The Role of Sustainability KPIs in Implementing Sustainable Strategies
Read this article and pay attention to how companies achieve high-quality performance for value creation. Focus on the selection of KPIs and the discussion. How can organizations improve sustainability in their strategies to improve certain KPIs?
Abstract
The role of sustainability dimensions in the value creation process has attracted considerable interest in the scientific academic world in the last two decades. The 2030 Agenda, which fixed the sustainable goals (SDGs) to safeguard our planet, highlighted the fundamental role of sustainability issues. In this context, companies around the world need to integrate their strategies with environmental, social, and economic dimensions. However, sustainability aspects are often not linked to company strategies, and there has been growing difficulty in measuring sustainable development by adopting an appropriate set of key performance indicators (KPIs). Accordingly, the aim of this study is as follows: (1) to identify the suitable KPIs that affect company performance, based on the literature and management practices, and (2) to propose a new perspective on a way to integrate sustainability issues in company strategies. Based on a systematic procedure, we obtained 82 papers that focus on KPIs related to sustainability issues. Following a review of papers and a survey conducted with Italian managers, we developed a sustainability perspective by selecting the most appropriate KPI system for each of the dimensions discussed. The proposed model suggests that incorporating sustainability dimensions within corporate strategy would allow strategic alignment in order to gain competitive advantage and therefore create sustainability value.
Keywords: sustainability; SBSC; performance management; key performance indicators
Source: Ivo Hristov and Antonio Chirico, https://www.mdpi.com/2071-1050/11/20/5742/htm
This work is licensed under a Creative Commons Attribution 4.0 License.