assessing impacts: overview on sustainability indicators and metrics

Environmental Quality Management / DOI 10.1002/tqem / Summer 2006 / 41

As sustainable devel-

opment is put into

operation in our so-

ciety and industry,

there emerges the

need to understand

the pertinent key in-

dicators and how

they can be meas-

ured to determine if

progress is being

made. The ability to measure sustainability be-

comes even more crucial—as the business adage of

“only what gets measured gets managed” sug-

gests—as we make decisions and navigate toward

the sustainability development goals.

Efforts to develop sustainability indicators and

metrics have been made at various scales, ranging

from global down to local community, business

unit, and technology levels. In general, indicators

and metrics are designed to capture the ideas in-

herent in sustainability and transform them into

a manageable set of quantitative measures and in-

dices that are useful for communication and deci-

sion making. This article provides an overview of

sustainability indicators and metrics, especially as

they relate to the chemical industry.

The terms “indicators” and “metrics” are

often used interchangeably in referring to meas-

urement of sustain-

ability. The term

“indicators,” how-

ever, is typically

used more broadly,

encompassing both

quantitative meas-

urements and nar-

rative descriptions

of issues of impor-

tance as well as, in

certain cases, the key aspects that need to be

managed. The term “metrics,” on the other hand,

is used almost solely in referring to quantitative

or semiquantitative measurements or indices.

Framing Sustainability Indicators andMetrics

Since the “Earth Summit” in 1992, there has

been a global consensus that sustainable develop-

ment encompasses at least economic growth, so-

cial progress, and stewardship of the environment.

As these so-called three dimensions of sustainable

development have long been separately managed,

the significance of the concept lies primarily in the

integration of the various concerns.

Dicksen Tanzil and Beth R. Beloff

Assessing Impacts:Overview onSustainability Indicatorsand Metrics

Tools for implementing

sustainable development in the

chemical industry—and

elsewhere

© 2006 Wiley Periodicals, Inc.Published online in Wiley InterScience (www.interscience.wiley.com).DOI: 10.1002/tqem.20101

Dicksen Tanzil and Beth R. Beloff42 / Summer 2006 / Environmental Quality Management / DOI 10.1002/tqem

Various metrics within each of the three di-

mensions of sustainability have long been well

developed and used. Gross Domestic Product

(GDP) per capita, literacy and poverty rates, and

ambient concentration of urban air pollutants are

some examples of economic, social, and environ-

mental metrics employed at the national level. In

businesses, financial metrics such as return on in-

vestment, as well as certain metrics that reflect

employee well-being and environmental per-

formance (such as health and safety incident

rates and regulated toxic releases) are also con-

ventionally used.

Sustainable development, however, requires

further cross-functional integration of these met-

rics, as well as the inclusion of additional metrics

that facilitate more systemic and comprehensive

multidisciplinary communication and thinking.

Integrating Economic, Social, andEnvironmental Dimensions

Exhibit 1 illustrates how the three dimen-

sions of sustainable development interlink. At the

intersections, one finds:

• socioeconomic considerations, such as job

creation and other impacts (positive and neg-

ative) of the relationship between the econ-

omy and societal well-being;

• socioenvironmental considerations, includ-

ing effects of natural resource degradation

and environmental releases on the livelihood,

health, and safety of people today and of gen-

erations to come; and

• eco-efficiency considerations—i.e., the gener-

ation of greater (economic) value using fewer

natural resources and with less environmental

impact.

While each of the above considerations nomi-

nally focuses on only two of the dimensions of sus-

tainable development, each is in fact closely con-

nected to all three. Environmental degradation or

improvement, for example, is one important factor

related to how economic activities affect societal

well-being (a socioeconomic consideration). Simi-

larly, socioenvironmental impacts have their re-

lated cost and economic implications.

Further, judicious consideration of eco-effi-

ciency, along with efforts to reduce absolute im-

pacts, may result in various societal advantages, in-

cluding the benefits derived from products and

services in satisfying human needs and improving

people’s livelihoods; the reduction of public health

and safety concerns associated with environmen-

tal impacts; and the more equitable use of natural

resources enabled by their more efficient uses.

Global and National MetricsTo effectively support decision making, indica-

tors and metrics must be linked to key goals of an

organization and important aspects that need to

be managed. Global agreements, such as Agenda

21 and the more recent Millennium Development

Goals, both developed under the umbrella of the

United Nations, are eminent foundations for iden-

tifying the important aspects of sustainability.

Exhibit 1. Three Dimensions of SustainableDevelopment

Socio-economic, socio-environmental, and eco-efficiencyconsiderations lie at the intersections of the triple dimensionsof sustainability.

Environmental Quality Management / DOI 10.1002/tqem / Summer 2006 / 43Assessing Impacts: Overview on Sustainability Indicators and Metrics

example is the “ecological footprint accounts”

developed by Dr. Mathis Wackernagel and

coworkers at the Ecological Footprint Network.

These aggregate the ecological impacts of

human economic activities in terms of “biologi-

cally productive land and water required to pro-

duce the resources consumed and to assimilate

the waste generated by humanity” (Wackernagel

et al., 2002).

Recent data on the ecological footprint ac-

counts for countries with the world’s largest

economies and populations are shown in Ex-hibit 2. Biologically productive land and water

areas used and impacted by agriculture and herd-

ing, forestry, fishing, infrastructure, and the burn-

ing of fossil fuels are included in the index. While

far from providing the entire picture of sustain-

ability, these calculations effectively highlight

how many countries, both developed and devel-

oping, have overshot their ecological capacities.

The issue of equity in the use of natural re-

sources is also evident. Developed countries such

as the United States, for example, use more than

four times the world’s average in global acres per

person. Details on the calculation of ecological

footprint accounts are available elsewhere (Loh &

Wackernagel, 2004).

