1. Dr Thomas Wiedmann Triple-Bottom-Line Accounting of Social, Economic and Environmental Indicators A New Life-Cycle Software Tool for UK businesses Third Annual International Sustainable Development Conference Sustainability – Creating the Culture 15-16 November 2006, Perth, Scotland Prof Manfred Lenzen

2. SD Reporting & TBL Accounting

3. World Business Council for Sustainable Development (2002) “There is a growing awareness that shareholders’ value is enhanced by increased corporate social and environmental responsibility.” “Corporate sustainability reports and sustainability ratings are increasingly used as key information for investment and lending decisions.”

4. Challenges remain… World Business Council for Sustainable Development (2002)  “There is little comparability …”  “A key challenge remains reporting on the links between sustainability and the bottom line.”  “Business will increasingly be expected to report … on supplier- and consumer-related impacts of activities, products and services.”

5. Trucost & Defra (May 2006)

6. Reporting on direct and indirect KPIs  “The Government expects businesses to report on their significant environmental impacts whether they are direct or indirect.”  “Businesses are likely to derive benefit from positively influencing their indirect environmental impacts.” Trucost & Defra (May 2006)

7. Indirect (environmental) impacts Supply Chain Impacts (upstream) Direct Company Impacts (on-site) Downstream Impacts Energy Water Raw materials Logistics Product s in use Product disposal Boiler emissions Car fleet emissions Manufacturing emissions Landfill waste Recycling rate

8.  “… there is still a lack of quantification in most reporting. … the majority of reports lack depth, rigour or quantification.”  “Most business will have supply chain impacts that they should understand and consider reporting. There is no single, quantifiable measure that companies can use as a Key Performance Indicator for the effect of their upstream supply chain on the environment.” Trucost & Defra (May 2006) The problem of quantification

9.  Principle 1: quantitative  Principle 2: relevant & reliable  Principle 3: comparable  Principle 4: complete SD Reporting Principles

10. TBL Accounting without boundaries

11. Where to draw the boundary?

12. e.g. total emissions (direct plus indirect) e.g. direct (on-site) emissions e.g. purchases of a company

13. BottomLine 3 A new TBL software tool

15. Two data inputs  Financial accounts  On-site impacts

16. Outputs  > 100 TBL indicators  Quantification of total (direct and indirect) impacts  Sector benchmarking  Structural path analysis  Production layer analysis

17. Indicator My Bakery absolute impacts My Bakery total intensities Total Sector intensities GDP120,509 £8.69 p/£46.6 p/£ Gross operating surplus244,853 £17.7 p/£17.2 p/£ Employment13.5 emp-y1.12 emp-min/£1.27 emp-min/£ Businesses1.550.00004 /£0.00009 /£ Greenhouse gas emissions343 t CO2-e247 g CO2-e/£465 g CO2-e/£ Energy consumption1,090 GJ786 kJ/£2,640 kJ/£ Water use30.5 ML22.0 L/£20.1 L/£ Ecological Footprint99.9 gha0.72 g-m2/£1.18 g-m2/£ Land use534 ha3.85 m2/£6.99 m2/£ Particulate Matter <2,5mm0.014 t0.010 g/£0.016 g/£ Main TBL indicators

18. Benchmark spider diagram (TBL)

19. Production Layer Decomposition Energy demand (GJ) Company Suppliers Suppliers of Suppliers

20. Structural Path Analysis

21. Structural path analysis (particulate matter) RankPath Description Path Value Path Order Percentage in total impact 1Refined sugar > My Bakery0.008 t258.5 % 2Raw sugar > Refined sugar > My Bakery0.0011 t37.56 % 3Animal food > Poultry > My Bakery0.0010 t36.79 % 4Paper products > My Bakery0.0006 t24.14 % 5Paper containers > My Bakery0.0005 t23.35 % 6Electricity supply > My Bakery0.0003 t22.28 % 7Electricity supply > Fresh meat > My Bakery0.00016 t31.14 % 8Raw sugar > Animal food > Poultry > My Bakery0.00014 t41.02 % 9Raw sugar > Plain flour > My Bakery0.00012 t30.84 % 10Raw sugar > Raw sugar > Refined sugar > My Bakery0.00010 t40.69 % 11Electricity supply > Plain flour > My Bakery0.00007 t30.52 % 12 Animal food > Untreated milk > Dairy products > My Bakery 0.00007 t40.49 % 13Confectionery > Plain flour > My Bakery0.00006 t30.44 % 14Animal food > Untreated milk > Cheese > My Bakery0.00005 t40.38 % 15Fresh meat > My Bakery0.00005 t20.38 % 16Animal food > Pigs > Fresh meat > My Bakery0.00005 t40.38 % 17Animal food > Untreated milk > Butter > My Bakery0.00004 t40.32 %

22. THANK YOU www.bottomline3.co.uk www.isa-research.co.uk