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The global reporting initiative G3 sustainability reporting guidelines

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INSIDE
Perspectives . . . . . . . . . . . . . . . . 3
Out of Africa: Firms Address Climate Change
Corporate Reporting . . . . . . . . . 5
Investors Achieve Major Company Climate
Change Commitments
Denmark Mandates CSR Reporting
Corporate Initiatives . . . . . . . . . 6
EPA Responds to Ruling
Social Innovation Awards
ECO:nomics Redux
Uranium Reserves Too Low to Solve
Energy Shortage
Product Stewardship and
Takeback . . . . . . . . . . . . . . . . . . . 9
Many TV Manufacturers Don’t Recycle
Enough
Coke Recycles PETs
ISO 14000 Update . . . . . . . . . . . 11
The Global Reporting Initiative G3
Sustainability Reporting Guidelines
(Conclusion)
Climate Change Update . . . . . . 15
Canada’s Forests Change From Sink
to Source
Intense Downpours More Common
Peridotite Can Soak Up Carbon Dioxide
February 2009 • Vol. XX, No. 2
Focus Report
Wind Energy’s Promise and
Bottlenecks, Part 1
A
s fossil fuel prices rise, oil insecurity deepens,
and climate change threatens, wind power
is booming in the United States. Texas is
now the leading US state for wind power. It has
nearly 6,000 megawatts (MW) of wind-generating
capacity online, and boasts another 39,000 MW under
construction or planned. This will supply more than
the residential needs of the state’s 24 million people.
Texas will be able to feed electricity to nearby
Louisiana and other US states.
Iowa, Minnesota, Washington, and Colorado
are also emerging as wind superpowers. Clipper
Windpower and BP are teaming up to build the
5,050-MW Titan wind farm, the world’s largest, in
eastern South Dakota. It will generate five times the
electricity the state’s residents currently use. A new
transmission line across Iowa will feed electricity into
Illinois and the country’s industrial heartland.
Colorado billionaire Philip Anschutz is developing
a 2,000-MW wind farm in south central Wyoming.
He has secured the rights to build a 900-mile high-
voltage transmission line to California. This opens
the door for scores of huge wind farms in sparsely
settled Wyoming. Another transmission line will
go south to link eastern Wyoming’s wind resources
to Denver and other fast-growing Colorado cities.
Wind-rich Kansas and Oklahoma hope to build a
transmission line to the US southeast, so that they can
export their wealth of cheap wind energy.
 California is developing a 4,500-MW wind Shifting to renewables increases energy
farm complex in the Tehachapi Mountains security because no one can cut off the
northwest of Los Angeles. Soon, Oregon supply of wind (or solar or geothermal)
will nearly double its wind generating energy. Prices are stable; once a wind farm is
capacity with a 900-MW wind farm in the built, there is no fuel cost. Renewable energy
Columbia River Gorge. On the opposite cuts carbon emissions deeply, helping to
coast, Maine is planning 3,000 MW of wind- avoid the most dangerous effects of climate
generating capacity, far more than the state’s change. Renewables will also staunch the
1.3 million residents need. Further south, outflow of dollars for oil, keeping that capital
Delaware is planning an offshore wind farm at home, and creating thousands of new
of up to 600 MW to satisfy one-half of its domestic jobs. Renewable power industries
residential electricity needs. New York State, not only hire workers, but also create jobs
with 700 MW of wind-generating capacity, in construction and basic supply industries,
plans to add an additional 8,000 MW. Most such as steel, aluminum, and silicon
will be generated by winds coming off Lake manufacturing. To build and operate the new
Erie and Lake Ontario. energy economy will require huge numbers
of electricians, plumbers, and roofers, as
Wind is poised to become the centerpiece well as wind meteorologists, geothermal
of the new US energy economy, eventually geologists, and solar engineers.
supplying perhaps one-third of the country’s
electricity. America’s new energy economy To ensure that this shift to renewables
will be powered largely by electricity from continues at a rapid rate, national leadership is
renewable sources. Electricity will light, needed to build a strong national grid. Private
heat, and cool buildings. As Americans investors are building long-distance high-
shift to plug-in hybrid cars, light rail transit voltage transmission lines, but these need
systems in cities, and high-speed electric to be incorporated into a carefully planned
intercity rail systems like those in Japan and national grid, the electrical equivalent of US
Europe, the transport system will also be President Eisenhower’s interstate highway
powered largely by electricity. system. Next month, we’ll take a quick
Group Publisher: Paul Gibson Editor: Martha Hyder
Designer: Don Torres Managing Editor: Vicki Dean
Contributing Editors: Gabriele Crognale, Jane Heinze-Fry, Gene Fry, and Connie Steinhaus
Editorial offices: Editor Martha Hyder can be contacted at martha.hyder@windriverenvironmental.com.
© 2009 Aspen Publishers. All Rights Reserved.
