It is my great pleasure to be visiting South Korea as part of my first tour of the Asia Pacific region as the Chief Executive of Global Reporting Standards (GRI). I am visiting the region in my first months on the job because Asia is our fastest growing market for sustainability disclosures. The number of GRI reports from Asia has doubled in the last five years. During this trip I have visited four countries and spent much of my time listening to the needs of companies, investors, stock exchanges and regulators. Clearly, all of these groups have strong interest in sustainability reporting.

GRI is the developer of the world’s most widely used standards for sustainability reporting. We work to empower companies to create transparency around their impacts on some of the world’s most pressing challenges, like climate change, poverty, and pollution. We help businesses use the GRI Sustainability Reporting Standards (GRI Standards) to measure, manage and communicate their most important sustainability impacts and opportunities, in ways that are accessible to various stakeholders. This includes investors, customers, employees, and people living in the communities where the business operates.
One of my main responsibilities at GRI is explaining to company leaders around the world why their businesses should report their sustainability results. While preparing to come here, I have been thinking specifically about why Korean companies should report. I spent a bit of time learning about the economy, in particular the remarkable way in which the Korean people lifted themselves out of poverty and became an economic force in the developed world. In just a few decades, through hard work and ingenuity, Korea has flourished, despite the fact that the region is not particularly rich in natural resources. Like other developed nations, sustainability has become a major issue in Korea and transparency is a fundamental element of sustainability.

The benefits of GRI reporting

Sustainability reporting, using the GRI Standards, creates many benefits for organizations and their stakeholders. For the business, sustainability reporting identifies risks and opportunities. Issues like the potential impact of climate change or labor concerns in the supply chain could become threats to a business. Sustainability reporting helps companies, investors and stakeholders stay informed and keeps them ahead of these emerging issues. And as investors and stock exchanges get more engaged in sustainability issues, businesses can gain better access to financial capital.
Reporting also helps businesses engage with their stakeholders, thus building better relationships and trust over time. This protects and also enhances corporate reputations, an intangible asset that for many businesses is worth millions. And finally, it’s important that businesses recognize that sustainability reporting helps to demonstrate to their customers, investors and employees that they are serious about social and environmental responsibility. In essence, it demonstrates the commitment of the company to the communities that support its business. While this may not seem important to every business, having worked for many years in the tech industry (Intel, Apple and AMD), I have firsthand experience that investments in sustainability provide a company with a moral “license to operate.” Companies that gain a reputation for profits over purpose will ultimately pay higher costs, as the public that supports them will turn away. In addition, as all companies are in a war for top talent, investing in sustainability can give you an edge. The talented young people in today’s job market want to work for more than just a paycheck; they want to leave a legacy of good.

Reporting empowers companies to contribute to sustainable development

Sustainability reporting can help you create benefits for your business, but even more important, it helps to make the world a better place. This may sound idealistic, but it is absolutely true. Some corporations have revenues that exceed the GDP of some countries and have supply chains that stretch around the world. Companies play an essential role in managing our planet’s resources and create economic growth, which has lifted millions of people out of poverty. Wise companies view sustainability issues such as increased population, scarce resources, and climate change as potential opportunities. By developing efficient products and services companies can help solve sustainability issues and make a profit in the process. Sustainability reporting is a first step on the road towards finding solutions. The old saying “What gets measured gets managed” is absolutely true. Only after we understand how we are spending our resources, can we develop solutions to help preserve them.

The evolution of sustainability reporting

Every business leader in Korea should keep in mind that reporting is a means to an end. The goal we seek is sustainable development: a decoupling of economic growth from environmental and societal degradation. At GRI, we are currently aware of more than 230 South Korean organizations that have issued a sustainability report. That figure more than doubled in the past 5 years. This is great progress, but there are still thousands of Korean companies that are not reporting their sustainability impact. If we are serious about preserving this planet for future generations, this must change.

In order to stimulate more disclosure of sustainability impacts, especially among small and medium-sized enterprises (SMEs), the practice of sustainability reporting must continue to evolve. Too many companies see the reporting process as burdensome and fail to recognize the many benefits they can gain by investing in sustainability. GRI is committed to helping even more companies reap the benefits of reporting and advancing our goal of achieving sustainable development. To this end, GRI is developing a special application of GRI Standards for SMEs. We plan to make this tool available around the globe once we have finished the pilot phase in select countries including Indonesia and Vietnam. Also, GRI is working in conjunction with the UN Global Compact to facilitate and establish tools for companies to report on their contributions in achieving the UN Sustainable Development Goals (SDGs). We would welcome leading Korean companies to join the Reporting on the SDGs Action Platform to help shape this important work.

No issue is more important than the sustainability of our world. Without sustainability, business cannot function. And without business, we cannot achieve sustainability. I am very optimistic that Korean companies will help lead the way in sustainable business practices for the world to follow.

Tim Mohin is the chief executive of GRI.

Originally posted on the Korean Times