Agenda 21, adopted by over 178 nations at

the 1992 Earth Summit in Rio de Janeiro, calls for

actions to address disparities in social and eco-

nomic development among and within nations,

especially in terms of poverty, hunger, adequate

housing, and public health, as well as education

and institutional capacity. In addition, it recog-

nizes the need for social and economic develop-

ment to be accompanied by the conservation and

management of natural resources in terms of pro-

tecting the atmosphere, forests, fragile ecosys-

tems, oceans, and freshwater resources, managing

land use and releases of wastes and toxic chemi-

cals, and conserving biodiversity.

Additional issues—such as energy, material

use, transportation, and global climate change—

have gained attention in the years since the Earth

Summit. Many of these aspects have been trans-

lated into indicators and metrics, such as those

compiled by the United Nations Commission on

Sustainable Development (UNCSD, 2001). Na-

tional governments may adopt these indicators

and metrics and adapt them to their needs in

order to track, manage, and report on their coun-

tries’ progress in sustainable development.

Some useful proxy indices of sustainability

have also been proposed in the literature. One

Exhibit 2. Ecological Footprint and Biocapacity, per Person by Country*

Population Ecological Footprint Biological Capacity Ecological Deficit(2002) (1999) (2002) (if negative)

[million] [global acres/pers] [global acres/pers] [global acres/pers]

WORLD 6,210.1 5.6 4.5 -1.1Brazil 174.5 6 15 9China 1,284.2 4 2.6 -1.3France 59.3 13 7 -6Germany 82.2 12 5 -7India 1,053.4 1.9 1.6 -0.3Indonesia 217.3 3 4.4 1.4Japan 127.2 11 2 -9United Kingdom 60.2 14 4 -10United States of America 288.3 24 15 -9

* Provided by Dr. Mathis Wackernagel, Global Footprint Network (www.footprintnetwork.org). Numbers may not always add up due torounding. Note that ecological footprint results are based on 1999 data, since consumption data reporting has a longer time lag. How-ever, ecological footprint numbers change only slowly over time.


Corporate-Level MetricsIndicators and metrics of sustainability have

also been identified and developed at the com-

munity, corporate, business unit, or even process

or technology levels. Information regarding sus-

tainability indicators at the community level may

be found, for instance, at the International Sus-

tainability Indicators Network’s Web site

(www.sustainabilityindicators.org). The remain-

der of this discussion will focus on sustainability

indicators and metrics used by companies in

tracking and managing their performance and in

assessing alternatives.

A list of important aspects of sustainability

shown in Exhibit 3 offers a starting point for

companies to identify aspects that need to be

considered in developing sustainability indicators

and metrics. By necessity, this list will differ

somewhat among companies and organizations.

How sustainability aspects get prioritized in

terms of relevance and importance is a function

of many factors, including differences in types of

business, operational conditions, history, com-

munity issues, and other aspects specific to a

company or an organization. Generally, resource

use and waste, monetary costs and benefits inter-

nal and external to the company, and well-being

of people in the workplace and in the community

affected by the company’s operations are the en-

vironmental, economic, and social aspects rele-

Exhibit 3. Identifying the Important Aspects of Sustainability in a Company

Environmental Resources • Material intensityStewardship • Energy intensity

• Water usage• Land use

Pollutants and Waste • Wasted resources• Releases to air, water, and land• Material recycling • Impacts on human health• Impacts on ecosystem and biodiversity

Economic Internal • Eco-efficiencyDevelopment • Internal costs to the company

• Revenue opportunities• Access to capital and insurance• Shareholder value

External • Costs of externalities• Benefits to local community• Benefits to society

Social Progress Workplace • Workplace conditions• Employee health, safety, and well-being• Security• Human capital development (education and training)• Aligning company values with employee values

Community • Social impacts of operations• Stakeholder engagements• Quality of life in community• Human rights

General/Institutional Sustainability • Commitment to triple bottom lineManagement • Product stewardship and supply-chain leadership programs

• Accountability and transparency• Product and service development• Employees' impact on environment

Source: BRIDGES to Sustainability.


Development of Sustainability Metrics in theChemical and Manufacturing Industry

Efforts have been made to develop sustain-

ability metrics for various purposes and industry

sectors, such as urban planning (e.g., Shane &

Graedel, 2000), green building (e.g., Olgay &

Herdt, 2004), and sustainable tourism (e.g.,

Hughes, 2002; Li, 2004).

Manufacturing companies, including chemi-

cal manufacturers, have also kept track of the var-

ious elements that make up sustainability met-

rics. This includes resource uses that carry

economic costs, as well as emissions and wastes,

as mandated by regula-

tion. Over the past

decade, the industry

has also begun to view

their resource con-

sumption and envi-

ronmental release data

in terms of broader

sustainability.

Evolution Toward Sustainability MetricsThe development and use of environmental

indicators and metrics in the manufacturing in-

dustry followed a learning curve summarized in

the five evolutionary levels described by Veleva

and Ellenbecker (2001):

• Level 1—Facility compliance/conformance

metrics, which are compliance-focused (e.g.,

number of reportable spills and violations,

amount of fines, and injury rates).

• Level 2—Facility material use and perform-

ance metrics, which are efficiency measures,

usually expressed as amounts of inputs and

outputs (e.g., energy use, Toxic Release Inven-

tory emissions) normalized by mass of prod-

ucts, monetary revenue, and value added.

• Level 3—Facility environmental and human

health effect metrics, which go beyond the

vant to most companies. In addition, the com-

pany’s strategy, structure, and processes for man-

aging sustainability underlie the company’s per-

formance in all aspects of sustainability.

Leading vs. LaggingEffective management of sustainability in an

organization requires the use of both lagging and

leading indicators and metrics. A lagging metric

is reported after an impact has occurred, and re-

flects past (including recent) outcomes in rela-

tion to the organization’s performance goals.

