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Gri Sustainability Reporting Guidelines For Public And Third Sector

Organizations
John Dumaya; James Guthriea; Federica Farnetia
a
Discipline of Accounting, Faculty of Economics and Business, University of Sydney, Australia

Online publication date: 20 July 2010

To cite this Article Dumay, John , Guthrie, James and Farneti, Federica(2010) 'Gri Sustainability Reporting Guidelines For
Public And Third Sector Organizations', Public Management Review, 12: 4, 531 — 548
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 Abstract
GRI SUSTAINABILITY
This article provides a critique of the Global
Reporting Initiatives (GRI) guidelines, sus- REPORTING
tainability reporting (SR) guidelines and also
examines their applicability to public and GUIDELINES FOR
third sector organizations. The article finds
that these guidelines promote a ‘manage-
rialist’ approach to sustainability rather than
PUBLIC AND THIRD
an ecological and eco-justice informed ap-
proach, potentially causing them to fall into
SECTOR
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an evaluatory trap. This means that they do

not contribute to sustainability. Since public
ORGANIZATIONS
and third sector organizations have yet to
take up SR with the same fervour as the
A critical review
private sector, the opportunity exists to learn
from the critique of the use of the GRI reports John Dumay, James Guthrie and
in practice. As such this article examines the
implications of this finding for public and Federica Farneti
third sector organizations. A conclusion is
that there is an opportunity for the GRI to John Dumay
develop guidelines further in line with existing Discipline of Accounting, Faculty of Economics and
practice to increase their relevance and utility. Business
University of Sydney
Australia
E-mail: [email protected]

Keywords James Guthrie

Critique, GRI, public sector, SR guidelines, Faculty of Economics and Business – Forlı̀ Campus
sustainability reporting, third sector University of Bologna, Italy
E-mail: [email protected]

Federica Farneti
Department of Economics and Business Law
Faculty of Economics and Business – Forlı̀ Campus
University of Bologna, Italy
E-mail: [email protected]

Vol. 12 Issue 4 2010 531–548

Public Management Review ISSN 1471-9037 print/ISSN 1471-9045 online
Ó 2010 Taylor & Francis
http://www.tandf.co.uk/journals
DOI: 10.1080/14719037.2010.496266

Electronic
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 532 Public Management Review

INTRODUCTION

Organizations are seeking to report more information than is included in traditional

financial accounting as there are ‘broader techniques of sustainability accounting and
accountability [that] have the potential to be powerful tools in the management,
planning control and accountability of organisations for their social and environmental
impacts’ (Unerman et al. 2007: 3). In addition, organizations have identified a need for
‘extended qualitative information’ (Ball et al. 2006: 266) about sustainability. This focus
on sustainability means that ‘public service organisations and institutions . . . are likely
to come under increasing pressure to revisit their concept of sustainability’ (Ball et al.
2007: 39). In doing so, these organizations are seen to be central to the continued
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development of sustainability as they are intricately involved in activities which shape

people’s lives. Should the public and third sector fail to develop sustainability, then
future generations will not have the opportunity for a sustainable lifestyle (Birney et al.
2010: 3).
Several national and international institutions have developed ‘guidelines’ for
sustainability reporting (SR). These guidelines have been established to facilitate the
disclosure of various social, environmental, ethical and governance matters to a range of
stakeholders. The most prominent of these is the Sustainability Reporting Guidelines
produced by the Global Reporting Initiative (GRI), which are the result of co-operation
between researchers, industry and consultants and the output of a multi-stakeholder
approach (GRI 2006). In addition, the GRI has published a pilot version of a public
sector supplement specifically to address the reporting needs of these organizations
(GRI 2005). But these guidelines in practice have been identified as being inward
looking, and for being used for other agendas such as to promote ‘public relations’
(Dickinson et al. 2005).
Given the relevance of SR, both for the public and third sectors, there has been little
critical analysis of the GRI guidelines in the development of sustainability reporting.
Thus, the main objective of this study is to provide a critical overview of the application of
the GRI as the de-facto reporting guideline for public and third sector organizations. This
article establishes several key issues involved in understanding and disclosing SR from a
public and third sector perspective. Also it explores how the GRI addresses aspects of SR
in order to identify gaps between the guidelines and practice, and particularly engages
with public policy debates concerning the ‘usefulness’ of the GRI guidelines for the
purpose of developing sustainability from an eco-systems approach.
The article is structured as follows. Section two presents a brief literature review of
SR and the public and third sector. Section three presents critique of current SR
practice and advocates the development of an ecological and eco-justice approach to
sustainability practices. Section four presents a critique of the current application of the
GRI guidelines in the context of the public and third sectors. Section five discusses the
implications of GRI for public and third sector organizations. Finally, section six
provides a conclusion, limitations and explores further research topics.

