The Amsterdam Global Conference on Sustainability and Transparency wrapped up a couple of days ago, and the website is a source of wonky sustainability fun. The Global Reporting Initiative (GRI), which advocates for transparent and reliable sustainability reporting and created the Sustainability Reporting Framework, produced the conference.

The event saw the release of Carrots and Sticks—Promoting Transparency and Sustainability, a study of mandatory and voluntary reporting trends worldwide produced by the UN Environmental Program (UNEP), GRI, KPMG Sustainability, and the University of Stellenbosch Business School that says government will be more involved in regulating sustainability reporting.

On balance, government oversight is a good thing—and the report shows sustainability reporting is coming of age. As Wim Bartels of KPMG Sustainability said, “Sustainability is a key business issue that needs a level playing field.” Representatives of sponsoring organizations also pointed out that:

• Regulation will result in more rigorous sustainability reporting and increased transparency, sharpen companies’ focus on their sustainability performance, and help drive professionalism and universal standards.
• Changing market conditions, information overload, and growing public demand for accountable use of resources require credible information and new management tools for reporting.

Mandated reporting is always burdensome in varying degrees, but it also raises the bar for global standards, even for voluntary reports. It means we’re all measuring the same things the same ways, backing up claims with credible information, and using the same language.

In other news from Amsterdam, the GRI announced its 2015 and 2020 goals, including a proposal to require all large and medium-size companies to report on their environmental, social, and governance (ESG) performance, or explain why if they don’t. GRI also released proposed G3.1 revisions to reporting content, and is accepted comments from the sustainability community through August 23.

We’re looking forward to joining Hub Bay Area with the May 1 opening of its new San Francisco space—8,600 square feet in the Chronicle building, encompassing offices, coworking spaces, meeting rooms, event spaces, and an art gallery.

Hub Bay Area is part of a loose organization of Hubs around the world designed to provide people who are working on or with sustainability-related enterprises (or “social innovators” in Hub parlance) with work spaces and access to mentors, partners, resources, and inspiration.

As the Hub site puts it: “We need new models that blend social and environmental value with economic viability. The system is broken. Together we can build a better alternative. When faced with a task of this magnitude, why not assemble great talent into a common space?”

We’re intrigued by what could come out of this community, and urge all you locals to check it out.

Current talk about the Obama Administration’s trouble with transparency reveals a strong parallel with sustainability-oriented businesses: it’s easy (and sounds so nice) to say you’re committed to transparency; try to deliver on that promise and you’re likely to encounter walls of uncertainty, fear, and bureaucratic resistance.

When transparency means revealing unfavorable or unflattering information (and it usually does to some extent), companies and institutions often get cold feet. They consider the negative publicity that could ensue and decide they can’t risk it. What they often fail to consider is the risk of continuing to hide and the benefits of public confession.

Someone’s bound to find out your secrets eventually, and then you have no control over the story. On the other hand, social psychology research, along with plenty of anecdotal evidence, shows that organizations that acknowledge problems—and say what they’re doing to address them—are perceived as more credible. Telling the truth makes you trustworthy. This is why attention to challenges is a factor in the Thinkshift Credibility Quotient™ (see an earlier post on how this applies to companies introducing advanced technologies).

You may be familiar with one of the best examples of transparency and acknowledging challenges: Patagonia’s Footprint Chronicles program, which traces the company’s products through the supply chain. If not, here’s a look at the site in action:

I look up a jacket, and the website tells me the sustainability “good” (it’s recyclable), and the “bad” (the waterproof finish uses a chemical that persists in the environment). It also tells me they’re researching alternatives, but for now the finish stays because it’s essential to performance.

The fact that they’re telling me a negative thing makes the positives they point out all the more credible. It also has the interesting effect of making me as a potential purchaser share responsibility. They’ve told me about the chemical; if I want to reduce its incidence, I can forego waterproofing. If I want the waterproofing, I am partly responsible for the sustainability problem. Nice, huh?