Leading metrics and indicators, on the other

hand, assess activities that occur prior to the im-

pact and affect the future performance of the or-

ganization, usually identified through a cause-

and-effect analysis.

Operational metrics that quantify a com-

pany’s environmental, health, and safety (EHS)

and sustainability performance are usually con-

sidered lagging. In contrast, management met-

rics, which include the characterization of a com-

pany’s EHS and sustainability management

system, are commonly regarded as leading met-

rics. Examples of management metrics include

the number of audits performed and the incorpo-

ration of global EHS and sustainability manage-

ment standards.

However, as pointed out by Epstein and Wis-

ner (2001), leading and lagging are relative

terms in a continuum of cause-and-effect rela-

tionships. For instance, incorporation of an en-

vironmental management system is a leading

indicator of environmental performance, which

in turn can be a leading indicator of a com-

pany’s reputation, employee morale, and finan-

cial performance. Thus, both types are impor-

tant for a company in navigating toward

sustainable development. Many of the efforts to

date in developing sustainability metrics, how-

ever, have focused on measuring the operational

dimensions of sustainability.

Effective management ofsustainability in an organizationrequires the use of both lagging

and leading indicators and metrics.


quantities of inputs and outputs and look

into their potential effects on human health

and the environment (e.g., human toxicity

potential, global warming potential, acidifica-

tion potential).

• Level 4—Supply-chain and product life-cycle

metrics, which extend Level 3 indicators to

consider impacts along the supply chain and

the entire life-cycle of the products.

• Level 5—Sustainability metrics, which further

extend the scope to cover long-term issues

such as material depletion and the use of re-

newable resources.

Further integration with social and economic

dimensions of sustain-

ability is also com-

monly considered as a

criterion of sustain-

ability metrics.

As compliance has

historically been a pri-

mary driver, conven-

tional EHS metrics typ-

ically focus on compliance-driven Level 1

metrics. While ensuring conformance with laws

and regulations, these metrics offer little business

competitive advantage to companies implement-

ing them. Level 2 to Level 5 metrics, on the other

hand, begin to address efficiency and value gen-

eration while minimizing undesirable impacts

and related costs to the company, the commu-

nity, and the environment.

Early work in this evolution toward sustain-

ability metrics includes the development of eco-

efficiency metrics by Canada’s National Round

Table on the Environment and the Economy

(NRTEE, 1999) and the World Business Council

for Sustainable Development (WBCSD) (Verfaillie

& Bidwell, 2000). Supported by participation

from their member companies, the organizations

recommended eco-efficiency measurements that

are defined as ratios, with resource use and envi-

ronmental impacts in the numerators, and value

generation in the denominator, or vice versa.

Informed by the above efforts, eco-efficiency

metrics were further refined for application at the

operational level through the “sustainability met-

rics” work of the American Institute of Chemical

Engineers (AIChE, www.aiche.org/cwrt/projects/

sustain.htm). In collaboration with the BRIDGES

to Sustainability Institute (formerly known as

BRIDGES to Sustainability), a nonprofit group

based in Houston, heuristics and decision rules

were developed and tested in industry pilots and

for over 50 chemical processes based on the re-

spected Process Economic Program (PEP) data

from SRI International (Menlo Park, California)

(Beaver, Schwarz, & Beloff, 2002; Schwarz, Beaver,

& Beloff, 2000). Efforts to develop sustainability

metrics were also undertaken by Britain’s Institu-

tion of Chemical Engineers (IChemE, 2002), re-

sulting in an expanded set that includes eco-

nomic and societal metrics in addition to those

focused on eco-efficiency.

Development of these metrics sets typically

began by focusing primarily on the amounts of

material and energy flows. Measures of potential

impacts, such as toxicity potential, were soon rec-

ognized as more meaningful and rigorous than

simple quantity measures, and thus became part

of standard metrics.

Extensions to supply-chain, life-cycle, and

broader sustainability considerations, however,

have been more limited, especially in progress

tracking and management decision making,

where such data are more difficult to obtain rela-

tive to the company’s own resource use and envi-

ronmental release data. Nevertheless, these more

extensive sustainability considerations are in-

creasingly applied in assessing products and

processes during research and development

(R&D), such as through the use of standard as

well as streamlined life-cycle assessment.

As compliance has historically beena primary driver, conventional EHSmetrics typically focus oncompliance-driven Level 1 metrics.


gorized usually into a few basic areas based on re-

source uses and impacts to the environment:

• Material consumption—The use of materials,

especially nonrenewable and finite resources,

affects the availability of the resources and re-

sults in environmental degradation both in

the extraction of the materials and when they

are converted to wastes.

• Energy consumption—In addition to being an-

other important area of resource use and avail-

ability, energy use results in various environ-

mental impacts. The burning of fossil fuels,

specifically, relates to impacts such as global

warming, photochemical ozone oxidation, and

acidification. Renewable energy, such as hy-

dropower, relates to a different set of impacts.

• Water consumption—Freshwater is essential to

life and to almost

all economic activi-

ties. With increas-

ing anthropogenic

demands and short-

ages in many water-

stressed parts of the

world, water con-

sumption becomes

an increasingly im-

portant consideration.

• Toxics and pollutants—Toxics and other pol-

lutants released in the form of air emissions

and wastewater effluents may result in dam-

age to human health and the environment

and financial liability to pollutant sources.

• Solid wastes—Reducing solid wastes is impor-

tant for certain industries, especially in re-

gions with no or very limited landfill capacity,

such as Europe, Japan, and the northeastern

United States.

• Land use—Land is another finite resource that

provides a variety of ecological and socioeco-

nomic services.