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 Dumay et al.: GRI Sustainability reporting guidelines 533

SR AND THE PUBLIC AND THIRD SECTOR

Prior research into social and environmental reporting has mostly explored SR
reporting and disclosures by corporations (Guthrie and Abeysekera 2006), but until
recently there has been relatively little research into the reporting of these matters by
organizations in the public sector (for exceptions see Guthrie and Farneti 2008; Farneti
and Guthrie 2009). Also, Ball and Grubnic (2007: 243) warn of the gap in the
contemporary sustainability literature, stating that ‘the agenda for research and practice
in sustainability accounting and accountability has been played out in most exclusively
for-profit, corporate setting’. They call for researchers to ‘help in understanding the
nature of SR accounting and accountability in PSOs [Public Sector Organizations] whose
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core tasks have to do with social welfare and justice’ (Ball and Grubnic 2007: 257).
There is no doubt that there is a growing interest in, and a critique of, sustainability
management and development in contemporary organizations (Gray 2010). More
specifically, as SR becomes more widespread, critics question its present usefulness. For
example, as Gray (2006: 793) comments, contemporary SR ‘demonstrate[s] that
modern international financial capitalism and the principal organs which support it are
essentially designed to maximise environmental destruction and the erosion of any
realistic notion of social justice’. Gray’s view is shared by others and stems from
recognition that private sector organizations inherently utilize SR for purposes other
than reporting on the extent of their sustainability performance; rather to, for instance,
enhance their public image (Adams 2002) or for economic ends (Milne et al. 2009). But
public sector organizations are somewhat distanced from the criticism as Dickinson
et al. (2005: 37–8) reports that most public sector organizations cite ‘performance
improvement’ as their main reason for preparing SRs. But in contrast, the desire to
enhance ‘public relations’, is almost as prominent. Thus, the criticism levelled at
private sector ‘greenwashing’1 (see Hubbard 2009: 3) also applies to the public sector
and is unlikely to change in the short term (Dickinson et al. 2005: 38).
Increasingly, there is pressure on public sector organizations to lead the way with
sustainability practices as Birney et al. (2010: 3) advocate:

Public sector organisations are central to the delivery of sustainable development. Every aspect of their
role – from education to environmental services, and from planning to social care – shapes how people
live their lives. If public sector bodies do not take on this leadership challenge, citizens may find
themselves cut off from sustainable lifestyles.

In addition, Milne et al. (2008: 17) argue that the current approach to SR is
counterproductive in that the application of contemporary SR guidelines promotes
unsustainability rather than sustainability. Ensuring that the public and third sectors’
approach to SR is not counterproductive is important because of the traditional
stewardship role for the physical environment and social infrastructure that these
sectors play in society (Ball 2005). Dickinson et al. (2005: 37–8) imply that for these

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 534 Public Management Review

sectors there is more at stake than just putting on a good public face or making a profit
(or achieving financial targets).
In this regard, the literature has highlighted some of the unintended counter-
productive consequences of accounting for sustainability by public and third sector
organizations. For example, Dey (2007) in his examination of social accounting at
Traidcraft plc unveiled how it developed ‘unforseen and unintended’ outcomes. The
result was an organization that shifted from its original stewardship role of utilizing
Christian values in developing trade with third world suppliers, to a new form of
‘commercial Christianity’ where morality was replaced by the financial bottom line.
Another example based on the work of the Agricultural Research Group on Sustainability in
New Zealand showed how accounting for ‘Food Miles’2 distorted the actual
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environmental impact of exporting food because it ignored the actual energy required
to produce the food in the first place (Saunders et al. 2006). Therefore, if export
decisions were based solely on the impact of ‘Food Miles’ it would threaten the
livelihood of people working in the exporting nation while at the same time causing
additional damage to the environment. Thus, it is important for public and third sector
agencies that embark on the process of accounting for sustainability through SR to be
cognizant of the potential impacts this may have.

