Businesses around the world are increasingly turning to an exciting new branch of management known as corporate sustainability management (CSM) to help them better understand and manage their non-financial performance.
Indeed, what we are witnessing is nothing less than the birth of a new management function. The main pillar of CSM is the Triple Bottom Line (TBL), which has been successful as an organizing principle but a disappointment in practice. This is largely due to the absence of 'sustainability context' in related measurement, management and reporting efforts, when for example the monitoring of a company's use of freshwater resources fails to take into account the size of related supplies.
This book is the first to introduce a systematic means of including context in sustainability management and doing effective CSM. After making the case for why context matters, the book explains how to do context-based CSM by providing a stepwise, cyclical blueprint for how to practice it in any organization. This includes a template for context-based metrics compatible with the Global Reporting Initiative (GRI), as well as specific examples of metrics for each of the triple bottom lines.
Practical examples of best practices are presented throughout, while simultaneously addressing key issues, such as how organizations can measure performance against context-based standards when consensus for such standards does not yet exist. Appendices include tools for developing and applying context-based metrics, as well as case studies taken from the practice of context-based CSM at two companies in the United States.
This guide is the essential tool for business and organizational leaders in all sectors committed to improving their sustainability performance, with a particular emphasis on measurement, management and reporting.
Table of Contents
Foreword by Mathis Wackernagel Acknowledgements Introduction 1. Context-Based Sustainability (a) A Brief History of Context (b) The Relevance of Capital Theory (c) Daly's Rules (d) The Triple Bottom Line (e) A Modern-Day Theory of Practice for CSM (f) Sustainability Context (g) Summary: Context-based Sustainability 2. Key Issues and Practice Implications of Context-Based Sustainability (a) How CBS interacts with Core Business Processes and Cycles (b) How CBS relates to Measurement and Reporting (c) GRI and the Prevalence of Context Free Sustainability (d) Summary: Key Issues and Practice Implications of CBS 3. How To Do CSM (a) Introduction (b) A case Study in CBS: Cabot Creamery Cooperative (c) A Methodology for Practitioners: the CSM Cycle (d) Practising the Cycle (e) Stakeholder Engagement (f) Summary: How to do CSM 4. Summary and Conclusions (a) General Summary of Context-based Sustainability (b) Ten Mini-Cases of CBS in Action (c) General Conclusions (d) Looking Ahead (e) Closing Words Appendix A: Approach to Sustainability at Cabot Creamery Cooperative Appendix B: Areas of Impact Checklist Appendix C: Formulating Duties and Obligations at Cabot Appendix D: Corporate Water Gauge® Appendix E: 2007 Water Sustainability Report at the Cabot Creamery Glossary References
Mark W. McElroy, Ph.D. is an accomplished researcher, developer, consultant and trainer in the area of tools, methods and metrics for measuring, managing and reporting the sustainability performance of organizations. He is the founder and Executive Director at the Center for Sustainable Organizations in Thetford Center, Vermont, and a leading advocate and practitioner of context-based sustainability. Dr. McElroy is also the creator of the Social Footprint Method, a context-based system for measuring and reporting the social sustainability performance of organizations. He is a veteran of management consulting, including time spent at Price Waterhouse, KPMG Peat Marwick and Deloitte Consulting where he led the Center for Sustainability Performance in Boston, Massachusetts.
Jo van Engelen is an experienced scientist and has held top-level management positions at several companies throughout his career. He has been a full professor since 1991 at the University of Groningen (where he also is a research fellow), and since 2010 has been at Delft University of Technology serving as chair of Integrated Sustainable Solutions. In his academic career, he has authored/co-authored five books and more than 140 scientific papers, and presented more than 200 leading lectures around the world. In his business career, he has served full terms on two Executive Boards in an international context and served or serves on more than 10 supervisory boards (including for publicly-traded companies).
'Sustainability needs context to be meaningful. In the business community, companies desperately need to use context-based sustainability to measure their actual social, environmental, and economic impacts, to gauge if they're operating within the carrying capacity of our earth's ecological and human systems. Currently, what passes for corporate sustainability is largely devoid of context, and therefore essentially greenwash. Luckily, McElroy and Van Engelen provide company executives and managers a clear roadmap for integrating sustainability context into corporate operations.' - Bill Baue, Independent Sustainability Management and Communications Strategist and Senior Research Fellow, AccountAbility
'Some 80 percent of CEOs worldwide think they have already embedded the sustainability agenda in their businesses. The bad news is that most are confusing sustainability with eco-efficiency or citizenship. The good news is that Mark McElroy and Jo van Engelen can help them understand the difference.' - John Elkington, founder of Volans and SustainAbility, and author of The Zeronauts: Breaking the Sustainability Barrier
'At long last, a text written for the management reader which recognises that current corporate claims to be acting `sustainably’, pursuing `sustainability’ or reporting on `sustainability’ are nothing of the kind and are at best unsupported assertions... if you are concerned about how organisations might genuinely start to contribute to sustainability and you currently assume that your organisation is addressing and/or managing sustainable development then this book is an absolutely essential read for you.' -Rob Gray, Professor of Social and Environmental Accounting and Director, Centre for Social and Environmental Accounting Research, University of St. Andrews
'Sustainability is about looking at the whole system and all of our assets, built, human, social, and natural. McElroy and van Engelen show the way for business to put sustainability reporting and management back in context and make it truly useful and relevant.' - Robert Costanza, Director of the Institute for Sustainable Solutions, Founder of International Society for Ecological Economics & Ecological Economics Journal, Founding Editor-in-Chief of Solutions Journal
'Getting a grip on non-financial performance as well as financial performance, is for sure grounded in the context of social and environmental resources in the world and the duties organizations have to their stakeholders: a very true statement of McElroy and Van Engelen. Unlike many other approaches, this very readable book illustrates a clear and practical way to make it happen.' - Dick Sluimers
CEO, APG Group, and Member of the Board of Trustees of the IFRS Foundation
'Until now, attempts to measure sustainability have fallen short. Mark McElroy and Jo van Engelen present a leading-edge approach to measuring and managing sustainability that provides us the means to fully understand where we are and where we need to go to achieve true sustainability.' - Rob Michalak
Global Director of Social Mission, Ben & Jerry's
'There’s more talk about corporate sustainability today than there’s ever been, and more individual companies taking a lead than ever before. But their business models remain largely unchanged, investors remain largely indifferent, and governments continue to play incremental catch-up rather than systems transformation. As the authors of this timely and important book point out, it’s clearly time for a much more radical change.' - Jonathon Porritt, Founder and Director, Forum for the Future
'At Ben & Jerry's where we are managing the concept of a 3-part mission statement, balancing product quality, profitability and social mission, we have experienced how difficult it is to implement and to measure the progress on delivery of social mission. It requires a systematic process approach, embedded in the normal reporting and audit programs of the business. The proposed approach of Jo and Mark to integrate both financial and non-financial capital deliveries, combined with the necessary cultural changes, is the only right way forward towards a truly sustainable business.' - Kees van der Graaf, Board Member, Ben & Jerry’s, Executive-in-Residence at IMD, and Retired Member of the Board of Unilever
'Mark McElroy and Jo van Engelen are proposing in this book a way to track performance in a number of domains, beyond ecological resources….In what he and Jo now broadly refer to as context-based sustainability, their approach has a number of parallels to the Ecological Footprint….if sustainability performance tracking is to become informative and meaningful, we need to build this knowledge base – we need courageous trial and error, because the alternative is failure.' - Mathis Wackernagel (from his Foreword in the book) Co-creator of the Ecological Footprint, and President, Global Footprint Network