Criteria for Selecting Sustainability MetricsConsensus on the criteria for effective sus-

tainability metrics has also emerged from the

above efforts (Bakshi & Fiksel, 2003; Beaver et al.,

2002; Beloff & Beaver, 2000; Schwarz et al., 2000;

Sikdar, 2003). It is generally accepted that sus-

tainability metrics should satisfy the following

criteria (Beloff & Beaver, 2000):

• simple and understandable to a variety of

audiences;

• reproducible and consistent in comparing dif-

ferent time periods, business units, or deci-

sion alternatives;

• robust and nonperverse (i.e., “better” met-

rics must indeed indicate more sustainable

performance);

• complement existing regulatory programs;

• cost-effective in terms of data collection—

making use largely of data already collected/

available for other purposes;

• useful for decision making;

• stackable along the supply chain or the prod-

uct life cycle;

• scalable for multiple boundaries of analysis; and

• protective of proprietary information.

Defining the Metrics: Eco-efficiencyAs described earlier, the development of sus-

tainability metrics requires one to first identify the

key aspects that need to be managed and included

in the metrics. Equally important, however, one

must define how the metric is calculated. For ex-

ample, when expressed as a ratio, one must identify

aspects that are to be included in the numerator

and in the denominator. Furthermore, one must

decide how the metric is bounded (e.g., which sup-

porting processes are included) and any heuristics

and decision rules to be used in the calculation.

In terms of eco-efficiency, the critical aspects

that need to be captured by the sustainability met-

rics have been largely recognized. They are cate-

Reducing solid wastes is importantfor certain industries, especiallyin regions with no or very limitedlandfill capacity, such as Europe,

Japan, and the northeasternUnited States.


Basic Eco-efficiency MetricsThe above-listed eco-efficiency categories can

be captured by a small number of metrics. For il-

lustration, let us consider the set of “basic metrics”

adopted by BRIDGES to Sustainability (Beaver et al.,

2002; Schwarz et al., 2000), shown in Exhibit 4.

Informed by the work of NRTEE (1999) and

WBCSD (Verfaillie & Bidwell, 2000), the metrics

were chosen as ratios. Impacts are placed in the

numerators and a measure of output is in the de-

nominator. The denominator can be mass or

other unit of product, functional unit, sales rev-

enue, monetary value-added, or a certain measure

of societal benefits. Expressing the metrics as ra-

tios allows them to be compared and used in

weighing decision alternatives and comparing

operational units. Defined in this manner, the

lower metrics are better as they reflect lower im-

pacts per unit of value generation.

A metric’s robustness can be very much af-

fected by how decision rules, boundaries, and

heuristics are set. The energy metric, for instance,

can become perverse when defined solely in terms

of direct energy use—i.e., the energy content of

fuel, electricity, steam, and other energy sources

consumed within the boundaries of a company, a

facility, or a chemical process. A facility that in-

cludes an efficient on-site cogeneration of heat

and power, for example, would fare worse than a

similar facility that purchases the heat and power

off-site. In the latter, generation of steam and elec-

tricity occurs outside the facility boundary, and

thus its inefficiency in fuel use is not considered.

Thus, the basic energy metric in Exhibit 4 is

reported in the equivalence of primary fuels, such

that losses in generation and transmission of sec-

ondary energy sources, such as electricity and

steam, are accounted for regardless of whether

they are generated on-site or purchased. This also

makes the basic energy metric more representa-

tive of the energy cost and the amount of green-

house-gas emissions associated with energy use.

Land use is not shown among the basic metrics

in Exhibit 4; it represents a category that is less de-

veloped and may not fit into the impact-per-unit-

output format of the other eco-efficiency metrics.

IChemE (2002) proposes a land-use metric ex-

pressed in terms of total area of land occupied and

affected per annual revenue. However, heuristics

and decision rules for the land-use metric, espe-

Exhibit 4. BRIDGES’ Basic Sustainability Metrics

Output: Material Intensity:Mass of raw materials – Mass of products

Mass of Product Output

or Water Intensity:Volume of fresh water used

Sales Revenue Output

or Energy Intensity:Net energy used as primary fuel equivalent

Value-Added Output

Toxic Release:Total mass of recognized toxics released

OutputSolid Wastes:

Total mass of solid wastesOutput

Pollutant Effects


• metrics that cover elements not usually in-

cluded in the basic metrics (e.g., the trans-

portation energy metric complements basic

energy metrics); and

• metrics that weigh the inputs and outputs

with respect to their impact potential (e.g.,

toxicity and global warming potential).

Examples of complementary metrics for var-

ious basic metric categories are provided in

Exhibit 5.

Impact AssessmentThose developing sustainability metrics have

increasingly made use of methodologies devel-

oped for life-cycle impact assessment (LCIA). This

includes methodologies to assess potential

human and ecosystem toxicity, as well as other

impacts of resource use and pollution. Udo de

Haes et al. (2002) provide an extensive discussion

on these methodologies. Each impact is esti-

mated by multiplying individual material flow

with a “characterization factor.”

LCIA differentiates the impact assessment

methodologies as “end-point” and “mid-point.”

The end-point methodology estimates the mag-

nitude of impacts at the end of environmental

cause-and-effect mechanisms. For example, Eco-

Indicator 99, a widely used impact assessment

cially in relation to impacts on biodiversity and

the ecosystem, require further development.

Complementary MetricsSome of the basic metrics shown in Exhibit 4

should be accompanied by other metrics. The

toxic release metric, defined in terms of total re-

lease of toxics recognized by regulatory systems

such as the Toxic Release Inventory (TRI), may

lead to inaccurate representation when used only

by itself, as a lower quantity of toxics does not

necessarily correlate with less impact.

The value of this metric lies primarily in its

broad recognition and long-time use in the in-

dustry. Certain measures of potential toxicity,

however, are necessary to complement this basic

toxic release metric. In the case of other pollu-

tants not designated as toxic, rather than having

a less useful basic metric in terms of total mass

quantity, they are reported similarly in terms of

various potential impacts.

