5 Essential Environmental Sustainability Metrics Enterprises Should Track

In today's world, consumers and businesses alike are increasingly focused on environmental responsibility. Procurement and supply chain play a critical role in ensuring a company's operations are sustainable and minimize environmental impact.

But how do you measure progress and identify areas for improvement? Here's a comprehensive guide to essential environmental sustainability metrics that procurement and supply chain professionals should monitor and track.

Building a Sustainable Foundation: Inventory and Goal-Setting

It's crucial to start by establishing a baseline understanding of your company's environmental footprint. This involves taking an inventory of your current practices. Collaborate with different departments to analyze utility bills, waste disposal records, and transportation data. This initial assessment paints a clear picture of your resource consumption and emissions.

With this knowledge, set clear and measurable environmental goals aligned with your industry and resources. Consider factors like industry best practices and your company's long-term sustainability vision.

Turning Data into Action: Capturing and Tracking Metrics

Once you have a roadmap, it's time to gather the data needed to track your progress. ESG software platforms designed to capture and track sustainability metrics can help you report and take action on opportunities to improve your enterprise’s carbon footprint and point you toward more sustainable suppliers based on ratings from organizations like EcoVadis or CDP.

Some Key Performance Indicators (KPIs) for Environmental Sustainability

Now that you have a data collection system in place, let's explore some key environmental sustainability metrics and KPIs (Key Performance Indicators) relevant to procurement and supply chain functions:

Energy Consumption

Energy Intensity (kWh/unit of output): This KPI tracks energy efficiency across your supply chain. By monitoring how much energy is used per unit of product produced, you can identify areas for improvement, such as optimizing transportation routes or partnering with suppliers who utilize renewable energy sources.

Percentage of Renewable Energy Used: This metric measures your progress towards using cleaner energy sources within your supply chain. Partnering with suppliers who invest in renewable energy solutions can significantly reduce your company's overall carbon footprint.

Water Usage

Water Withdrawal per Unit of Output (m³/unit): This KPI helps track water efficiency throughout your supply chain. Analyzing water usage can reveal opportunities for conservation, such as implementing water-saving technologies or collaborating with suppliers to reduce water usage in their production processes.

Percentage of Wastewater Treated: Responsible wastewater management is crucial. This metric indicates how effectively wastewater is treated before being released back into the environment. Partnering with suppliers who have robust wastewater treatment systems demonstrates your commitment to responsible water management.

Greenhouse Gas Emissions (GHG)

Total Carbon Footprint (tons CO2e): This metric provides a comprehensive picture of your company's total climate impact, encompassing emissions generated throughout your supply chain.

Reduction in Carbon Emissions Compared to Baseline: Track your progress towards achieving your emissions reduction goals. This helps you assess the effectiveness of your sustainability initiatives and identify areas for further optimization.

Waste Generation and Diversion

Waste Generation per Unit of Output (kg/unit): This KPI reveals how efficiently materials are utilized within your supply chain. By analyzing waste generation, you can identify opportunities for source reduction, such as optimizing packaging materials or implementing recycling programs with suppliers.

Recycling and Composting Rate (%): Track your progress towards waste diversion from landfills. Partnering with suppliers who prioritize recycling and composting demonstrates your commitment to a circular economy.

Material Efficiency

Material Input per Unit of Service (MIPS): This metric tracks how much material is needed to produce a product or service. By monitoring MIPS, you can identify opportunities to reduce material consumption throughout your supply chain.

Percentage of Recycled Content in Products: This metric showcases your commitment to using recycled materials. Prioritizing products with high recycled content minimizes your reliance on virgin materials and reduces your environmental impact.

Beyond Data: Putting Sustainability Into Action

Remember, data collection is just the beginning. Here are some additional tips to get the most out of your environmental sustainability metrics:

Start Small, Scale Up

Don't try to track everything at once. Begin with a few key metrics and gradually expand your data collection as you gain experience.

Invest in Employee Training

Educate everyone involved in procurement and supply chain operations on the importance of data collection and how their actions contribute to the larger goal of mitigating environmental risk and controlling costs.

Ready to accelerate your journey to a more sustainable supply chain? Download our playbook Mapping & Reducing Scope 3 Emissions: A Quickstart Guide for Procurement Pros.