting examples.

Companies following the G3 reporting framework are invited to submit their reports to the GRI. In doing so, company names are added to a public list that’s made available on the GRI website. GRI has prepared a number of tools to provide report makers with assistance, as preparing a sustainability report for the first time can be overwhelming. Templates, software, training and sample reports are just a few of the solutions GRI has to offer to those responsible for publishing a company’s sustainability report.