Adopting a sustainability framework is one of the single most important steps your organisation can take on its journey towards sustainability. Not only will you benefit from a well thought out system to follow, you’ll also get a thorough education as you implement the framework’s standards.
How do you define and measure sustainability? What do you need to do to make your organisation sustainable? And once you've begun the journey towards sustainability how will you know when you've arrived?
Sustainability Frameworks and their reporting systems exist to take the fuzziness out of answering these questions. They provide clear standards by which to assess your organisation's impact, to set goals, measure progress and report.
Background to sustainability reporting
Sustainability Reporting can be traced back to the chemical manufacturing industry in the 1980s. At the time serious image problems plagued the industry after a run of high profile industrial accidents. The most memorable of these was the 1984 Union Carbide disaster in Bhopal, India.
Voluntary reporting began as a move towards improving transparency and public relations. Around the same time a number of socially and environmentally aware SMEs, such as Body Shop, Patagonia and Ben and Jerry's began their own initiatives to communicate their impact.
Early reports took the form of simple narratives included in the Chairman's and CEO's letters in annual financial reports. But as environmental and social concerns found their way into the wider corporate world a number of initiatives began to help organisations focus their energies and measure progress in areas that counted most.
How do sustainability frameworks help?
Some important roles are:
- To define sustainability and organise it into areas of focus: carbon emissions, water consumption, profitability, safety, social impact etc.;
- Create standard methodologies for assessing and reporting impact;
- To give credibility to reporting by giving organisations widely recognised standards to measure themselves against;
- Education and Training;
- To create transparency around corporate sustainability by introducing the same rigour to environmental and social reporting as seen in financial reporting.
A simple premise underpinning sustainability frameworks is, what gets measured gets managed. Adopting a framework will help you identify your biggest impacts and then work on them. It will help you set goals for change, communicate them to your staff, suppliers, customers and investors and help you measure progress from year to year.
Here are a few examples of questions sustainability frameworks will help companies answer:
- Should we be focusing on cleaning up our supply chain, or reducing paper and energy consumption in the office?
- As far as sustainability goes, what will give us the biggest return on investment, reducing the carbon emissions on product shipping or installing solar powered hot water in our factory?
- Which is more relevant to our sector, waste reduction or water consumption?
- To what extent have our total carbon emissions changed over the last 12 months?
What are the most widely used and recognised sustainability frameworks?
Some of the best known frameworks at the time of writing are:
CDP (formerly The Carbon Disclosure Project) CDP’s main focus is to provide transparency to investors around issues on climate change and conservation of natural resources such as water. It offers a framework for signatories to report on carbon emissions, water usage and aspects of supply chain quality.
The Global Reporting Initiative (GRI) aims to provide transparency to all stakeholders on a much broader range of issues than CDP. The GRI concept of sustainability is organised into six categories:
- Economic,
- Environmental,
- Labour practices and decent work,
- Human rights,
- Society,
- Product Responsibility.
In 2013 CDP and GRI announced that they would be working together to align some aspects of their frameworks in the interests of standardisation.
Dow Jones Sustainability Index (DJSI) like CDP, DJSI’s primary focus is on creating transparency for investors. It is exclusively for large commercial organisations and participation is by invitation only.
Other frameworks include Triple Bottom Line, The Natural Step, International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB). There are many more frameworks besides these. More than we can possibly list. Each has its own particular focus and promotes its own methodologies.
Which Framework is Right for My organisation?
Which framework you choose will depend on whom your reports are aimed at and your type of organisation. If you need your reports to have maximum credibility to the world at large then it makes sense to choose one of the most widely recognised frameworks.
If you’re a fast growing start-up, or a mid to large size organisation aiming to attract investors you might want to consider CDP. But as we mentioned, CDP and GRI have now harmonised some of their standards, which means you won’t go far wrong with GRI either.
If you’re simply reporting to facilitate organisational change, or keep customers or your local community informed GRI would be a good framework to look at first.
The Natural Step began in Sweden, a country widely respected for its high standards of sustainability. It has gained considerable kudos in professional circles for its empirical and rigorous scientific approach but has the disadvantage of being relatively unknown to the wider world.
The Triple Bottom Line is widely known, and its founder has been credited with introducing useful concepts to the field of sustainability reporting. However, it has also been criticised for lacking rigour in some areas.
Many of the less well known frameworks have a particular geographic or sectoral slant and if you’re looking to compare your organisation with others in a given sector or region it may make sense to choose one of the less well known ones.
One key consideration will be what the framework organisers offer in terms of education, tools and resources and how well suited these are to yours. Another is simply the way the framework defines sustainability, for example you may find GRI’s definition too broad and prefer something that focuses on climate change along the lines of CDP.
Some sustainability professionals recommend selecting a mix of performance criteria from different frameworks that best suit your needs. A good reason for doing so might be if customers or investors need to evaluate you according to indicators from a specific framework. There are potential dangers with this approach however. For example, you may end up cherry picking performance criteria simply to ease your burden. It’s also worth considering how a framework’s model of sustainability breaks down when you remove certain performance criteria if these are relevant to your operations.
Once you’ve selected your framework or frameworks you’ll be ready to get started on your first sustainability audit, which we’ll be looking at in part 5.