Therefore, in addition to the basic metrics,

complementary metrics may be developed to ad-

dress specific needs. They include:

• metrics that emphasize certain elements of

the basic metrics (e.g., the toxic raw materials

metric emphasizes an element of the basic

material metric);

Exhibit 5. Examples of Complementary Metrics Under BRIDGES’ Basic Sustainability Metric Categories

Material Toxic release• Packaging materials • Toxic release under each TRI category• Nonrenewable materials • Human toxicity (carcinogenic)• Toxics in product • Human toxicity (noncarcinogenic)• Toxics in raw materials • Ecosystem toxicity

Water Pollutant effects• Rainwater sent to treatment • Global warming potential• Water from endangered ecosystem sources • Tropospheric ozone-depletion potential• Water use relative to water availability • Photochemical ozone-creation potential

• Air-acidification potentialEnergy • Eutrophication potential

• Energy consumed in transportation• Nonrenewable energy


methodology developed by the Pré Consultants

(Goedkoop & Spriensma, 1999), calculates the

impacts of resource uses and environmental re-

leases on three separate end-points: human

health (in terms of disability-adjusted life years,

or DALY), ecosystem health (in terms of species

diversity), and resource availability (in terms of

energy required for future mining efforts).

Mid-point analysis, however, appears to be

gaining broader acceptance for use in sustainabil-

ity metrics, partly due to the less complex model-

ing and analytical requirements compared to

end-point analysis. Impacts are calculated at cer-

tain “mid-points” before end-points of environ-

mental mechanisms,

such as human and

ecosystem health, are

reached.

TRACI, or Tool for

the Reduction and As-

sessment of Chemical

and other environ-

mental Impacts, devel-

oped by the U.S. Envi-

ronmental Protection Agency (Bare, Norris,

Pennington, & McKone, 2003), is an example of

a mid-point approach. In TRACI, impacts are

characterized in terms of impact categories that

include human toxicity (cancerous and non-

cancerous), ecosystem toxicity, ozone depletion,

global warming, acidification, smog formation,

eutrophication, and so forth. An earlier work by

ICI group in Britain (Wright, Allen, Clifi, & Sas,

1998), called the ICI Environmental Burden Sys-

tem, is another example, and includes a similar

set of impact-assessment categories.

Perhaps the simplest approach for assessing

toxicity potential is to weigh different toxic sub-

stances according to their permissible exposure

limits, such as the Threshold Limit Values (TLVs)

defined by the American Conference of Govern-

mental Industrial Hygienists (ACGIH) or the Oc-

cupational Exposure Limits (OELs) set by the U.K.

Health and Safety Executive. TLV, specifically,

constitutes the threshold concentration at which

a worker may be exposed to a substance over a

40-hour workweek with no adverse effects. Thus,

lower TLV denotes greater threat to human

health.

In this case, the inverse of TLV (or OEL) serves

as the characterization factor in weighting the

human toxicity potential of different substances.

Due to its simplicity and foundation on standard

human health and safety regimes, this approach

has gained relatively broad acceptance in compa-

nies and is incorporated as part of the ICI Envi-

ronmental Burden System, among others.

Exposure factors are also included in many of

the more recently developed characterization fac-

tors for human toxicity. These characterization

factors are obtained through more complex mod-

els that incorporate factors such as persistence,

pollutant fate, and exposure pathways. Although

involving greater complexity in its development,

end-users may simply employ the more complex

characterization factors already calculated by ex-

isting impact-assessment models such as TRACI.

Similarly, characterization factors have been

calculated through complex models for ecosys-

tem toxicity (based on toxicity to representative

plant and animal species) as well as other pollu-

tant impacts. International consensus exists on

the characterization of global warming potential

(Houghton et al., 2001) and stratospheric ozone-

depletion potential (World Meteorological Orga-

nization, 1999). Competing methodologies, how-

ever, exist for other impact categories, including

human and ecosystem toxicity.

In addition to the LCIA methodology, one

may report substances of priority concern. Glaxo-

SmithKline, for example, reports substances iden-

tified as persistent and bioaccumulative toxics

(PBTs) as a separate metric (Constable et al., 2001;

Constable, Curzons, Duncan, Jiménez-Gonzaléz,

Perhaps the simplest approach forassessing toxicity potential is toweigh different toxic substancesaccording to their permissibleexposure limits.


wastes can all be expressed as the total consump-

tion or loss of exergy, or energy available to do

work (Bakshi & Fiksel, 2003). Alternatively, the

metrics may be expressed in terms of land use, or

“ecological footprint.” Land-use impacts of en-

ergy sources and common household materials

have been reported (Chambers, Simmons, &

Wackernagel, 2000). It is unclear, however,

whether proxies such as exergy and land use ade-

quately represent overall sustainability impacts.

Integrating the SocioeconomicConsiderations

As discussed above, eco-efficiency considera-

tions are tightly linked with the social dimension

of sustainability. Greater efficiency in the use of

natural resources would allow them to be more eq-

uitably distributed among nations and between

current and future gen-

erations. Reduction in

environmental releases

may also relieve the

loads placed on human

health and safety. The

panel approach dis-

cussed above, which in-

corporates community

priorities by assigning

values to the different metrics through a panel of

stakeholders, provides one way to integrate the so-

cial dimension more explicitly into eco-efficiency

metrics.

While eco-efficiency is certainly an important

element of sustainability, it is by no means a rep-

resentation of the whole picture. Although not as

well developed as eco-efficiency metrics, separate

sets of social and economic metrics of sustain-

ability have been developed, such as by IChemE

(2002). Exhibit 6 lists examples of social metrics

developed by IChemE, which capture a variety of

workplace and safety issues, as well as societal is-

sues (such as number of stakeholder meetings,

& Cunningham, 2005; Curzons, Constable, Mor-

timer, & Cunningham, 2001).

