Sustainability Reporting Of Tramalway Industries
Question
Task:
You are required to watch the following YouTube clips from the GRI Secretariat:
1. The GRI Sustainability Reporting Standards: The Future of Reporting
https://www.youtube.com/watch?v=AGqE4OO0_7g&t=3s
2. Introducing the GRI Standards
https://www.youtube.com/watch?v=RDe8Kkh1BrU&t=2s
You must also read the Message from the CEO of fictional company Tramalway Industries. You must
then prepare a sustainability assessment report for Tramalway Industries.
Answer
Introduction
In any business organisation, sustainability reporting is a way of reporting openly on the environmental, social and economic impact of firm. It is not just a method of generating report from the gathered data instead it is a way to improve and internalise the commitment of a firm towards sustainable development in a method that can be visible for both external and internal stakeholders. The GRI standards embody the best practice in sustainability reporting on a global scale. It is also seen as the primal global standards for sustainable reporting. These standards are intended to be used like a set by any business entity who desires to report regarding the impact of its functions and operations and the ways by which it contributes to sustainable development (Boiral, Heras-Saizarbitoria and Brotherton, 2019). These standards are also worked as a reliable reference for the regulators and policy makers across the globe. These standards feature an interrelated, modular structure and characterise the finest practice of sustainability reporting on an array of social, economic and environmental impact on the global platform. This assignment aims to prepare a sustainable report on Tramalway Industries. This report will use the GRI standards for addressing the economic, social and environmental sustainability of the firm.
Economic sustainability
In the GRI standards, the economic aspect of sustainability is related to the impact of a business entity on the economic situation of stakeholders along with the economic systems at global, local and national levels. The economic sustainability standards are related to the capital flow amid various stakeholders and its main influence on the entire society. The GRI standards that are related to the economic sustainability of the Tramalway Industries are as follows:
1. Disclosure 201-4
The disclosure 201-4 of the GRI standards of economic sustainability is related to the financial assistance that are received by a business entity from the government. It involves information regarding the monetary value of financial assistance, relief in tax, tax credits, investment grants, subsidies, royalty holidays, and many others. As mentioned in this disclosure, any research and development grant are also a part of financial assistance from the government (Thomas, 2019). Tramalway Industries had gained a research and development grant of $15 million from the Federal Government for conducting research in the field of biotechnology.
2. Disclosure 203-1
The GRI 203 standards are related to the indirect economic influence that are supplementary significances of the direct influence of flow of money and direct transaction amin a business entity and its stakeholders. The disclosure 203-1 of GRI standards address the influences of the support of infrastructure services and investment of a business entity have on the economy and its stakeholders. The effect of infrastructure investments can encompass yonder the scope of the operation of a firm. Such investments involve utilities, health and welfare centres, transport links, sports centres and community social facilities. Tramalway Industries has completed a project on health and welfare centre of worth $10 million in Dolan Bay, SA. The main purpose of this centre is to provide support to the families that are handling with an array of social issues.
3. Disclosure 204-1
The GRI 204 standards are related to the practices of procurement in an organisation. It entails the support provided by a firm from the local suppliers. It also involves the sustainability reporting of the ways by which the procurement practices of a business entity contribute or cause to negative influence on the supply chain. The disclosure 204-1 of the GRI standards mainly addresses the proportion of spending on the local suppliers. The firms conduct local purchases either through managing budget at headquarter of the firm or at location of the operation (Gallego-Álvarez, Lozano and Rodríguez-Rosa, 2018). A business entity can indirectly entice additional investment towards local economy by providing support to the local suppliers. It an also be a strategy for ensuring supply, maintain community relations and supporting local economy. While using this disclosure, a business entity must involve procurement budget percentage used for important places of operation which is spent on the local suppliers to that operation, geographical description of local for the firm and significant places of operation. Tramalway Industries has changed its suppliers due to certain issues. The purchased of goods and services from the new local suppliers has required about 75% of the total procurement budget of the company.
What is environmental sustainability reporting?
In relation to the GRI standards, the environmental aspect of sustainability is related to the influence of the functions and operations of a firm on the non-living and living natural system which covers land, water, ecosystem and air.
1. Disclosure 301-1
The GRI 301 standard is related to the topic of material. The inputs that are used for manufacturing and packaging the services and products of a firm can renewable like water or wood or be non-renewable like minerals, oil, coal, or gas. Both type of materials can be composed of recycled input material. The dependence of an organisation on natural resources can be identified by recognising the amount and type of material use by a firm. The disclosure 301-1 of the GRI standards is related to the materials used by volume and weight. It instructs about the sustainability reporting of type of material used, process material, sei manufactured goods and others (Globalreporting.org., 2020). Tramalway Industries is using both recyclable and renewable material from new suppliers. It has reduced the total weight of non-renewable material to 55 tonnes and enhanced the total weight for renewable materials to 45 tonnes.
2. Disclosure 301-2
The disclosure 301-2 encompasses used recycled input material by a business entity. It enables a business entity to mention the used percentage of recycled input material for manufacturing the primary services and products of the firm. Tramalway Industries has experienced an increase of 25 tonnes in the used of recycled input material.
