Killer Analytics: Top 20 Metrics Missing from your Balance Sheet

Chapter 8

The Sustainability Index

WHY AN ORGANIZATION MIGHT TRACK THIS

Questions Answered

• What is our carbon footprint?
• Are we recycling and minimizing use of resources like energy and water?
• Are our products produced or services delivered in such a way as to minimize pollution and trash?
• Is sustainability part of our culture and values?
• Do outsiders view us as an environmentally responsible organization?

Why Is This Information Important?

Every few years it gets more complicated to run an organization. It used to be if you had a solid financial result, that was enough to be considered successful. About 30 years ago, new types of metrics started creeping in that were used to assess different aspects of organizational health. Product quality metrics became big in the 1980s, followed quickly by measures of customer satisfaction. Next, organizations realized that much of their work was done by employees, so measures of factors such as employee satisfaction and engagement, safety, and even employee health became part of the corporate dashboard. Other measures of supply chain management, processes, and even ethics began to find their way onto what Harvard Business School professors Robert Kaplan and David Norton came to call the Balanced Scorecard.

In the last five years or so, another dimension of the health of an enterprise is sustainability, or the degree to which the organization is environmentally responsible. This kind of thing was originally only considered important by ...