A CASE FOR THE ECOLOGICAL AND ECO-JUSTICE INFORMED APPROACH

In developing a critique of SR, Gray (2006: 803–5) identifies a taxonomy of three

approaches to social and environmental accounting (SEA): managerialist; triple bottom
line (TBL); and the ecological and eco-justice (EEJ) informed approach. In the
‘managerialist approach’, data are selectively reported based on the assumption that
there are no conflicts between traditional economic criteria and those relating to social
and environmental aspects. For this reason, readers of these types of reports cannot
have a reliable picture of an organization’s sustainability performance. The ‘triple
bottom line approach’ calls for an equal and reliable balance, within the annual report,
between economic, social and environmental activities. Generally, in these cases, the
financial aspects still dominate the bottom line. However, the EEJ approach to
sustainability focuses on establishing whether or not organizations act as socially and
environmentally sustainable members of society, with the default being that all
organizations are currently unsustainable. This approach is still in its infancy and offers
two schools of thought; one focusing on sustainability at an organizational level and one
at a regional level.
Expanding sustainability beyond organizational level boundaries also appears to be a
recurring theme in the literature. For example, Ball (2002) outlines how some local
government authorities have been examining the accounting of the ‘ecological
footprint’ of communities, rather than the footprint of the specific organizations. In
addition, there is a growing recognition that organizations operate in the wider

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 Dumay et al.: GRI Sustainability reporting guidelines 535

economic ecosystem rather than as separate entities. This point is elaborated by Birkin
(2000: 307) as follows:

New scientific information about the nature of the world indicates that an ontology of discrete objects is
no longer appropriate. This new scientific information describes an ontology of interconnected events. In
order that accountancy may operate efficiently within an ontology of interconnected events, a change is
needed to replace the medium of money with relationships as part of a transition going from
environmental economics to an economic ecology. The benefits of making such a transition include
resource utilisation efficiency.

Thus the contemporary view is that sustainability should be viewed as ‘a systems

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concept and not an organisational concept, and ultimately a global concept’ (Milne
2007: 54).
In contrast to the recognition that sustainability crosses organizational boundaries, it
appears accounting has not kept pace. In this regard, Milne (1996) claims that
management accounting practice has basically kept the issue of sustainability localized as
an organizational issue and has ignored organizational impacts on the biophysical
environment. More specifically, Birkin (1996: 233) argues that accounting practices
have shielded us from the context from whence accounting profits are generated as
outlined below:

it has been possible for accounting to report that such and such an industrial enterprise has contributed
significantly to the wealth of a nation whilst, in broader context, the same enterprise has inflicted the
most appalling damage to social, psychological, spiritual and environmental health.

Therefore, it seems to be recognized that accounting at an organizational level does not

address the wider implications of sustainability from a global or ecosystems perspective
even though there is recognition that it is a concept which extends beyond
organizational boundaries. Thus, it is the view of this article that there is merit in
expanding our understanding of the wider concept of sustainability as advocated by the
EEJ approach. A contribution of this article is to offer some insights as to how this
might be achieved by public and third sector organizations in the current context of
accounting for sustainability.

ACCOUNTING FOR SUSTAINABILITY AND THE GRI

As a result of the growing interest in sustainability there is no surprise that accounting

technologies have emerged as ‘a potential means for progressing sustainability
development’ (Ball and Bebbington 2008: 323) by way of reporting on an
organization’s sustainability strategies, activities and outcomes. As such, SR is designed
for externally reporting on organizational sustainability practices (e.g. environmental,

