The ESRS and GRI are similar in many areas of content, but they are based on different questions. Under the ESRS, the company must answer the question: which sustainability impacts, risks and opportunities are material, including in terms of their effects on the business? Under GRI, the company must answer the question: what are the organisation\u2019s most significant impacts on the economy, the environment and people? For European companies, this difference influences the materiality analysis, the data collected, the role of internal departments, reporting to management and the information published.<\/p>\n
Companies reporting under the ESRS must treat dual materiality as a core compliance process. Companies using the GRI must develop a robust methodology for identifying and prioritising impacts. Those using both frameworks need a careful mapping exercise and an internal data system to avoid parallel and inconsistent reporting.<\/p>\n
The ESRS was developed to implement the CSRD. Companies falling within the scope of the directive must include sustainability information in their annual reporting, in accordance with European standards. The ESRS has a regulated structure. There are cross-cutting standards, environmental standards, social standards and governance standards. The company must report on governance, strategy, impacts, risks, opportunities, policies, actions, targets and indicators.<\/p>\n
The GRI Standards are used by organisations to report publicly on their impacts on the economy, the environment and people. They can be used by large or small companies, whether public or private, across different jurisdictions. The GRI is structured in a modular way. It comprises universal standards, sectoral standards and thematic standards. The universal standards set out the reporting principles and the process for determining material topics. The sectoral standards help to identify impacts relevant to specific industries. Thematic standards provide reporting requirements for topics such as emissions, energy, water, biodiversity, labour, human rights, anti-corruption and taxation.<\/p>\n
For companies that are not required to report under the ESRS, the GRI may be a more accessible starting point. For companies that report under the ESRS, the GRI may be particularly useful if the company has previously reported on a voluntary basis or is part of an international group that uses this framework.<\/p>\n
The most significant difference between the ESRS and the GRI is the way in which it is determined which information is material. Under the ESRS, a company must apply a double materiality analysis. This means that a sustainability issue may be material from two perspectives.<\/p>\n
The first is the materiality of the impact. That is, the way in which the company affects people, the environment or society. For example, emissions, pollution, water consumption, working conditions or the effects on communities may be material due to the impact the company has through its operations or value chain.<\/p>\n
The second is financial materiality. More specifically, the way in which a sustainability issue may affect the company. For example, climate risks, energy costs, environmental regulations, the loss of contracts, supply chain disruptions or access to finance can become material through their effects on the company\u2019s financial performance, financial position or strategy.<\/p>\n
A matter may be material if it is relevant from one of these two perspectives. It does not have to be material in terms of both impact and financial significance. This is an important practical distinction for companies.<\/p>\n
In the GRI, materiality is approached differently. The company must identify the issues that represent the organisation\u2019s most significant impacts on the economy, the environment and people, including human rights. The GRI does not require a financial materiality analysis as defined by the ESRS. Business risks, investor interests or financial effects may be relevant to management, but they are not central to the GRI methodology.<\/p>\n
The key question in the GRI is: where does the company have its most significant impacts?<\/p>\n
The main question in the ESRS is broader. What sustainability impacts, risks and opportunities are material to the company and to those affected by its operations?<\/p>\n
This difference alters the way in which the analysis, internal dialogue, data collection and final reporting are carried out.<\/p>\n
For companies using GRI, the process should be based on GRI 3 Material Topics 2021.<\/p>\n
The first step is to understand the organisation\u2019s context. The company must analyse its activities, the sectors in which it operates, its products and services, its locations, its business relationships, its suppliers, its customers and other elements of the value chain. At this stage, the relevant stakeholders are also identified: employees, communities, customers, suppliers, public authorities, investors, trade unions, civic organisations or other affected groups.<\/p>\n
The second step is to identify current and potential impacts, both positive and negative. These may arise from the organisation\u2019s own operations or from its business relationships. Examples may include emissions, pollution, water consumption, impacts on biodiversity, workplace accidents, discrimination, effects on communities, corruption or procurement practices.<\/p>\n
