By Erica Frye
The sustainability community talks a lot about making the business case for social and environmental responsibility. We compare notes on how to measure financial return and swap stories about creative ways we have successfully framed complex outcomes.
We beat this particular drum because we know the current corporate model demands it. We want to be taken seriously by the mainstream business community, not dismissed as idealists who don’t understand how things really work. And, we believe there are benefits from investing in sustainability and are determined to create a compelling argument to advance this cause.
In a session on corporate reporting at West Coast Green, the necessity of framing sustainability in terms of financial value was firmly set forth yet again by panelists Peter Perrault of NetApp and Kathleen Gilligan of EcoStrategy Group.
But Robin Connell, the Manager of Sustainability Programs at Del Monte Foods, offered a different point of view. She argued it’s a mistake to over-emphasize ROI, because some issues transcend numbers. She gave the example of health and wellness programs she is working on at Del Monte. While wellness programs are likely to return value to a company and community over time, it would take years to actually prove that value — if definitive results could be ascertained at all.
This is one explanation why some environmental issues receive more corporate attention than many social ones. It’s easy to measure energy consumption and calculate the cost trade-offs of upgrading to a more efficient system. It’s far harder to define, much less calculate, metrics for a Social Return on Investment (SROI) analysis of goals such as wellness or community stability. Further, while identifying and measuring indicators is helpful for determining where to invest scarce resources and valuing externalities, there is a down side to this mental model that reduces life to a price tag.
Encouraging valuation implies we concede something is not worth pursuing if the numbers don’t add up conclusively. This will hold our progress back. We can often make strong circumstantial cases for potential benefits, and getting bogged down in establishing quantitative proof takes away resources that could be better spent on the initiatives themselves. After sustainability has gained stronger mainstream acceptance, my hope would be that we would reclaim and reshape the conversation — not ignoring financial value, but ensuring we are not trapped by it.
Erica Frye is a strategist dedicated to building brands driven by culture, mission, and sustainability, and a graduate of the Design Strategy MBA program at California College of the Arts. You can read more from her at www.ericafrye.com.