New global sustainability ratings initiative set to launch

Allen White, the co-founder of the Global Reporting Initiative, is among the principals behind a new initiative designed to get rid of “confusion and opacity” in sustainability performance ratings and create a generally accepted sustainability ratings framework.
The project, Global Initiative for Sustainability Ratings (GISR), is a swipe at the profusion of sustainability ratings providers and the “proliferation of tools and methods” which GISR says has created confusion for the market.
GISR grew out of the Tellus Institute’s ‘Corporation 20/20’ project whose backers include major corporations such as General Electric Co., Hewlett-Packard, Citigroup and State Street Corp. Domini Social Investments, KLD (now part of MSCI), the Corporate Library, Greenpeace and the UK’s Department of Trade and Industry (DTI) are also supporters.
The steering committee comprises White, Michael Marx of Corporate Ethics International and Mark Tulay, former head of ESG Solutions at RiskMetrics. It’s hoped that GISR will develop into a stand-alone, non-profit, global organisation.
GISR aims to create sustainability ratings products that will be “public goods, accessible to all users at nominalor no cost”. The activities will be via “an independent, non-commercial, multi-stakeholder process”.
The founders say the rapid consolidation of the ratings field and the proliferation of new raters are undermining confidence and trust in the quality of “available ratings frameworks”. It’s argued that it’s not uncommon for a single company to annually complete a dozen or more disparate questionnaires – with equally disparate outcomes.
GISR says it will drive the resources of asset owners and asset managers, government procurement, consumer purchasing, and civil society toward organizations that are true sustainability leaders.
“We believe it is time for an independent, non-commercial initiative to produce a white paper on the rating agencies and, more broadly, to chart a longer term strategy for building a world-class, normative ratings framework to guide capital, procurement and business-NGO partnerships toward companies that are true sustainability leaders,” said Tulay.
He said: “We are collaborating with asset managers, pension funds, foundations, and NGO’s that share a commitment to shaping and strengthening the future of sustainability ratings.”