ISM Sustainability and Social Responsibility Metrics and Performance Criteria for Sustainability and Social Responsibility Initiatives

Transcription

1 ISM Sustainability and Social Responsibility Metrics and Performance Criteria for Sustainability and Social Responsibility Initiatives Introduction The development and implementation of metrics and performance criteria is a critical and best practice to the success of sustainability and social responsibility initiatives. Integrating individual and business goals and objectives, with relevant measurements, will ensure the ability to track and report progress and determine where additional time and resources are required. Ongoing reporting of sustainability and social responsibility results ensures transparency throughout industry and governments. Frequently organizations employ independent auditors to review and substantiate reported results. Without measurement standards, it is virtually impossible to create rigorous auditing standards. (1) Recognition that sustainability and social responsibility challenges are complex, often know no country boundaries, and can impact the global population, has resulted in a wide sharing of knowledge and best practice. Organizations would do well to use what others have learned while freely sharing their experiences and successes. ISM s Principles of Sustainability and Social Responsibility provide direction to supply professionals on how their organizations and suppliers can develop and integrate sustainability and social responsibility practices and strategies into the business and the supply chain. A link to the PDF document describing the ISM Principles, approved by the ISM Board of Directors, can be found at Supply professionals must consider impact, influence, and positioning when selecting and developing metrics to embed throughout the: (1) supply organization, (2) entity and (3) supply base. (e.g., first tier and beyond, transportation services, etc.). Implemented metrics will typically be stated in absolute numbers, a percentage, by employee, ratios, and in other ways that allow for effective comparison and data management. This document was developed to provide supply professionals and management with a broad-based list of possible metrics. It is in no way complete, and it is updated from time to time. ISM and the ISM Committee on Sustainability and Social Responsibility welcome your comments and suggestions and can be reached at socialresponsibilty@ism.ws. (1) Eccles, Robert G., Ioannis Ioannou and George Serafeim, Essay: Is there an optimal degree of sustainability? posted on Ethical Corporation website, February 4,

2 1. Anti-Corruption Corruption in all of its forms, including extortion and bribery, will not be tolerated. a. Conduct guidelines b. Due diligence internally, with suppliers and across the supply chain c. Investigative and audit capabilities d. Reporting structures in place e. Subscribing to United Nations and other relevant initiatives f. Training g. Other 2. Diversity and Inclusiveness Workforce and Supply Base Workforce Workforce diversity and inclusiveness is the attraction and retention of a workforce that reasonably represents the customer and communities in which the organization operates. a. Disability/special needs b. Employee demographic mix across the organization and within organization levels: c. Ethnicity d. Gender e. Promotion and executive movement f. Recruiting g. Retention and promotion rates, if applicable h. Other Supply Base Attraction and retention of a diverse supply base is the responsibility of each supply professional. a. Diverse supplier training b. Diverse/small business category into which the supplier fits along with certification documentation c. Goals tied to performance pay; corporate, agency, division and department d. Percentage of direct/indirect expenditures e. Program in place and communicated f. Value-add beyond diversity (hard or soft cost savings, innovation, superior quality, customer service, etc.) g. Other 3. Environment Supply management promotes protection, preservation and vitality of the natural environment. a. Biodiversity concepts and practices b. Buildings and construction policy and practices (see LEED Certification, Green Globes, Energy Star, etc.) c. Certifications and awards, use of (see Performance Track, ISO 14000, SA8000, International Organization for Standardization, Social Accountability International, American Society for Quality, etc.) 2

3 d. Certified sources, use of e. Climate protection initiatives f. Commodity and raw material consumption (renewable, nonrenewable, bio-based, etc.) g. Consortia participation (see GRI, GEMI, etc.) h. Deforestation i. Direct and indirect emissions (see GHG Protocol for definitions) Business travel Facility consumption and impacts Worker commutes j. Disposal and waste management policies and practices k. Education and communication initiatives l. Energy consumption (power, natural gas, electric, including reduction, alternative energy generation and consumption, in plant, offices, warehouses, etc.) Baseload sources (e.g., nuclear, coal, hydropower) Intermittent sources (e.g., wind and solar) m. Energy sources (natural gas, coal, oil, wind, geothermal, etc.) and consumption n. Green House Gas (GHG) footprint o. Heat generation CO 2 (carbon dioxide) also term CO 2 and CO 2 equivalent NF 3 (nitrogen trifluoride) Sulfur hexafluoride (SF 6 ) 22,000 times more destructive than CO 2 Other green house gases p. IT and Print Fleet (see Energy Star, existence of print lifecycle management software) q. Landfill content reduction and/or zero waste initiatives r. Land use (sustainable agriculture, etc.), soil erosion management s. Material toxicity t. Noise pollution u. Offset policies and programs v. Packaging reduction initiatives Design (including size reduction) Eco-friendly materials/biodegradables (glues, inks, papers, etc.) w. Paper and paper product consumption, reduction, recycling, etc. (see Forest Stewardship Council and the Programme for the Endorsement of Forest Certification) x. Particulate emissions y. Product design, durability, disassembly, content (including disclosure of materials in products, product design, etc.) z. Transportation and logistics management including routing and consolidation, fleet management (see EPA SmartWay, hybrid trucks, truckload utilization, alternate fuels, etc.), gasoline and diesel consumption aa. Travel policies and statistics (miles driven, miles flown, nights away from home base, etc.) bb. Water conservation, consumption, recycling, treatment cc. Zero landfill concept dd. Other green and sustainable practices applications ee. Other pollution, emissions and gasses 3

