Sustainability Certifications

Ever since the late 1980s and 90s with the growing awareness from the public of the immense negative impact that companies could have on the environment, discourse has shifted from focusing solely on the financial performance and profitability of the business to a new accounting approach dubbed the ‘triple bottom line’. This business concept espouses the adoption of three main impact measurements that companies should take into account when making business decisions. The three performance metrics are: social, environmental and financial, or in other words the three Ps of People, Planet and Profit.

As such, a myriad of certifications, assessments, ecolabels and other indicators have popped up over the last few years to help answer the question: is this product/business good for the environment? Unfortunately, this isn’t an easy question to answer by any means, as a multitude of dimensions and variables can come into play, and making sense of all of them is an arduous and complex undertaking. This explains the existence of many indicators and certifications specializing in sub-aspects of sustainability such as energy efficiency/use of renewables (Green-e), carbon neutrality (Carbon Trust), ethical practices (FairTrade) and green building design (LEED).

The principal objective of sustainability indicators is to inform decision making as part of sustainable business practices, providing information on the interplay between economic and socio-environmental activities. Building strategic indicator sets generally deals with just a few simple questions: what is happening? (descriptive indicators), does it matter and are we reaching targets? (performance indicators), are we improving? (efficiency indicators), are measures working? (policy effectiveness indicators), and are we generally better off? (total welfare indicators).

In order to organize the chaos and disorder in selecting the metrics, specific organizations have been set up to group the metrics under different categories and define proper methodology to implement them for measurement. They provide modeling techniques and indexes to compare the measurement and have methods to convert the scientific measurement results into easy to understand terms. (For more on this subject, check out last week’s article on EcoVadis)

It is becoming more and more important for companies to obtain and adhere to sustainability certifications and ecolabels, as those are becoming the norm in the marketplace. Consumers nowadays are more and more demanding when choosing which products to purchase, and companies need to adapt to the changing demands of the market or risk being left behind in this new era of eco-awareness, the new “Green Wave”.


  1. Market Coverage of Voluntary Sustainability Standards
  2. The Triple Bottom Line
  3. Indicators and a Monitoring Framework for the Sustainable Development Goals
  4. Ecolabel Index, the global directory of ecolabels
  5. Advantages and Disadvantages of Ecolabels

Leave a Reply