3 principles for getting rankings right
3 principles for getting rankings right
If your company is challenged by public environmental ratings, such as the recent Newsweek Green Rankings, you are not alone. Or perhaps you are already a recognized sustainability leader, but can always do better. How might your company benefit from the recognition rankings bring, instead of being punished by it?
External rankings provide an incentive for companies -- and entire industries -- to measure and work towards impact reduction and cost savings. Public rankings also grab the attention of company executives, and can drive powerful enterprise-level conversations about environmental strategy and efficiency investment.
Here are three principles for getting rankings right: embrace transparency, know your impacts, and act on them.
Principle One: View transparency as an opportunity
Are you embracing transparency when it comes to energy and resource impacts, or are you sharing information on a need-to-know basis with your stakeholders? Perhaps only when there is something to celebrate?
Top performers take a proactive stance towards disclosure. For the Newsweek Green Rankings and other ratings systems, the very act of disclosure contributes 10 percent to the score. The Disclosure Score evaluates the adequacy, completeness and quality of company energy and sustainability data. It also rewards involvement in widely adopted reporting initiatives, such as the Global Reporting Initiative (GRI) and the Carbon Disclosure Project.
Cultivate an ongoing dialogue with stakeholders and rankings/ratings programs. When compared with brand perception studies, the Green Rankings demonstrate that many companies are either missing an opportunity to share their achievements more transparently with their customers, or missing the mark when it comes to how their brand is perceived in comparison with how they are actually doing. Greater and more frequent transparency will help to right this equation and turn your energy and resource data into reputational value.
Principle Two: Really KNOW your impacts
Your level of confidence in the accuracy of your company’s energy and environmental claims has a lot to do with what data you are tracking, and how you are tracking it.
Complex global organizations are often challenged by data collection and normalization when it comes to greenhouse gas emissions and water use, the two factors most heavily weighted in the Green Ranking’s Environmental Impact Score. The score itself counts for 45 percent of the total evaluation. Companies receive a higher score if they track comprehensive impacts, including waste and natural resources such as oil.
Start by setting enterprise-level goals for what energy and resources you want to track. Consider greenhouse gas emissions (scope 1, 2 and 3), water, waste, electricity and renewables as areas of business opportunity -- not just for the savings greater efficiency will yield, but also for the reputational benefit better performance will bring.
Determine how you will track progress towards energy and environmental goals internally. In advance of a rankings or ratings deadline, decide who is responsible for aggregating and analyzing data within your enterprise, when, and in what form. Align any new internal reporting and processes with key performance indicators to drive adoption. And seek to eliminate inefficient manual data entry and collection that is costing you both time and money.
The goal is to use the data you collect on your impacts to prioritize improvements with the greatest impact and financial return -- not to burn time in spreadsheet management mode.
Principle Three: Act on your data -- develop a management process that focuses investment where it matters most
With better visibility into the cost and composition of your energy and resource use comes insight that will change the way you manage investments in efficiency, and how you set corporate and supply chain goals. How effectively an organization acts on energy and resource data is a window into its values.
Photo of window on mountains and meadow provided by GoodMood Photo via Shutterstock.