Ethics and social responsibility
Impact valuation, impact assessment, corporate sustainability performance, Sustainable Business Value, SBV model
How can a company commit to maximizing stakeholder value while maintaining financial performance? Companies increasingly have the ambition to provide stakeholder value to their owners and shareholders, employees, consumers, suppliers, partners, the environment, and future generations. However, such companies often face difficulties in demonstrating the value they bring to stakeholders, due to the lack of universal methods for assessing their impact. Besides the practical need to develop a method for impact valuation, we researched the existing literature and discovered the lack of a holistic method to evaluate all impacts of a company using a common currency with flexible adaptations at different levels. We developed a new method called Sustainable Business Value (SBV) to address these gaps and enable companies to evaluate their impacts. We tested the SBV in two pilots. The SBV method differs from currently used methods, including sustainability reporting, sustainability rating and indices, and sustainability accounting. SBV can be used for decision-making, portfolio management, benchmarking, stakeholder communication, investor communication, and business development and also provides a comprehensive perspective of a company’s impact across six standardized dimensions. However, further development and standardization of proxies and cross-industry standards are needed.