What: A systematic way of analysing the value of sustainability investments.

Why is it important: We too often see sustainability measures as a cost and therefore something that can be cut back in tough times. A new tool offers the possibility of measuring the return on sustainability investments.

Too many companies (and CFOs) see sustainability as a cost rather than as a source of value. The authors have developed the Return on Sustainability Investment (ROSI) analytic tool to measure the financial returns on sustainability activities. Companies should:

1. Identify their current sustainability strategies,
2. Identify related changes in operational or management practices,
3. Determine the resulting benefits,
4. Quantify the benefits, and
5. Calculate the monetary value.

The savings and growth thus revealed can reach hundreds of millions of dollars, according to the authors. At present when budgets are under examination, this tool can help companies improve finances through sustainability investments that create value.

 How to talk to your CFO about sustainability

Related items:

• Sustainability series #1: the cost of being good
• Sustainability series #2: The Higg Index