Development of indicators for the social dimension of sustainability in a U.S. business context

Hutchins, Margot J.; Richter, Justin S.; Henry, Marisa L.; Sutherland, John W.

Development of indicators for the social dimension of sustainability in a U.S. business context

2019

Hutchins, Margot J. | Richter, Justin S. | Henry, Marisa L. | Sutherland, John W.

Businesses are being increasingly scrutinized regarding their social impacts. In order for businesses to make decisions that support all three pillars of sustainability, i.e., the social, environmental, and economic dimensions, tools and methods are needed that link their decisions to sustainability impacts – including societal effects. However, before such methods can be established, measures of social sustainability are needed. Based on Maslow's hierarchy of individual needs, a novel framework for social indicators has been developed by evaluating the needs of social entities with which a company interacts, e.g., employees and customers. A group of sustainability experts was surveyed using an iterative Delphi technique to converge on a suite of social sustainability indicators that should be addressed by a U.S. business. Statistical methods (i.e., Friedman test and t-distribution comparisons) were used to identify the “best fit” social indicators for the various entities with which businesses interact. The resulting indicators can be used to evaluate social performance for a business enterprise. As examples, some indicators identified for the employee social group include the percentage of employees below the cost-of-living adjusted poverty line and the percentage of employees that believe their contribution to a company is valued.

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