We know how busy organisations are preparing for the incoming Australian Sustainability Reporting Standards (ASRS) and we are working with our clients every day to get ready for a new era of mandatory reporting. Nevertheless, the recent release of new draft 'Climate Change' and 'Energy' Standards by the Global Reporting Initiative (GRI) underscores the significance of ongoing adherence to GRI guidelines. These disclosures play a crucial role in positioning organisations to navigate forthcoming and increasingly extensive requirements.
The new proposed standards aim to provide a comprehensive global standard for reporting on climate change and its impacts on people and nature. The GRI is seeking consultation on the new drafts until 29 February 2024. You are encouraged to provide feedback through the online 'Climate Change' and 'Energy' exposure drafts survey.
Today we delve into the significance of these new drafts, the rationale behind them, and how GRI maps against other global reporting frameworks including ASRS.
Key changes and features
The revised GRI 'Climate Change' and 'Energy' Standards introduce several key changes designed to improve reporting practices to enable transparent and credible sustainability disclosures. Given ongoing scrutiny around organisations’ targets and commitments, the exposure drafts explicitly asks organisations to explain how their actions relate to the Paris Agreement’s central aim of limiting global temperature rise to 1.5oC.
The GRI 'Climate Change Exposure Draft' includes:
- climate change transition and adaption plans and actions
- annual progress on greenhouse gas (GHG) emissions reduction targets
- transparency around GHG removals and carbon credits
- social aspect of climate change, emphasising the need for a just transition.
The exposure drafts also consider the interrelations between climate change and biodiversity. Climate change and biodiversity are connected, as climate change is a major driver of biodiversity loss, which, in turn can accelerate climate change. Biodiversity is referenced in several requirements throughout different GRI disclosures.
The GRI exposure draft for a revised 'Energy Standard' includes a new disclosure on:
- energy policies and commitments.
The new 'Energy' Standard delves into organisations' efforts to reduce energy consumption, enhance energy efficiency, and embrace renewable energy sources. With a focus on transparency and goal setting, the standard encourages reporting on significant energy consumption within the value chain and the role of energy policy in facilitating the transition to a decarbonised economy.
Driving alignment: the relationship between GRI and IFRS
With over 14,000 organisations worldwide using GRI Standards, the impact of these revisions extends across major markets and industries.
GRI and the International Financial Reporting Standards (IFRS) Foundation have jointly published an analysis and mapping document illustrating the areas of interoperability between 'GRI 305: Emissions 2016' and 'IFRS S2 climate-related disclosures' that an entity should consider when measuring and disclosing scope 1, scope 2 and scope 3 GHG emissions.
To understand how GRI maps against other sustainability disclosures, see the table below we've developed.
As experienced practitioners, take the opportunity to share your insights by 29 February 2024
GRI's new 'Climate Change' and 'Energy' Standards represent a pivotal step towards comprehensive sustainability standards that encompass climate, nature, and a just transition. By adopting these standards, organisations can meet evolving stakeholder expectations, enable positive environmental and social impacts, and prepare for future iterations of mandatory sustainability disclosures.
GRI also offers sector specific standards for oil and gas, coal, agriculture, aquaculture and fishing, mining, financial services and textiles and apparel.
