Cristina graduated the Faculty of Land Reclamation and Environmental Engineering, and completed post-graduate courses in marketing (Bucharest Academy of Economic Studies) and journalism (London School of Journalism). Prior to working as an independent CSR and sustainability consultant (2013-2015), Cristina has coordinated the activity of the UN Information Centre Bucharest (1998-2012).
In April 2015, she become the first sustainability reporting specialist in Romania and the sixth in the world to have passed the G4 exam. Cristina is also a certified sustainability assurance practitioner, and her areas of expertise cover stakeholder engagement (AA1000 SES), non-financial/sustainability reporting (Global Reporting Initiative, UN Global Compact) and sustainability assurance (AA1000 AS, AA1000 APS by AccountAbility).
What is the impact of the Non-Financial Reporting Directive implementation in Romanian legislation?
We must accept first that EU Member States, Romania included, need to issue national provisions in order to comply with the EU Directive 95/2014 by 6 December 2016. Also, we need to take into account that 2016 is an election year for Romania. This might lead either to a set back, or to a political rush, which is unproductive and definitely unhealthy. With that in mind, I think the first non-direct impact is that all stakeholders must come together and decide what are their material issues, what is important to them as an industry or as a community, and what is important to Romania, as a country.
If the law that would be passed by the Parliament would satisfy as many stakeholders as possible, we are safe. That would send a good signal to the international community and to the business community in Romania: that we no longer accept corruption, social discrepancies, lack of diversity, pollution, or irresponsible use of resources as business as usual. I wouldn’t mention any ‘but’ here, because I hope that we will no longer lose a momentum.
What are the main standards for non-financial reporting?
Well, there are a few frameworks companies could use: CDSB Framework issued by the Climate Disclosure Standards Board; UN Global Compact; OECD Guidelines for Responsible Business Conduct; ISO 26000; SASB; IR; or GRI (Global Reporting Initiative).
When is comes to sustainability reporting, however, GRI is the most widely used. What I like about GRI is that is includes both principles and key performance indicators. It guides reporting organizations throughout the reporting process, laying the grounds for a solid stakeholder engagement and matching their KPIs with international responsible business principles.
Out of the 25,000 reports registered in GRI’s sustainability disclosure database, 19,100 are GRI reports. There are about 7,700 organizations – public or private companies, NGOs, universities, even public institutions – that issued GRI-based sustainability reports. That speaks volumes.
What are the benefits for companies in terms of reporting on the short term? How about the long term?
There are many benefits that could be mentioned here, and I wouldn’t split them into short-, medium- and long-term because sustainability is about the future, whether by ‘future’ we refer to ‘tomorrow’, to the next decade or to the next century.
Worth to mention here that CRPE (Romanian Centre for European Policies) conducted a study among the 24 companies in Romania that undertook nonfinancial reporting processes. Indeed, it’s only 24 of them! But lets see the bright side of it: they are the pioneers; they are our case studies.
In no particular order, here are the benefits as seen by these companies: they gain reputation, a social license to operate, and a better public image; they position themselves as pioneers and industry leaders; the reporting process helped them in defining a sustainability strategy; they are now able to measure their business results against multiple materiality layers and KPIs; and they engage their employees in their strategic business decisions.
What needs a company to start reporting?
First, they need to know why they do it. If it’s only for compliance purposes, for ticking a box, they miss the point. But if there is a strategic reason that drives them, phew, they are on the right track.
Next, they need to decide if they count on internal resources (human, financial), or if they outsource the service. In the same time, they need to decide if they wish (or need) to assure their report or not. If they do it internally, I strongly recommend the assurance service. The benefits of the sustainability assurance, as described by GRI, are: increased recognition, trust and credibility; reduced risk and increased value; improved Board and CEO level engagement; strengthened internal reporting and management systems; and improved stakeholder communication. On the other hand, reporting organizations always have the option to submit their G4 reports to GRI for materiality disclosures or for the content index services.
Thirdly, they need to prepare for a long, painful, but extremely rewarding process: it takes about 6 to 8 months to do it rightly at first, but it slowly decreases in intensity once you have some experience, and people know exactly how, what, and when they need to deliver.
What competences are required to perform a correct reporting?
If I were to continue my previous answer, I would say that you need the right people in order to navigate unsafe waters. Ideally, whoever coordinates the reporting process should have some hands-on experience. People believe that reporting is about throwing some figures and texts into one document that no one reads anyway. Or that reporting is a PR exercise.
Reporting brings about a high degree of accountability and legal obligations. Check what’s going on in the USA, where well-known companies are taken to High Courts for statements included in their non-financial reports.
Returning to your question, I would recommend that companies work with skilled and well-trained people, either staff or consultants. They need to check credentials, commercial licenses to operate, or anything that could keep them and their reputation safe. These people need to check and triple-check any information that goes public especially once the legislation enters into force. Reporting, whether it’s financial or non-financial, is a serious business.
Do’s and don’ts for a company in terms of reporting?
If I could blend the dos with the donts, I would come up with the following: Aim high. Don’t shy away from any of your stakeholders. Engage as many as possible, as wisely as possible. Set smart targets. Be transparent. Don’t give up. Set a strategy and follow the plan. Keep in mind that reporting is a process. Don’t forget to communicate what you’ve done. Keep an eye on your competition. Be better next year.