The MultiCapital Scorecard: Rethinking Organizational Performance

Category: Book
By (author): McElroy, Mark W.
By (author): Thomas, Martin P.
Subject:  BUSINESS & ECONOMICS / Accounting / Managerial
  BUSINESS & ECONOMICS / Business Ethics
  BUSINESS & ECONOMICS / Environmental Economics
  BUSINESS & ECONOMICS / Green Business
Audience: general/trade
Publisher: Chelsea Green Publishing
Published: December 2016
Format: Book-hardcover
Pages: 256
Size: 9.01in x 6.02in x 1.02in
Our Price:
$ 63.95
Availability:
Available to order

Additional Notes

From The Publisher*

For decades now, organizations have been struggling to find the best way to address their social and environmental responsibilities alongside their economic obligations. In other words, they want to know how best to effectively manage their operations based on a triple bottom line (3BL)-one that reflects social, environmental, and economic performance.

Recently, an international standard for integrated reporting has emerged that in principle emphasizes the importance of managing toward a triple bottom line. But it fails to provide specific guidance on how to do so. Organizations have been left to their own devices to respond. How should 3BL management actually be done?

In this book, sustainability and performance experts Martin Thomas and Mark McElroy introduce the world's most advanced 3BL performance accounting methodology: The MultiCapital Scorecard. It is the first context-based integrated measurement, management, and reporting system. And, it can help corporations, public institutions, and other organizations answer the question they should be asking themselves for every aspect of their operations: "How much is enough for us to be sustainable?" The answers set internal performance standards against which operations and their impacts can be measured. Nothing less will do!

The MultiCapital Scorecard describes this open-source methodology, which consists of a structured, quantitative measurement and reporting system that complies with international standards for 3BL integrated measurement and reporting. Moreover, the MultiCapital Scorecard is designed to help organizations assess their own 3BL performance in their own contexts with context-based metrics of their own choosing. An eminently practical management aid for integrated thinking, it can be tailored to any organization's needs.

The authors also describe how and why businesses are gradually shifting from managing impacts on only one type of capital (economic) to managing impacts on multiple types. They also provide detailed examples of worked reports, showing how organizations might develop and quantify the interim and long-term goals to meet their obligations to their employees, community, shareholders, and the environment. The examples also show how an organization can use the Multicapital Scorecard methodology to assess their progress in meeting those goals, and convey that progress to their stakeholders.

Review Quote*

"The MultiCapital Scorecard provides a valuable aid to help companies get to grips with the complex set of resources and relationships upon which all organizations impact and depend. The context-based approach is a particularly important development, as social and environmental issues put ever greater constraints on business and the economy, and provide real opportunities for those providing solutions."--Jessica Fries, executive chairman, the Prince's Accounting for Sustainability Project (A4S)

Review Quote*

"As a company with global distribution and deep roots in social purpose, Ben & Jerry's has long been working on a meaningful set of sustainability performance metrics to assess social and environmental impacts. We consider the MultiCapital Scorecard one of the most promising performance measurement models for integrated reporting that we have yet encountered."--Jostein Solheim, CEO, Ben & Jerry's

Review Quote*

"Most of us easily forget we live in an ecological world. For the past two hundred years, often unknowingly, we have been busily sawing off the branch from the tree of life on which we survive. The annual biocapacity of the Earth is consumed at an earlier date each year, after which natural capital is eroded. As anyone in business knows, maintaining capital intact is essential. Running permanent long-term overdrafts is not-it leads to collapse. This book makes it clear that the ultimate source of all value (natural and human capital) is under threat, and sets out a series of practical and useful measurement tools that can aid business managers in the necessary turnaround. Measuring and managing an organization's social and environmental impacts is a useful start, but this book goes much further. With its systems-based philosophy and context-based target setting, it offers the kind of transformational thinking so necessary to reorganize business ecologically."--Markus J. Milne, professor of accounting, University of Canterbury

Review Quote*

"In order for sustainability reporting to provide an accurate picture of a company's impact on the economy, environment, and the society in which it operates, context must be given to the reported information. While the context principle was introduced in 2002, it has largely been absent in corporate reporting, partially due to a lack of available guidance on how to apply context to reporting. The Multicapital Scorecard is a step forward in addressing this gap and encouraging a widespread dissemination of context-based sustainability reporting."--Elisa Tonda, head of the Responsible Industry and Value Chain Unit, UNEP

Review Quote*

"To build a world where business and society thrive together, companies need to focus on solving the world's challenges and using the tools of capitalism and markets to do it most profitably. But how will business leaders know whether they've made this big pivot or how far they have to go to get to the hard-to-define sustainable? Business has been missing the right metrics and tools. This new MultiCapital Scorecard fills that critical gap. Managers now have the robust dashboard they need to understand how they're really doing on environmental, social, and financial performance."--Andrew Winston, coauthor of Green to Gold; author of The Big Pivot

Review Quote*

"The MultiCapital Scorecard provides the first multicapital reporting system that makes possible the practice of John Elkington's triple bottom line. In other words, it brings reporting into the 21st century. Thomas and McElroy are to be congratulated for their conceptually rich, comprehensive, and persuasive book.I am particularly impressed by the authors' concepts of capital thresholds and allocations; their broad stakeholder focus; their evenhanded approach to all six vital capitals; and their insight that sustainability criteria must be applied to economic capital, too, which shifts the focus from maximizing profits to reasonable returns. The issues The MultiCapital Scorecard addresses-and therefore makes it possible to tackle-are urgent and elude our current systems: climate change, resource depletion, toxic pollution, societal breakdown. I'd like to live in a world where all organizations are run using the MultiCapital Scorecard. I hope such a world is imminent."--Jane Gleeson-White, author of Six Capitals, or Can Accountants Save the Planet?

Review Quote*

"Having spent most of my career in finance, I am particularly struck by the manner in which The MultiCapital Scorecard answers the question about the balance between production, consumption, and profit in an era when the end consumer is demanding transparency. It turns out that performance is, in fact, about impacts on all vital capitals, not just one of them. What a simple, elegant, and effective way of transforming the triple bottom line from theory to practice in organizations. These principles are transforming every aspect of our business."--Edward R. Townley, CEO, Agri-Mark/Cabot Creamery Cooperative

Review Quote*

"Multicapitalism is a profound manifestation of early 21st century economic governance trends. But our capital markets, accounting, and governance systems are rooted in a one-dimensional history, so businesses need new tools to help them adapt-and quickly. Respecting all the capitals used by an organization to create value and communicating how business models are changing, so that wealth is not only created but also distributed to achieve broad-based prosperity, are the principal challenges of our age. That is why adoption of an integrated reporting model is so vital for the future success of the global economy and society. It is also why I am delighted to welcome the publication of The MultiCapital Scorecard, an important milestone on this journey and the outcome of decades of thinking and working with businesses to develop a practical approach that looks to be both scalable and backed by evidence. It is what the market needs, bringing innovation to management thinking and decision-making."--Paul Druckman, CEO, International Integrated Reporting Council

Review Quote*

"Thomas and McElroy's emphasis on using context-based metrics is fundamental. Operating without context is like standing on a scale without knowing your ideal weight, tracking your speed without understanding the speed limit, or monitoring your income while ignoring your expenditures. In the same way, the sustainability performance of organizations needs to be tracked relative to limits and thresholds in the world, as clearly illustrated by the MultiCapital Scorecard. This is why The MultiCapital Scorecard originates a whole new generation of triple bottom line accounting."--Mathis Wackernagel, founder and CEO, Global Footprint Network