How GRI maps against other sustainability disclosures[1]
Legend
X - GRI element matches standard/ framework requirement
O - GRI element partly matches
|
GRI’S Climate Change exposure draft |
Other standards and frameworks |
||||||
|
Disclosures |
Requirement elements |
CDP |
European Sustainability Reporting Standards (ESRS) |
International Financial Reporting Standards S2 (IFRS) |
Taskforce for Climate related Financial Disclosures (TCFD) |
US Securities and Exchange Commission (SEC) |
DRAFT Australian Sustainability Reporting Standards (ASRS) |
|
CC-1 Transition plan for climate change mitigation |
Transition plan |
X |
X |
X |
X |
X |
X |
|
Alignment with 1.5 C efforts, as per the Paris Agreement |
X |
X |
|
|
|
|
|
|
Investment in transition plan |
X |
X |
X |
X |
X |
|
|
|
Governance of transition plan |
X |
X |
X |
X |
X |
O |
|
|
Embedding of transition plan in business strategy |
X |
X |
X |
X |
X |
X |
|
|
Targets to achieve the transition plan |
X |
X |
X |
X |
X |
X |
|
|
Targets to phase out fossil fuels |
X |
|
|
|
|
|
|
|
Progress towards the targets |
X |
X |
X |
X |
X |
X |
|
|
Stakeholder engagement informing transition plan |
X |
X |
|
|
|
|
|
|
Impacts from transition plan on people and environment |
|
X |
|
|
|
|
|
|
Lobbying consistent with transition plan |
X |
X |
|
|
|
|
|
|
CC-2 Climate change adaptation |
Impacts associated with climate change-related risks and opportunities |
|
X |
|
|
|
X |
|
Adaptation plan |
|
X |
X |
X |
X |
X |
|
|
Climate change related scenarios |
X |
X |
X |
X |
X |
X |
|
|
Investment in adaptation plan |
X |
X |
X |
X |
X |
X |
|
|
Governance of adaptation plan |
|
X |
X |
X |
X |
O |
|
|
Targets to achieve adaptation plan |
|
X |
X |
X |
X |
O |
|
|
Stakeholder engagement informing adaptation plan |
|
X |
|
|
|
|
|
|
Impacts from adaptation plan on people and environment |
|
|
|
|
|
|
|
|
CC-3 Just transition |
# jobs created/eliminated/redeployed due to transition plan |
|
|
|
|
|
|
|
# employees trained for up and reskilling due to transition plan |
|
|
|
|
|
|
|
|
Locations with impacts on communities dur to transition plan |
|
X |
|
|
|
|
|
|
% locations with agreements with communities |
|
|
|
|
|
|
|
|
CC-4 GHG emission reduction target setting and progress |
Scope 1, 2, 3 GHG emissions reduction targets
|
X |
X |
X |
X |
X |
X |
|
Alignment with 1.5 C efforts, as per the Paris Agreement |
X |
X |
|
|
|
|
|
|
Base year |
X |
X |
X |
X |
X |
X |
|
|
Progress toward targets |
X |
X |
X |
X |
X |
X |
|
|
GH-1, GH-2, GH-3 Scope 1, 2, 3 GHG emissions |
Scope 1, 2, 3 GHG emissions |
X |
X |
X |
X |
X |
X |
|
Biogenic CO2 |
X |
X |
|
|
|
|
|
|
Breakdown by GHGs for Scope 1 |
X |
X |
|
|
X |
X |
|
|
Breakdown by GHGs for Scope 2 |
|
X |
|
|
X |
X |
|
|
Breakdown by 15 Scope 3 categories |
X |
X |
X |
|
|
X |
|
|
GH-4 GHG emissions intensity |
GHG emissions intensity ratios(s) |
X |
X |
|
|
X |
|
|
CC-5 GHG removals in the value chain |
Total GHG removals |
|
X |
|
|
|
|
|
Breakdowns by scope 1 and scope 3 and by storage pool |
|
X |
|
|
|
|
|
|
Quality criteria to manage the risk of non-permanence |
|
X |
|
|
|
|
|
|
Intended use of GHG removals |
X |
X |
|
|
|
X |
|
|
Impacts of removals on people and environment |
|
|
|
|
|
|
|
|
CC-6 Carbon credits |
Total carbon credits cancelled in reporting period |
X |
X |
|
|
X |
|
|
Identification of carbon credits |
|
|
|
|
X |
X |
|
|
Type of carbon credits |
X |
X |
|
|
X |
X |
|
|
Quality criteria for carbon credit projects |
X |
X |
|
|
|
O |
|
|
Purpose of cancellation of carbon credits |
X |
X |
|
|
X |
|
|
|
Monitoring impacts of carbon credit projects on people and planet |
|
|
|
|
|
|
|
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