Business and the Environment (ISSN 1089-0866) is published monthly by Aspen Publishers, 76 Ninth Avenue, New York, NY 10011. One-year subscription costs
$679. To subscribe, call 1-800-638-8437. For customer service, call 1-800-234-1660. Address editorial comments to Business and the Environment at vicki.dean@
wolterskluwer.com. POSTMASTER: Send address changes to Business and the Environment, Aspen Publishers, 7201 McKinney Circle, Frederick, MD 21704.
Printed in the U.S.A. This material may not be used, published, broadcast, rewritten, copied, redistributed or used to create any derivative works without prior written
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Permission requests: For information on how to obtain permission to reproduce content, please go to the Aspen Publishers website at www.aspenpublishers.com/
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the services of a competent professional person should be sought. —From a Declaration of Principles jointly adopted by a Committee of the American Bar
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2

look at two bottlenecks that threaten wind’s
potential: Transmission line issues and
limited manufacturing capacity.
Perspectives
Out of Africa: Firms Address Climate Change
B
usiness people recently gathered
in Dakar from across Africa, and
around the world, to attend the first
Africa Carbon Forum. They represented
governments, investors, and projects that
help the environment, while making good
business sense. Potential environmental
entrepreneurs had the chance to network
with those who know how to make their
projects profitable.
Carbon emissions have been identified
as a major factor in climate change. The
Kyoto Protocol established a mechanism
by which projects that help reduce carbon
emissions by using cleaner, renewable inputs
are compensated financially with so-called
carbon credits. Companies with high
carbon emissions have the option of buying
the carbon credits from the clean projects,
thus purchasing the “avoided” pollution,
rather than reducing emissions themselves.
Evan Ard from Evolution Markets
(London, United Kingdom) says this clean
development mechanism (CDM) has grown
into a US $70 billion market. With clients
making specific demands to diversify and
buy African credits, he sees the continent’s
potential as “huge.” Although slow to grow,
African businesses and governments are
beginning to see the advantage of investing
in carbon saving projects.
FEBRUARY 2009
For more information, see www.earthpolicy.
org/Updates/2008/Update77.htm. ■
The United Nations Development
Programme (UNDP) is playing a role in
helping African countries and businesses
gain better access to carbon markets, with
a view toward development, says program
manager Robert Kelly. Kelly says projects
financed partially through carbon credits
are intrinsically good for the environment,
but also provide many other advantages
for developing countries. “By establishing
carbon projects in Africa and selling the
carbon credits on the international market,
project developers can clearly make hard
currency revenue, but there are all sorts
of other benefits for … the host country,
in the form of clean technology transfer,
rehabilitation of degraded land, biodiversity
in the context of forestry, clean reliable
energy in the form of renewable energy
projects,” he said (see www.voanews.com/
english/2008-09-04-voa43.cfm).
Climate change is expected to hit Africa
hard. With a high poverty level and nearly
three-quarters of the population reliant
on agriculture, this is the continent least
able to adapt to severe weather changes
triggered by global warming. Nonetheless,
according to Reuters (14 August 2008),
big developing countries like China, India,
and Brazil have won far more funds than
Africa from rich nations cutting greenhouse
3
gas (GHG) emissions by investing in wind
farms, hydropower projects, or in cleaning
up industrial emissions. Just 2.4% of more
than 1,100 projects for cutting GHGs in
developing nations under CDM are in Africa.
In September 2008, a new World Bank
report was released at the Africa Carbon
Forum. Low-carbon Energy Projects
for Development in Sub-Saharan Africa:
Unveiling the Potential, Addressing
the Barriers reports that sub-Saharan
Africa currently enjoys only a 1.4%
share of the 3,900 CDM projects in the
pipeline. According to GLOBE-Net,
that’s nine times smaller than its global
share of GHG emissions. The report
inventories the potential of clean energy
projects in sub-Saharan Africa that could
receive support from CDM/Carbon Finance
products, and possibly the new Climate
Investment Funds, and thus contribute to
supply-demand energy balance in a cost-
effective manner. It is the first inventory
of opportunities for clean energy projects
across various sectors (covering supply
side, demand side, energy efficiency, and
renewable energy measures) in the region.
Win-win solutions are being proposed.
Investors are promised carbon credits in
return for social and economic infrastructure
improvements in the developing countries.
“Nigeria is proposing a solar-powered
university; Ivory Coast wants to turn
crop waste into fuel; Senegal is offering a
4
wind farm; all these “carrots” that could
be translated into carbon credits for the
pollution-heavy industries in the West.”
However, the playing field is complex.
And part of the landscape is a “Green
Gold Rush.” In Tanzania, the government
granted the British firm Sun Biofuels the
use of sparsely populated farmland for a
period of 99 years free of charge in return
for investments of about $20 million to
build roads and schools. Prokon, a German
company known chiefly for its wind turbines,
also expects to have Tanzanian land under
cultivation soon.
