A major problem with our current multitude of sustainability indicators, methodologies and reporting frameworks out there: They fail to provide a simple answer about whether or not the current environmental, governance, and socio-economic impacts of an organization is sustainable based on our current scientific understanding, international agreements, and accepted social norms.

Said differently: Our current sustainability metrics for businesses are not relative. They are not measured relative to, or in context to the limits of the natural systems that are necessary to sustain life on earth, and provide the multitude of natural resources that serve as the raw materials for every product.

Our current approaches to assessing and reporting on the sustainability performance of companies falls short in a number of ways. They lack deeper value because they are not comprehensive, meaning they can omit important sustainability issues. They often also prevent us from making apples-to-apples comparisons of business performance on sustainability. In other words, does Company A have a smaller footprint or operate more ethically than Company B?

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The way most businesses measure and report on their sustainability efforts can leave a bad taste in your mouth. It's not very meaningful to say you are better than your peers in the absence of a shared target or threshold. We’re measuring our performance on sustainability against each other, but it’s almost impossible to credibly claim that one business is more objectively sustainable than another using the current approach.

We can’t make those comparisons without measuring business performance in context to the planetary systems and natural resources that are needed by every business, every person, all life on earth. But what if we had a good way of determining if the sustainability performance of an organization was effectively balancing human needs with planetary boundaries? Then these kinds of meaningful comparisons, between businesses in the same industry and across different industries become possible. A “context-based” approach to sustainability measurement and reporting by businesses is the solution.

Ethical business practices and sustainability performance continue to serve as important differentiators among competitors. In a number of industries, goods and services that are perceived as being more sustainable continue to experience growth that outpaces traditional options and brands. Large consumer surveys routinely show a strong and consistent preference for “greener” options and for companies who treat their employees with respect. More importantly, we believe that businesses and their leaders have a moral and ethical obligation to authentically pursue sustainability in their operations, supply chains, and products. Read our moral case for sustainability in this blog.

We see context-based sustainability as one of the biggest emerging opportunities for ethical businesses in the near-term. It is scientifically sound, internationally recognized, and is leading edge (for now). There is considerable white space with this approach because relatively few businesses have publicly adopted and communicated about it. Adopting a context-based approach is one of the single best ways to substantiate business claims related to sustainability. Businesses that are early adopters will likely see the biggest benefits in terms of credibility and marketing potential.

Added benefits for businesses will include the ability to future-proof your sustainability efforts moving forward. A context-based approach to sustainability enables businesses to measure their performance on the environmental and social impacts that represent the largest sources of financial, reputational, and ethical risks.  

Boost your knowledge foundation on context-based sustainability with our key concepts blog.

Looking for some actionable guidance on how to adopt a context-based approach to sustainability? Check out the United Nations Sustainable Development Performance Indicators (UN SDPI). We think the approach to measurement and evaluation of enterprise sustainability performance the SDPI embraces is an important improvement that moves beyond existing frameworks and standards like GRI, ISSB, SBTs, etc. While SPDIs could act as an alternative to traditional reporting, we think it makes sense to use it in parallel with existing reporting frameworks.