Tough as it has been, the year 2020 is coming to a close and companies will soon be reviewing their annual performance.
While many agree 2020 is for survival and not necessarily for thriving, it has not removed the need for performance review, whose purpose is to indicate how better or worse off the business is compared to the previous year.
It is only by measuring performance that recovery and progress are possible. However, for long the annual stock-taking exercise has largely been tethered to traditional business metrics such as financial statements and balance sheets. Granted, money is the lifeblood of any enterprise, without which it dies off.
However, times have changed and the universe seems to be using uncanny reminders such as pandemics and extreme weather conditions to catch our collective attention. Simply put, it’s not business as usual. Human activities, while progressive, have unfortunately caused an imbalance in nature’s ecosystem and, therefore, people should be responsible enough and take steps to restore it.
For this reason, and to ensure future survival of not only businesses but also the entire planet, behaviour change is needed across boardrooms, offices, factories, farmlands, construction sites and transportation as far as performance reviews are concerned.
Annual reviews should go beyond monetary numbers to include people and environment goals.
Striking a balance between the three pillars – people, profit and planet – completes the sustainability equation.
Businesses should, to this end, make sustainability a part of their performance reviews. They should measure how many people were impacted as a result of their operations as well as their carbon footprint on the environment in the year under review.
It is encouraging to note that several companies, especially large ones, are already doing this through their annual sustainability reporting. This is the highest mark of environmental and social accountability at the corporate level.
The same way bonuses are awarded at the end of the year after hitting monetary targets, companies should have an incentive package to encourage the workforce to sustainably achieve environment and society goals through innovation.
To track progress efficiently, organisations should develop tools to measure their sustainability goals on a quarterly basis (every three months).
They, for instance, could develop a green scorecard sheet highlighting ecofriendly projects undertaken, the stages they’re at and the involved resources alongside returns on investment, both expected and actual. Equally, standard operating procedures—a set of step-by-step instructions compiled to help workers carry out routine operations—should also be designed around green practices.
Green behaviour is not only a responsible thing to adopt but could mean black ink for enterprises. Installing captive solar power, recycling water for instance, could return savings as could waste recycling and reuse.
In the same spirit, environmental and social targets may be made part of job description set out for executives. Also, most corporations nowadays have different mechanisms of reviewing staff annual performance, which seeks to establish whether or not they met their set targets, pledges and commitments in efforts to encourage productivity.
Instead of limiting this assessment to the usual key performance indicators (KPIs) rooted in finance and growth targets, the scope ought to be widened to include sustainability goals at an individual level. For instance, how often do workers remember to switch off office lights and devices when not in use? What quantity of plastic and solid waste does each employee generate in the office? What role do workers play during implementation of their companies’ corporate social responsibility (CSR)? How many trees has each staff member planted or lives transformed under their company’s CSR, for example?
While embedding sustainable features in company operations may seem inconvenient or could come at a cost, in the long-run the paybacks far outweigh the inconveniences.
Besides, it should be noted that consumers are becoming more demanding of corporations to conduct their operations in a sustainable way, with a long-term consideration for future generations.
As a result, sustainable enterprises tend to attract more customers and earn their loyalty towards their brand.
In light of multiple options available and modern-day challenges customers are increasingly getting discerning, with their purchase decisions guided not only by prices and quality but also the reputation associated with a brand.
Making sustainability a part of annual performance reviews is just as important as balance sheets and financial statements.
This article was originally published by the Business Daily