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 536 Public Management Review

social, ethical and managerial matters) by way of metrics (numbers), narratives or both.
Presently, SR is predominately a voluntary activity in most public and third sector
organizations (see Dickinson et al. 2005: 37) with organizations espousing a wide
variety of reasons for reporting; the most predominate as outlined earlier was to
‘monitor organisational performance’. However, public sector disclosures are generally
influenced more by the political climate rather than legislation (Dickinson et al.
2005: 16).
In response to the interest in sustainability, several international initiatives have been
undertaken to develop guidelines for the accounting of and reporting of sustainability
practices and outcomes – the most notable to date being the Sustainability Reporting
Guidelines of the Global Reporting Initiative (see GRI 2006). Other organizations
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such as the OECD (2006), the World Bank (WBG 2007), AccountAbility (2008a,
2008b) and the United Nations (UNCG 2008) have also undertaken exercises
to produce international guidelines, but from differing perspectives and using different
processes. The main purpose of these guideline initiatives can be summarized as
the need to develop organizational sustainability practices that are cognizant of the
needs of the present, without compromising the needs of future generations (GRI
2006: 2).
The GRI has even gone as far as issuing a pilot version of a sector specific supplement
for public sector reporting (see GRI 2005) and is developing one for third sector
organizations. The public sector supplement was launched in 2005 and was sponsored
by the Directorate-General for Social Affairs of the European Union, the City of
Melbourne (Australia) and the Australian Government Department of Family and
Community Services (GRI 2005: 2).
Since its publication, the GRI has commissioned research to review the use of the
supplement with a view to a possible revision (Tort 2010: 4). A major finding of the
Tort (2010) report was that the awareness and use of the supplement was minimal and
that the main GRI reporting framework was more likely to be used in developing SR,
rather than the specific public sector supplement. As a result of this report the GRI is
exploring the development of a final version of the supplement designed to encourage
improved public sector sustainability reporting and to entice more organizations to
develop SRs (Tort 2010: 12).
There is no doubt that in the private sector the GRI is becoming the dominate SR
guideline as its use has been growing exponentially every year. As Figure 1 shows, the
number of reports registered with the GRI has increased from ten reports in 1999, to
941 reports in 2008 (GRI 2009).
As discussed earlier, until recently the majority of SR has been concentrated on
disclosure by private sector organizations. Now, with Ball and Grubnic (2007: 257)
(and others) calling for researchers in public sector organizations to account and report
sustainability matters we would expect an increase in SR reporting. The same argument
can also be made for third sector organizations, whose role is seen as providing essential
services to the community (Unerman and O’Dwyer 2006). These organizations must
also engender confidence within their communities in order to maintain support for

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 Dumay et al.: GRI Sustainability reporting guidelines 537

their existence and to attain community based funding, government grants and/or
contracts in order to survive (see Fletcher et al. 2003: 506).
As shown in Figure 2, there has been a steady increase in the number of public and
third sector organizations utilizing the GRI framework. Similar evidence in this regard
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Figure 1: Reports registered with GRI 1999–2008

Source: Adapted from GRI (2009).

Figure 2: Number of public agencya and non-profit services GRI reporting organizations (2001–8)
Note: aPublic agency and non-profit services are the GRI classification names for these types of
organizations.
Source: Adapted from GRI (2009).

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 538 Public Management Review

has been provided in separate studies by Dickinson et al. (2005) and Tort (2010). The
concern here is that the total number of public and third sector organizations reporting
is relatively insignificant compared to the private sector (Dickinson et al. 2005; GRI
2009; Tort 2010), particularly considering that public sector organizations alone
represent about 40 per cent of economic activity (Ball and Grubnic 2007: 243).
A recent GRI sponsored study declared that public sector reporting on
sustainability was still in its ‘infancy’ when compared to the private sector with only
1.7 per cent of all GRI reports emanating from this source (Tort 2010). In parallel
with the private sector, the GRI has been the predominant framework used by
public sector agencies who issued sustainability reports (Dickinson et al. 2005;
Farneti and Guthrie 2009) although the utilization of the specific public sector
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specific guidelines (GRI 2005) is minimal (Tort 2010). Thus, the relative lack of
participation of public and third sector organizations in SR questions the current
relevance of SR to them.
While the above discussion concentrates on the GRI, it is not the only reporting
guideline in existence. An analysis of reporting practices by organizations using services
provided by corporateregister.com, as presented in Table 1, indicates the predominant
use of three different international guidelines, adding the AccountAbility standards
(AccountAbility 2008a, 2008b) and the United Nations Global Compact (UNGC 2009)
to the list, for reports issued in 2008.
As highlighted in Table 1, in 2008 the GRI was the dominant international guideline
for SR, with fewer than 5 per cent of organizations reporting to corporateregister.com
not using it. Conversely, nearly 20 per cent of the organizations supplemented the GRI
guidelines with one or two of the other guidelines. It is difficult to derive information
on public sector and third sector use of the other guidelines due to the dearth of
research in this area and the lack of information in commercial databases available at this
time. However, considering the dominance of commercial organizations using the GRI,
as reported above, it is highly likely that public and third sector organizations would be
as equally under-represented in the use of other guidelines.

