My latest article for GreenBiz.com is “Getting Real About Measurement: How to Size Up the Triple Bottom Line.” This addresses a new methodology developed by Dr. Mark McElroy, called context-based sustainability management, to measure social responsibility performance against the actual scope of the issue at hand and the company’s relative responsibility. Excerpt and link to full piece below. GreenBiz editor Leslie Guevarra did a fabulous job on the layout to help illustrate this weight topic, so the full piece is definitely worth a look.
Getting Real About Measurement: How to Size Up the Triple Bottom Line
Melissa Schweisguth, for GreenBiz.com, 1/26/10
As businesses become increasingly strategic about sustainability programming, using metrics to measure and manage social, environmental and economic impacts has become standard practice. Yet, there’s still significant variation in how companies interpret and use the resulting data to guide their activities. Few offer much explanation about how they’ve chosen improvement goals or how their performance relates to real-world factors, such as whether their personal contribution to atmospheric carbon represents a viable ecological footprint. This represents a critical gap, since objectives that fail to align with real boundaries and needs in the external context stand to leave risks unaddressed or exacerbate them, negatively impacting both commerce and society over the long term.
Mark W. McElroy, Ph.D., the director of research for the Center for Sustainability Performance at Deloitte Consulting has developed a methodology to address this, called context-based sustainability management. McElroy took time out for an interview to inform readers at GreenBiz.com about the approach. Briefly described, the system helps businesses delimit their social and ecological operating context and establish performance targets accordingly, ensuring they stay within responsible boundaries, meet basic social needs and move toward systems that are more truly sustainable.
Essentially, it helps put numbers on the triple bottom line (as McElroy wrote on GreenBiz) and size up one’s social and environmental footprint, addressing some of the industry’s most elusive questions. The mechanics involve quantifying an entity’s allowable impact or share of responsibility for environmental and social issues and using this context-based metric as yardstick to evaluate outcomes.
The mechanics involve quantifying an entity’s allowable impact or share of responsibility for environmental and social issues and using this context-based metric as yardstick to evaluate outcomes. Context-based metrics rest on empirical limits, such as local water supplies, optimal levels of atmospheric carbon or social/economic factors like local cost of living.
The company’s allowable impact (e.g., share of available water, contribution to global emissions) and responsibility (e.g., total compensation) within this context are determined using factors such as staff size, facility size or production. To evaluate their progress, users divide actual performance data by allowable impact or share of responsibility. A result of one or less for environmental factors, or one or more for social factors, indicates they they’re operating within contextual boundaries….[article continues at GreenBiz.com: Getting Real About Measurement: How to Size Up the Triple Bottom Line