Value-based planning & development
Sustainable Value
Responsibility to create value for shareholders has been joined by efforts to address the broader societal and environmental impacts of a company's operations. This is based not only on the near-term expectations of the goodwill or green premium in the share price, but the long-term prospects for responsible and sustainable value creation. As companies move forward to adopt the management framework of People, Planet and Profit, it presents challenges in describing and measuring the impacts of societal and environmental factors and linking them to shareholder value. We can help you do that.
Sustainable Value* is a technique for estimating the value contributions of a variety of societal and environmentally connected factors. It is based on the concept of opportunity cost. The societal and environmental resources used by the company to produce financial value are compared to the amount of value that would have been created by a benchmark (society). In this way you can quantify how much more or less sustainable value the company contributed in the use of these resources than the benchmark would have created.
The return that is produced by the company in the use of each resource is compared to what the benchmark would have created (the opportunity cost). This spread is the value contribution associated with each resource. Add them up and divide by the number of resources used in the assessment and you get an estimate of Sustainable Value Added.
We can work with you to:
- Identify your company's use of societal and environmental resources
- Measure your company's use of those resources
- Identify and establish appropriate and available benchmarks
- Make estimates of Sustainable Value Added
- Merge sustainable value goals and targets into strategic planning processes
- Communicate the concept, process and quantification of sustainable value into your CSR messages.
- Manage other internal or external experts in functional disciplines critical to successful management of sustainable value
* Sustainable Value is a concept developed by Professor Frank Figge of Queen's university Belfast and Dr. Tobias Hahn of the Institute for Futures Studies and Technology Assessment (Berlin).
