The Process Analysis Method of selecting indicators to quantify the sustainability performance of a business operation

This paper describes a method for assessing the degree of sustainability of a business operation, in terms of indicators related to the sustainability impacts of its particular activities. The Process Analysis Method considers the impact on the capital residing in the three domains: the environment, the economy and the domain of human/social capital. It is found, using the Brundtland definition of sustainability, that these impacts can be related to two business perspectives: (1) Resource efficiency, which measures the effectiveness of conversion of natural, financial, human and social capital; (2) Fairness in benefit which describes how fairly the benefits and disbenefits of changes in the three domains are distributed amongst stakeholders. The method requires a complete review of the activities of the business within an appropriately defined system boundary, in order to make an inventory of activities which affect the capital stores of value; those effects are found to relate to the business perspectives. The effects of these activities on stakeholders are identified, and those which are deemed to be significant are characterised by issues: these determine the selection of indicators whose values are given by metrics. The methodology thus enables the development of a comprehensive set of sustainability indicators and metrics for the particular business operation. The set of indicators will be similar for businesses with similar activities, so the methodology facilitates comparison and benchmarking. Further, the value of a particular indicator can be traced back through the analysis to a particular business process, which is especially helpful in guiding remedial action, since cause is linked to effect by the method. (C) 2010 Elsevier Ltd. All rights reserved.