Aggregating MetricsAggregating metrics into a single performance

index is often desirable to facilitate easy compar-

ison. By converting all metrics into the same unit,

one may assess the relative importance of differ-

ent impacts and, hence, determine the focus of

future impact-reduction efforts.

Economic and panel approaches are arguably

the most common methodologies in aggregating

metrics. In the economic approach, metrics are

weighted in terms of their associated monetary

costs and benefits, both internal and external to

the company. AIChE’s Total Cost Assessment

methodology (TCA) and the “Environmental Pri-

ority Strategy in product development” (EPS)

(Steen, 1999) are tools that may be used to assess

environmental and sustainability costs and ben-

efits.

The panel approach, on the other hand, in-

volves normalization and weighting, as outlined

in the ISO 14042 standards on LCIA. The total

impact from each category (e.g., total energy use

or total global warming potential) is first normal-

ized to a reference value. The reference value can

be the impact within a geographical boundary

(i.e., local, regional, or global), or other bench-

mark values (e.g., companywide total, industry

average). Weighting values (usually in percent)

may be determined by a panel of stakeholders

and applied to the normalized impacts to pro-

duce a single-value impact score. A slightly mod-

ified version of the LCIA normalization and

weighting methodology is used in generating ag-

gregate indices in the eco-efficiency analysis of

BASF (Saling et al., 2002; Schmidt et al., 2004;

Schwanhold, 2005).

Other aggregation methodologies have also

been proposed in the literature. One approach is

based on thermodynamics: materials, fuels, and

While eco-efficiency is certainly animportant element of sustainability,

it is by no means a representationof the whole picture.


number of complaints, and so forth) expressed

per unit value-added.

Automated Sustainability MetricsManagement Tools

As sustainability metrics have developed to

include the assessment of potential impacts and

life-cycle considerations, the challenges in calcu-

lating and managing the metrics have increased.

However, this challenge can be reduced through

the use of automated sustainability metrics man-

agement software tools, such as BRIDGESworks™

Metrics (Tanzil, Ma, & Beloff, 2004).

This software tool incorporates the basic and

complementary set of metrics shown in Exhibits

4 and 5, along with their heuristics for calcula-

tion, as well as providing the capability to con-

struct a customized set of metrics. In addition, a

robust set of impact-assessment methodologies is

included for use in identifying the potential ef-

fects of toxics and pollutants. An example screen

capture from the tool is shown in Exhibit 7.

The availability of such automated tools will

further facilitate the incorporation of sustainabil-

ity metrics for management and progress track-

ing, especially when integrated into a company’s

internal management information system. The

tool will help companies collect data at the

process or facility level, as well as aggregating

metrics from process, facility, and all the way to

the corporate level. In addition, with the capabil-

ity to stack the metrics along the product’s life

cycle, it encourages life-cycle thinking in man-

agement decision making.

Using Sustainability MetricsWhile sustainability metrics have become in-

creasingly sophisticated in content and method-

ology, they continue to consolidate disparate data

into meaningful measures that provide insights

for decision making. Metrics can be used to sup-

port various decision-making activities, including:

• evaluating alternatives, such as:

❖ technical alternatives (e.g., different raw

materials and process improvement op-

tions) and

❖ business alternatives (e.g., different sup-

plier and acquisition options);

• comparing facilities/business units;

• identifying environmental aspects and im-

pacts of an industrial operation; and

• tracking performance over time.

When desired, the metrics may also be em-

ployed to communicate with stakeholders, such

as in external reports.

Two company examples on the use of sustain-

ability metrics are reported in the book Transforming

Sustainability Strategy into Action: The Chemical Indus-

Exhibit 6. Social Metrics Developed by the Institution of Chemical Engineers*

Workplace (Employment) Society• Benefits as percentage of payroll expense (%) • Number of stakeholder meetings per unit • Employee turnover (%) value-added• Promotion rate (%) • Indirect community benefit per unit • Working hours lost as percent of total hours worked value-added• Income + benefit ratio (top 10%/bottom 10%) • Number of complaints per unit value-added

• Number of legal actions per unit value-addedWorkplace (Health and safety)

• Lost-time accident frequency (number per million hours worked)

• Expenditure on illness and accident prevention relative to payroll expense

* Source: IChemE (2002).


similar to the basic sustainability metrics shown

in Exhibit 4.

The BASF ExampleSchwanhold (2005) describes an eco-effi-

ciency analysis methodology developed at BASF.

Based on standard life-cycle assessment, the

analysis involves the use of metrics for various re-

source uses and environmental, health, and

safety impacts. The use of normalization and

weighting methodologies to generate a single-

value environmental performance score is also il-

lustrated in great detail. The discussion also cov-

ers extension of the eco-efficiency analysis to

“socio-efficiency” by including various social as-

pects of sustainability (Schmidt et al., 2004).

try, from which this article is adapted. These exam-

ples are summarized in the sections that follow.

The GlaxoSmithKline ExampleConstable et al. (2005) describe the use of sus-

tainability metrics in product and process devel-

opment at GlaxoSmithKline (GSK), a pharmaceu-

tical company. To fit the metrics to their own

needs, GSK has developed specific green chem-

istry metrics (such as mass productivity, reaction

mass efficiency, and total solvent recovery en-

ergy) for evaluating chemical synthetic processes.

To evaluate chemical-processing technolo-

gies, GSK uses green technology metrics that in-

cludes mass efficiency, percent purity, and heat-

ing and cooling energy, in addition to metrics

Exhibit 7. Data Input Screen for BRIDGESworks™ Metrics, an Automated Metrics Management Tool


While the methodology is primarily used in prod-

ucts and process development, it has also been

applied to strategy development, as well as to

communication with industrial customers and

other value-chain partners of BASF.

