eKPI’s – Executive Summary
There is an increasing recognition that good environmental performance makes good
business sense. Environmental risks and uncertainties impact to some extent on all
companies, and affect investment decisions, consumer behaviour and Government policy.
Management of energy, natural resources or waste will affect current performance; failure
to plan for a future in which environmental factors are likely to be increasingly significant
may risk the long-term future of a business.
Companies that measure, manage and communicate their environmental performance are
inherently well placed. They understand how to improve their processes, reduce their costs,
comply with regulatory requirements and stakeholder expectations and take advantage of
new market opportunities. Over a third of FTSE 350 companies already report KPIs according
to the guidance specified here. Nevertheless, the landscape of environmental, sustainability
and corporate responsibility reporting can be complex. These Guidelines seek to help
companies report their environmental impacts in a meaningful and cost-effective way.
The Guidelines are consistent with other standards and reporting guidance as far as possible.
There is an increasing demand for company reporting that is sharper and more focused on
the key impacts on the business and on the environment. The requirement for a Business
Review1 is designed to improve company reporting, and requires companies to report on
environmental matters where necessary for an understanding of the business. The use of
Key Performance Indicators (KPIs) will help companies manage and communicate the links
between environmental and financial performance.
These Guidelines seek to make this process easier for businesses by setting out 22
environmental KPIs, together with information on how environmental impacts arising
from the supply chain and from the use of products can be taken into account. Although
22 direct KPIs are described, no one company is expected to report on all of these. An
analysis of business sectors suggests that around 80 per cent of companies are likely to
have 5 or fewer KPIs. Whilst some companies already have sophisticated reporting systems
in place, these Guidelines aim to help many more companies reach a level where
they understand their environmental performance and can improve it.