The director of Global Reporting Initiative’s (GRI) South Asia regional hub, Aditi Haldar, says that transparency in Indian business is important for foreign investors. GRI is an international, independent organization that helps businesses, governments and other organizations understand and communicate the impact of business on sustainability issues such as climate change, human rights and corruption.

Edited excerpts from an interview:

How is the Global Reporting Initiative (GRI) relevant for Indian companies?

India has emerged as a major global economic player and that is why the disclosure of sustainability impacts has become important for Indian companies. Questions about how a business is contributing to climate change or its human rights record are risks that diligent investors want to know about before trusting companies with capital. Also, as multinational companies search for new businesses to bring into their supply chains, the sustainability performance of potential suppliers is an important factor.

How have Indian companies responded to GRI? Where do they stand as compared to companies in other countries?

Sustainability reporting is fairly new to most companies in India and South Asia. We are encouraged by the fact that India has the highest percentage of companies that submit their reports for external assurance, giving them more credibility in the market.

Why do you think sustainability must be included in a company’s DNA?

We believe this is a crucial part of how we address pressing issues such as climate change, human rights violations and corruption. These challenges won’t be met if companies take up sustainability in a superficial manner and this is why we believe sustainability should be a part of a company’s DNA.

What is the value of sustainability?

Internally (for a company), sustainability efforts can improve management systems, motivate employees and help with the identification of business strengths and weaknesses. Externally, robust sustainability reporting helps businesses attract funding, gain competitive advantage and improve corporate reputations with stakeholders and the public.

The definition of sustainability is very broad. So, if one were to assess the sustainability of a business, what are the aspects one should take into account?

The concept of sustainability is indeed broad, but that’s because there are many factors, not just financial capital, that contribute to the long-term viability of a business. Businesses rely on workers, consumers, environmental resources such as water, oil and commodities, as well as investors. The aspects that businesses need to take into account differ per business. GRI Standards lay out a comprehensive list of aspects and indicators. As such, companies need not disclose information on each and every one of the indicators, but instead should focus on the ones that are most important, in terms of the ability of the business to continue operations over the long term.

Is there a need for a legislation or just more time for the importance of sustainability to become common knowledge?

Governments and regulators have a direct interest in sustainability reporting—it can help markets function more efficiently, and drive progress towards sustainable development goals.

Legislation has played a key role in advancing sustainability in certain regions. In others, reporting done on a voluntary basis has led to improvements in the sustainability performances of organizations. Both legislation and voluntary reporting play a role in making sustainability reporting common practice.