Toward Common Metrics and Consistent Reporting of Sustainable Value Creation (2024)

FAQs

What are the metrics for sustainability? ›

Environmental sustainability metrics are the main area for tracking sustainability in most organizations. Environmental metrics cover a wide range of activities impacting climate, waste, and energy use. Sustainability KPIs include: CO2 emissions reduction in kt.

Sustainability is fundamentally about long-term success. Companies and charities are created and managed to sustainable create value, whether that is described primarily in financial or social terms.

Introduction. The ideal method to measure sustainability would reflect the three-legged stool paradigm – environmental protection, social equity, and economic benefit. The metrics must make the connection between what the indicators measure and actual sustainability.

By taking a closer look at operations data, sustainability reporting allows businesses to identify redundancies and inefficiencies. From there, you and your team can redesign internal systems to free up bandwidth, resources, and unnecessary tolls on the environment.

Examples of sustainability metrics: Carbon emissions, water footprint, energy consumption, employee turnover rate, and Global Reporting Initiative (GRI) standards.

The framework divides disclosures into four pillars — principles of governance, planet, people, and prosperity — that serve as the foundation for ESG reporting standards.

Sustainable value creation requires systems thinking in order to maximise total value captured. There is a need to better understand how companies can improve sustainable value creation. Few tools or structured approaches to thinking about sustainable value are available.

Sustainability reporting is based on performance-based management and is a cycle to promote continuous improvement. There are four steps in the sustainability reporting process: (1) define performance goals and metrics, (2) measure performance, (3) evaluate performance, and (4) manage performance.

To calculate the Sustainable Value of a company (or other organisational entities), it must be determined where the financial, environmental and social resources of the company create more return: within the company or in the benchmark.

How to measure sustainable performance KPIs and metrics? ›

Sustainability KPIs are defined through clear metrics that measure things like carbon dioxide output, energy consumption, recycling rates, water usage, and more. Within ecommerce, the biggest areas of impact surround carbon emissions from shipping and packaging waste.

Preparing a sustainability report involves several steps, from setting up a team to validating and disseminating the report. Each phase is essential to ensure that the report is comprehensive, accurate, and useful for both the organization and its stakeholders.

Within this report the following terminology is used: Sustainability Metrics: a standard of measurement, based on assessment criteria and indicators, used for measurement, comparison or to track performance.

The most effective company reports clearly lay out the overall sustainability strategy over the short, medium and long term as well as how it fits into the core strategy. Sustainability risks and opportunities are highlighted and are linked directly to actions, making it easy to follow reasoning.

In the long term, sustainability reporting helps companies assess risks and opportunities and helps them drive green operations, align with CSR goals and increase cost saving opportunities.

Sustainability key performance indicators (KPIs) show your business where it can become more sustainable.

Focused on four themes, People, Planet, Prosperity and Principles of Governance, these metrics and disclosures reflect a six-month consultation process with more than 200 companies, investors and other interested parties.

Five important global-scale indicators are biological diversity, food production, average global surface temperature and atmospheric CO2 concentrations, human population, and resource depletion.

When we talk about ESG metrics, we're really talking about performance measures or indicators of a company's performance on environmental (E), social (S), and governance (G) issues. They are similar to other business metrics in that they're used to assess a company's operating performance and risk.