GRI 413: Local Communities 2016 contains disclosures for organizations to report information about their impacts related to local communities, and how they manage these impacts.
The Standard is structured as follows:
The rest of the Introduction section provides a background on the topic, an overview of the system of GRI Standards and further information on using this Standard.
Background on the topic
This Standard addresses the topic of local communities. In the GRI Standards, local communities are defined as individuals or groups of individuals living or working in areas that are affected or that could be affected by the organization’s activities. The local community can range from those living adjacent to the organization's operations to those living at a distance.
An organization’s activities and infrastructure can have significant economic, social, cultural, and/or environmental impacts on local communities. Where possible, organizations are expected to anticipate and avoid negative impacts on local communities. Establishing a timely and effective stakeholder identification and engagement process is important to help organizations understand the vulnerability of local communities and how these might be affected by the organization’s activities.
Due to the heterogeneous nature of local communities, an organization is expected to consider the differentiated nature of communities and the distinct and specific vulnerabilities these groups can suffer as a result of the organization’s activities.
These concepts are covered in key instruments of the Organisation for Economic Co-operation and Development and the United Nations: see the Bibliography.
System of GRI Standards
This Standard is part of the GRI Sustainability Reporting Standards (GRI Standards). The GRI Standards enable an organization to report information about its most significant impacts on the economy, environment, and people, including impacts on their human rights, and how it manages these impacts.
The GRI Standards are structured as a system of interrelated standards that are organized into three series: GRI Universal Standards, GRI Sector Standards, and GRI Topic Standards (see Figure 1 in this Standard).
Universal Standards: GRI 1, GRI 2 and GRI 3
GRI 1: Foundation 2021 specifies the requirements that the organization must comply with to report in accordance with the GRI Standards. The organization begins using the GRI Standards by consulting GRI 1.
GRI 2: General Disclosures 2021 contains disclosures that the organization uses to provide information about its reporting practices and other organizational details, such as its activities, governance, and policies.
GRI 3: Material Topics 2021 provides guidance on how to determine material topics. It also contains disclosures that the organization uses to report information about its process of determining material topics, its list of material topics, and how it manages each topic.
Sector Standards
The Sector Standards provide information for organizations about their likely material topics. The organization uses the Sector Standards that apply to its sectors when determining its material topics and when determining what to report for each material topic.
Topic Standards
The Topic Standards contain disclosures that the organization uses to report information about its impacts in relation to particular topics. The organization uses the Topic Standards according to the list of material topics it has determined using GRI 3.
Using this Standard
This Standard can be used by any organization – regardless of size, type, sector, geographic location, or reporting experience – to report information about its impacts related to local communities.
An organization reporting in accordance with the GRI Standards is required to report the following disclosures if it has determined local communities to be a material topic:
See Requirements 4 and 5 in GRI 1: Foundation 2021.
Reasons for omission are permitted for these disclosures.
If the organization cannot comply with a disclosure or with a requirement in a disclosure (e.g., because the required information is confidential or subject to legal prohibitions), the organization is required to specify the disclosure or the requirement it cannot comply with, and provide a reason for omission together with an explanation in the GRI content index. See Requirement 6 in GRI 1: Foundation 2021 for more information on reasons for omission.
If the organization cannot report the required information about an item specified in a disclosure because the item (e.g., committee, policy, practice, process) does not exist, it can comply with the requirement by reporting this to be the case. The organization can explain the reasons for not having this item, or describe any plans to develop it. The disclosure does not require the organization to implement the item (e.g., developing a policy), but to report that the item does not exist.
If the organization intends to publish a standalone sustainability report, it does not need to repeat information that it has already reported publicly elsewhere, such as on web pages or in its annual report. In such a case, the organization can report a required disclosure by providing a reference in the GRI content index as to where this information can be found (e.g., by providing a link to the web page or citing the page in the annual report where the information has been published).
Requirements, guidance and defined terms
The following apply throughout this Standard:
Requirements are presented in bold font and indicated by the word 'shall'. An organization must comply with requirements to report in accordance with the GRI Standards.
Requirements may be accompanied by guidance.
Guidance includes background information, explanations, and examples to help the organization better understand the requirements. The organization is not required to comply with guidance.
The Standards may also include recommendations. These are cases where a particular course of action is encouraged but not required.
The word ‘should’ indicates a recommendation, and the word ‘can’ indicates a possibility or option.
Defined terms are underlined in the text of the GRI Standards and linked to their definitions in the Glossary. The organization is required to apply the definitions in the Glossary.
An organization reporting in accordance with the GRI Standards is required to report how it manages each of its material topics.
An organization that has determined local communities to be a material topic is required to report how it manages the topic using Disclosure 3-3 in GRI 3: Material Topics 2021 (see clause 1.1 in this section).
