What is sustainability data?

The push for sustainability in business has grown rapidly in the last century. Sustainable business practices—such as improving energy efficiency, shifting to renewable energy and preserving biodiversity—are often analyzed against environmental, social and governance (ESG) metrics. Companies share the resulting sustainability data in ESG reports for investors or sustainability reports for a more diverse audience.

The concept of sustainability was widely popularized by the Brundtland Commission, a United Nations subdivision that sought to unify countries through the pursuit of sustainability. In 1987, the Commission published “Our Common Future, From One Earth to One World,” a report that defined sustainable development as “meeting the needs of the present without compromising the ability of future generations to meet their own needs.”¹

Amid the public’s newfound awareness of sustainability, companies felt pressure to reduce the adverse environmental and social impacts resulting from their operations. And so, early versions of sustainability data took shape as organizations quantified their impact across the three pillars of sustainability—environmental, social and economic.

By 2016, the United Nations created the Sustainable Development Goals (SDGs) which outlined 17 sustainability targets. The SDGs set a global agenda for sustainable development with the hopes of achieving a more sustainable future by 2030. They also provided clear targets for companies to measure their own sustainability initiatives against, making sustainability data less of a luxury and more of an imperative.

Companies use sustainability metrics for several reasons, including:

Sustainability data provides key insights to optimize value chains against ESG metrics. Some businesses use sustainability data to ensure they’re ethically sourcing raw materials during the procurement phase. Others use it to track fuel use so they can improve fleet management. Consider Eltel, a Scandinavian telecom service provider that uses carbon accounting to optimize routes for its fleet of vehicles, which reduces fuel use and carbon emissions in the process.²

Companies can use sustainability data to improve operations and accurately measure sustainability performance. For example, companies can track energy use to manage energy consumption and improve resource utilization. IKEA, the Swedish multinational conglomerate, uses sustainability data to minimize its carbon footprint, improve waste management and transition to renewable energy across its operations.³

Some businesses include sustainability data alongside their financial reporting to meet stakeholders’ calls for greater transparency. Sustainability data can be used as a benchmark year-over-year to ensure that organizations meet their sustainability goals, boosting brand reputation in the process. Mahindra Group, an India-based multinational federation, uses sustainability metrics to attract impact investors who are aligned with the company’s purpose.⁴

Sustainability data helps companies meet reporting mandates. The Corporate Sustainability Reporting Directive (CSRD) requires companies to disclose their social and environmental impact. The Sustainable Accounting Standards Board (SASB) and the Taskforce on Climate-Related Financial Disclosure (TCFD) provide guidance on how to prepare ESG and sustainability reports. Nearly all of the world’s top 250 companies (G250) provide sustainability reports, with a reporting rate of 96%.⁵

Many organizations use strong sustainability data management to fully realize the power of sustainability data.

Sustainability data management is the collection, analysis, optimization and reporting of sustainability data. It requires a comprehensive approach that spans the enterprise because sustainability data is often scattered across disparate, siloed systems and departments.

Data collection involves capturing quantitative and qualitative data.

After organizations collect data, they analyze the datasets and look for opportunities to optimize operations, reduce costs and improve decision-making. For instance, historical data like weather reports can help improve transportation logistics. In some cases, sustainability data can even forecast potential demand, risk and opportunities. With a strong sustainability data foundation, organizations can streamline reporting and disclosure and accelerate their decarbonization efforts.

Sustainability data is typically disclosed through ESG and sustainability reports. Whether these reports are mandated depends on the region. However, companies can reference the SDGs as a framework and follow guidance from organizations like the SASB, TCFD and the International Sustainability Standards Board (ISSB).

Some organizations include sustainability data alongside ESG data to provide a more comprehensive view of their operations. While similar, ESG and sustainability data are not the same. ESG data provides concrete metrics that investors and other stakeholders can use to valuate a company. Sustainability data offers a more holistic picture of the organization’s resource use and sustainability management strategy.

Sustainability data can be shared through real-time dashboards, spreadsheets or other interactive data visualization tools, making it easier to track the organization’s progress and find areas for improvement. Data can also be showcased on social media platforms like LinkedIn to highlight sustainability efforts and boost brand reputation.