The best sustainability and environmental KPIs for your business

In this article, we'll explore several options of KPI that you can track which will give an accurate picture of your sustainability and environmental credentials.

So you’ve already taken action to improve the sustainability and environmental credentials of your business.

Great!

But how are you measuring the impact of your actions?

Without accurate measurement, you can’t understand which changes are having the biggest effect. And you can’t identify areas that need to be improved.

Equally, without proper tracking, you can’t show customers exactly how much you’re doing for the environment. Demonstrating your progress on your sustainability journey can be the difference between winning and losing investment and big contracts. And as new legislation kicks in it will be essential to show that you are compliant.

That’s why we’re here to help you put in place the best measurements for your business.

How to measure sustainability

KPIs (Key Performance Indicators) are used to measure all aspects of business performance. Historically they’ve been most used to track things such as sales, client retention, revenue and profit growth, and customer service. 

They’re an objective way of getting a true picture of how a business is performing in various areas, and then tracking it over time so you can easily see how much you are improving. 

So it makes sense to use KPIs for sustainability too.

Businesses in the digital world are data-rich. All the information you need to track your sustainability is available. You just need to capture it and use it in the most effective way.

The most important thing is to define the environmental KPIs that are critical to your business and ensure that you are accurately recording and reporting on the data.

Once you do, you’ll gain valuable insights that not only show off your environmental credentials but also inform you on how to improve further.

Let’s take a look at some sustainability KPI examples that all businesses can use.

Energy consumption

Digital tools are available to measure energy consumption across your business. Smart meters can accurately report your electricity and gas usage. 

Your bills should show you the total kilowatt-hours used in both electricity and gas. Track these on a monthly basis to see how you’re performing.

Publish this data internally and encourage staff to save energy wherever possible. Not only will this reduce your carbon footprint but it will also lower your bills.

If your business has any manufacturing or industrial processes look to the Industrial Internet of Things (IIoT) to employ sensors that capture and analyze data in real-time. As well as showing exactly how much energy these processes use, connected sensors and actuators enable you to identify inefficiencies and potential problems. This will help you both develop greener processes and get products to market faster and cheaper.

KPI To Track: kWh per Month

Image credit: Unsplash

Water use

Just like energy, water is a precious commodity that is essential to the running of every business. Water meters show exactly how much water you are using, in terms of both water supplied and wastewater treated. 

Similar to energy consumption, tracking this every month will tell you if your water use is going up or down. 

Your water provider should have suggestions for how you can reduce your usage. Some offer incentives for installing sustainable drainage systems and rainwater harvesting so you can save money at the same time as reducing consumption.

KPI To Track: m3 of Water Usage per Month

Waste generation

Every business creates waste, but what you do with that waste makes a big difference. The aim should be to recycle as much as possible so that the amount sent to landfill is minimised. Take a look at our blog on packaging to see how something that every business uses can make a big difference to your overall footprint.

Paper is the most common material found in landfills and the easiest to measure. Simply offset the amount purchased against the amount recycled over a given period. A good recycling partner will provide reports on the weights of all materials you have recycled with them, giving you figures for each category.

By measuring how much of your waste is recycled on an ongoing basis you can set targets to raise this from, say, 60% to 90%. You’ll be able to see your progress over time and show how serious your business is about reducing the harmful impact of sending waste to landfill.

If you use a waste management or recycling company that gives accurate figures then you can start to report on waste in the same way that you report on energy and water usage.

The aim should be to reduce waste generation at the source rather than simply recycling as much as possible. So if you can show that paper recycling has decreased from 1 tonne to 100kg over 12 months, that can be published in your sustainability policies alongside revenue and operational costs.

KPI To Track: Tonnes of Waste Per Month (break down by type, e.g. glass, plastic)

Transport emissions

Transport accounts for almost a quarter of worldwide direct CO2 emissions from fuel combustion. Electric vehicles are rapidly growing in popularity, but it will be some time before they are ubiquitous. 

Tracking all your transport usage, including ‘supply chain miles’ will help you identify areas for improvement. 

If you have company-owned vehicles, the most accurate way to track their emissions is to record the litres of fuel purchased from invoices and receipts. For public travel, including road, rail and air, ensure your expenses process collects receipts and uses calculation websites to obtain the distances travelled. 

You can then track the total travel miles clocked up by your staff each month and report on the total emissions contribution from your business.

You need to focus not only on what you can do as a business to reduce your own transport emissions but on what your partners are doing to ensure that your goods are delivered in the most environmentally friendly way. Selecting transport partners that track emissions in a similar way and are equally committed to green initiatives is another way to show how serious you are about making positive changes.

KPI To Track: Distance Travelled & Associated CO2e figures per month

Image credit: Unsplash

Carbon intensity metrics

If you want to comply with Streamlined Energy and Carbon Reporting (SECR) you must include at least one intensity ratio in your reports.

This defines your emissions data in relation to business metrics. For example, tonnes of CO2 per sales revenue, or tonnes of CO2 per total square metres of floor space. This allows for accurate comparison with other similar companies, as well as self-comparison as your business grows.

Without intensity metrics, a growing business will always look as though it is creating more emissions. If you double the number of staff over 12 months, you’ll need a bigger office. A bigger office with more people means higher energy and water usage. But if the usage per person or per square metre is less, then your sustainability is improving. Similarly, if you are able to show that you’ve doubled revenue but only generated 15% more waste and 20% more transport mileage, then you are proving your green credentials.

Reporting in this way not only keeps you in line with regulations but also allows you to demonstrate your long-term commitment to emissions reduction. This can be a key differentiator that helps you to stand out from competitors and persuade customers to choose your products and services.

KPI To Track: CO2e Per Employee, or CO2e per £ revenue

How are you tracking yours?

As you can see, there are several KPIs you can track that will give an accurate picture of your sustainability and environmental credentials. And once you are reporting on them regularly, they’ll help you reduce costs as well as emissions.

If you’re looking for a solution to quantify and record this data, check out Spherics, the carbon accountability software. 

Need help getting started?

We created the Small99 Hero for businesses just like yours.

Our prebuilt action plans, customized to your industry, help you not only measure KPIs but also reduce and offset them too. 

We’ll be with you every step of the way through your Net Zero journey, and our intuitive tool helps you track your progress and easily demonstrate the improvements you’ve made.

Want an idea of how your business is doing right now? Take our Net Zero Scorecard and get a quick analysis of your biggest emission areas. We also plant 5 trees for every completed scorecard so you’ll already be having a positive impact!

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