This section is therefore designed to supplement – and not replace – Disclosure 3-3 in GRI 3.
1.1 The reporting organization shall report how it manages local communities using Disclosure 3-3 in GRI 3: Material Topics 2021.
The reporting organization can also describe:
Background
Communities have individual and collective rights deriving from, among others, international declarations and conventions such as:
Other standards such as the International Finance Corporation’s (IFC) Performance Standards (PS) also provide widely-accepted good practice approaches for organizational assessment, engagement and treatment of community-related impact issues (see IFC PS1 – Assessment and Management of Environmental and Social Risks and Impacts, and PS4 – Community Health, Safety, and Security).
The reporting organization shall report the following information:
2.1 When compiling the information specified in Disclosure 413-1, the reporting organization should use the data from Disclosure 2-6 in GRI 2: General Disclosures 2021 to identify the total number of operations, if the organization has reported its total number of operations when describing its activities.
Background
A key element in managing impacts on people in local communities is assessment and planning in order to understand the actual and potential impacts, and strong engagement with local communities to understand their expectations and needs. There are many elements that can be incorporated into local community engagement, impact assessments, and development programs. This disclosure seeks to identify which elements have been consistently applied, organization-wide.
Where possible, organizations are expected to anticipate and avoid negative impacts on local communities. Where this is not possible, or where residual impacts remain, organizations are expected to manage those impacts appropriately, including grievances, and to compensate local communities for negative impacts.
Establishing a timely and effective stakeholder identification and engagement process is important to help organizations understand the vulnerability of local communities and how these might be affected by the organization’s activities. A stakeholder engagement process both in early planning stages as well as during operations, can help establish lines of communication between an organization’s various departments (planning, finance, environment, production, etc.) and key stakeholder interest groups in the community. This enables an organization to consider the views of community stakeholders in its decisions, and to address its potential impacts on local communities in a timely manner.
Organizations can utilize a number of useful tools to engage communities, including social and human rights impact assessments, which include a diverse set of approaches for proper identification of stakeholders and community characteristics. These can be based on issues such as ethnic background, indigenous descent, gender, age, migrant status, socioeconomic status, literacy levels, disabilities, income level, infrastructure availability or specific human health vulnerabilities which may exist within stakeholder communities.
An organization is expected to consider the differentiated nature of local communities and to take specific action to identify and engage vulnerable groups. This might require adopting differentiated measures to allow the effective participation of vulnerable groups, such as making information available in alternate languages or format for those who are not literate or who do not have access to printed materials. Where necessary, organizations are expected to establish additional or separate processes so that negative impacts on vulnerable or disadvantaged groups are avoided, minimized, mitigated or compensated.1
The reporting organization shall report the following information:
2.2 When compiling the information specified in Disclosure 413-2, the reporting organization should:
2.2.1 report the vulnerability and risk to local communities from potential negative impacts due to factors including:
2.2.1.1 the degree of physical or economic isolation of the local community;
2.2.1.2 the level of socioeconomic development, including the degree of gender equality within the community;
2.2.1.3 the state of socioeconomic infrastructure, including health and education infrastructure;
2.2.1.4 the proximity to operations;
2.2.1.5 the level of social organization;
2.2.1.6 the strength and quality of the governance of local and national institutions around local communities;
2.2.2 report the exposure of the local community to its operations due to higher than average use of shared resources or impact on shared resources, including:
2.2.2.1 the use of hazardous substances that have an impact on the environment and human health in general, and specifically have an impact on reproductive health;
2.2.2.2 the volume and type of pollution released;
2.2.2.3 the status as major employer in the local community;
2.2.2.4 land conversion and resettlement;
2.2.2.5 natural resource consumption;
2.2.3 for each of the significant actual and potential negative economic, social, cultural, and/or environmental impacts on local communities and their rights, describe:
2.2.3.1 the intensity or severity of the impact;
2.2.3.2 the likely duration of the impact;
2.2.3.3 the reversibility of the impact;
2.2.3.4 the scale of the impact.
Guidance for Disclosure 413-2
Internal sources of information about actual and potential negative impacts of operations on local communities can include:
Background
This disclosure is focused on significant actual and potential negative impacts related to an organization’s operations and not on community investments or donations, which are addressed by GRI 201: Economic Performance 2016.
This disclosure informs stakeholders about an organization’s awareness of its negative impacts on local communities. It also enables the organization to better prioritize and improve its organization-wide attention to local communities.
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This glossary provides definitions for terms used in this Standard. The organization is required to apply these definitions when using the GRI Standards.
The definitions included in this glossary may contain terms that are further defined in the complete GRI Standards Glossary. All defined terms are underlined. If a term is not defined in this glossary or in the complete GRI Standards Glossary, definitions that are commonly used and understood apply.
entity with which the organization has some form of direct and formal engagement for the purpose of meeting its business objectives