Company-Specific MetricsSustainability metrics also play an important

role in management decision making, especially

in progress tracking. As noted by the National Re-

search Council (1999), “The ability to gauge im-

provement in any endeavor is critically depend-

ent on establishing valid methods of measuring

performance. Tracking progress toward an estab-

lished goal serves to

influence behavior by

providing continual

feedback, and it re-

quires reliable and

consistent metrics

against which per-

formance can be com-

pared.”

Many of the eco-ef-

ficiency and socioeconomic metrics described

here are used in companies (see, e.g., GEMI, 1998;

NRC, 1999) and tracked on a quarterly, annual, or

other periodical basis. Metrics used for routine

progress tracking, however, tend to be simpler

and far less complex than those used in product

and process development. The use of impact as-

sessment, in particular, is only gradually gaining

acceptance in management use.

In developing a metrics program for a com-

pany, it is important to realize that “one size

doesn’t fit all” (GEMI, 1998). Each company has

its own distinct set of concerns due to its unique

combination of operational, geographical, tech-

nological, and community factors. Therefore, in

developing a metrics program, one must first

identify the important issues and impacts that are

most significant and relevant to a company.

This can be performed by mapping a com-

pany’s operations and identifying environmental

and other sustainability concerns for each opera-

tion. Then, a larger set of metrics can be piloted

at representative facilities or business units to

identify the most relevant ones.

For example, a pilot was recently conducted

using BRIDGES’ sustainability metrics at The

Stanley Works, a worldwide manufacturer and

provider of tools, hardware, and security products

(Nelson, 2003). Comparison of metrics for similar

manufacturing facilities within The Stanley

Works led to the identification of improvement

opportunities in facilities that perform less effi-

ciently than others. When applied to stages in

the value chain (production of raw materials,

manufacturing processes, and transportation),

the metrics provided insights on the relative con-

tribution of the different stages to impacts such

as energy use, waste generation, and greenhouse-

gas emissions. Issues regarding data sources and

reliability were also identified in this pilot.

Once the most important metrics are identi-

fied, one may construct a system for periodic

tracking and establish measurable goals at the

corporate, business, and facility levels to drive

improvement toward sustainability.

Summary and ChallengesIn the past decade, we have witnessed consid-

erable progress in the development of sustain-

ability metrics, especially in the chemical indus-

try. Metrics, especially those focused on

eco-efficiency, have gained acceptance for use in

management, progress tracking, and marketing,

as well as in the assessment of a company’s prod-

ucts and processes. Progress has also been made

in extending the eco-efficiency analysis to work-

place and community well-being, as well as in

identifying separate social and economic metrics

of sustainability. Availability of automated met-

rics management tools should further facilitate

In developing a metrics program,one must first identify the importantissues and impacts that are mostsignificant and relevant to acompany.


termine what is green—A corporate perspective. Green Chem-istry, 3(1), 1-6.

Epstein, M. J., & Wisner, P. S. (2001, Winter). Using a balancedscorecard to implement sustainability. Environmental QualityManagement, 11(2), 1-10.

Global Environmental Management Initiative (GEMI). (1998).Measuring environmental performance: A primer and surveyof metrics in use. Washington, DC: Author.

Goedkoop, M. J., & Spriensma, R. S. (1999). The Eco-Indicator99 methodology report: A damage oriented LCIA method. TheHague, The Netherlands: VROM.

Houghton, J. T., Ding, Y., Griggs, D. J., Noguer, M., van derLinden, P. J., Dai, X., et al. (Eds.) (2001). Climate change2001: The scientific basis. Cambridge, UK: Cambridge Uni-versity Press.

Hughes, G. (2002). Environmental indicators. Annals ofTourism Research, 29, 457–477.

Institution of Chemical Engineers (IChemE). (2002). The sus-tainability metrics: Sustainable development progress metricsrecommended for use in the process industries. Rugby, UK:Author.

Li, W. (2004). Environmental management indicators for eco-tourism in china’s nature reserves: A case study in Tian-mushan Nature Reserve. Tourism Management, 25, 559-564.

Loh, J., & Wackernagel, M. (Eds.). (2004). Living Planet Report2004, Gland, Switzerland: WWF–World Wide Fund For Nature(formerly World Wildlife Fund).

National Research Council (NRC). (1999). Industrial environ-mental performance metrics. Washington, DC: NationalAcademy Press.

National Round Table on the Environment and the Econ-omy (NRTEE). (1999). Measuring eco-efficiency in business:Feasibility of a core set of indicators. Ottawa: Renouf Pub-lishing Co.

Nelson, K. (2003). Applying sustainability metrics at the Stan-ley Works. Presented at the 11th International Conference ofthe Greening of Industry Network, San Francisco, October12-15.

Olgay, V., & Herdt, J. (2004). The application of ecosystemsservices criteria for green building assessment. Solar Energy,77, 389-398.

Saling, P., Kicherer, A., Dittrich-Krämer, B., Wittlinger, R.,Zombik, W., Schmidt, I., et al. (2002). Eco-efficiency analysisby BASF: The method. International Journal of Life-Cycle As-sessment, 7(4), 203-218.

Schmidt, I., Meurer, M., Saling, P., Kicherer, A., Reuter, W., &Gensch, C.-O. (2004). SEEbalance®: Managing sustainabilityof products and processes with the socio-eco-efficiencyanalysis by BASF. Greener Management International, Issue45, 79-94.

Schwanhold, E. (2005). The Eco-efficiency analysis developedby BASF. In B. Beloff, M. Lines, & D. Tanzil (Eds.), Transform-ing sustainability strategy into action: The chemical industry(Section 6.1.3). Hoboken, NJ: Wiley.

Schwarz, J., Beaver, E., & Beloff, B. (2000). Sustainability met-rics: Making decisions for major chemical products and facili-

the use of sustainability metrics, especially when

integrated into a company’s management infor-

mation system.