“Carbon trading gives growing African
economies an opportunity to avoid the
mistakes of the West and meet increasing
demands for energy in a way that
doesn’t contribute to climate change,”
argues Yvo de Boer, executive secretary
of the UN Framework Convention on
Climate Change. “Although Africa
is tiny in terms of its contributing to
the problem, it can potentially make
a huge contribution to the solution.”
(See www.globe-net.com/news/index.
cfm?type=1&newsID=3725.)
Executive summary of World Bank report
available at http://carbonfinance.org/docs/
FINAL_ENGLISH_Executive_Summary_
with_New_Table_1_for_Printing,_CDM_
Report,_n._adams,_8-18-08.pdf. ■

Corporate Reporting
Investors Achieve Major Company Climate Change
Commitments
I
nvestors that manage more than US
$300 billion in assets filed a record
57 climate-related shareholder resolutions
with US companies during the 2008 proxy
season. Nearly one-half were withdrawn after
the companies agreed to positive climate-
related commitments. Remaining resolutions
received record high average voting support
of 23.5%, including 39.6% support for a
resolution filed with coal company CONSOL
Energy, the highest vote ever on a climate
change shareholder resolution.
A total of 26 resolutions asked companies
to provide a sustainability report to investors
that would include information about how the
company is managing climate risk. A record
80% of these resolutions were withdrawn
after the companies agreed to issue a
sustainability report to shareholders.
Shareholders also filed first-ever
resolutions with oil companies on the
far-reaching environmental impacts from
Canada’s tar-sands oil extraction project.
Resolutions with ConocoPhillips and
Chevron received strong support of 27.5%
and 28.6%, respectively.
Five coal-heavy electric power companies
(Allegheny Energy, Alliant Energy, Dominion
Resources, FirstEnergy, and Southern
Company) agreed to report on their strategies to
FEBRUARY 2009
significantly boost energy efficiency as a way
to reduce greenhouse gas (GHG) emissions.
Partly as a result of shareholder
resolutions, Ford plans to cut GHGs from
its vehicles by 30%. Two major US
homebuilders, Centex and KB Home, also
announced commitments to increase the
energy efficiency of the homes they build
beginning in 2009.
“Growing investor pressure is prompting
more companies to see the value of making
environmentally sound products,” said
Mindy Lubber, president of Ceres, a leading
coalition of investors and environmental
groups that helped coordinate the shareholder
filings. Lubber added, “By re-thinking
their strategies with high energy prices and
climate change in mind, these companies
will have a distinct competitive advantage in
the years ahead.” Leslie Lowe, director of
the Energy and Environment Program at the
Interfaith Center on Corporate Responsibility
(ICCR; www.iccr.org), said, “Companies in
all sectors need to get ready now to prosper
in a world of higher energy costs and carbon
constraints. The crisis in the auto industry
has shown how quickly business models can
become obsolete.” ■
CONTACT: Peyton Fleming, Ceres. Tel: +1
617 247 0700; E-mail: fleming@ceres.org.
5
Denmark Mandates CSR
Reporting
I n December 2008, the Danish Parliament
voted to require its largest 1,100 enterprises,
including private and state-owned companies
and institutional investors, to include corporate
social responsibility (CSR) information in
annual financial reports, beginning in 2010.
Organizations are expected to describe
their corporate CSR or socially responsible
investment policies, discuss how they’ve been
implemented, and highlight the results they’ve
produced. To incentivize companies to join the
United Nations (UN) Global Compact or UN
Principles for Responsible Investment, affected
organizations may refer to their Communication
on Progress in the annual reports, rather than
reporting under the new rules.
“In the current financial crisis, it is
more urgent than ever to promote greater
transparency, especially in the field of
environmental, social and governance
performance,” said Donald MacDonald,
Corporate Initiatives
EPA Responds to Ruling
I
n November 2008, a US Environmental
Protection Agency (EPA) Environmental
Appeals Board (EAB) decision rejected a
federal permit for Deseret Power’s Utah coal
plant at Bonanza, Utah (USA) (see BATE,
December 2008). The panel said that EPA’s
Denver office failed to adequately support its
decision to issue the permit without requiring best
available control technology (BACT) to control
emissions of carbon dioxide (CO2). It remanded
6
chair of the UN Principles for Responsible
Investments. “For investors, corporate
responsibility and the proper management of
extra financial risks is essential.”
The proposal hopes to encourage Danish
companies to actively work on social
responsibility. Gaining a reputation as a
socially responsible business community will
enable Danish companies to become more
competitive globally, according to the proposal.
Denmark is not the first country in Europe
to require CSR reporting. For example,
French companies have had to include
information about social and environmental
factors in their annual reports since 2001,
while companies in the United Kingdom
have had similar reporting requirements since
late 2007.
For more information, see www.greenbiz.
com/news/2009/01/08/mandatory-csr-
reporting-denmarks-largest-companies. ■
the case to the Denver office to “reconsider
whether or not to impose a … limit [on CO2].”
