XBRL Taxonomy for G3

Guest blogger: Debbie Dickinson

GRI today released its XBRL taxonomy for the G3 Guidelines. Don’t switch off yet! And yes, I hear you saying it “what does all that mean?” I myself have sat many a-time with Sean Gilbert, our technical director who worked closely with PwC to develop the taxonomy. His patience means I think I finally get it.

Basically, XBRL –eXtensible Business Reporting Language – is way to exchange data. It’s been used for ages in financial reporting systems, and involves “tagging” data. This means that when you go looking for a piece of data, you can search for it and retrieve it via the “tag”, rather than by sifting through reams of spreadsheets, pdfs, documents, web pages etc. XBRL is really set up for exchanging data electronically, between computers.

It’s proven really successful in the financial reporting world. Some say even “revolutionized” the way that businesses report.

For sustainability reporting, the release of XBRL is a huge, positive step. It means we’re moving so much closer to easily comparable reporting. Organization have (and, I believe, rightly so) developed such different styles of disclosing their performance, depending on their needs. But this means it’s sometimes been a lot of work for analysts, employees, stakeholders and other report users to find the exact disclosure item they’re looking for. Now with the XBRL taxonomy, it will be easier to overcome these obstacles and move to more efficient data distribution (for companies) and collection (by investors and other report users). Many tip that XBRL will also reduce questionnaire fatigue.

The moment where I really started to understand XBRL was when Sean (our technical director) told me a little story “imagine two kids drawing, each with their sets of 64 Derwent pencils in front of them (the joy!). One says to the other ‘can I borrow your red pencil color #234’. The other knows exactly which red pencil to hand over; and there is no confusion between either kid as to which shade of red is requested.” So the color numbers are the tagged pieces of sustainability information, and now there’s no confusion between report users and makers about which pieces of economic, environmental and social data are in question.

Find out more about the newly released XBRL taxonomy, developed in collaboration with XBRL experts from PriceWaterhouseCoopers.

Still unsure what it’s all about? Follow the link to “leave your comment” and post your questions here