GRI’s Climate Change and Energy Topic Standards have been reviewed and updated.
There’s a good reason why the GRI Standards are the world’s most widely used sustainability reporting standards. Having recently updated the Climate Change and Energy topics, GRI’s updated standards offer a more holistic, detailed, and socially attuned climate reporting framework, going beyond what’s required under the XRB’s Climate-related Disclosures (NZCS) regime.
Purpose and Lens: Comparing GRI Standards and XRB’s NZCS Regime
- XRB NZCS: is designed for compliance and financial risk management and focused on financial materiality of climate-related issues — i.e. how climate risks/opportunities affect enterprise value. It’s more narrowly focused on investor interests.
- GRI: Anchored in impact materiality, GRI covers impacts of an organisation on people, the environment and the economy. As such, GRI takes a broader, multi-stakeholder view that reflects good corporate citizenship. GRI is designed to highlight and disclose these broader system-level sustainability impacts.
- XRB hasn’t mandated GRI alignment, but NGOs, iwi, and local authorities in Aotearoa are increasingly favouring GRI for its inclusiveness and impact-first lens. There have been indications from XRB and the NZ Government that broader reporting, of the sort enabled by GRI, is desirable.
- For NZ firms that are serious about leadership in climate, ESG and sustainability, aligning with the GRI’s updated standards will help future-proof reporting and credibility, whilst informing decision-making on a broader range of issues and risks.
What You Need to Know about the GRI’S Updated Standards
- Double materiality: GRI supports credible disclosure of an organisation’s broader impacts on people and planet, aligning with XRB’s signals toward wider reporting. Combined with a financial lens for how ESG issues affect firms, it offers a robust way to disclose both current business risks and the impacts that may drive future ones. Double-materiality is increasingly viewed as good practice.
- Interoperability with ISSB and ESRS: it will suit some NZ companies to align with IFRS S2 (where operations, investors or customers are in jurisdictions using that standard) and these GRI standards allow that with minimal duplication. That could be a win for firms disclosing to multiple jurisdictions (e.g. exporters and trans-Tasman firms) who want to tell a broader story more credibly about sustainable development and impact.
- Reputation and risk: NZ firms with overseas investors, customers or partners (especially in Europe) will find these standards help meet increasing global due diligence and transparency expectations (e.g. CSRD, CBAM, SFDR).
- Transition planning and just transition: The new standards require disclosure of climate transition and adaptation plans, and how impacts on workers and communities are being managed. These are likely to mirror underlying public sector expectations for just transition and adaptation planning — especially for councils, infrastructure providers and Crown entities. The GRI standard includes information about risk to workers, supporting re-skilling, community and stakeholder engagement processes, protecting vulnerable groups; as well as governance / oversight of social implications arising from transition planning. This reflects GRI’s focus on accountability for human impacts, not just environmental outcomes.
- Energy use and mix: Energy use is an increasingly hot topic and GRI requires detailed disclosures about demand, mix and trends. That includes total consumption, energy intensity, energy sources, reduction and efficiency initiatives alongside trends and performance over time. The standard enables transparency not just about climate risk, but about a company’s operational energy footprint, efficiency trajectory, and contribution to the energy transition — all very relevant impact areas that financial-only frameworks like IFRS S2 treat as secondary.
- Pressure on suppliers: GRI’s Scope 3 and value chain focus means large NZ companies may require more data from SMEs and suppliers, which could catch smaller players off-guard.
For NZ organisations wanting to lead, combining NZCS (risk + governance) with GRI (impact + equity + energy) creates a full-spectrum, credible climate report. The bottom line: GRI expects organisations to treat the climate transition as a people-centred change process, requiring transparency on both risks and responses for those most affected. This is absent in IFRS S2 and NZCS. In our view, GRI’s more holistic approach is likely to suit those aiming above a compliance-first approach and enable better management of a broader range of sustainability risks.
The Details
The recent review of the GRI topic standards covers GRI 302: Energy 2016, GRI 305: Emissions 2016 (Disclosures 305-1 to 305-5), and GRI 201: Economic Performance 2016 (Disclosures 201-2: Financial implications and other risks and opportunities due to climate change).
Here’s a high-level summary of how the update GRI disclosures compare to XRB NZCS and IFRS S2.
XRB vs GRI
| Disclosure Area | XRB NZCS (Mandatory) | GRI 302/305 (Voluntary) | IFRS S2 (Mandatory in some jurisdictions) |
|---|---|---|---|
| Scope 1–3 Emissions | 🟢 Required Scope 1-3, aligned with GHG Protocol | 🟢 Required Scope 1-3 plus context, methodology, and allocation approach | 🟢 Required |
| Emissions Methodology Disclosure | 🟡 Basic reference to methodology | 🟢 Detailed method, scope and assumptions | 🟢 Required and based on GHG Protocol |
| Energy Use and Mix | 🟡 Not explicitly required | 🟢 Detailed energy demand, mix and trends | 🟡 Optional unless material to climate risk |
| Energy Efficiency Measures | 🟡 Not explicitly required | 🟢 Required in detail | 🟡 Optional |
| Carbon Offsets and Removals | 🟡 High-level disclosure | 🟢 Detailed info on type, quality, accounting treatment, and offset integrity | 🟢 Required incl. quality and permanence |
| Transition Plan | 🟢 Required with scenario-based insights | 🟢 Required with added emphasis on targets, just transition, barriers, and governance | 🟢 Required with specific targets and financing |
| Adaptation Strategy | 🟢 Required – high level disclosure | 🟢 Required with vulnerability assessments and adaptation outcomes | 🟢 Required incl. vulnerability and response |
| Climate-related Risks and Opportunities | 🟢 Required | 🟢 Required incl. mitigation outcomes | 🟢 Required incl. opportunities and time horizons |
| Just Transition Impacts | 🔴 Not specifically addressed | 🟢 Required | 🔴 Not specifically addressed |
| Social and Worker Impacts | 🔴 Not specifically addressed | 🟢 Required for workers, communities, and supply chain impacts of the climate transition | 🔴 Not specifically addressed |
| Governance of Climate Strategy | 🟢 Required | 🟢 Required incl. responsibilities and oversight | 🟢 Required incl. board oversight and roles |
| Scenario Analysis | 🟢 Required | 🟡Optional but encouraged | 🟢 Required incl. resilience to multiple scenarios |
| Value Chain Engagement | 🟡 Emerging expectation | 🟢 Required and central | 🟢 Required for Scope 3 and value chain risks |
| Double Materiality (Impact & Financial) | Financial materiality focus | Impact materiality focus | Financial materiality focus |
