Energy and Utilities Industry Insights
Developing a utility sustainability reporting framework
July 2013
What is sustainability reporting?
Sustainability reporting and sustainability metrics are methods that are used to measure sustainability performance and your organization’s approach and progress towards responsible resource management.
There are established standards and metrics for sustainability reporting through the Global Reporting Initiative and accounting standards for further metric evaluation are being established through the Sustainability Accounting Standards Board. This Baker Tilly whitepaper will serve as an
introduction to sustainability definitions and reporting, while subsequent papers will explore how your utility can develop a sustainability reporting
framework and controls for assurance on the reliability of your reported assurance metrics.
Sustainability reporting
By definition, sustainability is the method of using a resource so the resource is not depleted or can be replenished. The Sustainability Reporting Guidelines from the Global Reporting Initiative state that the goal of sustainable development is to “meet the needs of the present without
compromising the ability of future generations to meet their own needs.” The energy industry is well-suited to lead sustainability reporting as it
has made great strides in utilization of new technologies and internal business practices that lead to sustainability in its business model.
Reporting sustainability performance is a natural product of many of the reporting practices the energy industry has at its core foundation, with
reporting to key stakeholders, regulators, and ratepayers as part of the industry’s framework.
Establishing sound sustainability reporting practices, like any business practice, involves integrating sustainability reporting into the corporate
fabric of your organization. This involves formalizing controls that will allow for proper oversight over establishing sustainability metrics that
make sense given your utility’s corporate strategy and providing for the reliability of data collection and reporting.
Sustainability metrics
Metrics are key in sustainability reporting. Like any successful measurement tool, metrics bridge the divide between performance and reporting
through the use of statistics that are clear and understandable to the reader. Metrics also set the benchmark with which to measure your utility’s
performance against both internal and peer organizations.
In May, 2013, the Global Reporting Initiative released the G4 Sustainability Reporting Guidelines that detail the latest reporting standards and
principles being followed in sustainability reporting, as well as the categorization of industry specific standards. The next article in this Baker Tilly
series on the Sustainability Reporting Framework will detail some of these metrics and how they might be incorporated into the control environment of your energy organization.
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Energy and Utilities Industry Insights
Some metrics that are used in energy industry reports:
Sustainability metric
Sustainability metric
1. Sustainable action plan. Examples include:
a. Increase wind and hydro percentage of portfolio
b. Reduction of emissions
c. Inform and educate employees—helping employees learn to
apply sustainability principles to their daily activities
d. Establish specifications for sustainable procurement
e. Improve vegetation control methods to better protect biodiversity
2.Investment in employee safety training and reduction in workrelated accidents
3.Emissions from thermo generation operations
4.Investment in renewable energy sources
5.Results of energy efficiency programs
a.Thermostats and lighting products distributed
b.Number of commercial and industrial projects submitted
6.Investment in preservation of natural resources:
a.Preservation of wildlife habitats
b.Site restoration and enhancement
7.Percentage of energy portfolio from renewable energy sources
8.Detail on environmental management activities
9.Procurement and recycling of residual materials such as powerline hardware, computers, paper products, porcelain, clothing
10. Investment in advanced metering
11. Investment in research and development for future
sustainable initiatives
12. Positive labor relations
13. Investments and scholarships for university studies on
sustainable business practices
14. Selecting and retaining talent
15. Health awareness and promotion activities
16. Employee intellectual, social, and physical welfare
The Global Reporting Initiative G4 Sustainability Reporting Guidelines list many potential metrics that are used in the energy industry as well as
the matrix to properly classify metrics in line with your organization’s operations. Future Baker Tilly articles in this series will delve deeper and
provide details on matching the G4 outline metrics to your specific business lines.
Utility sustainability reporting leaders
Utilities in Europe have led the energy industry in sustainability reporting, but the initiative is gaining momentum in North America. According to
the Global Reporting Initiative, energy organizations that have robust sustainability reporting frameworks include:
>>Hydro Quebec
>>Energy Development Corporation
>>Pacific Rubiales Energy Corp
>>The Mosaic Company
>>Shell
>>Pemex
>>Transportadora De Electricidad S.A.
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These reporting examples can be found on the GRI website.
The report for Hydro Quebec provides an example of the range of metrics that are used by electric utilities and of dialogue that reaches out to
stakeholders and shareholders on the corporate responsibility that Hydro Quebec takes as part of its operating and reporting framework. The
report for Pacific Rubiales Energy Corp is an example of a reporting framework effective for oil and gas energy organizations, while The Mosaic
Company report is an example for mining industry measures.
Any organization that is a member of the GRI reporting framework can register their report to the GRI for inclusion in their database.
How can Baker Tilly help your organization?
In future articles in this series, Baker Tilly will discuss considerations for establishing the controls for a reliable sustainability reporting framework. As with any such initiative, using a trusted advisor to provide insights into establishing and reviewing the framework will provide assurance
to both internal preparers and report readers and also to external stakeholders. They can rely on the reporting and see that the metrics will be
beneficial in furthering your organization’s implementation strategy.
For further information, contact Russ Hissom (608 240 2361) or Megan Decker (608 240 2527).
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