At the time, David Bookbinder, a Sierra
Club lawyer, said the decision “[Is] going
to stop everything while EPA mulls over
what to do next” about controlling CO2.
EPA apparently agreed, and the agency
made sure it didn’t mull over what to do
for very long.

On 18 December 2008, EPA’s
Administrator, Stephen Johnson, issued a
“definitive interpretation” of regulations that
determine pollutants covered by the federal
prevention of significant deterioration (PSD)
permit program. PSD permits are required
for the construction or modification of large
air pollutant sources of all types in areas
with clean air. Approximately 275 sources
obtain PSD permits each year. The process
of applying for and receiving a PSD permit
generally takes at least one year.
The “definitive interpretation” revolves
around the meaning of the phrase “regulated
NSR [new source review] pollutant.” The
PSD regulations define regulated NSR
pollutants to include “Any pollutant that
otherwise is subject to regulation under the
[US Clean Air] Act,” and require BACT for
“each regulated NSR pollutant” emitted in
significant amounts. As of 18 December,
EPA interprets this definition to exclude
pollutants for which EPA regulations require
only monitoring and reporting, but to include
each pollutant subject to a provision under the
Clean Air Act [CAA] or a regulation adopted
by EPA under the CAA that requires the
actual control of emissions of that pollutant.
And that means that, under current
regulations, CO2 is not a pollutant subject
to the PSD program. Certain power plants
are currently required by CAA regulations to
monitor and report CO2 emissions, but those
requirements impose no actual controls on
CO2 emissions.
Environmentalists and lawyers for industry
groups said that the November 2008 EAB
ruling would stymie permits for about
FEBRUARY 2009
100 coal-fired power plants. However, EPA
noted that the potential impact of the ruling
went far beyond coal-fired power plants. The
time-consuming and laborious PSD permit
process is only required for installations
that qualify as new and modified “major
stationary sources” based on their potential
to emit regulated pollutants (smaller sources
are regulated under state “minor source”
permitting programs, instead of PSD). The
term “regulated NSR pollutant” is also found
in the definition of “major stationary source.”
As a result, EPA said that many hundreds of
thousands of smaller sources might be required
to obtain PSD permits before they could build
or modify if CO2 was considered a “regulated
NSR pollutant,” including those in source
categories that have never had to obtain PSD
permits in the past. As a common by-product
of combustion, CO2 is emitted by many fuel
burning sources in much larger amounts
than pollutants that are subject to emission
control under the CAA, such as sulfur
dioxide or particulate matter. According to
the agency, interpreting the phrase “regulated
NSR pollutant” to include CO2 threatened to
bring industrial development to a screeching
halt in the United States, something EPA
wanted to avoid.
For a copy of the EPA interpretive memo,
see www.epa.gov/nsr/documents/psd_
interpretive_memo_12.18.08.pdf. ■
Social Innovation Awards
T he first ever Social Innovation Awards will
be given out on 2 March 2009 during the
Financial Times (FT) Sustainable Business,
Responsible Investing Conference in New York
City (New York, USA). The event is being
7
held in conjunction with the Social Investment
Forum, an association devoted to the
advancement of socially and environmentally
responsible investing, and JustMeans, a social
media Web site that encourages healthy debate
on social and environmental considerations that
benefit the global population.
Over the past five years, corporate
social responsibility (CSR) and investing
initiatives have grown in prominence at
a number of major global corporations.
Concurrently, investors are increasingly
recognizing that environmental, social,
and corporate governance factors that
are addressed in CSR programs can have
a positive impact on performance. This
conference will take a closer look at how
CSR influences investment decisions,
and how leading-edge companies
implementing such initiatives show a clear
connection to shareholder value.
The awards will recognize companies and
individuals for their progressive thinking in
melding social and environmental innovation
into their core strategy. Awards will be given
to one company in each of three categories:
large (revenue > US $500 million); small
to medium (revenue $5–$500 million); and
start-up (revenue $500,000–$5 million).
For additional information, and to register,
see www.socialinnovationawards.com. ■
ECO:nomics Redux
O n 4–6 March 2009, the editors of the
Wall Street Journal are hosting an
encore presentation of the world’s leading
CEOs, policymakers, and key decision
8
makers sharing their views at ECO:nomics,
in Santa Barbara, California (USA).
Changes in the global economy have had
profound effects on the financial, oil,
and renewable-energy markets and, with
the changes in direction promised by the
incoming Obama Administration, myriad
challenges are facing business leaders as
they try to navigate uncharted financial
and environmental territories. What can
decision makers do in such tumultuous
times to leverage their position?
Enter ECO:nomics, a forum that brings
together the brightest minds in business and
policy-making to assess the most pressing
risks and identify emerging opportunities
in the fluid realm of environmental capital.