Several issues, however, need further explo-

ration. While considerable efforts have been

made in developing performance metrics, leading

metrics such as management metrics still require

additional development. Such metrics, however,

may differ considerably from one company or or-

ganization to another due to the varying cause-

and-effect relationships within each company or

organization. Moreover, while anecdotal evi-

dence exists that links various impacts to a com-

pany’s financial performance, further studies are

needed to more explicitly link sustainability met-

rics to a company’s exposure to risks and oppor-

tunities.

ReferencesBakshi, B. R., & Fiksel, J. (2003). The quest for sustainability:Challenges for process system engineering. AIChE Journal, 49,1350-1358.

Bare, J. C., Norris, G. A., Pennington, D. W., & McKone, T.(2003). TRACI: The tool for the reduction and assessment ofchemical and other environmental impacts. Journal of Indus-trial Ecology, 6(3-4), 49-78. Software available at http://epa.gov/ORD/NRMRL/std/sab/traci/index.html

Beaver, E., Schwarz, J. M., & Beloff, B. R. (2002, July). Use sus-tainability metrics to guide decision-making. Chemical Engi-neering Progress, 98(7), 58-63.

Beloff, B., & Beaver, E. (2000). Sustainability indicators andmetrics of industrial performance. Paper SPE 60982. Presentedat the SPE International Conference on Health, Safety, andEnvironment in Oil and Gas Exploration and Production, Sta-vanger, Norway, June 26-28.

Chambers, N., Simmons, C., & Wackernagel, M. (2000). Shar-ing nature’s interest: Using ecological footprints as an indica-tor of sustainability. London: Earthscan.

Constable, D. J. C., Curzons, A., Duncan, A., Jiménez-González, C., & Cunningham, V. L. (2005). The GSK approachto metrics for sustainability. In B. Beloff, M. Lines, & D. Tanzil(Eds.), Transforming sustainability strategy into action: Thechemical industry (Section 6.1.2), Hoboken, NJ: Wiley.

Constable, D. J. C., Curzons, A. D., Freitas dos Santos, L. M.,Geen, G. R., Kitteringham, J., Smith, P., et al. (2001). Greenchemistry measures for process research and development.Green Chemistry, 3(1), 7–9.

Curzons, A. D., Constable, D. J. C., Mortimer, D. N., & Cun-ningham, V. L. (2001). So you think your process is green,how do you know—Using principles of sustainability to de-


ties. Final report to the U.S. Department of Energy Office ofIndustrial Technologies. Houston: BRIDGES to Sustainability.

Shane, A. M., & Graedel, T. E. (2000). Urban environmentalsustainability metrics: A provisional set. Journal of Environ-mental Planning and Management, 43, 643–663.

Sikdar, S. K. (2003). Sustainable development and sustainabil-ity metrics. AICHE Journal, 49, 1928–1932.

Steen, B. (1999). A systematic approach to environmental pri-ority strategies in product development (EPS), Version 2000—General System Characteristics, Report 1999:4, Centre for En-vironmental Assessment of Products and Material Systems.Göteborg, Sweden: Chalmers University of Technology.

Tanzil, D., Ma, G., & Beloff, B. R. (2004). Automating the sus-tainability metrics approach. Presented at the AIChE SpringMeeting, New Orleans, April 25-29.

Udo de Haes, H. A., Finnveden, G., Goedkoop, M., Hauschild,M., Hertwich, E.G., Hofstetter, P., et al. (Eds.) (2002). Life-cycleimpact assessment: Striving towards best practice. Pensacola,FL: Society of Environmental Toxicology and Chemistry(SETAC).

United Nations Commission on Sustainable Development.(2001). Indicators of sustainable development: Guidelines andmethodologies. Available at http://www.un.org/esa/sustdev/natlinfo/indicators/isdms2001/isd-ms2001isd.htm

Veleva, V., & Ellenbecker, M. (2001, December). Indicators ofsustainable production: Framework and methodology. Journalof Cleaner Production, 9, 519–549.

Verfaillie, H. A., & Bidwell, R. (2000). Measuring eco-efficiency:A guide to reporting company performance. Geneva: WorldBusiness Council for Sustainable Development (WBCSD).

Wackernagel, M., Schultz, N. B., Deumling, D., Linares, A. C.,Jenkins, M., Kapos, V., et al. (2002). Tracking the ecologicalovershoot of the human economy. Proceedings of the Na-tional Academy of Sciences, 99, 9266–9271.

World Meteorological Organization (WMO). (1999). Scientificassessment of ozone depletion: 1998. Report No. 44, Geneva:Author.

Wright, M., Allen, D., Clifi, R., & Sas, H. (1998). Measuring cor-porate environmental performance: The ICI EnvironmentalBurden System. Journal of Industrial Ecology, 1(4), 117-127.

Dicksen Tanzil, PhD, is technical specialist and project manager at BRIDGES to Sustainability, Golder Associates Inc. Hehas advised companies on the integration of sustainability considerations into business and technical decision making, in-cluding the use of sustainability metrics for management and engineering design. He received his PhD from Rice Univer-sity and BS from Purdue University, both in chemical engineering.

Beth R. Beloff is the director of BRIDGES to Sustainability, a newly acquired division of Golder Associates, and presidentand founder of the nonprofit organization, BRIDGES to Sustainability Institute, which is dedicated to the practical imple-mentation of sustainability in businesses and industry. She is an expert in integrating sustainable development with othercritical business aspects, and in particular is a thought leader in how to measure sustainability performance. Ms. Beloff hascoauthored many publications on environmental accounting and sustainability performance assessment, and has receivedawards and grants from a variety of industrial, government, and nonprofit sources.

This article is adapted from Section 6.1.1 of Transforming Sustainability Strategy into Action: The Chemical Industry, ed-ited by Beth Beloff, Marianne Lines, and Dicksen Tanzil, © 2005 John Wiley & Sons, Inc.

assessing impacts: overview on sustainability indicators and metrics

Documents