thèse professionnelle sur les indicateurs de performance rse et le management de projet

SKEMA BUSINESS SCHOOL

MASTER OF SCIENCE IN PROJECT AND PROGRAMME MANAGEMENT &BUSINESS DEVELOPMENT

LAST NAME: Delepierre GIVEN NAME: Chris NATIONALITY: French TUTOR: Philippe Vaesken SPONSORING ORGANIZATION: Réseau Alliances – World Forum Lille WORD COUNT : 22630 PAGE COUNT : 78

TITLE: SUSTAINABLE PROJECT MANAGEMENT: THE SUSTAINABLE KEY PERFORMANCE INDICATORS

Keywords: Project management, Sustainability, KPI (Key Perforamnce Indicator), CSR (Corporate Social Responsibility), Integrated Reporting, CSV (Creating Shared Value), “Triple Bottom Line” accounting, SROI (Social Return Of Investment), sustainability index, universal accounting, ESG evaluation (Environment, Social and Governance) « I certify that this work is personal, quote all the sources used and does not contain plagiarism » Chris DELEPIERRE

Chris DELEPIERRE 2012-‐2013 MSc PPMBD – Centrale/Iteem Professional Thesis Research

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I. TABLE OF CONTENT I. Table of content ................................................................................................................... 2 II. Introduction ........................................................................................................................ 4

A. Title of the thesis ............................................................................................................ 4 B. Problem ........................................................................................................................... 4

1. Choice of this topic ..................................................................................................... 4 2. Sub-questions .............................................................................................................. 5

C. Scope of the thesis .......................................................................................................... 6

1. Level of study .............................................................................................................. 6 2. 2 ways of thinking ....................................................................................................... 6 3. According the type of project ...................................................................................... 7 4. According the project life cycle .................................................................................. 9

D. Structure of the thesis: the main parts .......................................................................... 11

III. Contextualization and Stakes .......................................................................................... 11

A. Sustainable Development, Triple Bottom Line, CSR and CSV ................................... 11 B. Sustainability in projects .............................................................................................. 13

1. Some reminders about project management ............................................................. 13 2. Reasons for sustainable project management ............................................................ 13 3. The position of project management ......................................................................... 14 4. Two approaches of sustainable project management ................................................ 15 5. Sustainability monitoring and controlling ................................................................. 17

C. Stakeholders consideration ........................................................................................... 17

1. Definition .................................................................................................................. 17 2. Stakeholder theory ..................................................................................................... 19 3. Process of stakeholders classification ....................................................................... 20 4. Dynamic analysis tool: theory of stakeholder identification and Salience (Mitchell, Agle and Wood – 1997) ................................................................................................... 21 5. Examples of stakeholders .......................................................................................... 22 6. Stakeholders pressure ................................................................................................ 23 7. Recommendations, rules and responsibility .............................................................. 24

IV. New indicators, New reporting ....................................................................................... 25

A. Classical project reporting and KPI .............................................................................. 25

1. Definition .................................................................................................................. 25 2. Indicators establishment ............................................................................................ 27 3. The indicators necessity ............................................................................................ 29


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4. Efficiency (“efficience”) and Effectiveness (“efficacité”) ........................................ 30 5. Monitoring and controlling process .......................................................................... 31 6. Regular project monitoring ....................................................................................... 32

B. Sustainability KPI and Reporting ................................................................................. 35

1. New indicators necessity ........................................................................................... 35 2. Sustainable KPI ......................................................................................................... 42 3. Sustainable reporting ................................................................................................. 46 4. The Balanced Scored Card ........................................................................................ 50 5. Notes about the difficulties of these new KPI ........................................................... 53

C. Standards and Methodologies ....................................................................................... 53

1. The GRI: Global Reporting Initiative ....................................................................... 53 2. ISO 26000 ................................................................................................................. 56 3. Other guideline or standards ...................................................................................... 58 4. Best in class approach ............................................................................................... 58 5. CSR Best Practice framework from Réseau Alliances ............................................. 58 6. Conclusion ................................................................................................................. 59

D. Feedbacks from the field .............................................................................................. 59

1. Interviews .................................................................................................................. 59 2. Case studies ............................................................................................................... 67

E. CSR KPI Modeling ....................................................................................................... 71

1. Some sustainable project KPI .................................................................................... 71 2. Methodological advice .............................................................................................. 72 3. Composite indicator .................................................................................................. 72 4. The form of the reporting .......................................................................................... 73

V. Conclusion ........................................................................................................................ 75 VI. References ....................................................................................................................... 77


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II. INTRODUCTION

A. TITLE OF THE THESIS The thesis will focus on CSR performance indicators and project management:

Sustainable Project Management: The sustainable key performance indicators

This thesis will deal with the Corporate Social Responsibility (CSR), Key Performance Indicators (KPI) and the project management as part of the MSc. Project & Program Management and Business Development in SKEMA Business School.

