Selecting meaningful and effective tools for measuring environmental performance is becoming increasingly important due to the increasing costs of environmental operations; market, regulatory and public pressures; voluntary initiatives, such as the International Chamber of Commerce Business Principles for Sustainable Development; and international standards, such as the International Organization for Standardization (ISO) 14001. Many metrics are already in use. These include lagging indicators, which measure outputs such as pounds of pollutants emitted or discharged; leading indicators, which are in-process measures of performance; and environmental condition indicators, which measure the direct effect of an activity on the environment. Each type of indicator has its own strengths and weaknesses, and different audiences; most organizations use a mixture of them.

Selecting meaningful and effective tools for measuring environmental performance is becoming increasingly important due to the increasing costs of environmental operations; market, regulatory and public pressures; voluntary initiatives, such as the International Chamber of Commerce Business Principles for Sustainable Development; and international standards, such as the International Organization for Standardization (ISO) 14001.

Many metrics are already in use. These include lagging indicators, which measure outputs such as pounds of pollutants emitted or discharged; leading indicators, which are in-process measures of performance; and environmental condition indicators, which measure the direct effect of an activity on the environment. Each type of indicator has its own strengths and weaknesses, and different audiences; most organizations use a mixture of them.

Other means of measuring progress include benchmarking against other companies or average industry performance; evaluating progress against codes of management practices developed by trade associations such as the Chemical Manufacturers Association (CMA) or the American Petroleum Institute (API); measuring progress against principles, goals, or corporate management system standards; and development of indices to evaluate progress from year to year.

Metrics can measure the business value of environmental programs or progress as well as the environmental performance of business operations. This can be particularly effective in demonstrating the value of environmental efforts to management. It can also provide data with which business units can design more efficient processes, decreasing material usage and environmental impacts while at the same time increasing yield and profitability.

The last several years have seen the development of several trends in environmental metrics. Some of these trends are:

• the globalization of metrics,

• increasing emphasis on sustainability in its environ-
• mental context (the efficient use of resources) and efforts
• to develop sustainability metrics,

• increasing use of environmental management systems
• as benchmarks of environmental performance,

• and emphasis on the integration of environmental per-
• formance with business performance with the goal of
• reducing costs and material losses, and improving yield,
• market share, and profitability.

There are a number of points to consider when designing, implementing,
evaluating, and improving a metrics program. The single most
important consideration, however, is to realize that no single approach
is suitable for every organization. Each company has its own particular
products and services, organization, financial structure, legal and
regulatory requirements, customer demands, data collection and management
systems, and environmental impacts. The approach selected
must also be responsive to a variety of potential audiences such as
management, employees, regulators, shareholders, and the public.
Underlying any successful metrics program are the concepts of alignment,
accountability and continuous improvement. Alignment involves
blending environmental performance measurement with business measurement,
data collection, reporting and management to ensure consistency,
and to minimize redundancy and incompatibility. It also means
ensuring that metrics are appropriate to the needs of the company,
business units, and other audiences. Accountability is a two-way
street; not only must employees and business units be held accountable
for environmental performance, but management must clearly
define expectations and should encourage business unit participation
in the development of performance criteria. The third major concept,
continuous improvement, is a key link in the plan-do-check-act cycle.
It should be remembered that measurement occurs not for the sake of
measurement, but to drive performance towards reduced environmental
impacts, more efficient use of resources, increased profitability and a
sustainable future.

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