The conference will highlight the impacts of
environmental issues on CEOs and how to
assess real strategic opportunities and risks
resulting from such issues. Participants will
get the inside “scoop” from experts on key
topics, from the future of fossil fuels to new
green technologies to what’s in store with
carbon trading.
Participants will learn from the insight of
other leaders who are forging the bottom line
on business and the environment. To request
an invitation, see www.economics.wsj.com. ■
Uranium Reserves Too
Low to Solve Energy
Shortage
A ccording to a background paper by
the EnergyWatch Group (available
at www.energywatchgroup.org/fileadmin/
global/pdf/EWG_Report_Uranium_3-12-
2006ms.pdf), uranium supplies will become

scarce over the next 25 years, even as new
reactor capacity grows slowly. Neither
breeder reactors, nor thorium reactors, will
play a significant role during that period,
due to long lead times.
According to the study, discovered
reserves of uranium are not enough to
guarantee uranium supplies for more than
30 years. A total of 11 countries have
already exhausted their uranium reserves.
Only Canada still has uranium deposits
with ore grades above 1%. Two-thirds of
reserves in other countries have ore grades
below 0.06%. Below concentrations of
0.01%–0.02%, the energy needed for
uranium processing increases substantially.
Proved reserves (below US $40 extraction
cost per kilogram of uranium) and stocks
Product Stewardship and Takeback
Many TV Manufacturers Don’t Recycle Enough
T
he Electronics TakeBack Coalition
(ETBC) released its TV Recycling
Report Card in November 2008,
available at www.TakeBackmyTV.com. The
report graded major TV manufacturers on
their efforts to establish national programs
to take back and recycle their old TVs.
Over 50% of the 17 companies got an F,
because they have no recycling program
in place. Sony got the highest grade, a B
minus. Other companies scored C’s and
D’s. “We hope that consumers who are
shopping for a new TV … will take the
manufacturers’ environmental record into
account when they decide what to buy,”
said Barbara Kyle, National Coordinator
of the ETBC.
FEBRUARY 2009
will be exhausted within the next 30 years
by current annual demand. Possible
resources (extraction costs of up to $130 per
kilogram) will be exhausted within 70 years.
Currently, mining supplies only 42 kilotons
per year of the 67 kilotons of uranium used
per year worldwide. The rest is drawn from
stockpiles accumulated before 1980. Thus,
uranium production capacity must increase
by at least 50% to supply current reactors. In
sum, supply problems are likely by 2020. If
all possible resources can be converted into
production volumes, the shortage can be
delayed until 2050.
For more, see www.heatisonline.org/
contentserver/objecthandlers/index.
cfm?id=7153&method=full. ■
“While we are encouraged that some TV
manufacturers now have national programs
to take back their old products, none of these
programs have enough locations to allow
for easy and convenient TV recycling for
most consumers,” said Kyle. “We want to
see a lot more collection sites and a lot more
transparency about what the recyclers are
doing with these products.”
Grades were based on the scope of the
recycling program, the commitment to
responsible recycling, the volume and
visibility of their program, and the level of
support for public policy that encourages
responsible recycling. Criteria addressed
the transparency of the programs, public
9
disclosure about vendors used, the ultimate
destinations of toxic materials in the
products, and clear commitments not to allow
exports of toxic materials to poor countries.
With the switchover to digital TV in the
United States in February 2009, ETBC
estimates that 100 million old TVs, with
4–8 pounds of toxic metals each, could end
up in landfills in the near future, or be sent to
poor countries overseas.
Coke Recycles PETs
T he New United Resource Recovery
Corporation, LLC recycling plant in
Spartanburg (South Carolina, USA) is set
for its grand opening on 1 February 2009,
and expects no objections from animal rights
organizations. The type of PET to be recycled
at the plant, a joint venture of United Resource
Recovery Corporation, LLC (URRC) and
the Coca-Cola Company, is polyethylene
terephthalate, the plastic used to make
beverage bottles. While the plant is not the
first recycling facility to be developed jointly
by URRC and Coca-Cola, it is expected to
be the world’s largest producer of food-grade
resins from recycled materials when it reaches
full capacity. The facility will open at an
annual production rate of 56 million pounds of
food-grade PET, and is expected to reach its
full capacity of 100 million pounds per year by
early 2010. Coca-Cola is expected to purchase
50% to 60% of the recycled PET.
Raw materials will be purchased on the
open market, with 98% coming from curbside
recycling programs, albeit much of it (from
Coca-Cola Enterprises and RecycleBank) will
have ties to the Coca-Cola Company. The plant
10
will also employ a number of technologies
aimed at reducing waste and greenhouse gas
production. According to URRC Vice President
Gerry Fishbeck, a “dry roasting” system to rid
the chips of contaminants will eliminate the
need for pre-washing and melting, decreasing
energy and water use. The process also
helps keep the characteristics of the plastic
intact. Coca-Cola estimates that, over the next
10 years, the Spartanburg recycling plant should
eliminate the production of 1 million metric tons
of carbon dioxide emissions, the equivalent of
removing 215,000 cars from the road.
