German Sustainability Code

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The German Sustainability Code ( DNK ) is a cross-sector transparency standard for reporting corporate sustainability performance and can be used by companies and organizations of all sizes and legal forms. It was developed in 2011 by the German Council for Sustainable Development in a stakeholder process and has since been revised several times. In its last revision (as of August 2017), the legal requirements of the CSR Directive Implementation Act were integrated.

General

The German Sustainability Code (DNK) provides a framework for reporting non-financial services that can be used internationally by organizations and companies of all sizes and legal forms. It was decided on October 13, 2011 by the German Council for Sustainable Development following a stakeholder process . The DNK makes corporate sustainability achievements visible and better comparable through standardization . It thus broadens the basis for assessing sustainability and describes minimum requirements for reporting companies and organizations. In order to meet the GSC, users create a declaration of conformity for 20 GSC criteria on strategy, process management , environmental issues, employee issues and society as well as corporate governance . In addition, they report or explain selected performance indicators of the Global Reporting Initiative (GRI) and the European Federation of Financial Analysts Societies (EFFAS). The 28 GRI or 16 EFFAS performance indicators are either reported (comply) or the deviation is explained (explain). This is possible, for example, if data has not yet been collected or the information required is not essential for the business case. In addition, industry-specific supplements or orientation aids and guidelines for savings banks, the Federal Association of German Banks , Housing , Food , Waste Management and City Cleaning as well as a university-specific DNK are available. As a result, users describe the core of corporate sustainability in their specific business case. In addition, they receive new impulses for the integration of sustainability into the core business and thus gain a competitive advantage in the long term . The companies' declarations of conformity are published in a database on the DNK website.

history

The Council for Sustainable Development initiated the German Sustainability Code after discussions with politicians, investors and analysts from the financial world, companies and civil society organizations. After extensive preparatory work at expert level, the Sustainability Council presented a first draft on November 29, 2010 and invited the public and all companies to a dialogue about it. By the end of the dialogue phase on February 25, 2011, the Council had received almost eighty statements and contributions to the discussion. These contributions, a qualification workshop with companies on May 9, 2011 and the experience of a practical test from June to August 2011 formed the basis for the further development of the design. At the multi-stakeholder forum on September 26, 2011 in Frankfurt am Main, questions about the scope of the code and its implementation were discussed in public. The results were incorporated into the decision-making meeting of the Sustainability Council on October 13, 2011. The German Council for Sustainable Development has now presented the German Sustainability Code of October 13, 2011 in a fourth updated version from July 2017. Chancellor Angela Merkel praised the German Sustainability Code in her speech at the annual conference of the Council for Sustainable Development on June 25, 2012. It is a good guide for sustainable business . In the foreword of the DNK Angela Merkel " invites every company to apply the German Sustainability Code and to make better use of the opportunity to do business sustainably." The current version of the DNK is legally compliant with the requirements of the CSR Directive Implementation Act, which the European Directive for Implemented corporate non-financial reporting (2014/95 / EU) into national law. Companies can thus use the DNK to draw up a non-financial declaration.

application

Companies often set up or integrate a sustainability team first. The project group then determines at which points information may be missing and who in the company could provide it and then collects all quantitative and qualitative information for the respective criteria. The company creates a company profile in the database through which the information can be entered. Then the declaration of conformity is checked for formal completeness by the DNK team. If reports are made on all criteria according to the “comply or explain principle”, the DNK team or, if requested, the company itself, publishes the declaration of conformity. Otherwise, the company will receive feedback on the information that has yet to be supplemented before the declaration is activated. The DNK declarations of conformity are available to all interested parties in a free database. The implementation was funded by the Federal Ministry of Education and Research (BMBF) as part of a project by the Sustainable Business Institute (SBI) in the first few years .