Table 1: Use of international SR guidelines issued in 2008 as reported by corporateregister.com

SR guideline # of reports Usage %

AA1000AS 102 8.87
GC 199 17.30
GRI 1,093 95.04
2 Frameworks 214 18.61
3 Frameworks 15 1.30
Total organizations 1,150 100.00

Source: Based on searches performed on corporateregister.com (2009; UNGC 2009) accessed on 3 May 2009.

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 Dumay et al.: GRI Sustainability reporting guidelines 539

The utilization of other SR guidelines in conjunction with the GRI may point to a
level of incompleteness in the GRI guidelines. In essence, this is something that the GRI
alludes to in the justification of the development of the different sector supplements as
outlined by Tort (2010: 4): ‘Some sectors face unique needs that require specialized
guidance in addition to the universally applicable core Guidelines. Sector Supplements
respond to these needs and are a key part of the Reporting Framework, designed to
complement the Guidelines.’ Thus, it appears that a one size fits all approach to SR is
not possible and the sector supplements are designed to fulfil the gap. But in the case of
the GRI supplement for the public sector, this does not appear to have had the desired
success. Tort’s (2010: 10) examination of the relatively few examples of public sector
supplement based GRI reports found that in practice the reports used the specific
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indicators diversely and sporadically. This was similar to the findings of an Australian
study as reported in Guthrie and Farneti (2008). Thus, there remains a gap between
desired and actual practice in the utilization of the sector supplement from the GRI’s
perspective.
In addition to the generic international GRI guidelines and the draft GRI (2005)
public sector supplement, there are also examples of national frameworks, targeted at
the public sector that impact on managers’ choices as to what to disclose and how. For
instance, in Italy, there are several different SR guidelines for public sector and third
sector organizations (Farneti et al. 2010). For example, L’Agenzia per le ONLUS3 has
just released a specific set of guidelines for social reporting concerning Italian third
sector organizations. Other guidelines are the Directives issued in 2006 by the Minister
of Public Affairs (Presidenza Del Consiglio Dei Ministri Dipartimento Della Funzione
Pubblica (DAP) 2006; Farneti et al. 2010), addressing social reporting in public sector
organizations; the ‘Osservatorio per la finanza e la contabilità degli enti locali’ issued by
the National Standard Setter for Local Government Accounting (Osservatorio per la
finanza e la contabilità degli enti locali – Ministero dell’Iterno (LiOss) 2007), the Code
for third sector organizations issued in 2007 (Consiglio Nazionale Dei Dottori
Commercialisti – Commissione Aziende Non Profit (CNDC) 2007) and a ‘Standard for
public sector’ issued by the Gruppo per il Bilancio Sociale (GBS 2005).
So while there is evidence that public and third sector organizations are beginning to
consider and report on sustainability issues, there is a perceived problem in relation to
what ‘sustainable value’ these organizations create. This is because, in public and third
sector organizations, the notion of value needs to encompass much more and is
separated from the notion of monetary value (see Dumay 2009a: 195). As Gray (2006:
809) notes, it is necessary to: ‘make it explicitly clear that there is other ‘value’ than
that of money – the value of life, the value of society, the value of quality and, if one is
of a religious bent, the value of creation itself’.
This issue appears not to have been addressed by the GRI or other guidelines until
recently when the Forum for their Future published their latest report on the public
sector and outlined that sustainability value is created by effectively deploying natural,
social, human, manufactured and financial capital (Birney et al. 2010: 4–9). Thus, the

