Sustainability Practice
More attention is being paid to the actions of companies who claim to be conscious of their Environment, Social and Governance (ESG) awareness as well as their UN Sustainable Development Goal (SDG) achievements. Companies also track their compliance with regulatory requirements and boast about their voluntary achievements in other areas, possibly as industry-leaders. Publicly available data is turned into new stock indices and allows investors to apply screens to their portfolios. Negative ESG events go viral in social media and damage the reputation of corporations.
But how does a company understand what its impact is, how it can measure it, and what steps are needed to improve it over time? Does the sustainability commitment align with the operational culture and with internal evaluation criteria? What Key Performance Indicators are tracked, and how are they recorded? How can an organization automatically populate all the reports required by regulators, investors, shareholders, stakeholders and others?
Screening Audit
High level assessment of how corporate commitment to sustainability and associated KPIs are adhered to and tracked throughout the organization. KPIs typically include voluntary reporting (SDG, ESG, industry best practice), as well as regulatory required reporting (e.g. health and safety).
Activities:
- Understand the vision for the company, desired outcomes over time, and opportunities for operational change.
- Conduct a desktop audit, a review of social media standing and interviews with a cross-section of executive and middle management.
- Review annual reports, as well as reports published by HR, Health and Safety, Marketing, etc for coherence.
- Assess how existing mandatory and voluntary reporting priorities match commitment to sustainability and existing operational protocol.
Outcomes:
- Snapshot in time analysis of desired, perceived and actual sustainability standing. Includes: potential greenwashing, disconnects, and areas for improvement; and unexploited “wins” and “avoidable” losses.
- Results of the screening audit are used to scope a full gap analysis (limited to core company, across corporation, or including immediate supply chain and even service providers).
Gap Analysis
Scope of work identifies areas for confirmation, further study, missed opportunity delineation, mitigation options, and how to capitalize on sustainable operations.
Activities:
- In-depth analysis of the degree KPIs are met via document review, interviews with select stakeholders (employees, consultants, contractors, customers), and onsite reviews.
- Confirm reported outcomes, evaluate for relevance, assess scope for improvement.
- Check across silos for missed opportunities and shared understanding of the sustainability mission (HR, purchasing, marketing, operations, management).
- Identify legacy practices, issues and vulnerabilities.
- Identify effectiveness of mitigation practices.
- Identify high points that can be capitalized on for branding.
- Review KPI alignment with corporate sustainability strategy and stakeholder expectations.
- Assess how are KPIs are tracked, whether there is a corporate-wide KPI tracking system, and how internal, mandatory and voluntary reports are populated.
Outcomes:
- Input for Change Management Plan, including operational and other changes such as adjusting current training.
- Overview of missed potential to attract impact investment and quality employees.
Change Management Plan
Change Management Plan proposes improvements across work and client streams, positive support mechanisms (training, evaluations, cross silo exchanges), and impact measurement through KPI tracking.
Activities:
- Identify relevant set of KPIs based on approved gap analysis findings.
- Create clear reporting criteria.
- Adapt corporate operating procedures, protocol, evaluations, contracts and purchasing norms to sustainability commitment and KPI tracking.
- Establish a well-defined cross-silo Continuous Improvement Process, reflected in personnel evaluations.
- Design automation of reporting systems based on single set of KPI data.
- Develop clear cradle to grave impact understanding, including clear criteria for supply chain.
- Assist with marketing high points and wins for branding.
Outcomes:
- Proposed Change Management Plan.
- Proposed Continuous Improvement Process.
- Input for changes and additions to existing training.
- Change can be managed organically and progressively – adjusting operations over time to increase ranking.
Centralized KPI Repository
Central repository and automated tools to propagate KPIs into various types of reports.
Activities:
- Perform analysis of KPI data (content and format) across the different reporting requirements.
- Define a normative set of KPI data from which all reports can be derived.
- Design import and export mechanisms to integrate KPI data with currently used reporting tools.
- Discuss potential to cross-reference among different types of reports.
- Discuss potential to enable links to KPI reporting from supply chain.
Outcomes:
- All information in reports and marketing material to be based of single set of information.
- All work-flows use same set of KPIs.
- Clearly show change year over year.
- Reduce the effort to selectively copy and reformat KPIs into the myriad of reports (regulatory required and voluntary) that a company typically has to produce.
Training
Alignment of training and awareness guides with sustainability commitment.
Activities:
- Review existing training and ensure that it is aligned with KPIs and the Change Management Plan.
- Add new training elements and revise existing protocol as needed.
- Empower employees to evolve a meaningful Continuous Improvement Process within the framework of the Change Management Plan.
Outcomes:
- Sustainability training and awareness guides support corporate sustainability commitment.
- Well aligned performance evaluations.
- Streamlined process, no legacy operational training disconnects.
Optional Supply Chain Audit
Comprehensive review of existing supply chain. Potentially review service providers.
Activities:
- Review the supply chain and service providers used.
- Develop a clear understanding how supply chain and service providers impact ranking and reputation.
- Review which performance requirements are included in supplier contracts - recommend changes.
- Audit supply chain and service providers against contractual obligations to assess actual compliance.
- Determine opportunity to invest in supply chain relevant companies (Impact Investment in lieu of CSR spending).
Outcomes:
- Map of goods and services flow through the supply chain.
- Cost / benefit analysis of different supply chain strategies.
- Basis to negotiate contract updates.
- Integrated KPI reporting.
- Training guide.
- Implementation plan to create a captive supply chain (if desired).