Oil on troubled waters

Why has the oil industry produced its own sustainability reporting guidelines – apparently leaving the GRI to its own devices?

The international oil industry has produced a new version of its sustainability reporting guidelines. This comes in the middle of the GRI oil sector supplement development. While the industry guidelines acknowledge the GRI – and even discuss how it differs – this is not a helpful step.

Some of the key problems with the new version of the oil industry guidelines include not addressing the major impact of oil: burning it. In the words of the external stakeholder panel:

“it does not provide more emphasis on the need for the industry to report on actions taken to reconcile the twin challenges of energy security and climate change. One  notable example is greenhouse gas emissions related to the use of petroleum product”.

In addition, reporting on tax expenses is reduced to commentary, without the need to produce hard figures. And transparency over taxation is one of the most important ways to tackle corruption. In this sense, taxation is a crucial indicator of development impact.

Despite all this, the guidelines are described as the formulation of an  “industry consensus on the most material sustainability issues and the associated choice of consistent indicators and reporting elements”. Well, they definitely represent an industry consensus, but could not be presented as any kind of cross-stakeholder view.

Even the industry’s own Stakeholder Panel is asking them to co-operate with the GRI.