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 540 Public Management Review

notion of sustainability value extends beyond financial value and needs to address a
more encompassing notion of value, as just highlighted.
Another issue with SR guidelines (such as GRI and the AccountAbility guidelines) is
that they utilize the same definition of sustainability, that is to ‘meet the needs of the
present without compromising the ability of future generations to meet their own
needs’ (GRI 2006: 2; AccountAbility 2008b: 24).4 Again, there is no finite point at
which an organization utilizing the GRI guidelines could call itself sustainable, but these
guidelines do outline the balance that is required. However, this does not appear to be
translated into the indicators of sustainability espoused by the guidelines. So if the goal
of sustainability is to achieve a balance between organizational inputs versus outputs and
there is no finite measure of sustainability advocated in the guidelines, the question that
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emanates from this analysis is ‘How do public and third sector organizations know when
they are ‘‘sustainable’’?’ But as Milne (1996: 137) outlines this may be difficult to
operationalize because of the divergent views of practitioners, economists and
ecologists as to what sustainability is and thus ‘confusion and value entrenchments can
arise when policy is formulated’.
A further question is raised as to how the GRI guidelines and supplement could be
classified within Gray’s (2006: 803–5) Social and Environmental Accounting (SEA)
taxonomy presented in section two. Here, it is argued that both the GRI guidelines and
supplement fall within the ‘managerialist’ approach. This is because the GRI public
sector supplement advocates a three step approach to sustainability reporting as outlined
in Figure 3 being (Tort 2010: 5): (1) organizational performance; (2) public policies
and implementation measures; and (3) context or state of environment.
While it could be argued that item (3) is in keeping with the EEJ approach, the
supplement specifically advocates not-reporting on it because:

The content of the Supplement was developed in recognition of these three types of information, but
remarked that the focus of the Supplement is to provide reporting guidance on the first and second type
of information, as the third type of information is often included in other types of reports.
(Tort 2010: 5)

Thus, it is the view of this article that the current application of the GRI and the public
sector supplement takes in the main a ‘managerialist’ approach to sustainability rather
than the EEJ approach. The implications of this finding for public and third sector
organizations are discussed next.

IMPLICATIONS FOR PUBLIC AND THIRD SECTOR SR

In the end, it is not so much the framework that is utilized that makes a difference, but
whether or not organizations act in a manner that has impact. This means that
organizations need to get closer to Gray’s (2006: 808) ideal of an ‘ecologically and

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 Dumay et al.: GRI Sustainability reporting guidelines 541
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Figure 3: Types of information that reports by public agencies can include

Source: Tort (2010: 5).

eco-justice-informed approach to reporting directly on sustainability’ and to reflect this

first in practice. No longer can sustainability be viewed from a middle-range perspective
because the question is not ‘Is our organization sustainable and if not how do I fix the
gaps?’ but rather, ‘How unsustainable is my organization?’, or ‘What is my
organization’s contribution to the unsustainability of the general environment in which
we operate?’
In proposing these questions for the public and third sector, it is important to
understand the personal, social and environmental costs they invoke. Organizations also
need to weigh this against the personal, social and environmental benefits they provide
without relying on economic outcomes or value added as a justification for an

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 542 Public Management Review

imbalance. This will not be straightforward because, as discussed above, finite measures
of ‘sustainability’ have not yet been developed and it is likely to be an impossible task.
Additionally, it may well prove counterproductive if attempts to measure sustainability
become a managerialist measurement exercise, when what is required is action, not
measurements and reporting.
To communicate sustainability, organizations need to develop their own
sustainability narratives in an informed way, rather than try to develop a set of
measures, numbers or indicators based on generic guidelines that may be difficult to
understand or have no relevance to people within the organization and to others (see
Dumay 2009b). If this is indeed the solution, then this raises the question as to whether
there is, in fact, a need for the current GRI guidelines and supplement, or can the
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current GRI guidelines and supplement be adapted to take on a more narrative

approach? Thus, what may be required is similar to what Roslender and Fincham (2004)
refer to as ‘self-accounts’, whereby organizations are free to tell the story of how they
contribute to the sustainability of the planet rather than to the sustainability of their
enterprise through the adherence to particular SR guidelines. The use of qualitative and
narrative disclosures by public sector organizations in their SRs is varied, as outlined by
Tort (2010: 12):

The analysis of GRI reports by public agencies has revealed that reporting on the Sector Supplement
items was fragmented and that the types of disclosures provided by the different public agencies were
very diverse and predominantly narrative/descriptive, with little quantitative performance data.