B. PROBLEM In the project management circumstance, what is the methodology to use so as to integrate sustainability in measuring of the project performance?

1. Choice of this topic The professional thesis in the MSc. PPMBD must cover three main aspects: the subject must be related to project management and business development, be linked with the professional world, especially with an issue from the organization I am currently working for: Réseau Alliances and be in a relevant academic research field My professional project This professional thesis is a real opportunity for me to think about a project that I hold dear and I want to go into depth. I am absolutely persuaded that the concept of sustainability becomes more and more important in the project management field. Project managers need new tools to evaluate Return of Investment of projects in terms of sustainability. As project manager or entrepreneur, I will define the suitable key sustainability criteria for my projects and this work will give me some clues to progress. Réseau Alliances and World Forum Lille The objective of this association is to assist companies so that they improve performance while better respecting people and the environment. The question asked by the organization is: which relevant measures should we ask to companies in order to have a global view of their CSR (Corporate Social Responsibility) approach? Thus, it will be very useful for my organization to have a method to define the suitable indicators for the evaluation of sustainability in projects and companies. Furthermore, Réseau Alliances organizes each year the World Forum Lille: a standard-setting forum for responsible economy. The objective is to make responsible economy real by promoting best practices of companies that, all over the world, perform their activities responsibly and thus make examples replicable. The topic of the 2012 edition was “Responsible companies, profitable companies”: Project managers need to be fiscally sustainable. They manage time and budget as well as socially and environmentally sustainable, they manage resources. The think tank entitled "World Forum Lille Institute” has already worked about CSR indicators: it has highlighted that this topic is a burning issue.


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Expert in the domain of CSR, this organization will help me to find some people to interview, thanks to its large network of companies and experts. Link with Sustainable Project Management course We had a course with Mr. Vaesken as teacher in MSc. PPMBD about: ‘How to integrate sustainability into project management in order to save cost and get a higher customer satisfaction, get sustainable benefits and a longer term value for the customer.’ « The last part of the course was focused on monitoring and assessment in project management and sustainability. This part presents the different way of monitoring sustainability in project management and different assessment guidelines: Indicators, GRI, … » I want to deepen our understanding and increase our knowledge about these questions. Sustainability is a burning issue for nowadays companies Let's make no mistake about the question. Rather than get lost in discussions about whether or not sustainability creates value, it is probably more relevant and effective to reflect on the conditions for successful integration of sustainable development within the company. In France, the legal context following the Grenelle of the Environment is increasingly in favour of CSR reporting companies. Since January 1, 2003, quoted companies on the stock exchange under French law must publish in their annual report a number of information on "how they take into account the social and environmental consequences of their activities." This requirement was introduced by section 116 of the New Economic Regulations Act of 15 May 2001 and specified by a decree of 20 February 2002 on the nature of social and environmental indicators. The scope of this law was expanded under the Grenelle 2 law (article 225): it is primarily intended (for 2011) that the requirement applies (to verify their non-financial information) to any company with more than 500 employees, it is quoted companies on the stock exchange or not. For its part, the European Commission is part of a recommendation process that would force companies to publish reports of Sustainable Development. In addition, pressure from stakeholders about more transparency on the part of businesses, including access to quantitative data, is stronger. The objective of sustainable development is to "meet the needs of the present without compromising the ability of future generations to meet their own needs." Organizations of all kinds as companies have an important role to play in achieving this goal. The urgency and magnitude of the risks and threats for our society, alongside increasing choices and opportunities, will make transparency on economic, environmental and social impacts. Transparency is a key element in effective stakeholder relations, communication, reporting, and investment decisions. The definition and implementation of sustainability indicators within the projects in companies is an opportunity to measure progress towards sustainable development.

2. Sub-questions


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We study the problem with the angle of a methodology for establishing conventional indicators incorporating the specificity of CSR indicators. First off, we will study first the academic literature and then the empirical information from the reality on the ground. The study is based on studies and research organizations as well as experts on specific cases of companies (testimonies, reports, best practices). Some sub-problems can be:

• How to measure the immaterial benefits of projects (a new definition of value)? • Is there a method that would define the suitable indicators according the project? • Does it exist some tools to assess project sustainability performance?