The third step is to assess the significance of the impacts. For negative impacts, the GRI focuses in particular on severity and, where appropriate, probability. Severity takes into account the scale of the impact, its scope and how difficult it may be to remedy. For positive impacts, the company assesses the scale and scope of the benefit.<\/p>\n
The fourth step is to prioritise the topics. The topics that reflect the most significant impacts become material topics. For these, the company reports on how it manages the impacts and what topic-related information is relevant.<\/p>\n
This methodology is closer to due diligence and to understanding the actual impacts than to a traditional financial analysis.<\/p>\n
The ESRS is more prescriptive. The company must describe how sustainability is integrated into governance, strategy and risk management. It must explain the material impacts, risks and opportunities, as well as its policies, actions, allocated resources, targets and indicators.<\/p>\n
Under the ESRS, reporting is not limited to impact. If an issue is financially material, the company must also explain the potential effects on its business model, strategy, performance or financial position.<\/p>\n
This approach is particularly important for issues such as climate change, biodiversity, energy, the value chain, the workforce, business conduct and relationships with suppliers. The company must demonstrate not only the impact it has, but also how these issues can influence the resilience and development of the business.<\/p>\n
In the GRI, reporting focuses on material impacts and how the organisation manages them. The company must explain the process by which it identified the material topics, the list of material topics, and the management approach for each topic.<\/p>\n
It then uses the relevant topic-specific standards. If emissions are material, it can use GRI 305. If energy is material, GRI 302. If health and safety at work are material, GRI 403. If anti-corruption is material, GRI 205.<\/p>\n
GRI allows for greater flexibility in reporting, but this flexibility does not mean superficial reporting. The company must be able to demonstrate that it has identified its material impacts and that it reports on them consistently.<\/p>\n
Both the ESRS and the GRI require companies to look beyond their own operations. The value chain is important in both frameworks.<\/p>\n
In the ESRS, the value chain is relevant for identifying material impacts, risks and opportunities. The company must analyse upstream and downstream activities where these may generate impacts or create risks and opportunities for the business.<\/p>\n
In the GRI, business relationships are relevant for identifying the impacts that the organisation causes, contributes to or is directly linked to through its activities, products, services or commercial relationships.<\/p>\n
The difference lies in the emphasis. ESRS requires a link between the value chain, impacts and financial effects. GRI focuses on the organisation\u2019s responsibility for its significant impacts, including those relating to business relationships.<\/p>\n
A company that has reported using GRI has the advantage of already having data, processes, indicators and experience in engaging with stakeholders. However, a GRI report does not automatically constitute ESRS reporting. ESRS requires a double materiality analysis, structured reporting in the sustainability statement, information relating to strategy and business model, financial risks and opportunities, as well as specific requirements under European standards. For this reason, companies transitioning from GRI to ESRS need to carry out a mapping exercise. They must identify which existing information can be reused, which ESRS requirements are not covered, and where new processes need to be developed. The most common differences arise in the areas of financial risks and opportunities, the value chain, targets, anticipated financial impacts, formalised policies and data required in a more prescriptive format.<\/p>","protected":false},"excerpt":{"rendered":"
ESRS \u0219i GRI sunt apropiate \u00een multe zone de con\u021binut, \u00eens\u0103 pornesc de la \u00eentreb\u0103ri diferite. \u00cen ESRS, compania trebuie s\u0103 r\u0103spund\u0103 la \u00eentrebarea ce impacturi, riscuri \u0219i oportunit\u0103\u021bi de sustenabilitate sunt materiale, inclusiv prin efectele asupra businessului? \u00cen GRI, compania trebuie s\u0103 r\u0103spund\u0103 la \u00eentrebarea care sunt cele mai semnificative impacturi ale organiza\u021biei asupra […]<\/p>\n","protected":false},"author":4,"featured_media":9638,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[9],"tags":[],"class_list":["post-10806","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-noutati"],"_links":{"self":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10806","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/comments?post=10806"}],"version-history":[{"count":2,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10806\/revisions"}],"predecessor-version":[{"id":10808,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10806\/revisions\/10808"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/media\/9638"}],"wp:attachment":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/media?parent=10806"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/categories?post=10806"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/tags?post=10806"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}