Thus, it appears that the evidence from practice is eluding that organizations want to
‘tell their story’ of sustainability practices in preference to GRI disclosures of abstract
indicators.
For illustration, a ‘sustainability narrative’, which takes the EEJ approach, can be
found at the Forum for the Future website.5 A narrative from the website tells the story
of the ‘West of England Carbon Challenge’ (Rainger 2009). Its plot is based upon the
current unsustainability of organizations, the need for urgent action, the benefits of
participation and who is putting their hand up to participate. The following is an
excerpt from the narrative (Rainger 2009):

Forum for the Future is launching the West of England Carbon Challenge today at the Prince of Wales’
May Day Network event in Bristol. We believe we are unique in targeting organisations across all sectors
in a single region, requiring them to commit to a fixed target for cutting carbon emissions and supporting
them with the practical guidance and resources they need to achieve those reductions.

What is evident from this narrative is that organizations from all sectors are
participating. The narrative presents a group, rather than individual organizations,
whose approach to sustainability not only removes the ‘blur’ between the private,
public and third sector organizations, but for the sake of sustainability removes the need

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 Dumay et al.: GRI Sustainability reporting guidelines 543

to delineate between different organizations. This responds to Gray’s (2006: 808)

concerns as to ‘whether reporting at, say, an eco-systems level would be desirable, how
it could be operationalised and how the reporting might be used’. From this article’s
perspective, an answer is that the GRI needs to adopt a broader view of ‘sustainability’,
which incorporates the eco-systems level for analysis and reporting.
What is becoming increasingly evident, is that because of reporting practices in the
private sector, interest in SR is beginning to wane as Bent (2009) claims:

Here in the UK we are thoroughly bored of reporting, but that is because we got the full value from it a
while ago. Putting out a CSR report forced companies to create management information systems and
engage with difficult opinions from stakeholders. Clever change agents used the annual cycle to make
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public commitments that kept the company moving forward. Now the systems are bedded in there is little
extra change to wring out of each year’s report.

This further questions the need for public and third sector organizations to embark
down the same path as their private sector counterparts.
This article advocates that public and third sector organizations who are about to
embark on the sustainability journey should try to avoid what Olson et al. (2001)
describe as the ‘evaluatory trap’, whereby they use the GRI guidelines and supplement
to disclose ‘managerialist’ sustainability information without actually achieving some
form of ecosystem sustainability. This is because there are inherent pressures on
organizations’ management to manage in the traditional budgetary style of analysing
performance against budgets and in the past the management of sustainability appears to
have followed the same path as managing other organizational resources.
The issue at hand here is that there appears to be a form of mimetic adoption by
public and third sector organizations of the GRI guidelines compounded by the
production of a draft GRI public sector supplement and still no third sector
supplement. If public and third sector organizations follow the same path, then they
may well fall into the same ‘evaluatory trap’ whereby their SRs have little to do with
sustainability and their SRs become exercises in internally managing budget variances
and/or publicity; as Dickinson et al. (2005) have already alluded to; rather than
sustainability (Gray 2010: 2; Farneti et al. 2010).
Dumay (2009a) refers to this as a form of ‘accountingization’ which, in this context,
alludes to the process of reifying the environment into numbers which may have some
attention, informational or public image value but does not contribute to the praxis of
‘sustainability’. Thus, the new skills that need to be developed from a sustainability
perspective are those which transcend the ‘accountingization’ skills of academics and
practitioners, as reflected in the GRI guideline, to put ‘sustainability’ management into
practice. If this is not achieved, then SR may have no discernible impact on
sustainability, other than providing an outlet for ‘greenwashing’ or as a source of
‘managerialist’ information. In turn, if organizations cannot manage their sustainability
voluntarily, governments will be provoked to force SR frameworks and practices onto

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 544 Public Management Review

organizations. This may lead to government sanctioned ‘greenwashing’ or the

development of a platitude of inwardly focused sustainability reports and practices.
Therefore, if the GRI continues to be adopted in the same manner as the private
sector, then public and third sector organizations will become inward looking in
relation to the impact of sustainability and may not have any impact on the wider global
problem of sustainability. Gray’s (2006: 808) advocating of the EEJ approach should be
applied to public and third sector organizations’ sustainability management and
reporting, so that they have the opportunity to develop sustainability practices that have
an impact not only on themselves, but also at an ecosystems level (see Milne et al.
2009: 1241). Not doing so may result in sustainability initiatives which provide some
benefits at an organizational level, but have little or no impact at an ecosystems
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level. This is problematic because a so-called ‘sustainable’ organization would not be

able to survive in an unsustainable ecosystem. As such they become the ‘canary in a coal
mine’. No matter how healthy the canary is, it will surely perish in a poisonous
environment.