Fulfillment of the CSR reporting obligation

As of the 2017 financial year, numerous larger companies in Germany and the EU will have to provide data on environmental, social and employee issues, on respect for human rights and the fight against corruption . It requires the EU Directive 2014/95 / EU of October 22, 2014 on the disclosure of non-financial and diversity information . According to the Hans Böckler Foundation, around 540 large companies in Germany are affected by the reporting obligation. Large, non-listed companies are spared. In addition, medium-sized companies (SMEs) in particular will be indirectly affected. An external legal opinion confirmed that with the GSC, users are already fulfilling all aspects of the EU reporting obligation on extra financial information adopted in 2014.

DNK for SMEs

The DNK is particularly suitable for SMEs as it is easy to use. In cooperation with the Bertelsmann Foundation, the German Council for Sustainable Development has drawn up guidelines for SMEs that lead step by step to the declaration of compliance. According to the guidelines, sustainability is part of everyday business for many medium-sized companies. However, the services are often not documented - this is exactly where the declaration of conformity should start and offer the SMEs a means of documentation to the public.

Overview of the DNK criteria and performance indicators

The performance indicators of the Global Reporting Initiative (GRI) and the umbrella organization of the national associations of European financial analysts (European Federation of Financial Analysts Societies, EFFAS) listed below support DNK reporting. The companies can freely decide which set of indicators they report (GRI G4 / SRS or EFFAS). This decision is to be retained for the entire code.

DNK criteria Performance indicators
strategy

1. Strategic analysis and measures
2. Materiality
3. Goals
4. Depth of the value chain

  • no
Process management

5. Responsibility
6. Rules and processes
7. Control

  • GRI SRS-102-16 Values, principles, standards and norms of behavior of an organization.
  • EFFAS S06-01 Percentage of all suppliers and partners within the supply chain that were assessed for compliance with ESG criteria.
  • EFFAS S06-02 Percentage of all suppliers and partners within the supply chain that have been audited for compliance with ESG criteria.
8. Incentive systems
  • GRI SRS-102-35a Compensation Policy.
  • GRI SRS-102-38 Ratio of total annual compensation.
9. Involvement of stakeholders
  • GRI SRS-102-44 Key Issues and Concerns.
10. Innovation and product management
  • G4-FS11 (also to be reported in GRI SRS) Percentage of financial assets that pass a positive or negative selection test based on environmental or social factors.
  • EFFAS E13-01 Improvement of the energy efficiency of own products compared to the previous year.
  • EFFAS V04-12 Total investment (CapEx) in research for ESG-relevant areas of the business model, e.g. B. ecological design, eco-efficient production processes, reduction of the impact on biodiversity, improvement of health and safety conditions for employees and partners in the supply chain, development of ESG opportunities for products, evaluated in monetary units, e.g. B. as a percentage of sales.
environment

11. Use of natural resources
12. Resource management

  • GRI SRS-301-1 Materials used by weight or volume.
  • GRI SRS-302-1 Energy consumption within the organization.
  • GRI SRS-302-4 Reduction of energy consumption.
  • GRI SRS-303-1 Water withdrawal by source.
  • GRI SRS-306-2 Waste by type and disposal method.
  • EFFAS E04-01 Total weight of the waste.
  • EFFAS E05-01 Percentage of total waste that is recycled.
  • EFFAS E01-01 Total energy consumption.
13. Climate-relevant emissions
  • GRI SRS-305-1 Direct GHG emissions (Scope 1).
  • GRI SRS-305-2 Indirect energy-related GHG emissions (Scope 2).
  • GRI SRS-305-3 Other indirect GHG emissions (Scope 3).
  • GRI SRS-305-5 Reduction of GHG emissions.
  • EFFAS E02-01 Total GHG emissions (Scope 1, 2, 3).
society

