Building an ESG KPI dashboard

What is an ESG KPI dashboard?

It is a summary of a few key sustainability metrics, each with its target, trend and status, designed for regular review. It is not the full set of reported metrics: those sit in the sustainability statement. The dashboard picks out the measures that show whether the company's strategy and targets are working, in the way a finance dashboard picks out revenue, margin and cash. See ESG KPIs explained.

Which KPIs should an ESG KPI dashboard include?

• One or two KPIs for each material topic in the materiality assessment, so the dashboard reflects what matters to the business and its stakeholders.
• Every KPI with a published target, including those linked to executive pay or sustainability-linked loans.
• A mix of lagging measures, such as emissions or injuries, and leading ones, such as energy projects completed or safety training delivered.
• Usually between six and twelve KPIs: enough to cover the topics, few enough to read.

See running a double materiality assessment and ESG targets and net zero.

An ESG KPI dashboard in practice: a manufacturer's board page

A manufacturer reports seven KPIs to its board each quarter. A KPI is on track if it is at or better than the glide path to its target, at risk if it is within 10% of the path, and off track otherwise.

Emissions, waste diversion and voluntary turnover are on track. The renewable energy share is at risk until a second power purchase agreement starts next year, and the women in senior management figure depends on promotions planned for the spring. Water in stressed areas and the injury rate are off track, so the board asks for recovery plans, and the dashboard links to them. Each figure comes from the same data as the annual report; see energy consumption and mix, water and waste metrics and workforce metrics.

How should the dashboard be designed?

• Show each KPI's value, target, prior year and a small trend line, with units and the period covered.
• Use status labels or icons as well as colour, so the page works in print and for colour-blind readers.
• Show absolute and intensity measures separately, and say which one the target uses; see GHG emissions intensity.
• Mark estimated or restated figures, and give a definition for each KPI one click or one footnote away.

Where does the data come from?

From the same group data collection that feeds the sustainability statement, through a simple data model: one table of KPI definitions and targets, one of actual results by site and period, and calculated totals, intensities and status. The dashboard should refresh when new data is approved, not when someone updates a slide, and every figure should trace back to its source. See collecting ESG data across a group.

Who uses an ESG KPI dashboard?

The board or its sustainability committee, usually quarterly; management, monthly, often with more detail by site; remuneration committees, for ESG-linked pay; lenders, for KPIs in sustainability-linked loans; and investors, through a public KPI table in the annual report or on the website. Versions for each audience should draw on the same numbers. See ESG-linked executive pay and sustainability-linked loans.

What mistakes should be avoided?

Too many KPIs, measures chosen because they look good rather than because they matter, definitions that differ from the published report, KPIs with no target, and quietly dropping a KPI when it goes off track. Each makes the dashboard less useful to the board and, once published, can become a greenwashing risk. See greenwashing risk.

This guide is general information. It is not tax or legal advice for your situation.