CONCLUSION

A key finding of this article is the current lack of take up of sustainability reporting in
the public and third sector as evidenced in section two. As with the private sector, it
appears that the GRI dominates the current reporting practices of public and third
sector organizations. The production of specific sector supplements for these
organizations by the GRI would suggest that this has the potential to dominate future
reporting practice. There may also be regulatory pressure placed on public sector
organizations to produce reports utilizing specific local and or international guidelines in
the future, as evidenced by the directive to report currently in place in Italy.
In answering the question ‘are the GRI guidelines in use relevant to public and third
sector organizations?’, this article first draws on a critique of the GRI guidelines in
general practice. Here it was noted that the findings of the Dickinson (2005) and Tort
(2010) studies were critical of the GRI guidelines as they appear not to have influenced
widespread public or third sector practice or have been utilized to promote a
managerialist approach to reporting on sustainability, rather than actually achieving
some form of ecosystems based sustainability. This is not to say that organizations
themselves may not in the future become sustainable, but that the current GRI
guidelines do not give any indication of how or at what point one moves from being
classified as unsustainable to sustainable. This article goes as far as to question if this is
possible at all and that the attainment of organizational sustainability may in fact be a
utopian ideal.
And finally, what are the possible implications of utilizing the GRI guidelines for
public and third sector organizations? Here this article takes the view that the current
lack of take up of SR by public and third sector organizations presents an opportunity to

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 Dumay et al.: GRI Sustainability reporting guidelines 545

learn from the private sector’s experience with SR guidelines. This is because the
contents of the current GRI guidelines are a managerialist approach to sustainability.
Public and third sector organizations can take the opportunity to achieve more by
attempting sustainability from the EEJ perspective.
In order to progress beyond the critique levelled at contemporary GRI guidelines,
public and third sector organizations need to rethink their approach to sustainability.
These organizations must change to reflect viewing sustainability from an organizational
perspective to viewing it from an eco-systems perspective, therefore moving away from
the dominance of ‘managerialist’ practice and setting the standard for the manner in
which all organizations disseminate information about their sustainability activities. In
this case, the public and third sector organizations will need to learn how to produce
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self-accounts of their activities rather than utilizing guidelines that in practice seem
designed to fit all organizations into the same framework. Alternately, there is an
opportunity for the GRI to engage further with organizations, as it has said it intends to
do, and to develop further their guidelines and supplement to better reflect
organizational practice, which by the results of its own research points to a desire by
organizations to take a more narrative approach to account for their sustainability
practices (Tort 2010: 12). Doing so is likely to increase both the relevance and utility of
the GRI guidelines and the supplements.
This article has its limitations, as with all studies. It has only examined GRI
guidelines, although arguably their use is so dominant that it would be hard to justify
examining other guidelines in the same context. Additionally, our findings should be
used to inform the debate about the application and development of the guidelines,
rather than advocate that public and third sector organizations should follow a specific
path.
This then leads to the opportunity for further research into the development of SRs
in public and third sector organizations, examining those organizations which use either
the GRI or other guidelines in developing an EEJ approach to sustainability.

ACKNOWLEDGEMENT

Thanks to the participants and reviewers from the SMOG2009 and CSEAR2009
conferences for their helpful comments on earlier versions of this article. Thanks also to
Fiona Crawford and Julz Stevens for their editorial assistance.

NOTES
1 ‘Greenwashing’ occurs when organizations report only overly positive views of their ‘green’ activities
(Hubbard 2009).
2 ‘‘‘Food miles’’ is a very simplistic concept relating to the distance food travels as a measure of its impact on
the environment’ (Saunders et al. 2006: 93).

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 546 Public Management Review

3 L’Agenzia per le ONLUS is a public agency. It is a network of experts as well as practitioners, established in
2002.
4 Originally from: The World Commission on Environment and Development (1987: 43), see Our Common
Future, Oxford, Oxford University Press.
5 http://www.forumforthefuture.org/ (accessed 10 May 2009).

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