Why Metrics Matter<br/>in Business Sustainability

Why Metrics Matter
in Business Sustainability

30 // October // 2012

In honor of Make a Difference Day, Leon Kaye explains why companies should prove they are sustainable.

Can metrics help steer companies on a sustainable source? While awareness about humans’ and businesses’ impact on the environment has increased rapidly the past 40 years, much work needs to be done for the planet to remain viable for future generations. Over the years companies in a bevy of industries were quick to claim that they were working on issues from preserving forests to offering dignity to their workers. With the advent of the internet and now, of course, social media, companies cannot just SAY they are “sustainable” or responsible; they have got to PROVE it.

 

And the tools that allow companies to measure their progress on environmental and social issues are improving. One reason is because of regulations; but at the same time, companies that communicate with their stakeholders about not only their successes, but challenges, are strong business leaders. That does not stop some companies from exaggerating their progress on sustainability, but it easier for stakeholders and investors to gauge who are ahead, and who are behind.

 

A recent report Brandlogic and CRD Analytics issued earlier this month demonstrates how the perception of what a sustainable company can be a stark contrast to the reality based on metrics. So who are some leaders? Many technology companies are in that group, including SAP, Cisco, Dell and IBM. They are among firms that are transparent about the effects their supply chains and operations have on the planet. These companies also stand out for their fluid communication with stakeholders via their web sites or social media platforms. Other companies that focus more on the social impact their people and products can offer, such as pharmaceutical giants Abbott Labs and Novo Nordisk, also appear as leaders in the Brandlogic-CRD Analytics survey.

 

One company emerges tall in my view. It follows a variety of sustainability reporting standards including the Global Reporting Initiative and Carbon Disclosure Project.

 

UPS is a company that is open about its sustainability performance. The task is not easy for a company known for its trucks, airplanes and the impact its operations have on the world’s environment. Nevertheless UPS does not shy away from discussing its greenhouse gas emissions, water consumption and waste the company generates across the globe. No one wants to admit they had a higher percentage of penalties within their total environmental inspections, but UPS is forthcoming about this data point and others where the company falls short. Yet at the same time, its global workforce enjoyed a safer workplace, and therein lies the strengths of UPS’ metrics: steady improvement and key performance indicators appropriate to the company’s core business. Becoming a sustainable and socially responsible global company is difficult for countless reasons, but metrics help hold these organizations accountable.

 

Metrics are only part of the story as we gauge whether a company is truly a wise steward of the planet and its people. But they help paint a story about the direction to which a company is headed, and reduces self-promoting rhetoric that frustrates stakeholders and invites only more criticism instead of the much needed collaboration necessary to reverse environmental degradation, social injustices and corruption. You can bend the truth–it is harder to manipulate numbers.

 

 

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