3 Roadblocks to Effective Environmental Measurement

These practices don’t guarantee success at meeting environmental goals, but they definitely help remove some of the biggest and most longstanding obstacles.

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Apqc Fig111APQCWhile many organizations are setting ambitious environmental goals, relatively few expect to actually meet them. Based on recent research with 1,700 global participants, APQC found that only 45% of respondents expect to meet or exceed their climate-related targets. About another quarter of respondents have a complete roadmap but only ‘hope’ to achieve it. The remaining respondents are uncertain if they will meet their environmental goals, or in some cases, don’t have any goals or a complete roadmap.         

Organizations are not necessarily struggling with buy-in for environmental goals. In fact, we found that the opposite is true. Nearly three-quarters of respondents (72%) consider their environmental objectives to be very or extremely important. If the challenge isn’t one of enthusiasm, what’s driving a lack of confidence in the ability to hit climate-related goals?

In this article, we review three common roadblocks that often prevent organizations from achieving their environmental objectives. Along the way, we share strategies and approaches that leading organizations have found to meet these challenges.

Roadblock 1: Too Many Measures

Many organizations are being swamped by the number of environmental measures they are trying to track and report. At the median, we found that organizations report 50 environmental metrics on an annual basis. At the 75th percentile, organizations report on as many as 75 environmental metrics annually, whereas organizations at the 25th percentile report 40 environmental metrics per year.

50 measures—just for environmental purposes—is a lot to ask leaders to track and potentially act on. We recommend choosing a single KPI per process or objective, which is supported by no more than seven support indicators used to manage and monitor performance. Ten measures or fewer are usually sufficient for a dashboard.

Most organizations use five typical selection criteria for measure selection, which can also apply to environmental measures:

  • Reliability—can we consistently gather inputs for this measure?
  • Impact—does the measure link directly to organizational goals?
  • Trends—can we track trends over time?
  • Ease—how easy (or difficult) is it to access and analyze the data?
  • Familiarity—is this a measure we have used historically, or is it commonly used in our industry?

If you’re struggling with too many environmental measures, work through these questions with your stakeholders to narrow down to a smaller but more impactful set of measures.

Roadblock 2: Measures Lack Context

Data for any measure needs context. Without it, organizations risk either reacting too quickly to data or not reacting at all when they urgently need to. Providing context means looking at performance over time, between peer groups, and in light of external factors that affect the data. For example, an organization’s industry, size, and location can all play a meaningful role in shaping what its environmental metrics look like.

Greenhouse gas (GHG) emissions, the most common climate-related topic that organizations include in their environmental reporting, is a good example of a measure that often lacks context. While 93% of respondents include this measure, only 55% report on the intensity of their GHG emissions. GHG emissions intensity expresses the amount of GHG emissions per unit of activity, output, or any other organization-specific metric. In combination with an organization’s absolute GHG emissions, measuring GHG emissions intensity helps to contextualize the organization’s efficiency, including in relation to other organizations.

Roadblock 3: Measures Lack Targets

Setting targets for measures helps ensure that organizations are tracking progress over time and working to take corrective action if needed. When measures lack targets, they are less actionable, their relevance is less clear, and it’s easier for them to clutter up a dashboard without providing meaningful intelligence.

While measures need targets, organizations won’t be able to meet those targets without creating accountability and ownership for the key players involved. Leading organizations create this accountability through practices like creating a public-facing roadmap for reaching net zero emissions (i.e., having an equal balance of carbon emitted versus sequestered or offset) and by linking elements of compensation for key employees to achieving strategic environmental goals.

While some supply chain organizations are on the right track, many still have an opportunity to instill more accountability for hitting environmental targets. For example, we found that while 72% of organizations publish their target year for achieving net zero emissions, only 50% share their roadmap for how to get there.

Key Takeaways

While most organizations recognize the importance of achieving their environmental goals, many are struggling with roadblocks related to having too many measures, providing context for making measures actionable, or setting meaningful targets. Any one of these roadblocks is enough to make it more difficult for organizations to achieve their environmental goals.

To avoid these roadblocks, it’s important to:

  • Work with stakeholders to identify the most relevant and impactful performance measures
  • Provide decision makers with context for interpreting the significance of environmental data
  • Increase visibility and accountability for environmental targets through approaches like creating a publicly available roadmap

These practices don’t guarantee success at meeting environmental goals, but they definitely help remove some of the biggest and most longstanding obstacles.        

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