MATERIALITY AT GRAINGER
Our 2018 CSR report details our progress across each of the four pillars of our program: Operating Responsibly, Valuing our People, Sustaining our Environment and Serving our Communities. We have completed a materiality assessment with critical stakeholders to identify which areas of our CSR program provide value to our customers, team members, investors, suppliers and community partners. Through research, competitive intelligence, surveys, focus groups and one-on-one conversations with these stakeholders, we confirmed many of our current areas of focus and gained insight into new ones. We are excited to share our findings below, and are already hard at work integrating these insights into our operations.
The Global Reporting Initiative’s (GRI) GRI Standards are the foundation for our annual reporting approach and our materiality assessment. The GRI is an independent international organization that has pioneered sustainability reporting since 1997. They help businesses and governments worldwide understand and communicate their effect on critical sustainability issues such as climate change, human rights, governance and social well-being. Through this framework, we are able to describe the effect of our operations along the GRI Standard’s Core elements of economic, environmental, social and governance.
Materiality Assessment Process
Identification of Issues The first step in preparing a report with the GRI Standards in mind is identifying material topics. Material topics are those issues reflecting an organization’s significant economic, environmental and social challenges or issues that have some substantive influence on the assessments and decisions of stakeholders.
We compiled a list of nearly 100 issues specific to industrial distribution from a number of external resources. We categorized environmental, social and governance issues into four themes: Governance and Ethics, Solutions and Stewardship, Supply Chain and People and Purpose. These themes define the scope of our assessment and will guide future conversations with stakeholders.
Internal Assessment of Business Importance Once we identified the themes relevant to Grainger, we considered our customers’ needs, the scope and breadth of an issue, probability of risk and magnitude of effect, brand reputation, regulatory concerns, and affect to the communities where we live and work.
Value chain maps display the primary activities and stakeholders associated with sourcing, selling and consuming a company’s services and products. This form of mapping allows us to see where our material topics affect our value chain. While many of these material topics are related to activities that occur within Grainger’s direct operations, some have implications throughout our entire value chain. The graphic above shows the boundary of each of our material topics.
KEY FINDINGS FROM OUR MATERIALITY ASSESSMENT PROCESS
- Continuing Engagement The interest in Grainger’s Envionmental, Social and Governance (ESG) profile suggests a need for greater communications on sustainability objectives and deeper engagement with stakeholders to address sustainability challenges and opportunities.
- Customer Data Privacy As technology evolves, the customer experience may be enhanced through the use of personal data. With that enhancement, new considerations arise for organizations like Grainger in processing that data and in operating in observance of applicable regulatory requirements and meeting customer expectations.
- MRO Solutions Stewardship Differences in customer size and complexity, industry type and our primary customer contact can make the link between the evolution of sustainability and the challenges our customers face a moving target. Our customers believe we have an opportunity to strengthen that link and create a distinct positive global sustainability effect with our products and services.
- Inclusive and Diverse Culture Our customers span the globe and represent every demographic group, and we best serve them when our workforce reflects their diversity. Diversity helps us better understand the different needs of our customers and deliver products and services that improve their daily lives. To give our stakeholders greater visibility to the diversity of our workforce, we learned there was value in releasing the demographic data for our workforce.
- Thought Leadership As suppliers continue to innovate environmentally preferable product, Grainger is positioned to use its expertise and leadership to engage with suppliers to help identify and scale policies and solutions that help reduce greenhouse gas emissions and further the circular economy.
FORWARD: What’s Coming in Our 2019 Report
As Grainger evolves, our CSR report should evolve, too. That’s why we conducted a materiality assessment this year, and that’s why our four pillars will change in our 2019 report. Look for the Forward section at the end of each pillar for a sneak preview as to how the report will adjust in 2019.