Is your business fit for the future?

7th April 2016


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Author

MIRIAM ALVI

Michael Hardisty asks when a company can be considered genuinely sustainable

Having worked in carbon management and sustainability for many years, I often hear the term ‘sustainable business’ or the phrase ‘making the business more sustainable’.

The Oxford English Dictionary defines sustainable as ‘capable of being maintained or continued at a certain rate or level’ and ‘forms of human activity…avoiding the long-term depletion of natural resources’. Strictly, it is an absolute term much as ‘stationary’ or ‘unique’ are. Something is sustainable, stationary or unique or it isn’t – so how can it be made more sustainable? And, if it is an absolute condition, at what point does an organisation achieve the goal of being sustainable?

A guide

The GRI (Global Reporting Initiative) has developed a comprehensive framework to guide organisations in reporting on the economic, environmental and social impacts caused by their everyday activities. Such a report might show that an organisation is heading in the right direction – by reducing its carbon emissions, for example – but the GRI provides no guidance on the performance levels that might be considered sustainable. It indicates the desired direction of travel but does not identify the destination.

The white paper Defining Corporate Sustainability, produced by IEMA and GACSO, provides a lexicon of sustainability definitions. These were developed in workshops by 24 leading sustainability professionals, and the descriptions for a sustainable business include:

‘An organisation whose operations seek to support sustainable development by delivering long-term social and economic value within environmental limits.’

‘Organisations [that] minimise environmental impact and maximise social benefit.’

However, these definitions prompt two questions:

  • How do we assess whether an organisation is operating within environmental limits?
  • If an organisation has minimised its environmental impact and maximised its social benefit as far as it reasonably can, does that necessarily make it environmentally and socially sustainable?

Testing businesses

We need a set of tests that can assess whether the organisation is sustainable. There are already several frameworks for assessing sustainability, but none seems to answer the question: when is an organisation sustainable?

The planetary boundaries framework developed by Johan Rockström and colleagues provides a set of absolute ‘red lines’ that should not be crossed at a global level, such as the concentration of atmospheric carbon dioxide. However, it is unclear how it could be applied at an organisational level.

Another approach might be to take an ecological footprint – a method developed by sustainability guru Mathis Wackernagel – of an organisation’s operations and products. This would provide a single measure of its environmental impact in hectares of land, but would not indicate whether that impact is sustainable.

An environmental profit and loss (EP&L) analysis, such as that pioneered by sportswear company Puma, attempts to put a monetary value on the environmental impact of a business, but must this value be reduced to zero for it to be considered sustainable?

Perhaps Bioregional’s 10 principles of One Planet Living (see p29, the environmentalist, January 2015) have come closest to providing a set of benchmarks that businesses can apply. The principles include:

  • Health and happiness: encouraging active, sociable, meaningful lives to promote good health and wellbeing.
  • Sustainable materials: using sustainable and healthy products, such as those with low
  • embodied energy, sourced locally, made from renewable or waste resources.
  • Zero waste: reducing waste, reusing where possible, and ultimately sending zero waste to landfill.
  • Zero carbon: making buildings energy-efficient and delivering all energy with renewable technologies

But even these stop short of defining a set of key performance indicators (KPIs) to measure a business’s progress on each principle.

Future fit?

Perhaps the Future-Fit Business Benchmark provides the answer. It defines a ‘future-fit business’ as ‘one that creates value while doing nothing to undermine the possibility that humans and other life will flourish on Earth forever’.

This open source initiative, led by the non-profit Future-Fit Foundation, has defined a set of eight environmental and societal business principles, including ‘protects the environment from physical degradation’. Building on these is a set of 20 business goals – the desired, sustainable end-points. Thse include one that states: ‘All materials are from responsibly-managed sources.’

Twenty key fitness indicators or KFIs enable practitioners to measure how close a business is to achieving each goal. Progress against each KFI can be represented by a percentage, with 100% indicating fully future-fit in that area.

Although some of the goals may appear idealist – such as ‘operations emit no substances which cause harm’ – the Future-Fit Foundation does provide examples of companies that have already made public commitments to similar aims.

In his foreword to the second draft, sustainability expert John Elkington writes: ‘The benchmark is designed to help [a] business measure – and manage – the gap between what they are doing today and what science tells us they will need to do tomorrow.’ He warns, however, that some of the thinking may surprise those business leaders who think they have already nailed the environmental, social and governance agenda.

*Two public drafts of the Future-Fit Business Benchmark have been released for feedback, with the first full public release due later this month. IEMA and GACSO held a workshop on 2 February to better understand members’ views on the benchmark. Members were largely very positive. All members are encouraged to take a look at the benchmark (futurefitbusiness.org) and contribute their thoughts at bit.ly/1XsKhp0.

Michael Hardisty is a principal sustainability consultant at WSP|Parsons Brinckerhoff. The consultancy will be piloting the benchmark to see how easily it can be applied in practice.

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