But will the process prove to be
economically sustainable as well? Both
Fishbeck and Scott Vitters, director of
sustainable packing for Coca-Cola, are hopeful.
In a recent interview, Vitters admitted that,
“Explaining the economics around recycling
is always an adventure,” and that the cost of
virgin PET is currently dropping (see “PET
Project: Coke’s Big Recycling Plant,” www.
marcgunther.com/?p=466). However, he
remains optimistic. “The driver for this
program was environmental,” Vitters said. “It’s
not going to make anyone wildly wealthy. But
we’re looking to turn a profit, long term.”
For more information, see www.
plasticsnews.com/headlines2.
html?cat=1&id=1232117617 and www.
thecoca-colacompany.com/presscenter/
nr_20070905_ccna_support_recycling.html. ■
CONTACT: United Resource Recovery
Corporation, 5396 N. Blackstock Road,
Spartanburg, SC 29303, USA. Tel: +1 864
574 0904; Fax: +1 864 574 0710; E-mail:
bhayes@urrc.net; Web site: www.urrc.net/
new/pages/index.html.

ISO 14000 Update
The Global Reporting Initiative G3 Sustainability
Reporting Guidelines (Conclusion)
T
his month, we conclude our
overview of the Global Reporting
Initiative (GRI) G3 Guidelines from
an ISO 14001 perspective. In previous
installments, we have discussed Part 1
(Reporting Principles and Guidance)
and Part 2 (Standard Disclosures) of the
Guidelines. Part 1 is a set of directions
and explanations to help guide both novice
and seasoned report preparers through the
reporting process that is described in Part 2.
This month, we will discuss the report itself.
What to Include
In Step 1, report content, an organization
determines the extent and detail of information
to define the Report Boundary; that is, how
much information the organization decides
to provide, depending on the level the
organization is aiming for with its reporting.
In Step 2, report preparers both identify
and review relevant topics and related
Indicators. This requires an iterative
process using the Principles of materiality,
stakeholder inclusiveness, sustainability
context, and guidance on setting the
Report Boundary.
In Step 3, report preparers need to declare
the Application Level of their completed
report to communicate which elements of
the GRI Reporting Framework have been
applied: level “C,” “B,” or “A.”
FEBRUARY 2009
In addition, consider: (1) Stakeholder
Inclusiveness, to take into account those
stakeholders who can reasonably be
expected to be significantly affected by
the organization’s activities, products, or
services; (2) Sustainability Context, that
is, how an organization contributes, or
aims to contribute in the future, to the
improvement or deterioration of economic,
environmental, and social occurrences at
the local, regional, and global levels; and
(3) Completeness, which focuses on the
“scope” of the sustainability topics covered
in a report, the “boundary” encompassing the
entities influenced by the organization whose
performance is represented in the report,
and “time,” which refers to the discreet time
period specified by the report.
Report Contents
The sustainability report should begin
with a strategy and analysis that includes a
general statement from the organization’s
top management regarding the relevance
of sustainability to the organization, and
how the organization will manage key
challenges associated with economic,
environmental, and social performance.
The report should also include responses
to the following six statement elements:
(1) Strategic priorities and key topics
for the short/medium-term with regard
to sustainability; (2) Broader trends
affecting the organization and influencing
11
sustainability priorities; (3) Key events,
achievements, and failures during the
reporting period; (4) Views on performance
with respect to targets; (5) Outlook on the
organization’s main challenges and targets,
as well as future goals; and (6) Other items
pertaining to the organization’s strategic
approach.
The report should also include
two narrative sections responding to
key impacts, risks, and opportunities.
Section One focuses on the organization’s
key impacts on sustainability and effects
on stakeholders. This section should
describe the organization’s significant
impacts related to sustainability and their
associated challenges and opportunities;
how the organization plans to prioritize
these items; key conclusions related to
progress in addressing these items during
the reporting period; and a description
of the main processes to address this
performance and/or relevant changes.
Section Two focuses on the sustainable
trends, risks, and opportunities related
to the long-term prospects and financial
performance of the organization. This
section should describe the most
important risks and opportunities
related to sustainability trends, and the
prioritization of key sustainability topics
according to their relevance for long-
term organizational strategy, competitive
position, and qualitative and quantitative
financial value drivers.
Next, the report describes the
organizational profile of the company. This
task takes into account the organization’s
primary brands, products, and services;
12
markets served; sales/revenues; employees;
significant changes and awards; and other
pertinent company information.
