Industrial Environmental Performance Metrics Challenges and Opportunities (1999) / Chapter Skim
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2 What are Industrial Environmental Performance Metrics?
2 What are Industrial Environmental Performance Metrics?
Pages 29-46
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From page 29... ...
generally is interested in many internal corporate metrics and is concerned about the impacts of industry activities on the environment at the local, regional, and global levels. These concerns frequently relate to such issues as air quality, water quality, product recyclability, and regulatory compliance.
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From page 30... ...
Operational metrics may also address product design, packaging, and transport. Given the conventional wisdom that 80 percent of a product's attributes are determined during the first 20 percent of the product development process, efforts to measure and improve environmental performance during the design phase can be particularly fruitful (DeLadurantey et al., 1996; Hoffman, 1997~.
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From page 32... ...
Management Metrics Whereas operational metrics provide an indication of the present state of a company's environmental performance, management metrics furnish information on steps being taken to influence operations. Management metrics describe such things as the allocation of funds and labor, implementation of environmental programs and new environmental policies, environment-related legal expenses, environmental remediation activities, and the status of environmental information systems (Box 2-2~.
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From page 33... ...
Environmental Condition Metrics In the final analysis, it is generally environmental condition metrics that are of greatest interest to industry and external stakeholders. Unfortunately, this is also the area in which the fewest number of robust metrics have been developed and implemented.
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In order for a metric to be useful, it also must be possible to obtain reliable measurements and data; the information gathered must be relatively unambiguous and readily understandable; and it must be communicated internally to those decision makers capable of affecting change or, alternatively, to interested external stakeholders. In addition to these general properties, industry, public stakeholders (e.g., local communities, citizen groups)
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From page 35... ...
It also improves a company's ability to compare the environmental impacts of disparate processes or products. Most of the characteristics cited by survey respondents were of primary relevance within companies themselves, but some industry respondents showed substantial interest in metric attributes more useful for external application.
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Such public relations efforts can be important to avoiding negative media attention and more intensive regulatory scrutiny. Characteristics Desired by Public Stakeholders As considered by the committee, external stakeholders are individuals and groups that generally have little direct financial interest in an industrial operation or sector.
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The Environmental Defense Fund has recently established an online system that uses local maps to graphically link TRI emissions data to thousands of specific industrial sites throughout the United States. The website, called Scorecard, can disaggregate and weight emissions based on such characteristics as carcinogenicity.
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From page 39... ...
Regulatory compliance, on the other hand, is a firm lower bound by which corporate laggards can be judged. Survey respondents' concern over compliance issues was clear when they were asked to rank environmental factors related to financial performance and management quality (questions 6 and 7~.
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were asked to describe and rank the types of decisions that were most affected by environmental performance metrics (Table 2-1~. As might be expected, regulatory compliance topped the list: Over 60 percent cited this as the number one area of business decision making affected by metrics.
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From page 43... ...
Environmental metrics would therefore seem to have some impact on corporate investment decisions, but their utility for decision making in an array of other core business areas appears to be either limited or underutilized. Given this, it is interesting to note how respondents ranked the overall importance of environmental criteria in corporate decision making (Figure 2-2~.
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It may simply be that metrics are used primarily for compliance because that is the area in which most metrics exist. There seems to be a considerable unmet demand for environmental information; substantial rewards might accrue to those able to collect and make use of it.
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1998. Measuring corporate environmental performance: The ICI environmental burden system.
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