3. Disclosure 306-3
The GRI 306 standards are related to the waste and effluent. This involves generation, disposal and treatment of waste, water discharge, fuel, chemical and oil spills and others. the influence of water discharge is different and depends on the destination, quantity and quality of discharge. The discharge of waste or effluent in an unmanaged manner with the presence of high nutrient or chemical can impact on the water supply, aquatic habitats and the relationship of a fir to the community and others. the treatment, disposal and generation of waste involves improper transportation of it which can cause harm to the environment and human health. The disclosure 3 of this standard covers the sustainability reporting elated to the significant spills by a business entity (Globalreporting.org., 2020). While using this standard in reporting, a firm must provide information regarding the total volume and number of the recorded important spills, information about the spills that has also mentioned in the financial statement of the firm and location of spills. The sustainability reporting can also involve material like oil, fuels, wastes, chemicals or others of spill and its volume. The influence of the spills can also be mentioned in the reporting. Tramalway Industries has faced an issue because of the significant fuel spill. The location of the spill was as a ware house located in Chemora, Queensland. The volume of spill was about 8 kilolitres which was caused due to a rupture in a fuel tank in soil. The spill was directly soaked into the ground which can impact on the quality of soil.
Social sustainability
In relation to the GRI standards, the social aspect of sustainability is the impact of the functions and operations of a business entity on the social system inside which it functions.
1. Disclosure 408-1
The GRI standards has defined a young worker as an individual who are above the pertinent least working age and smaller than the age of 18 years. The disclosure 408-1 of the GRI standard does not need quantifiable reporting on number of young workers or child labour. Instead of it, this mainly involves sustainability reporting regarding the suppliers and operations which are measured to have substantial rick for child labour incidents or young workers that are exposed to any hazardous work. The convention of International Labour Organisation refers child labour as an abuse which can not be muddled with the working children or with working young persons which may not get abused (Globalreporting.org., 2020). The minimum employment age varies as per the nations but ILO has stipulated a minimum employment or working age which is 15 years or after the accomplishment of mandatory schooling. However, certain countries have exception due to the insufficient educational and economic facilities as they have stipulated minimum age to 14 years. The incidents of child labour or the risk associated with it have serious influence on the firm as well as on the society. Therefore, this disclosure of GRI standards mainly emphasises on sustainability reporting regarding the suppliers and operations at substantial risks for the child labour incidents. Tramalway Industries has faced concerning issue because of the ongoinguse of child labour in Bangladeshi manufacturing facilities. The company has investigated the issue and found that one of its suppliers named as Golden Goods limited employed child labours for producing their products. The company did not have prior information regarding the issue and such act of their supplier was a breach of the supply contract of company. Due to this reason the company has terminated its contract with Golden Goods limited.
2. Disclosure 412-2
The disclosure 412-2 of GRI standards is related to the training of employees on the policies of human rights or processes regarding facets of human rights which are related to operations involving the application of procedures or policies of human rights to the employees that are at work. The training can be defined as a training that is provided to human rights subject or to a module of human rights within a universal training program. This disclosure involves sustainability reporting about the total hours in which training is provided to the employees. The information from the sustainability reporting can illustrate the capacity of a firm to applicant its procedures and policies of human rights. Tramalway Industries has also conducted a training program for employees on human rights. The total training hours that has are completed by this program are 100 hours. The training involves the facets of human rights which are related to the operations of the firm. It can also be said that 35% employees of the company have received training about the principles of human rights which involves human respect, dignity, gender equality and others.
3. Disclosure 417-3
The GRI standard disclosure 417-3 is related to the event of non-compliance that happen within the period of reporting can connect to events previously resolved during the period of reporting regardless of their occurrence in the reporting period (Globalreporting.org., 2020). This disclosure comprises the sustainability reporting regarding events of non-compliance which are related to the marketing communication. Marketing is a significant way of communication among customers and firm and is entailed with various voluntary codes, regulations and laws like Consolidated Code of Advertising and Marketing Communication Practice of International Chamber of Commerce (ICC). Tramalway Industries has faced an issue regarding the marketing communication because of the investigation from Australian Competition and Consumer Commission (ACCC). It has been found that the company has engaged in the misleading and false conduct. The company has also faced an Infringement Notice with a penalty of $12,600. The company has paid the fine and also updated its policies of marketing for avoiding such issues in future.
Conclusion
GRI standards provide guidelines which are effective in conducting sustainable reporting by any business entity. The sustainability reporting of Tramalway Industries has been performed in this work with the usage of suitable disclosure of GRI reporting. This reporting has shown the extent of sustainability in Tramalway Industries in the economic, social and environmental aspect.This work also shows that these standards are effective are providing sustainability reporting.
References
Boiral, O., Heras-Saizarbitoria, I. and Brotherton, M.C., 2019. Assessing and improving the quality of sustainability reports: The auditors’ perspective.Sustainability reporting Journal of Business Ethics, 155(3), pp.703-721.
Gallego-Álvarez, I., Lozano, M.B. and Rodríguez-Rosa, M., 2018.An analysis of the environmental information in international companies according to the new GRI standards. Journal of cleaner production, 182, pp.57-66.
Globalreporting.org. 2020. [online] Available at:
Globalreporting.org. 2020. [online] Available at:
Globalreporting.org. 2020. [online] Available at:
Globalreporting.org. 2020. [online] Available at:
Thomas, E.A., 2019. How Useful Is the Global Reporting Initiative (GRI) Reporting Framework to Identify the Non-financial Value of Corporate Social Performance (CSP)?.In Responsible Business in Uncertain Times and for a Sustainable Futuresustainability reporting (pp. 37-87).Springer, Cham.
