Green metrics: Mastering sustainability with KPIs

In today's data-driven world, understanding the sustainability of business operations has become crucial. Here's a look at some key KPIs against which this data is measured: Data plays a pivotal role as companies strive towards sustainability. But given the vast scope of this subject, how can companies effectively utilise data to obtain precise insights into their sustainability efforts?

Employing key performance indicators (KPIs) allows organisations to compare collected data with their objectives, thereby evaluating the effectiveness of their strategic initiatives. Additionally, the rise of digital transformation across sectors — reducing the need for laborious manual tasks — enables firms to analyse their data more swiftly, ensuring its relevance.

Below are some KPIs companies are currently leveraging to generate meaningful sustainability insights:

Carbon emissions

While extensively discussed, the carbon emissions of a company remain a critical KPI due to its comprehensive analysis of data from the company, as well as its suppliers and customers. By evaluating Scopes 1, 2, and 3 emissions, organisations can understand the impact of their products or services on climate change.

Energy usage

How can one simply lessen the reliance on coal-powered energy? By reducing energy intensity. Companies are examining their energy consumption to identify areas for reduction, leading to cost savings and lower emissions from energy production. Digital tools, including the industrial internet of things (IIoT), offer detailed insights into the energy used across different processes.

Supply chain emissions

Besides direct production, the emissions from a company's supply chain also offer room for improvement. Organisations are adopting eco-friendly transport and vehicle solutions to cut emissions and waste in logistics. Access to comprehensive supply chain mileage data helps companies understand the impact of their transportation methods.

Waste management and recycling

As consumer awareness about product recyclability and sourcing grows, companies are adapting their procurement and operational practices to stay competitive. Tracking waste management practices helps ensure that not only is production sustainable, but the products themselves contribute to a circular economy.

Social impact

With changing consumer attitudes towards sourcing, companies must maintain transparency about how they treat their suppliers. Environmental, social, and governance (ESG) reporting, such as that provided by EcoVadis, offers valuable insights into the social consequences of business operations, supporting companies in enhancing their ESG transparency.