Published on February 19th, 2014 | by Jonathan Churchman-Davies0
Setting Business Sustainability Goals
Jonathan Churchman-Davis delivers the fourth part in his sustainability series. The Independent Specialist Adviser for Innovation and Sustainability discusses how by setting realistic targets, you can direct your organisation to achieving sustainable goal delivery, and present usable and useful data to stakeholders, analysts, and executives.
To read Jonathan’s opinions on profitability and sustainability, click here. To read Jonathan’s thoughts on sustainability as a corporate strategy driver, click here. His intriguing post on using sustainability as a cash saving investment tool can be viewed by clicking here. All three posts give valuable insights into effective business sustainability.
Business Sustainability Targets and Strategy
On the face of it, setting ambitious business sustainability targets looks great – it shows commitment to building a better world and delivering customer and stakeholder goals. However, companies need to think very hard about how they set, communicate, deliver and report on these targets.
This is especially important now that mandatory carbon reporting is here. All too often, instead of one harmonised system which efficiently coordinates and reports, companies rely on ad hoc, disjointed processes that suck in scarce resources which could be better spent on performance delivery.
Why are Business Sustainability Goals and Targets Important?
Aim too high and a programme sets itself up to fail. Aim too low and it may not impress clients and investors. Seasoned assessors and analysts will be fooled by neither. Typical questions tend to run on the lines of:
- “Are you running according to plan?”
- “You are promising to run our service more efficiently, but you missed your own targets”
- “Yes, we know CO2 is important, but what about the cost of the fuel that releases it?”
- “Why are your rivals saving 10% when you have saved just 5?”
Getting business sustainability targets set for successful delivery is important.
Dodgy Corporate Sustainability Targets – A Symptom of Trouble to Come
Targets can be useful indicators of the maturity of a company’s sustainability programme. For a start, look at values and timings. Consider:
- If targets are large, rounded in value, set a long way off and with little detail on delivery, watch out. It may be due to a programme that is driven by guesswork and expectations rather than fundamentals.
- Secondly, check actual achievements to date. If they have missed or wildly exceeded targets, this may indicate a weak link between goal setting and the planning of delivery.
- Finally, look at published performance data. It should be detailed and up-to-date. If not, this betrays an under-resourced or badly-led programme.
How many corporate websites have performance data that is over a year old?
Setting Corporate Sustainability Targets From the Bottom-up
It’s no surprise that the best way to set a business sustainability target that can be delivered is from basic planning data. The process should start by listing specific company activities and the associated sustainability issues. This list will include resources consumed, interested and affected stakeholders, wastes generated, impacts and exposure to risk. Following on, issues can then be prioritised and linked to improvement plans. Well-formulated plans will include specific delivery targets.
Easy Does It
Once a company understands what the plans can deliver, the challenge is how to set and communicate the overall targets. My thinking is that a company should start out by thinking of three types of targets for each sustainability issue, depending on the audience:
- The most ambitious levels represent what can be achieved at best - your senior level performance aspiration.
- A lower set of targets would represent what is feasible in practice - the internal targets for staff and managers.
- The third class of target would be most heavily discounted for business risk and would be what you tell your external stakeholders.
In theory, all three target levels could be identical, but it helps to think in this way so that performance risk is always taken into account depending on the audience.
Detailed and Honest Communication on Targets is Key
The last thing to mention is how to communicate your business sustainability targets. While targets should reflect reality, they should also be living numbers. They should be plotted into the future, with an actual performance updated at least yearly. They should include commentary on successes and failures. Why failures? Because honest descriptions of failures and corrective actions are powerful evidence of an in-depth and ethical approach.
At the end of the day, isn’t that what your clients and stakeholders want?
Do you agree with this approach to effective monitoring of business sustainability targets? Is sustainability a priority in your organisation or does it sit on the back burner. We welcome your input.
Photo credit: NicoElnino
About the Author
Jonathan Churchman - Davies is a leading thinker on sustainability and business. His skills are constantly in demand for leading corporate businesses from 35 industrial and commercial sectors. He has shown businesses how to embed sustainability into their business efficiently and effectively.
Based in Oxfordshire, Jonathan has been a leading advisor to corporate giants such as Serco and May Gurney plc.