The PricewaterhouseCoopers survey, Measuring and managing total impact: A new language for business decisions, found 93 percent of CEOs believe measuring their organization’s total impact could help them make better decisions about business risk and build a stronger reputation with employees, investors and regulators, than using financial measures alone.
The survey results suggest many business leaders are looking beyond revenues, expenses and profits to a more inclusive and responsible economic development. The approach, dubbed by PwC as total impact measurement and management or TIMM, takes a holistic view of social, environment, fiscal and economic issues within the company. Companies using TIMM look beyond revenues and profits to understand their total footprint, quantify and monetize those impacts and then evaluate options to make better decisions.
Four out of five CEOs surveyed believe using information on their organization’s total impact would help them make more insightful decisions than conventional financial data.
However, most CEOs fail to use that information. Less than a quarter of 187 CEOs surveyed by PwC are using information on their company’s total impact to make decisions. Less than 15 percent are using the information for reporting.
Chief execs reported using some information on their company’s economic, environmental and social impact for board level decision making. But fewer shared that information with investors, employees and the public, according to the survey results.
Overall, 60 percent of those surveyed measured environment impacts, but only 51 percent reported it externally.
Larger companies appear more tuned into their environmental footprint. All CEOs at the largest companies in the survey — those with revenues over $10 billion — said they factored environmental impacts into their board decisions.
A white paper released by CH2M Hill in July 2013 says companies that set tangible, public sustainability goals improve their financial and environmental performance. The paper says as companies work to meet their goals, they cut energy use, greenhouse gas emissions, water consumption and waste — all of which result in cost savings and boost the bottom line and can result in increased employee satisfaction and productivity.