ultimate aim is to improve the performance of businesses and monitor performance with measures which are transparent and verifiable, and therefore meaningful to business managers as well as to exter nal stakeholders. While the emphasis is on areas under direct management control, we also recognize there are relevant issues upstream (e.g. with suppliers) and downstream (e.g. in product use) of a company’s activities.
Generally applicable indicators can be used by virtually all businesses. As well as being more or less universally relevant, each of these indicators r elates to a global environmental concern or business value and methods for measurement are established and definitions accepted globally.
All other indicators which do not meet these criteria have been termed business specific, meaning that they
are more likely to be individually
defined from one business or one sector to another. These indicators are not necessarily less important than the first group. That judgment will depend on the nature of an individual business. They are merely less widely applicable. A company’s eco-efficiency performance profile will include both types of indicators.
The indicators fall into two gr oups, based on the eco-efficiency formula which brings together the two eco dimensions of economy and ecology to relate product or service value to environmental influence. Eco-efficiency is represented by:
Product or service value
Environmental influence includes aspects of product or service creation and aspects of product or service consumption or use.
The generally applicable indicators for product/service value are:
Quantity of goods or services produced or provided to customers
Those relating to the environmental influence in product/service creation are:
Greenhouse gas emissions
Ozone depleting substance emissions
While the environmental influence of products or services in use is important we have not identified any generally applicable indicators for this category of eco-efficiency. All indicators in this group are considered to be business or product specific.
The following additional indicators could become generally applicable if current efforts to develop global agreement on measurement methods are successful:
Additional financial value indicators
Acidification emissions to air
We believe the small number of generally applicable indicators is helpful
in assessing companies’ eco-efficiency because a proliferation of measures would make it difficult for reports to be clear and understandable, especially externally. A small core of common indicators will help learning and comparability across time, sectors and industries. At the same time, individual companies should develop a fuller description of their performance by adding business specific indicators.
PREPARING AND REPORTING INFORMATION
The pilot program identified several important practical issues for preparing a company’s eco-efficiency profile and reporting internally and to external stakeholders. The report provides advice on selecting boundaries for the data, where to find data and how to compile it appropriately, taking account of sensitivity and error and problems of transformation and conversion. It is important that companies provide some perspective on issues such as the scope and limitations of their indicators, so that users understand the nature of the information provided.
The questions of aggregation and benchmarking are particularly important. While aggregation will often be desirable, it may obscure potentially
important information about an
enterprise’s eco-efficiency performance. For example, different types of
unrelated emissions, or emissions across different geographic locations, may be
added together, preventing a valid
assessment of potential influences on the environment. Similarly, eco- efficiency estimates from different products, processes, or geographic areas
may be combined and averaged,
obscuring details about the performance of individual units. Aggregation must