Thursday, 3 April 2014

Sustainability Maturity Model Part I – Establishing a Need and a Survey of the Terrain

By Joe Kent and Jaya Chakravarty

The practice of environmental sustainability in businesses is an emerging discipline.  Driven by impending climate change and scarcity of vital resources, it has made its way into the lexicon of the modern business. We’ve seen a rapid adoption of sustainable business practices over the past 10 years, and leading companies, NGO’s, the government, and sustainability consultants have been helping shape new environmental standards for businesses to operate by. Until the standards, frameworks, tools and processes are established, there is room for vagueness, misinformation and misunderstandings. In the case of the sustainability practice, there is confusion around what a robust sustainability practice should look like. Most companies have not had the experience of conscious sustainable operations and cannot envision what they are missing, and they don’t know the difference between bad and good sustainability practice. As a result, we have seen companies struggle to advance their sustainability practices, while others are reluctant to begin any initiative at all.

In this scenario, the Sustainability Maturity Model, can help create a vision of what a robust sustainability practice looks like, and how sustainability should be integrated into a business model. The sustainability maturity model characterizes a continuum of sustainability maturity levels, from low maturity to high. Managers can benchmark their company’s performance against the model to see where they currently stand, and envision how they can progress further to achieve high maturity. It can be considered a roadmap to sustainability integration.

While many different frameworks exist, they generally follow the same basic format. Low maturity businesses are characterized by having none or just few isolated sustainability projects, whereas high maturity companies fully integrate sustainability into each aspect of their business strategy, from product design to energy sourcing. Usually the model will also characterize 2 – 3 intermediate levels as well. A comparison of the models published by PREST University of Manchester, FairRidge Group, and Terra Infirma, BAE Systems, and Industrial Research Institute illustrates this point nicely.

Sustainability Maturity Model Comparison Chart

Maturity Model Comparison Chart

While being generally called Sustainability Maturity Model, most of these frameworks are focused on environmental sustainability (Once exception is the Industrial Research Institute's, which includes one small social element as well).  This is perhaps justified since the very critical scenarios of depleting and degrading natural resources, and a rapidly heating Earth has brought Environment centre-stage amongst the three pillars of sustainability.

Most of the frameworks are based on subjective data, so are useful primarily for internal analysis of a company and only loose comparisons to other companies. Only insiders will truly know how well sustainability has been integrated into the business model. Some organizations have attempted to make their models more objective to make more concrete comparisons between companies. The Industrial Research Institute, for example, has created an Excel-based survey which a manager can download and fill in. The survey then automatically maps their sustainability maturity in 14 different categories. They can e-mail the completed survey back to IRI and receive a copy of the overall results from their industry.

The model we created at Climate Miles learns from these existing models, but is based on more objective indicators and only information that is available in the public domain. This allows us to objectively rank a company’s maturity level without the need for internal information, and to make unbiased comparisons of the maturity level of many companies within a sector. We’ll explain our model more in upcoming blogs.

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