The core of the Sustainability Report
includes information that addresses the
following:
A Report Profile—The reporting period,
date of previous report, cycle, and contact
person;
Report Scope and Boundary—Describes
the process for deciding what goes
into the report, including discussions
of prioritization, stakeholders, report
“fenceline,” the basis for reporting,
data measurement and compilation,
re-statements of previous reports’
information, and any significant changes
from previous reporting periods;
GRI Content Index—A detailed table
depicting the location of the Standard
Disclosures in the report where the
Guidelines’ elements can be found (and
verified), such as Strategy and Analysis,
Organizational Profile, Report Parameters,
and Core Performance Indicators and
Supplemental Indicators; and
Assurance—Validation by an independent
third party.
The remaining portions of the report
address core fundamentals related to an
organization’s governance, commitments
to external initiatives, stakeholder
engagement, and management approach and
Performance Indicators. Governance relates
to the mechanisms for how the organization

Sustainability Reports ⎯ A Closer Look
The information required to develop a
sustainability report can be challenging,
but not impossible. A prudent approach
might be to benchmark against those
organizations that have developed
substantive and well laid out sustainability
reports. With that in mind, BATE briefly
reviewed the GRI-compatible sustainability
reports of three multinational corporations
in three distinct business sectors to see how
they compared with each other.
The reports from General Motors (GM),
Royal Dutch Shell (Shell), and Hewlett-
Packard (HP) were too large to review in their
entirety. All of the companies allow users to
design their own downloadable report with
as much, or as little, information as desired,
which helps stakeholders find the highlights
of most interest to them. At an average
of about 150 pages per report, the task of
reading each report from cover to cover is a
logistical challenge. We opted to design our
own custom reports that focused primarily on
the GRI criteria for ease of review.
The information each company provided
was considerable, although the format for
each report was different. For example,
only the HP report provided a Table of
Contents and a self-declaration of the report
to GRI Application Level B, while only
the Shell report provided a summary of
the comments from their External Review
Committee. While all three companies
provided clear evidence of adherence to
the specific elements of the GRI Reporting
FEBRUARY 2009
Guidelines, both the GM and Shell reports
were designed to be easier to read than the
HP report, with pages broken up by more
graphs, diagrams, and photos.
The Shell report, representing the
energy sector, described the global
energy challenge, and also provided an
explanation of two future energy scenarios
as each relates to the management of
climate risk. The GM report, representing
the automotive sector, and linked to the
energy sector by consumption, described
its efforts to bring to market alternative
energy fuel vehicles, like the all-electric
Chevy Volt and prototype all-hydrogen
vehicles, as well as high-efficiency
engines for standard vehicles. The
company also described its efforts to
generate greater amounts of alternative
energy at its assembly plants.
The HP report, representing a large,
multinational electronics device
manufacturer, with products containing
components requiring special disposal
practices, focused its efforts on its supply
chain, climate and energy, and product
reuse and recycling. The company
listed its top tier suppliers to highlight
its transparency, and discussed reducing
carbon in its products, improving
energy efficiency, initiating alternative
energy production and use at several
manufacturing facilities, and developing
products that can more easily be reused
and recycled. ■
13
sets responsibility for economic, social,
and environmental performance, and
how shareholders and employees can
provide guidance to top management.
Commitments to external activities refer
to any external economic, environmental,
and social principles, standards, or other
initiatives to which the organization
subscribes, and any associations to which
the organization belongs.
Stakeholder engagement refers to all of
the stakeholders affected by, and having a
vested interest in, the organization, such
as communities, customers, shareholders,
suppliers, and employees, and how the
organization interacts with them, and how
often. The results of such interaction,
including key items and concerns, are
documented in some fashion.
Management approach and Performance
Indicators refer to the disclosures made for
each Performance Indicator in each of the
main economic, environmental, and social
categories. For each item addressed, report
on trends, use of protocols, presentation of
data, data aggregation, and metrics.
In Summary
According to Lord Michael Hastings, Global
Head of Citizenship and Diversity, KPMG
International, “We are in the midst of a rapid
global transformation with increased demand
on corporations … to be good corporate
14
citizens. …There has been an important
shift in this direction with [corporate social
responsibility] reporting becoming the norm
rather than the exception within the world’s
largest companies.” Hastings concludes,
“[KPMG’s] goal is to further the ideal
that corporate responsibility reporting and
assurance practices become as commonplace
as financial reporting and assurance.”
As noted in the December 2008 BATE
issue, an ISO 14001 framework, by its
design, can facilitate the data gathering
and reporting that G3 Guidelines require,
and should be considered whenever
practical. Better yet, perhaps in the
future, G3 and ISO 14001 Environmental
Management System (EMS) standards
will be harmonized so as to facilitate the
cross-usage of information from one to
the other. For KPMG’s goal to come to
fruition, many more companies need to
embrace transparency in their reporting.
Having a clear set of guidelines that
reference and link to related standards and
guidelines could help tip that balance, and
the marketplace would probably welcome
one clear set of standards/guidelines for
companies to follow to satisfy the concerns
of their stakeholders and other interested
parties. We may be on the right track, but
we are not there yet. ■
For BATE: Gabriele Crognale, PE. E-mail:
mriso14k@yahoo.com.

