Sustainability information spans operations, buildings, products and supply chains and resides in many shapes and forms inside the organization and across its value chain. Once captured, this information empowers enterprises to improve the use of raw material, energy and resources and to reduce carbon emissions and waste.
This is a statement made in an article back in 2012, 8 years ago. It is still very true. Today we know through experience that sustainability information needed in business operations has become a greater driver, more relevant and more critical than ever before. It may have seemed at the time that the primary goal of generating a company’s sustainability profile was to optimize resource use, minimize waste and emissions.
Today sustainability information still serves that purpose, but the primary goal of sustainability information has gradually shifted. Sustainability performance information is used more and more to help define new corporate and product strategies, identify critical areas of business improvement, determine success potential of new product development, support corporate risk assessment, identify compliance challenges in an early stage of product development and assess financial risk of projects and business operations as a whole.
Particularly in the field of compliance, more emphasis is put on the inclusiveness of sustainability parameters in the annual performance assessment of companies. The European Commission is with its PEF and OEF methods, laying the ground for compulsory integration of product and corporate sustainability performance assessment. At some point soon, those pilots are likely to be implemented across Europe to help drive European wide business success and competitiveness.
GRI already is an excellent basis for companies that are initiating their sustainability reporting endeavors. GRI provides sector-specific KPI’s for sustainability performance monitoring that a steadily growing community of companies already uses to express their sustainability performance. For parts of the global market, GRI reporting is already compulsory.
While for pure marketing purposes, an annual update of sustainability performance information was probably enough, use of that information in a much broader day-to-day business context requires frequent nourishing and refreshing of sustainability information.
Studies in the last decade have clearly shown that companies that use sustainability information to define their corporate and product strategies, that use that information to attract investors and new talent and that build and monitor their innovative development projects based on it are significantly more successful than companies that do not.
Conclusion is that the use of sustainability information over the past 10 years is increasingly being internalized. It has matured to the extent that it is now used more than ever to run and monitor an operation in the full scope of aspects, environmental, social and financial. That development is of course not without implications. Risks of corporate exposure because of incomplete or misinterpreted information have increased over the years. In that context emphasis on third party risks has significantly changed the global business landscape. Information requirement and its complexity have increased and the operational context within which the information is used is more divers than ever. Accuracy and speed of information have become more critical while at the same time the information perspectives are much more divers.
Today sustainability information needs to be presented in the context of strategy development, market and product development, project management, risk assessment and compliance management, financial performance monitoring and operational decision making. Though often the same data is underlying the information, the information itself needs to vary a lot.
In the coming years, sustainable innovation will become more business critical than ever. New business concepts, new products and services, new ideas need to stand the challenge of sustainability and circularity. Business challenges will change, increase and shape new environments for companies to prosper in. Agility, speed and accuracy of sustainability performance information from within and outside the company are critical to future business success.
- Explore the best way for your organization to collect and manage data. There are tools and services on the market today that can be configured to meet your needs today, but also provide agility to help meet future needs.
- If starting your sustainability reporting practice, consider using simple GRI-based tools and services that help you with these first steps.
- Consider how product sustainability performance may influence your corporate sustainability performance. You may need expertise to generate that product perspective, but this may be a worthwhile effort and investment, as such study could clearly identify the areas of change worth considering.
- Leverage sustainability content. Use these tools to generate the required information from different business perspectives. A materiality assessment might be a useful starting point.
- Companies with broad experience and large corporations should consider automation. Automation of information generation simplifies the management task, reduces effort and costs and mitigates risk of error.
Depending on the availability of sustainability content in your sector and the maturity of your organization in sustainability performance management, you will find that certain types of content are worth your time and effort, while other areas are less relevant to you. Industry benchmarks and smart best practice content tend to be valuable for any organization if the information provided is up-to-date, relevant for your sector, size and location.