Author Silvia Schmid is a graduate of the Master of Environmental Studies program at the University of Pennsylvania and takes care of communications and web content management for IGEL. Opinions represented in blog posts and research briefs represent the opinions of the authors only, not of Wharton, IGEL, or the University of Pennsylvania.
Last week, Wharton’s Initiative for Global Environmental Leadership (IGEL) and the Wharton Social Impact Initiative hosted Sustainable Brands’ “New Metrics of Sustainability”, a two-day conference centered on innovations in environmental analysis and reporting. The conversation engaged the audience of business leaders and sustainability professionals on the ever-evolving issue of quantifying sustainability efforts in business. Among the primary topics discussed were the standardization of sustainability context and the implementation of more intelligible indicators and reporting guidelines.
Sustainability Context. Sustainability context is the extensive information describing a system and situation in which a change occurs, for instance a shift in emissions released or resources consumed. The two traditional conventions in emissions analysis are absolute and relative reporting, with the former measuring emissions only and the latter considering emissions in relation to another variable (e.g. emissions per unit of production). Mark W. McElroy of the Center for Sustainable Organizations points out that the context-based approach offers a more comprehensive assessment, relating emissions to dissipative capacity, resource management, long-term models, thresholds, and multivariable scenarios over time.
For example, relative emission reporting can tell us that a firm has decreased its discharges from 0.171 tons of CO2 per unit produced in 2010 to 0.142 CO2 per unit produced in 2011. But although this is a significant per unit decrease, determining how this accomplishment should be valuated requires a wider perspective. If, as part of a goal of reducing global CO2 emissions to 350 parts per million , this hypothetical firm were allotted a permit for only 0.002 tons of CO2 per unit produced, then its emissions reduction from 2010 to 2011 turns out to be rather dismal. Comparing absolute, relative, and context-based emissions thus helps us to better interpret and portray the magnitude -or triviality- of a firm’s ecological impact and performance. If long-term sustainability is the goal, then the sustainability context is a fundamental part of any thorough conversation.
Reporting. The wide range of standards and reporting frameworks –from the Sustainability Accounting Standards Board and the International Integrated Reporting Council to the latest version of the Global Reporting Initiative’s reporting guideline (known as the G4)– can make choosing the right framework a perplexing endeavor. According to Bahar Gidwani, Co-Founder & CEO of CSRHub, the fog is unlikely to fade anytime soon, with current certification schemes and frameworks remaining in competition and new guidelines expected as well.
Friendlier Metrics. Making metrics more comprehensible must also become a priority of effective sustainability measurement and reporting. Ori Zik of EnergyPoints reiterated the struggle of thinking about quantities using the metrics currently employed, be it carbon content or British Thermal Units. This is hardly news, but it remains a fundamental concern. If we were able to approximate the amount of carbon contained in everyday objects as easily as we can estimate the number of calories in our food, we could perhaps make greater strides in understanding our impact and altering our habits. EnergyPoints’ aim is to make complex units more intuitive. Their platform starts by assigning one “energy point” to the embodied energy of one gallon of gasoline, and from there points are allocated to other resources –water, electricity, transportation, gas, waste, and materials– while accounting for determinant factors such as location, time, quality, source, and more. The normalization achieved by using a single unit of measurement more precisely quantifies consumption and ecological impact across resources and allows for direct and more intuitive comparisons.
Contextualizing measurements and simplifying metrics will help bring more force and dynamism to sustainability reporting even if different certification schemes and frameworks persist. Sustainable Brands will continue its conversation in London on November 27-28.
Image by Rupal Prasad, MES Candidate 2013