The Climate Of Business #100: The Key Performance Indicators (KPIs) for businesses looking to turn sustainability into success

Climate Change Reality

• In data: The European countries that take the most private jet flights (Euronews )
• New York’s floods weren’t a one-off — here’s how the city is preparing for the future (CNBC )
• Extreme weather displaced 43m children in past six years, Unicef reports (The Guardian )
• Climate change leads homebuyers to seek a place not in the sun (Financial Times )
• Extraordinary September heat means 2023 is on track to be the warmest on record (CNBC )

• US issues first ever fine for space junk to Dish Network (BBC )
• Russia says it will oppose plan to phase out fossil fuels (Financial Times )
• UK space satellite maps heat at Earth's surface (BBC )
• UN report urges global end to fossil fuel exploration by 2030 (The Guardian )
• Dengue fever is likely to 'take off' in Europe as planet heats (Euronews )

Business Climate Reality

• Apple voices support for California climate bill on strict emissions reporting (CNBC )
• UK oil and gas sector ‘must do more’ to meet 2030 emissions target (The Guardian )
• Theresa May: Net zero isn't act of economic harm (BBC )
• ESG ratings: whose interests do they serve? (Financial Times )
• The 'white gold' rush dividing communities (BBC )
• Nickel miners linked to devastation of Indonesian forests (Financial Times )
• Climate change and El Ni?o behind unpayable global food prices (Euronews )
• How a huge new LNG plant spells ‘dire’ trouble for whales off Canada’s coast (The Guardian )

• Biden launches American Climate Corps to train the green workforce (CNBC )
• UK universities accepted millions in funding from fossil fuel giants (Euronews )
• The ‘Green’ Future of Furniture Is a Sofa Stuffed With Seaweed (WIRED )

Reality Check

In a world where sustainability is quickly becoming an integral aspect of business operations, translating sustainability into wider business success has become a priority for organisations worldwide.?

Sustainable practices not only benefit the planet and society but also yield economic advantages and long-term resilience. However, in order for businesses to effectively turn sustainability into success, they must ensure they are able to efficiently measure and manage sustainability efforts via the use of Key Performance Indicators (KPIs). As such, this week's newsletter will explore the critical KPIs, often already tracked by businesses, that must be prioritised in order to achieve sustainability success.

The key sustainability Key Performance Indicators (KPIs)

Listed below are various types of KPIs that businesses must collect data on, measure and extensively analyse in order to ascertain the long term strategic benefits of sustainability:?

• Energy efficiency

Energy efficiency is a critical KPI for not only sustainability, as it impacts a businesses carbon emissions, but also finance; as it directly impacts an organisation's operational costs. Tracking energy consumption and implementing energy-saving measures not only reduces costs but also contributes to a company's overall sustainability goals. Companies often set targets to improve their energy efficiency through equipment upgrades, building retrofits, and employee engagement programs. In doing so, businesses are able to reduce their scope 2 emissions and their overall carbon footprint; accelerating the net zero journey .

Read more: What are Scopes 1, 2 and 3 of Carbon Emissions?

• Waste reduction

Yet again, waste reduction is not only a critical sustainability metric; but also a vital financial metric. Monitoring waste involves organisations tracking the amount of waste generated, setting targets for waste reduction, and implementing strategies such as recycling programs, waste diversion, and product design improvements. By minimising waste, companies can reduce disposal costs, decrease their environmental impact, and improve resource efficiency.

• Water conservation

Water scarcity is a growing global concern, making water conservation a vital sustainability KPI. Businesses monitor their water usage, set targets for reduction, and implement water-saving technologies and practices. By reducing water consumption, organisations can mitigate environmental risks and contribute to the responsible management of this finite resource. Meanwhile, water conservation initiatives result in savings through reduced water bills, energy efficiency, rebates, and avoidance of infrastructure costs.

• Corporate Carbon Footprint (CCF)

One of the primary sustainability KPIs that businesses track is the reduction of their overall Corporate Carbon Footprint . Corporate Carbon Footprint (CCF) represents a company's direct and indirect carbon dioxide equivalent emissions within a defined time period (usually a single year). To translate sustainability into success, companies set ambitious targets for reducing their CCF through the adoption of sustainability software and sustainable actions such as energy efficiency improvements, the adoption of renewable energy sources, and transportation optimisations. Reducing the carbon footprint not only aligns with global climate goals but can also lead to cost savings and increased brand reputation.

• Supply chain sustainability (scope 3 emissions)

A significant portion of a company's environmental footprint often lies within its supply chain - also known as their scope 3 emissions. To turn sustainability into success, businesses evaluate the sustainability of their suppliers and set KPIs to improve supply chain practices. This includes tracking supplier emissions, labour practices, and the use of sustainable materials. Plan A's new Suppliers Module allows businesses to track, report and reduce emissions beyond scopes 1 and 2 by providing a complete overview of Scope 3 supplier emissions. Through using such technology to develop a more sustainable supply chain, businesses can enhance their reputation and reduce risks associated with supply chain disruptions.

• Customer satisfaction and brand reputation

As consumers increasingly look to support companies that are acting sustainably, sustainability can also be measured by customer satisfaction and brand reputation. Companies use KPIs such as customer surveys, Net Promoter Scores (NPS), and social media sentiment analysis to gauge how their sustainability efforts are perceived by consumers. Positive feedback and a strong brand reputation can lead to increased customer loyalty, market share, and long-term success.

• Financial performance

Ultimately, the success of sustainability efforts must be reflected in a company's financial performance. Businesses track KPIs related to sustainability investments, cost savings, and revenue generated from sustainable products or services. These financial metrics demonstrate the tangible benefits of sustainability, including increased profitability, access to new markets, and reduced risks.

The best practices for tracking sustainability KPIs

To track sustainability KPIs and metrics, companies must implement a system that enables the collection, analysis, and reporting of ESG data. This can be achieved through the use of data analytics and sustainability tools that are accurate, reliable, suitable to their industry, meet stakeholder expectations, and align metrics with relevant reporting standards. This will help companies to identify key areas for improvement and track progress over time.

One notable solution provider is Plan A - the industry leader on carbon accounting, decarbonisation, and ESG reporting software. The green-tech pioneer hosts a data-driven SaaS platform that combines cutting-edge technologies and the latest scientific standards and methodologies (certified by TüV Rheinland and GHG Protocol compliant) to ensure that businesses can accurately and efficiently track key sustainability metrics. The end-to-end software solution automates CO2 emissions calculation, carbon reduction planning, as well as regulation and audit-proof ESG reporting, empowering businesses to manage their entire net-zero journey in one platform.?

Businesses that choose to use Plan A’s platform only have to use one software for their entire decarbonisation journey. Subsequently, Plan A provides end-to-end carbon analysis that allows businesses to efficiently measure, and reduce scope 1, 2, and 3 emissions , decarbonise operations and value chains, comply with ESG regulations , and communicate performance to internal and external stakeholders. Additionally, Plan A boasts an in-house team of experts in sustainability, carbon accounting, decarbonisation, policy, and customer success, ensuring the sustainability journey of their clients is seamless.

For a comprehensive guide to choosing the best sustainability software suited to your business, read here.

Ultimately, turning sustainability into success requires a comprehensive approach that includes tracking and measuring key performance indicators across environmental, social, and financial dimensions. Businesses that are equipped with the appropriate sustainability tooling will inevitably be able to accelerate their net-zero journey and undergo sustainable transformation in order to reap the long-term strategic benefits of decarbonisation.?

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