4 4. Ethics and Business Conduct Every supply management professional is responsible for behaving ethically and actively promoting ethical conduct throughout the supply chain. a. Audit and accounting concerns b. Business conduct inquiries (by employees, suppliers, others) c. Conduct built into supplier contracts and measured d. Discussion around the topics of influence encouraged e. Employee and supplier training f. Ethical sourcing and practices defined g. Ethics and conduct actively explored during job interviews/hiring h. Ethics hotline and other reporting channels used (audits, etc.) i. Executive ethics committee j. Impropriety allegations addressed k. Regular communication with suppliers l. Sourcing decisions documented m. Subscribe to the ISM Principles and Standards of Supply Management Conduct n. Suppliers required to formally sign on to ethical sourcing and practice policy o. Types and numbers of disciplinary actions taken (oral warning, written warning, termination, resignation, counseled) p. Written code in place and communicated q. Other 5. Financial Integrity and Transparency Financially responsible supply management is characterized by integrity and transparency in all supply-related dealings and decisions. a. Accounting principles and standards issued by governance and governmental entities b. Determine if source of supplies is strong/viable/sustainable Business continuity plan in place Alternate sources identified c. Fiscal supplier health d. Internal policies and guidelines published e. Responsible investing f. Subscribe to UN Principles of Responsible Investment g. Other 6. Global Citizenship Global citizenship is the ethical and moral obligation to act for the benefit of society locally, globally and virtually. a. Business decisions evaluated in context of community impact b. Donation of products and services c. Employee giving support and initiatives 4

5 d. Employee volunteerism Employee leave of absence to volunteer outside local community (e.g., voluntary service overseas) Support provided for this effort by company (e.g., personal fixed cost such as mortgage repayments) Hours or personal days provided to employees for community initiatives e. Funding of citizen-based initiatives f. In-kind contributions g. Indigenous programs and support h. Number and types of programs in place, including philanthropy and foundation resources/giving i. Other 7. Health and Safety Health and safety is the condition of being protected or free from the occurrence of risk of injury, danger, failure, error, accident, harm and loss of life. a. Accidents and injury rates b. Cafeterias comply with regulations c. Employee housing d. Health and wellness initiatives and programs e. Heath care and insurance (e.g., costs, coverage) f. Illness prevention measures g. Product safety h. Safe and ergonomic equipment provided (e.g., eyewear, ear plugs, gloves, hard hats) i. Working conditions (e.g., heat, lighting) j. Written safety procedures, audits k. Other 8. Human Rights Human beings have universal and natural rights and status regardless of legal jurisdiction and local factors. a. Benefits b. Child labor policies c. Compensation and wages (e.g., living wage concept) d. Freedom of association practices e. Indigenous peoples f. Performance and evaluation processes and programs g. Signatory to United Nations Global Compact h. Training and development i. Understanding and following local laws and regulations j. Working hours k. Workplace culture, environment and conditions l. Other 5

6 9. Labor Rights Supply management is committed to protecting and respecting labor rights globally. a. Child labor policies b. Compensation and wages (e.g., living wage concept) c. Freedom of association practices d. Performance and evaluation processes and programs e. Signatory to United Nations Global Compact f. Training and development g. Understanding and following local laws and regulations h. Working hours i. Workplace culture, environment and conditions j. Other 10. Sustainability Sustainability is the ability to meet current needs without hindering the ability to meet the needs of future generations in terms of economic, environmental and social challenges. a. Contact information for Chief Sustainability Officer publicly available b. Developing processes/knowledge to ensure understanding of sourcing, recycling, etc. decisions c. Development of relationships with key suppliers to gain access to protected information on chemical makeup of products being purchased d. Implementing end-of-life-of-product management policies and procedures internally and with suppliers e. Maintaining appropriate records to feed into corporate sustainability and social responsibility reporting f. Measurement, tracking and reporting mechanisms embedded at worker level g. Periodic reports released internally and into the marketplace h. Processes in place to embed sustainability and social responsibility into product design, redesign, and statements of work i. Processes in place to embed sustainability and social responsibility into supplier qualification and certification decisions j. Senior management engaged across the organization with appropriate governance structures in place k. Use of sustainability criteria in procurement and supply decisions l. Working with risk management and/or internally to develop, quantify and base decisions on financial and other risks related to nonconformance with or lack of support of sustainability and social responsibility initiatives m. Other 6

7 Published by: Institute for Supply Management, Inc. Paul Novak, C.P.M., A.P.P., Chief Executive Officer 2012 Institute for Supply Management P.O. Box Tempe,Arizona USA All Rights Reserved. Material may be copied and used with permission with credit given to ISM. 7