The Ultimate Sustainability Index

The Ultimate Sustainability Index
A new rating system exploits corporate pressure to clean up all stages of the supply chain

How “sustainable” is a can of soda or a bottle of shampoo? An increasing number of consumers want to base their buying decisions on the answer, but finding a comprehensive measure for the negative impact that the making of a product might have on the planet is difficult. Scores of “sustainability indexes” scrutinize discrete stages of the supply chain or different effects—such as landfill waste generated or carbon dioxide emitted—and use different metrics supported by different groups. The problem is not a lack of information; it is too much of it.

Judging products would be much easier if there were one set of metrics to evaluate environmental and social costs. That is the idea behind the Sustainability Consortium, a collection of 10 leading universities, large nonprofit organizations and 80 international companies—including Walmart, Coca-Cola and Disney—that have agreed to devise a standard index covering the entire supply chain. The group recently unveiled the measures its members will use to evaluate a first set of 100 products, ranging from breakfast cereals to laundry detergents to televisions.

Advocates such as Jeff Rice, Walmart's director of sustainability, argue that sustainable practices across the supply chain not only can clean up the environment but also can cut costs by, for instance, reducing the amount of waste that needs to be hauled away. Walmart is building the metrics into “scorecards” that it has begun distributing to the roughly 400 buyers who procure the retailer's products. Buyers will develop plans with suppliers to reduce environmental impacts, and whether suppliers act will be discussed in the buyers' performance reviews.

Consortium member Dell is already asking contractors that produce its LCD screens to figure out how to reduce the emission of perfluorocarbons (powerful greenhouse gases) created when the screens are manufactured. The consortium's data “gave us a guide of where to target our efforts,” says Scott O'Connell, director of environmental affairs at Dell.

The consortium believes its index will ultimately supersede other ratings schemes. Consumers can already walk into a grocery store, whip out their mobile phones, scan a bar code on a bottle of shampoo and pull up a sustainability ranking compiled by GoodGuide. But the guide is built only on publicly available information. The consortium's ratings will factor in closely held data on emissions, waste, labor practices, water usage and other sensitive factors that will become available only as large corporate players exert pressure on suppliers to disclose them. The data should make the index more comprehensive than others. Companies the size of Walmart, Best Buy and Dell control hundreds of billions of dollars in annual spending by suppliers. “That in and of itself is going to make sustainability more mainstream than anything else ever has,” Rice says.

It will be several years before consumers can access the index's data. Consortium leaders expect to make it available but have not yet determined how consumers would be able to access it. In the meantime, the index could spur innovation. Researchers at the University of California, Berkeley, for one, produced a white paper for the consortium reviewing the advantages of using bio-based materials in laptops instead of plastics. And scientists at the University of Arkansas are studying the best ways to evaluate impacts of various crop practices on water scarcity. — Adam Piore

http://www.scientificamerican.com/article.cfm?id=world-changing-ideas-2012-innovations-radical-enough-alter-lives&page=6