New Standards for Climate and Energy Reporting Unveiled by GRI
**New GRI Climate Change and Energy Standards Bolster Sustainability Reporting**
The Global Reporting Initiative (GRI) has recently unveiled its updated Climate Change (GRI 102) and Energy (GRI 103) Standards, aiming to strengthen corporate climate action and decision-making. These updated standards emphasise transparency, accountability, and alignment with global climate goals.
**Key Changes in GRI 102: Climate Change**
The revised GRI 102 focuses on science-based targets, ensuring reported climate actions align with the latest climate science. It also introduces just transition metrics, addressing the social dimensions of climate change, ensuring that climate actions promote fairness and equity. The new standard aligns closely with global climate goals, reinforcing consistency with international efforts such as the Paris Agreement. Companies are now required to report comprehensively on how they manage climate-related impacts, improving the relevance and reliability of climate disclosures.
**Key Changes in GRI 103: Energy**
GRI 103 places a strong emphasis on decarbonization pathways, encouraging companies to reduce carbon emissions related to energy use. It also encourages the reporting of renewable energy use and the transition towards cleaner energy sources. Enhanced energy impact transparency enables stakeholders to understand a company’s energy consumption and management strategies clearly.
**Alignment with Other Standards**
Both GRI 102 and 103 are aligned with the Greenhouse Gas (GHG) Protocol, a leading standard for greenhouse gas accounting. They are designed to be used alongside IFRS S2, the International Financial Reporting Standards Sustainability Disclosure standard on climate-related disclosures. The International Sustainability Standards Board (ISSB) has announced equivalence between GRI 102 and IFRS S2 specifically for GHG emissions disclosures, highlighting a coordinated effort to harmonise sustainability reporting frameworks.
This alignment facilitates companies' ability to integrate sustainability disclosures into broader financial reporting frameworks, enhancing consistency and comparability for investors and regulators. The GRI standards also complement the European Sustainability Reporting Standards (ESRS) by addressing overlapping themes such as climate impact and energy management, aligning well with the broader EU ESG regulatory ecosystem.
**Summary Table: GRI vs IFRS S2 vs ESRS on Climate and Energy Reporting**
| Aspect | GRI 102 & 103 | IFRS S2 | ESRS | |-------------------------|------------------------------------------------|------------------------------------------------|----------------------------------------------------| | Focus | Climate impacts, energy use, science-based targets, just transition | Financially material climate-related risks and opportunities | Comprehensive ESG, including environmental, social, governance factors | | GHG Emissions Reporting | Aligned with GHG Protocol; detailed climate impact and management | Emissions reporting consistent with climate risks/opportunities | Requires detailed climate and energy disclosures consistent with EU taxonomies | | Social Dimension | Emphasizes just transition and social impacts | Focus mainly on financially material climate risks | Strong social and governance focus alongside environment | | Integration | Can be used alongside IFRS S2 for holistic reporting | Part of IFRS sustainability disclosure standards | EU-mandated sustainability reporting standard | | Decision-usefulness | Designed for broad stakeholder transparency | Tailored for investor decision-making | EU regulatory compliance and stakeholder info |
The new GRI 102 and 103 standards strengthen climate and energy disclosures by embedding science-based, socially inclusive metrics and harmonising with IFRS S2 and ESRS frameworks, supporting companies in delivering transparent, comparable, and decision-useful sustainability information.
For more information on the new GRI Climate Change and Energy Standards, please visit the provided link.
- The updated GRI Climate Change and Energy Standards, such as GRI 102 and GRI 103, are designed to bolster sustainability reporting by emphasizing science-based targets, decarbonization pathways, and aligning with global standards like the Paris Agreement and Greenhouse Gas Protocol.
- Companies are now required to report comprehensively on their climate-related impacts, management strategies, and energy consumption, with a focus on renewable energy use, carbon emission reductions, and just transition metrics that address the social dimensions of climate change.
- The new GRI standards are not only designed to improve the relevance and reliability of climate disclosures for stakeholders but also facilitate integration with financial reporting frameworks, such as IFRS S2, and align with the European Sustainability Reporting Standards (ESRS), enhancing consistency and comparability for investors and regulators.
