Measuring sustainability. Part I: the basics of a sustainability index
This is the first article in a series that will explore in more detail the ins and outs of creating a sound, useful, and robust sustainability index for your organization.
- Part II: Constructing a sustainability index
- Part III: How a sustainability index can optimize decision-making
When we work with a company that is just starting its sustainability journey, we try to focus on one central framing question: What does sustainability mean to your organization? Sustainability has evolved much farther than just measuring carbon emissions, which means it requires management of many factors. There are a multitude of impacts to consider: impacts on water use and water supply; impacts on human health; and even social impacts on workers and communities.
What does sustainability mean to you?
Defining and managing a sustainability program is a complex, multi-faceted task that can take vastly different forms, depending on the priorities defined and the choices made by the company. Starting a program by defining what sustainability means to an organization can help reduce confusion and launch stakeholders into a common understanding of the goals, priorities, and opportunities surrounding sustainability efforts.
It is important to not only understand what impacts are relevant to your organization, but it is also important to understand the trade-offs between different decisions. Organizations often define a set of metrics to help manage complex decisions. Managing sustainability decisions should be no different.
What is a sustainability index?
One tool that is useful for managing these types of complicated decisions is a sustainability index. A sustainability index is meant to simplify the complex decision-making process that will help your company to become more sustainable. Boiling this information down to a manageable set of decision criteria can greatly alleviate this complexity. The idea behind a sustainability index is to aggregate the relative information about the sustainability aspects of various decisions, strategies, and approaches, and then provide an easy-to-understand “scoring” system to quickly determine the most sustainable options.
A customized sustainability index will help to provide a platform for evaluating decisions that will increase the sustainable value of the organization.
Those who have done it before (successfully)
Let’s look at a few examples of sustainability indices that are used to help make decisions in the face of the complexity of sustainability.
GoodGuide is a website that rates products on health, environment, and social impacts. It compiles data from many sources and translates that data into actionable information for consumers. This system provides a ranking system, ranking products from 0 to 10 in each of these three impact areas. The result is a set of metrics that consumers can use to quickly evaluate and identify products that fit their values.
The Higg Index is a tool that is published by the Sustainable Apparel Coalition. It measures the environmental impact of consumer apparel and footwear using a single-score approach. The tool assesses environmental and social sustainability at the brand, product, and facility level, and looks at several impact categories. Scores from each of the impacts are combined using a weighted average approach, intended to help organizations assess their progress towards sustainability goals. The Higg Index is based on several other existing tools, including the NIKE Material Sustainability Index and the OIA’s EcoIndex.
These are two great examples of organizations developing sustainability indices to help individuals make more sustainable decisions. Each of these indices takes complex sustainability information and translates it into easily-understood metrics. The scoring systems promote sustainable outcomes that are consistent with a clearly defined set of sustainability criteria and help their users make more sustainable decisions.
In the next article in this series, we’ll explore the specific steps for creating a customized sustainability index for use in your organization.
Cash worked for PRé as a Senior Sustainability Consultant from 2012 to 2017. His areas of expertise included sustainable return on investment, sustainable supply chain collaboration, and sustainability performance. For PRé, he lead the development of tailored sustainability software tools for the Sustainable Apparel Coalition, among many other projects in sustainable development and sustainability integration.