Executive Director, Certified Institute of Management Accountants CIMA
Executive summary
Sustainability can drive significant business benefits. But in many
organisations, its value is not
fully realised. Robust sustainability performance management, driven
by finance professionals, can be a key enabler to
unlocking this value. Sustainability, when embedded throughout an
organisation, its strategy and operations, can
drive value across a number of dimensions:
• Revenue generation – from new products, services and markets.
• Cost control – resource efficiency, lower energy consumption and
waste minimisation.
• Building trust – enhancing brand value and promoting a positive
culture among employees and other stakeholders.
• Risk management – by breaching regulations or avoiding safety and
environmental incidents.
Sustainability and the value it creates must be quantified and linked
to business performance if the case for
sustainability is to be made and the benefits are to be realised. A
robust sustainability performance management
(SPM) capability provides the information required for decision makers
to identify and create value from the
sustainability levers relevant to their business.
The discipline and rigour applied to financial information should be
applied to sustainability reporting. In many
companies that process has already begun. Standard Chartered, in the
first of our case studies, incorporates
environmental, social and economic dimensions into its performance
reviews and the approvals processes for new
loans. Novo Nordisk, the second case study, has not only embedded
sustainability throughout the organisation but is
also one of a host of companies that has incorporated sustainability
reporting into its annual report, creating an
integrated approach for its management, auditors and investors.
However, for many organisations current efforts to manage
sustainability performance tend to be tactical rather than
strategic. These efforts are rarely linked to business performance and
the measurement and tracking of sustainability
initiatives is not as rigorous as that of revenue or profitability. In
a recent CIMA survey for example, only 17% of
respondents said their organisations have fully integrated
environmental considerations into project appraisal.3 By
incorporating sustainability into standard business systems and
processes, it becomes part of planning and reporting –
further integrating it with both day to day operations and strategy
Executive summary
Sustainability can drive significant business benefits. But in many
organisations, its value is not
fully realised. Robust sustainability performance management, driven
by finance professionals, can be a key enabler to
unlocking this value. Sustainability, when embedded throughout an
organisation, its strategy and operations, can
drive value across a number of dimensions:
• Revenue generation – from new products, services and markets.
• Cost control – resource efficiency, lower energy consumption and
waste minimisation.
• Building trust – enhancing brand value and promoting a positive
culture among employees and other stakeholders.
• Risk management – by breaching regulations or avoiding safety and
environmental incidents.
Sustainability and the value it creates must be quantified and linked
to business performance if the case for
sustainability is to be made and the benefits are to be realised. A
robust sustainability performance management
(SPM) capability provides the information required for decision makers
to identify and create value from the
sustainability levers relevant to their business.
The discipline and rigour applied to financial information should be
applied to sustainability reporting. In many
companies that process has already begun. Standard Chartered, in the
first of our case studies, incorporates
environmental, social and economic dimensions into its performance
reviews and the approvals processes for new
loans. Novo Nordisk, the second case study, has not only embedded
sustainability throughout the organisation but is
also one of a host of companies that has incorporated sustainability
reporting into its annual report, creating an
integrated approach for its management, auditors and investors.
However, for many organisations current efforts to manage
sustainability performance tend to be tactical rather than
strategic. These efforts are rarely linked to business performance and
the measurement and tracking of sustainability
initiatives is not as rigorous as that of revenue or profitability. In
a recent CIMA survey for example, only 17% of
respondents said their organisations have fully integrated
environmental considerations into project appraisal.3 By
incorporating sustainability into standard business systems and
processes, it becomes part of planning and reporting –
further integrating it with both day to day operations and strategy
No comments:
Post a Comment