5 Essential Environmental KPIs Businesses Need to Measure

Environmental key performance indicators (KPIs) are powerful tools that empower organisations to measure and track their environmental performance. KPIs are utilised in nearly every industry and job role as a quantifiable measure of performance for a specific objective. They provide targets for teams to aim for and milestones to gauge progress.

By providing insights into results, these KPIs enable companies to align with environmental stewardship, identify areas for improvement, and monitor the effectiveness of sustainability goals. Understanding the use of sustainability KPIs can be a significant driver for positive environmental change in an organisation.

Establishing environmental KPIs creates operational efficiencies, reduces costs, ensures compliance, and mitigates risks. But it's also about much more than that. It's about inspiring innovation, fostering the development of sustainable products and offerings, and creating improved business models that can give companies a competitive edge. Discover the main environmental KPIs that businesses can use to ensure their sustainability goals.

Key Categories of Environmental KPIs

Drawing inspiration from our IEMA Pathways to Net Zero course we’ve compiled a list of some key environmental performance indicators which learners can use to measure the progress their new practical skillset is bringing to an organisation.

Energy Consumption

• Total Energy Consumption: Monitoring energy consumption and efficiency provides an entire view of a company's energy consumption for all energy sources (electricity, fuels, heating, cooling, etc.) over a given period, measured in kilowatt-hours (kWh) or megawatt-hours (MWh).
• Non-Renewable Energy Consumption: This metric of energy consumption includes energy from non-renewable sources like oil and gas, and companies track this element to assess over-reliance on fossil fuels and finite energy sources.
• Renewable Energy consumption: Companies and society are increasingly driven to transition to sustainable/renewable energy sources like solar, wind, geothermal, hydro, etc. Measuring what percentage of renewables is utilised against non-renewable sources allows you tangibly measure your shift to carbon neutrality.

Energy Efficiency

• Energy Intensity: To measure improvement actions and opportunities for achieving energy efficiency, companies can measure total energy consumption against other company metrics like revenue, floor area, production output, etc. Lower energy intensity values show higher energy efficiency for businesses/organisations.
• Energy Consumption Benchmarking: using this environmental KPI requires companies to compare their energy usage with industry-published standards or benchmarks to identify hotspots of energy used and areas of improvement in energy consumption.
• Energy Conservation Measures (ECMs): Using this environmental KPI, a company tracks the effectiveness of energy-saving initiatives and installations and tracks progress in reducing them.
• Other relevant energy-related KPIs: These environmental KPIs include monitoring energy costs and compliance with energy standards, which enable companies to manage their energy performance and environmental impact.

Carbon Footprint

This environmental KPI measures the total amount of greenhouse gas (GHG) emissions from all organisational scopes (Scope 1: direct emissions, Scope 2: indirect emissions from purchased energy, Scope 3: other indirect emissions from the supply chain, etc.). The GHG unit for measurement is typically kilograms or tonnes of carbon dioxide equivalent (CO2e).

Carbon Intensity

This environmental KPI measures the amount of GHG emissions per unit of organisational activity or output, e.g., GHG emissions compared to a unit of energy produced or per revenue dollar. Carbon intensity is a useful metric for companies to review their carbon footprint hotspots and presents opportunities for improvement.

Total Carbon Emissions

This environmental KPI measures an organisation's absolute GHG emissions based on its operational requirements or financial obligations and ambitions. Like the carbon footprint, GHG emissions are categorised into scopes 1, 2, and 3, and the unit of carbon dioxide equivalent (CO2e) is used.

Water Consumption

This environmental KPI for water consumption provides a comprehensive view of a company’s water consumption over a period. It is typically measured in absolute terms of the total volume of water consumed (m3 or gallons) or in normalised data forms of water consumption per unit of production or service or employee/ occupant.

Water Conservation

Organisations can use this environmental KPI to quantify the percentage of water recycled and other facilities implementing water-saving technologies.

Water Footprint

Using this environmental KPI helps companies calculate their total water footprint (direct and indirect water consumption across the business value chain, expressed as water footprint per unit of offering or production).

Waste Management

• Waste generation rate: This environmental KPI measures the amount of waste generated by a company over a period, which presents an opportunity for improvements in waste reduction initiatives.
• Waste composition: This environmental KPI enables organisations to target recycling and disposal strategies based on the types and proportions of different waste, such as paper, food waste, metal, and wood.
• Waste recycling rates: This environmental KPI quantifies the proportion of waste recycled compared to what is diverted from incinerators/landfills, with higher rates indicating sustainable business practices.  

In order to measure the effectiveness of their efforts to become more sustainable, organisations need to track environmental KPIs related to energy, carbon emissions, water, and waste management. However, it's not just about knowing these KPIs. It's about using them to inform and improve on your existing processes wherever possible. It's about committing to responsible and efficient resource utilisation. And it's about continually monitoring and evaluating these metrics to identify new opportunities for improvement. This commitment to improvement is what sets companies apart in their sustainability efforts.

If you’re interested in more ways to become more sustainable as a business, we strongly recommend you look into the IEMA Pathways to Net Zero course below.