The GreenIt! Scorecard Engine (Copyright Imvelo GreenIt! 2008-2011)
There are many green rating systems/scorecard standards that have evolved, and it is useful to consider these as falling broadly into three categories;
carbon - dealing with Greenhouse Gas emissions ecological - dealing with natural resources such as water, natural forests etc. ethical - dealing with situations where exploitation and/or human right abuses take place.
This is not a 'cast in stone' framework, just a useful one to get a practical overall picture.
Much of the activity is around carbon firstly and ecological secondly, with the ethical aspects seen as 'something' else and hardly, if ever. integrated into 'Green'.
Green is Sustainability and without the ethical dimension the latter is unlikely to be maximally achieved.
But regardless of the category or the rating/scoring system the common denominator is data.
If we start off with this as the platform we can also consider that 'transactions' (supply chain management, operational, service etc.) can be analysed in terms of any useful standard and scored against the applicable criteria.
Hence our Engine, installed and implemented, would be capable of multiple outputs, according to the rating/scoring system applied.
The sum total of carbon/ecological/ethical footprint of an enterprise (for any given standard) includes not only the carbon/ecological/ethical footprints of the various activities within the enterprise but also those of the external enterprises supplying products and services to it.
In other words each and every input into the enterprise at the level of raw material or product or service constitutes in itself a carbon or ecological or ethical footprint.
In an ideal world the carbon/ecological/ethical footprints of all these inputs would be known, in as much as e.g. we have common practice today in specifying the kilo-joule count and fat count on food products.
However, we are far removed from such a reality at present when it comes to carbon emissions and other ecological factors.
More challenging still are the "ethical" footprints.
For example, a number of products imported into South Africa may in fact arise from sweat shops that contravene the UDHR (Universal Declaration of Human Rights).
If so they cannot be sustainable even if their carbon foot print is low. Sustainability in its greatest sense includes ethical and moral practices that promote harmony.
Sweat shops that deliver lower cost products through unfair labour practices cause South African job losses by "cheating".
We can no longer exclude ethical aspects from the Sustainability Equation.
The seemingly 'obvious' idea is that the world is getting worse and worse when it comes to human rights. We certainly have still far too much human rights abuse but the Zeitsgeist as far as violence is concerned is lifting! See: http://www.samharris.org/blog/item/qa-with-steven-pinker/
Actually, the idea that we should and can work towards a world that is not only greener but also less violent is catching on as Steven Pinker writes in the "Twilight of Violence".
"... existing estimates of death tolls, when calculated as a proportion of the world’s population at the time, show at least nine atrocities before the 20th century (that we know of) which may have been worse than World War II. They arose from collapsing empires, horse tribe invasions, the slave trade, and the annihilation of native peoples, with wars of religion close behind. World War I does n’t even make the top ten."
Getting on the right side of History will make business sense!
The GreenIt! Scorecard Engine model is a transparent model that engages continuously with the transactional and operational data of the enterprise despite the paucity of such data.
In its first implementation phase the GreenIt! Scorecard Engine acts as a benchmark inventory to begin the process of tracking the parameters that an enterprise genuinely committed to a green vision requires in its scope.
For the current universe of raw material, product and services procured by the enterprise we can consider at least three types of input:
Ecologically Proactive Inputs (EIPs):
These inputs would carry with them e.g. via their bar coding, the linkage to accessing the numerical values of carbon footprints and ecological footprints;
We can assume that these will typically be in a minority within the current stream of inputs that enter the enterprise.
Statistically Measurable Inputs (SMIs):
These would be inputs that can be typed as belonging to a certain category which on average have a specific carbon footprint or ecological footprint. For example, a ton of paper would have a certain carbon footprint as a global average.
Metric Deficient Inputs (MDIs):
These would be inputs that for the time being do not have specific or statistical values available for calculation and should be seen as part of the unknown contributions.
The point is that whether or not data is immediately available the GreenIt! Scorecard Engine can inventorise and categorise the input streams according to one of these three types.
Furthermore by assigning numerical values to each input, be it a specific figure or a statistical average or even a Null, as more and more data becomes available so the model can produce more and more accurate figures.
Why The Bother?
A common perception is why the fuss when there are ‘more’ stringent pressures facing the enterprise? The quotes below from a formidable paper issued by the IBM Institute for Business Value are critically relevant!
“The trade-offs in the supply chain are no longer just about cost, service and quality – but cost, service, quality and carbon. By incorporating carbon reduction into their overall SCM strategy, companies can help reduce their environmental emissions footprint, strengthen their brand image and develop competitive advantage.”
“Consider that the global fleet of ocean going ships accounts for more CO2 emissions than any of all but six countries world-wide. Yet, none of this environmental impact is reflected in shipping prices.”
“Going forward, firms should expect to be charged for their CO2 emissions. And most certainly, this charge will force a change in the way companies run their supply chains. Common practices of the last century – like long-distance airfreight, small batch size, just-in-time concepts and energy-intensive production in countries with low environmental standards – will likely go by the economic and political wayside. Reducing the supply chain’s carbon footprint will become an inescapable obligation.”
“As companies move from a reactive to a proactive stance in managing carbon, they can convert a cost issue into a growth opportunity. Taking into account traditional concerns about quality, service and cost, a comprehensive carbon-management strategy can help organizations develop more sustainable growth opportunities, maintain competitive differentiation, and strengthen their brand image. In an age of heightened corporate scrutiny and social responsibility, the companies that turn the tables on the carbon challenge could well be the leaders in the 21st century global economy.”
“Each ton of carbon dioxide causes about $85 of damage.”
“Including carbon in the mix will require deep computing, plus mathematical and analytical capabilities.”
“Businesses well positioned for the 21st century are those that can quantify cost and carbon, and provide partners and customers with a level of knowledge and management that can help differentiate them in the marketplace.”
“There are specific steps companies can take to limit GHG emissions – from easy-to-implement local improvements to complex optimizations that involve an extended supply chain. The further these activities extend and integrate across the supply chain, the greater leverage and control they will have over carbon emissions.”
There is no question that an enterprise that is proactively seeking to measure its carbon/ecological/ethical footprints on a continuous basis will be positioning itself more strategically in the market place.
It is only a matter of when rather than if the market will penalise those enterprises that have not yet begun the process of greening.
The idea of taking ‘green snapshots’ as and when required may appear as sufficient but in practice it is more likely to lead to stagnation.
Measurement should be a spin-off, a by-product, of the day-to-day activities within the enterprise.
Like poetry it should be ‘as easy as leaves falling off trees”.
The GreenIt! Scorecard Engine is actually a Green Business Intelligence application, a ‘green nervous system’ if you like running throughout the enterprise.
When deployed in this manner, and sensing the ‘green states’ of various activities and functions it can be a continuous measurement.
Every transaction, be it a business transaction or an operational one, will carry with it quanta of ‘green’ information.
The challenge is to unlock such information from the myriad of day-to-day streams of data that by necessity need to flow through the enterprise.
The GreenIt! Scorecard Engine is thus a plug-in that monitors and evaluates without interference and also without necessitating any additional input over and above the set of inputs that are already part of the operation of the enterprise.