The Sigma Project has completed its much-needed sustainable management guidelines. Flemmich Webb looks at what they are and how they will helpIt's been a long journey for the Sigma (Sustainability - Integrated Guidelines for Management) Project since it began in 1999. Discussions, arguments, endless meetings - you name it, the team comprising representatives from the British Standards Institution, Forum for the Future, and AccountAbility, has sat through it all.
Despite the complexity of their task, the Sigma team, backed by the DTI, persisted. The end result: a set of tools and management guidelines that are probably the most important development in the history of sustainable management to date.
As many companies know, sustainable development is a fiendish concept to grasp, let alone manage. Most managers have a handle on the environmental side of things, but trying to assess the value of community engagement or quantify staff satisfaction has left many scratching their heads in bewilderment.
Add related concepts like corporate social responsibility and triple-bottom line accounting to the pot and the result is a thick stew of confusion. Realising this, the Sigma team tried to create a framework that would challenge and engage companies, and help them tackle sustainable development by making it easier to integrate it into mainstream business management.
In Phase 1 of the project, a set of six management tools was created and rigorously tested in a pilot programme. They fed their experiences back to the team, who made tweaks and adjustments accordingly. In Phase 2 - the recently completed final phase - the team have built 13 tools and sets of guidelines.Slaying complexity
The objective of the guidelines is to try to incorporate a wide range of management systems and frameworks into one toolkit, including ISO 14001, Investors in People, the ISO 9000 series, OHSAS 18001 and the AA1000 Framework. This means that the Sigma guidelines are compatible with companies' existing systems, avoiding meaningless duplication.
They consist of a set of guiding principles to help organisations define sustainability and their relationship to it, and a management framework that helps integrate it into mainstream decision-making and business operations.
Because it is modular, companies can take the elements that they need - whether they are big or small, from the private or public sector.Tools of the trade The 13 toolkits and guidelines are summarised below:
1 AA1000 Assurance Standard - provides guidance on this sustainability reporting standard.
2 The Business Case Tool - allows businesses to tailor a sustainability strategy to their individual company's need.
3 The Compatibility Tool - helps integrate existing management systems into the Sigma Management Framework. Systems covered include: the AA1000 Framework, Investors in People, EMAS, ISO14001, ISO14031, OHSAS 18001, ISO 9000, SA8000, AS/NZS 4581, The Natural Step (TNS), The UN Global Compact and the Charter Mark.
4 The Environmental Accounting Tool - evaluates "internal" environment-related expenditure (expenditure already incurred and captured within a company's accounting system but perhaps lost in general overheads) and 'external cost accounting (the internalisation of environmental externalities), and helps companies set up their own external environmental cost accounts.
5 The Global Reporting Initiative (GRI) Tool - based on the GRI guidelines, this provides guidance on how to put a sustainability report together.
6 The Marketing and Sustainability Tool - offers advice on how to select which policies to publicise and how to capitalise on them as part of a company's marketing strategy.
7 The Performance Review Tool - a questionnaire that assesses organisational performance against the SIGMA framework.
8 The Risk, Opportunity and Sustainability Guide - provides information and simple tools to help companies improve their understanding and management of sustainability risks and opportunities.
9 Guide to Guidelines and Standards - a review of the 20 standards and guidelines relevant to sustainable development that currently exist.
10 The Stakeholder Engagement Tool - uses two approaches to improve stakeholder communication. The first is based on the AA1000 process, which integrates stakeholder dialogue with core management procedure; the second looks at how to explain and evaluate stakeholder engagement.
11 Guide to Sustainability Issues - a basic explanation of the core elements of sustainability.
12 The Sustainability Accounting Guide - looks at the current methodologies used for accounting sustainable performance.
13 The Sustainability Scorecard - builds on the concept of a Balanced Business Scorecard, which allows organisations to identify key drivers and develop targets and measures accordingly.Practical experiences
The companies that have been involved with testing the Sigma guidelines are delighted with the results so far. Not only have they helped drive forward their sustainability strategies, but the network of information-sharing between the participants has also been invaluable, they say.
Chris Spray, the environment director at Northumbrian Water, says that although his company has been reporting on environmental issues since 1994, the plethora of standards that have sprung up since has made management very complicated.
"What Sigma offered us was an umbrella under which we could devise one management plan," he says. "It allowed the company to realise the interconnectivity of the business units and how that impacted on risk and future liability."
Vauxhall Motors is another convert. It has been reporting on environmental impacts since 1997 and using the Global Reporting Initiative guidelines since 1999, but it was interested in using the Sigma guidelines to develop its social policy.The results, says Cheryl Foreman, the company's corporate responsibility manager, have been encouraging. "The social policy assessment has been helpful in highlighting Vauxhall's strengths and the areas that need further development," she says. "It has helped our understanding of how social issues and core business activities are interrelated."
High-street retailer Boots took part in the pilot in order to develop a more co-ordinated approach to sustainability, and to identify the risks and opportunities it offered. Ultimately, the company wanted to incorporate sustainable development into its core operations. Using the Sigma guidelines, Boots is developing commercial value criteria and indicators to help achieve this objective. Andrew Jenkins, the company's advisor on packaging and environmental compliance, says that companies seeking to use Sigma must look at the available case studies, to put its use into a practical context. "You couldn't read the guidelines and implement them overnight," he says. "They require visualisation of how other companies are using them."What next? A
lthough the project is officially over, the Sigma team is looking for more DTI funding to keep the business network going. The companies will set the network's agenda, but the team may look to develop the guidelines further to cover areas such as supply chain management, product design, decision-making, engaging personnel to further develop and refine the guidelines, and to try and make them more attractive to SMEs.
The aim of the Sigma team is to get as many companies to use the guidelines as possible. Already there have been international enquiries as well as some in the UK. The message from the Sigma project team is: What are you waiting for? Get onto the website and use the free toolkits.
As Sigma's project director Rosalind Oakley says: "SIGMA fosters an approach that is fundamental to an organisation's way of thinking, not merely playing lip service to increasing political and public demands for greater accountability."