14. Employee rights
15. Equal opportunities
16. Qualification

  • GRI SRS-403-2 Type and rate of injuries, occupational diseases, lost days and absenteeism, and the number of work-related deaths.
  • GRI SRS-403-4 Health and safety topics covered in formal agreements with trade unions.
  • GRI SRS-404-1 Average number of hours for training and further education per year and employee.
  • GRI SRS-405-1 Diversity in governance bodies and employees.
  • GRI SRS-406-1 Incidents of Discrimination and Corrective Actions Taken.
  • EFFAS S03-01 Age structure and distribution: Number of full-time equivalents (FTE) by age group.
  • EFFAS S10-01 Share of female FTEs in relation to the total number of employees.
  • EFFAS S10-02 Percentage of female FTEs in management positions in relation to total FTEs in management positions.
  • EFFAS S02-02 Average expenditure on further training per FTE per year.
17. Human rights
  • GRI SRS-412-3 Significant investment agreements and contracts that contain human rights clauses or have been screened for human rights issues.
  • GRI SRS-412-1 Business locations at which an audit for compliance with human rights or a human rights impact assessment was carried out.
  • GRI SRS-414-1 New suppliers that were screened using social criteria.
  • GRI SRS-414-2 Negative social impacts in the supply chain and actions taken.
  • EFFAS S07-02 II Percentages of all facilities that are SA 8000 certified.
18. Community
  • GRI SRS-201-1 Direct economic value generated and distributed.
19. Political influence
  • GRI SRS-415-1 Party donations.
  • EFFAS G01-01 Payments to political parties as a percentage of total sales.
20. Conduct in accordance with the law and guidelines
  • GRI SRS-205-1 Business locations that have been audited for corruption risks.
  • GRI SRS-205-3 Confirmed incidents of corruption and actions taken.
  • GRI SRS-419-1 Non-compliance with laws and regulations in the social and economic area.
  • EFFAS V01-01 Expenditures and penalties following lawsuits and lawsuits for anti-competitive behavior, antitrust and monopoly violations.
  • EFFAS V02-01 percent of sales in regions with a Transparency International Corruption Index below 60.

Use

The standard provides analysts and other stakeholders with information in order to be able to evaluate sustainability performance. The main target group of the instrument is the capital market . The benefit of the DNK lies in its condensed and user-friendly form: It provides companies of all sizes with a framework for reporting on their own sustainability management. The clear structure and the focus on the essential criteria are central advantages of the DNK. They promote the comparability of the information. It is particularly useful for all companies and organizations without an established reporting system . In order to achieve higher credibility, companies are free to have the information checked by third parties.

Training concept

The Council for Sustainable Development has developed a training concept for the application of the DNK, which paves the way for reporting in particular for small and medium-sized companies. The concept includes the free use of a toolbox, the placement of DNK training partners and support in planning events on the topic of CSR and sustainability reporting . Trainers from DNK partner organizations are available for training on the DNK. The DNK training partners have completed training on the DNK themselves and submitted a declaration of compliance and are now offering training across Germany. If available, contact is made with a mentor company in the vicinity that is already a tried and tested GSC user and can report on practical experience.

Web links

Individual evidence

  1. The German Sustainability Code: History , accessed on March 29, 2018.
  2. New Action: Downloads - Application - The German Sustainability Code. Retrieved March 29, 2018 .
  3. New Action: News - Current Issues - The German Sustainability Code. Retrieved March 29, 2018 .
  4. Speech by Chancellor Angela Merkel at the 12th Annual Conference of the Council for Sustainable Development , June 25, 2012.
  5. Council for Sustainable Development: The German Sustainability Code - the benchmark for sustainable business . Ed .: Council for Sustainable Development. 4th updated version 2017 edition. July 2017, p. 5 .
  6. Federal Law Gazette . Retrieved March 29, 2018 .
  7. Directive 2014/95 / EU (PDF) of October 22, 2014 on the disclosure of non-financial and diversity information
  8. Norbert Kluge and Sebastian Sick: Secret economy with transparency for social engagement? To the group of companies potentially affected by the CSR Directive Implementation Act . Ed .: Hans Böckler Foundation. MBF report 27/2016 edition. Düsseldorf November 2016.
  9. Andreas Hecker: Study on the implementation of the “CSR Directive” in Germany taking into account the “German Sustainability Code” initiative , May 21, 2015
  10. Bertelsmann Stiftung, German Council for Sustainable Development: Guide to the German Sustainability Code
  11. The German Sustainability Code: Training Concept , accessed on September 2, 2015.