Select assessment tools for environmental and social impacts - ADVANCED

Cost
LOW
Cost
MEDIUM
Cost
HIGH
EFFORT
low
EFFORT
medium
EFFORT
HIGH
IMPACT
low
IMPACT
MEDIUM
IMPACT
HIGH

Together with financial information, non-financial metrics should be part of the decision making process to understand the relationship between accounting and environmental issues. Based on a detailed understanding of the processes at a fine granularity (from solution above "Screen the impacts on the entire value chain"), the following tools are methods for assessing the externalities that sustainability accounting is expected to integrate:

Life Cycle Assessment (LCA) - measures the environmental impact of a product or service from start to finish, covering all stages of a life cycle. Carbon footprint could be an example. The Life Cycle Initiative provides insight into LCA assessment tools and methodologies. The principles and framework for LCA are described in ISO 14040 and the requirements themselves are set out in ISO 14044.

Social Return on Investment (SRoI) - to assess the range of impacts of an investment. It differs from other methods in that it allows the societal value of an investment to be calculated beyond the financial return. It helps to identify the different types of social, environmental and economic outcomes that an activity has. Example: NGOs and non-profit organisations use SRoI to effectively measure their activities and their impact on creating value in society.

Internal carbon pricing - an internal carbon pricing system identifies the process in which emissions are produced and puts an internal shadow price on them. You can browse our website on carbon footprint management.

Living wage - When outsourcing to a low-income country, a living wage should be incorporated to reflect the real cost of the product. It is a standardised cost that includes the actual cost of labour paid in the foreign country, increased by a wage differential based on the domestic market. More details on the Living Wage Accounting Model (Shift, 2023).

126th / 142 countries

is Singapore's rank in terms of carbon emissions per $GDP
(NCCS)

over 80%

of the world's wastewater is discharged untreated into biodiversity-rich freshwater and into coastal ecosystems
(World Economic Forum)