Sustainability is an issue that is pertinent to every business sector, but arguably none more so than aviation. Indeed, the sector has its own Sustainability Reporting Framework developed by the Global Reporting Initiative (GRI) to address issues of particular relevance to airport and airline operators.
In the case of airports, there is a particular framework for reporting risks like wildlife strikes, noise and human trafficking.
So what are the organisational and management challenges that face airport operators as they seek to achieve compliance with the GRI Reporting framework?
What milestones can airport operators achieve along the way and how best can reporting be used to promote the commercial, environmental and social responsibility of the airport in question?
One of the key principles underlying GRI is the expectation that the reporting organisation identifies its stakeholders – those that it impacts and those that impact upon it – and reports on how it has responded to their reasonable expectations and interests.
Without doubt, the demands of the international community for airports and airlines to act in a responsible manner now place new burdens on management.
And, there is no denying that adherence to the requirements of the Global Reporting Initiative has an impact throughout the organisation, and represents a new style management challenge, at a time when there are plenty of those.
However, it is a challenge worth undertaking in order to ensure sustainability and, in essence, an airport’s licence to grow.
The mounting expectation for airport and airline management to communicate about its environmental, economic and social performance has largely been focused on ‘green issues’ and the steps being taken by the industry to mitigate those concerns. But, there is more.
The industry is increasingly being pressed to demonstrate the steps it is taking in other areas, such as its performance in reducing the risk of accidents and minimising incidents of ‘wildlife strikes’.
Noise is another area of concern, particularly as it pertains to people living near airports. As there are no internationally agreed airport noise standards, the GRI reporting structure should help the industry report how it measures noise, enabling it to make necessary improvements.
The scope of GRI reporting can be further extended to include impact on local communities through employment and business development; impact on biodiversity; and, even, human trafficking.
Delta is the latest airline to put GRI reporting front and centre. In its 2012 Corporate Social Responsibility report, CEO Richard Anderson, commented that the airline was looking to build a business model that would improve its sustainability “for the benefit of our customers, employees and shareholders for many years to come.”
Crucially, he added, that Delta believed that “transparency goes hand in hand with sustainability.”
The report highlighted significant accomplishments, among them, were reducing its annual aircraft greenhouse gas emissions by 8.4 million tonnes since 2005; verifying its greenhouse gas emissions from 2005 to 2011; and, establishing standards for calculating and publicly reporting carbon footprints.
It also reveals that Delta has successfully reduced the number of 50-seat regional jets it operates and replaced them with larger two-class aircraft that are far more fuel efficient.
Delta Air Lines also claims to have addressed 11 additional Global Reporting Initiative indicators than in its 2011 report. The situation clearly demonstrating that, for many, achieving GRI standards is a work in progress.
The comparatively new trend of sustainable development means that there has not only been an increase in the number of organisations in the aviation sector issuing reports on their sustainability activities, but also in those having them assured by an independent third party.
These best practices are strongly encouraged by GRI as third-party assurance of a report’s materiality, accuracy, consistency and completeness, enhancing the credibility of the report, while driving improvements to the organisation’s internal data collection and reporting process.
It is also worth noting that third-party assurance is not a one size fits all process, and needs to take into account the organisation’s business and its distinct sustainability challenges. It involves working with those responsible for collecting and collating reporting data, as well as those drafting the report’s content.
So what should an in-depth, third-party assurance assessment focus on? The simple answer, is the material issues driving sustainability in an organisation.
This can be achieved by comparing what the organisation views as its most important issues, such as those discussed at senior management meetings, and those the organisation chooses to report publicly.
This internal materiality scan is then supplemented by reviewing the company’s external stakeholder communications (media and blogs, for example) and then verifying message alignment between the ‘inside’ and ‘outside’ story.
An assurance process that is skewed towards verifying data can be a costly, time-consuming exercise that provides limited value to the reporter and the intended audience.
Assurance should help the organisation make sure it is “getting the right numbers not just getting the numbers right.”
There is, of course, a commercial imperative behind all of this as well. According to a survey conducted by Accenture and the UN Global Compact, the incorporation of sustainability within management thinking and processes is a way, of “strengthening brand trust and reputation”.
The aviation industry is no different to others in seeking evidence that a rigorous commitment to sustainability will lead to increased revenues, lower costs, less risk, improved reputation and stronger corporate governance.
Independent verification of that is the shortest, most transparent route towards achieving a competitive advantage.