A New Business Guide to Sustainability
It is becoming increasingly important for financial organizations to implement sustainability into their practices and their mindsets, whether it is to keep up with their competitors, meet government regulations, appease interested stakeholders, or because of their own ethical convictions. A recent Globe and Mail article describes the “MultiCapital Scorecard”, which resonated with me and may with many of our clients. Many people have heard of the “Triple Bottom Line” – which refers to integrating ecological, social and financial elements into business models – however, many people do not know how they can successfully measure this integration, besides the traditional profit-loss calculation.
Two consultants, Martin Thomas and Mark McElroy have developed a way to manage and evaluate the level of sustainability in the workplace. This method, called the MultiCapital Scorecard, provides businesses the ability to self-evaluate specific material and it focuses on five types of vital capital:
- Natural: Air, land, water, minerals, flora, fauna, ecosystems and other natural biophysical resources that humans and non-humans rely on for their well-being;
- Human: Knowledge, skills, experience, health, values, attitudes and ethical duties;
- Social and relationship: Teams, networks and hierarchies working together and their shared knowledge, skills, experience, health and values;
- Constructed: Material objects, systems or ecosystems created by humans;
- Economic: This can be internal or external. Internal financial capital refers to the pool of funds available to a company, including debt and equity finance. External financial capital consists of all funds available to parties outside an organization that your company can choose to access.
Companies will identify more specific areas of focus within these categories depending on their main stakeholders and major activities. Each of the items that the company wishes to focus on is weighted in importance and a score is assigned to each item. The goal of this scorecard is to “provide governors of organizations an overview of progression”.
Integrating sustainability into a business model is a process that will take time and resources, however it is a worthwhile endeavour. InvestorCOM is moving forward with exciting sustainability initiatives and we look forward to see how they impact our “Triple Bottom Line”! How does your company integrate sustainability into its everyday business practices?