Climate Change Update
Canada’s Forests Change From Sink to Source
C
anada’s 1.2 million square miles of
trees have been dubbed the “lungs
of the planet” by ecologists, because
they account for more than 7% of the Earth’s
total forest lands. In the past, they could be
depended on to sequester vast quantities of
carbon dioxide (CO2), but not anymore. In
a series of recent studies, scientists have
concluded that Canada’s forests, stressed
by damage from warming, have crossed an
ominous line. They are now emitting more
CO2 than they are sequestering.
Rising temperatures slowly, but steadily,
dry out forests, leaving trees more vulnerable
to fires. They also accelerate the spread of
mountain pine beetles, which have already
devastated forests across 10% of British
Columbia, and threaten timber in neighboring
Alberta. Bitter cold winters used to kill off
most pine beetles, keeping them in check, but
warming has changed that balance. So, dying
forests become carbon sources. That’s the logic
laid out by British Columbia’s chief forester.
Experts predict that Canada’s forests will
continue to be net carbon sources indefinitely
(at least until 2022). “We are seeing a
significant distortion of the natural trend,”
said Werner Kurz, senior research scientist at
the Canadian Forest Service and the leading
expert on carbon cycles in the nation’s
forests. “Since 1999, and especially in the
last five years, the forests have shifted from
being a carbon sink to a carbon source.”
FEBRUARY 2009
In response, Canada’s government wrote
off its forests as a carbon sink in 2007,
when officials submitted their plan updates
to abide by the Kyoto Protocol. Under
the Kyoto agreement, governments are
permitted to count forests as credits, or
offsets, when calculating their national
carbon emissions.
For more information, see www.
chicagotribune.com/news/nationworld/chi-
canada-trees_wittjan02,0,539661.story. ■
Intense Downpours More
Common
A report on extreme weather warns that
human-induced climate change is
making heavy downpours more intense,
with storms that used to occur every
20 years projected to occur every 8 years
by the end of the century. “As greenhouse
gases increase, the faster they increase,
the more extreme weather and climate
events we’ll be seeing,” said Thomas
Karl, co-editor of the report and director
of the National Climatic Data Center at
the US National Oceanic and Atmospheric
Administration.
“Weather and Climate Extremes in a
Changing Climate” compiles existing
scientific research to examine present and
future climate change impacts on the United
States. The report calls weather extremes
15
 “the most serious challenges to society in
coping with a changing climate.”
One of the clearest trends in observed
records is an increase in the number and
intensity of heavy precipitation events. Over
the last century, for example, days when it
has rained more than 4 inches in the upper
midwest have jumped 50%. Scientists say
that, as the atmosphere warms, it holds more
moisture. “That increase in water vapor is
absolutely necessary for the production of
heavy and extreme precipitation events,”
noted Karl.
There is less clarity in the report when it
comes to how much influence humans are
having when it comes to hurricanes. The report
states, “… a confident assessment of human
influence on hurricanes will require further
studies … with emphasis on distinguishing
natural from human-induced changes.”
The report also says that abnormally hot
days and nights are likely to become more
frequent, and there will be fewer colder days.
“A day so hot that it is currently experienced
only once every 20 years would occur every
3 years by the middle of the century over
much of the continental [United States] and
every 5 years over most of Canada,” the
report states.
Droughts are likely to become more
severe in the southwestern part of the
United States, as rainfall totals drop in
winter. Warmer air also will help evaporate
moisture from the ground, making droughts
worse. Wildfires in the American west
are “strongly associated with increased
spring and summer temperatures and
16
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correspondingly earlier spring snowmelt in
the mountains,” the report notes.
Climatologist James Hansen warned,
“The … President and Congress must
define a course … in which the United
States exerts leadership commensurate
with our responsibility for the present
dangerous situation.”
For more information, see http://
abcnews.go.com/Technology/Weather/
story?id=5204034&page=1. ■
Peridotite Can Soak Up
Carbon Dioxide
P eridotite, the most common rock in the
Earth’s mantle, is found near the surface,
mostly in Oman. Oman is close to the
Persian Gulf, where a great deal of carbon
dioxide (CO2) is emitted. Peridotite there
can soak up 2 billion tons of CO2 annually
as it turns to minerals, such as calcite (see
BATE, October 2008). That’s about 7% of
humanity’s annual CO2 emissions.
The study by geologist Peter Kelemen
and geochemist Juerg Matter, of Columbia
University’s Lamont-Doherty Earth
Observatory in New York City (New York,
USA), appeared in the 11 November 2008
edition of the Proceedings of the National
Academy of Sciences. The scientists
calculated that it costs too much to mine the
rock and bring it to the surface. Instead,
liquid CO2 can be injected with water
underground, down to the rock for absorption.
For more, see http://news.yahoo.com/s/
nm/20081107/sc_nm/us_climate_rocks. ■