Scorecards provide on-going monitoring of the organization’s progress toward prioritized goals and target(s). In the Sustainability Scorecard we integrate the goals from established sustainability frameworks, such as B-Corp, UN’s SDGs (Sustainability Development Goals), GRI (Global Reporting Initiative), SASB, etc. with the organization’s strategic goals to create a Sustainability Strategy Map and scorecard.
This facilitated process delivers alignment up and down and across the organization on the strategic direction, priorities, targets and accountabilities.
Attributes of the Sustainability Scorecard
- Measures come from the organization’s existing transaction systems (e.g. ERP (enterprise resource planning), CRM (Customer Relationship Management), accounting, etc.)
- The scorecard is near-real-time and published monthly.
- The scorecard can be cascaded down from the organization overall to departments, to teams and down to individuals.
- Individual & team ownership / participation defined.
- Multiple comparatives can be used – e.g. This quarter target. This year target, SDG Target, Business break-even target, Best in class, Best in region, etc.
- The same scorecard can be published using multiple frameworks – e.g. The scorecard can be published within the 17 UN- Sustainable Development Goals (UN-SDG), the 21 Future-Fit Business Benchmark Goals, or to be compliant with the GRI conditions.
- The Sustainability Scorecard is part of regular reporting – Executives need to manage several things simultaneously… Performance, Risk, Sustainability, Human Capital, Strategy Execution, Regulatory Compliance, etc. The Sustainability Scorecard is linked through data and goals to all the other scorecards…making it “a part-of, not apart-from” on-going activities.
- Enables multiple types of scorecards – Valuation, Navigation, Compensation, Calibration, Communication, Regulation.
- Enable “open-ended” questions – Systems are complex – when ever we try to predict where they will fail, we inevitably get it wrong to a greater or lesser extent. In the scorecard we use ‘indicators’… metrics that indicate if a system is working, not measures derived from previous problems.
Benefits of a Sustainability Scorecard
A longer list of benefits was captured in an earlier LinkedIn article. Here we will look into the benefits created by the above attributes
Current Sustainability Reporting – Assessments
Many current sustainability practices rely on either interviews or surveys to gather data. Interviews are when experts ask key people for their response / opinions to preset questions. Surveys are form-based responses from select people to preset questions.
Interviews and surveys have several common flaws (in no particular order):
- Recency – When questioned, people are best at remember recent activities, and tend to down-play / forget what has happened months and quarters ago.
- Perception of control – If a person thinks an issue is under control, it will be down-played or ignored.
- Level of exposure – based on your level in the organization, you may not be aware of issues below – or above – your responsibilities.
- Deception – if the interviewee could (on purpose or accidentally) hide or mis-direct the assessment
- Bias (and bias influencing the score) – if the interviewee has a bias, it will skew their responses
- Ignorance – we “do not know what we do not know”. One could provide an inaccurate response purely because we do not understand the question or the organization’s situation
- Risk aversion – One might be concerned about the consequences if certain situations were discovered
- Rewards – if the individual is compensated for particular performance, responses are likely to be biased towards a greater reward.
…leverage best practices from sustainability, performance management, risk and communications, while correcting the weaknesses of the periodic assessment approach.
We are in the final phases of refining the scorecard, measures and delivery. We are looking for a few more “early adopter” organizations that what to help craft this new solution. If you are interested in being a pilot site – which will take about a week’s on-site time and minimal cost, please let us know.
This article first appeared on LinkedIn
Brett Knowles is the Founder and CEO of Performance Measurement & Management. Brett assists organizations in achieving significant and sustainable performance improvement through world class execution of strategic intent.