C. SCOPE OF THE THESIS

1. Level of study We will work on the project level, trying to loosen up the corporate level. This is critical point because most of the studies on the topic relate to the strategic level of the organization, not on the project level. So we will try to implement the Sustainability KPIs from the strategic level to the project level.

2. 2 ways of thinking We will discuss about sustainable project management (the inclusion of sustainability in the way to manage projects) ant not about management of sustainable projects (sustainability-oriented projects). Thus, we will be concerned about the project performance in the pipeline (Quality, Time, Cost) in terms of sustainability (Triple Bottom Line) and not about the direct or indirect impacts of project that is to say the performance of the deliverable or the product once the project is finished.

≠ Source: Sustainability and Project Management course part 3 in MSc. PPMBD -‐ Skema Business School – Philippe Vaesken, 2012 For instance, how to integrate Sustainability in the way to manage the project?


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Example: to avoid CO2 emission in a classical project, to take account the wishes of stakeholders. The thesis will focus on indicators of achievement or performance. They are used to measure the effort made. They are related to the'' efficiency and resources committed to the result actually achieved.

3. According the type of project We can distinguish three types of projects according to the degree of innovation, the sponsor and the result. Our approach of the problem will be different depending on the level of the project in these three dimensions. Here, we will define each type and determine the consequences in our study on sustainability indicators in the project management.

a) Degree of innovation

Although the degree of innovation is a continuous variable, we can roughly distinguish.

(1) Closed projects The expected outcome is known at the beginning of the project, it leaves little room for creativity. Example: an application database for a client online banking. Features: Forecasts are (should be) reliable. If management is strict, the course does not suffer from major hazards. è Indicators are easily upstream defined in the project management. Project team should be strict in the measure; the data will be reliable.

(2) Opened project The results of the project are defined very late. Choices are almost endless. Example: a game software for seniors Features: Critical Importance of exploration phases; functional approach required; Implementation techniques of creativity and important multidimensional risk. è Need to constantly redefine the indicators based on the criteria to measure.


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b) Result

We call deliverables, the outcome of the project. The result of the project is called work in the building trades and public works. More and more, the result of the project is a set of deliverables including hardware and intangible elements (software, procedures). This is called system (organizational, IT). A third group consists of projects to create series products. The result of these projects is the system (machines, materials, procedures, means of control,...) that will deliver the products in question. The project is completed when the production system is able to produce in quantity and quality.

(1) Work (or system) The project leads to a unique achievement, one-time project to develop a specific deliverable. Examples: The construction of a building, a highway, a factory. The realization of a special machine, a computer network. Features: The control of these projects is limited to the use of conventional tools of project management. We talk about projects controlled cost. è On a construction project, the performance indicators for sustainable construction and non-construction itself will be identified.

(2) Product development -‐ Market driven The result of the project is a system which itself produces objects in series. Examples: Airbus A380 project, a new CAD software Features: For the sponsor, the economic objective is long-term profitability rather strict budget control. We are dealing with projects profitability controlled. The project is often an innovative project. Marketing and sales aspects are paramount. The intellectual property concerns, design and ergonomics are often present.

• R&D projects to develop solutions in response to a market need • Self funded – payback through sales (new clients/existing clients) • Significant part of activity in projects (multi-project environment) • Critical Issues: Reduce development time, capacity planning & risk management

è For example, we can consider the overall energy consumption in the implementation of the project.

(3) Organizational project The project is a set of deliverables including hardware and intangible elements: software, procedures Examples: Organization of the London Olympics, corporate reorganization, standardization ... è Project team will ensure that the suppliers of the project comply with social and environmental requirements in a responsible purchasing policy.


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c) Sponsor

Originally the project process is the realization of a real or perceived need. In business or external projects, the trigger is the formulation of a need by call for tenders from a customer or prospect. Internal projects have originated in the desire to solve a problem or will progress in a specific area.

(1) Internal project The company carries out the project for its own account. Example: The entrepreneur has decided to implement a system of quality management. Features: Frequent absence of cost control and difficulty of mobilizing internal resources. è Easy to measure because internal stakeholders project team should be mobilized.

(2) External projects (or business) -‐ contract driven The project is carried out on behalf of a third party. Example: An independent engineering firm designs and manufactures a special machine. Features:

• In response to defined requirement; clear objectives • Clear definition of Customer/Supplier roles • Short term financing, direct payback from client • Multiple stakeholders: Owner, Consultant, Contractors, sub contractors • Critical Issues: Schedule adherence; Contract & Claim Management, Acceptance &

payment milestones è Difficulties to define the scope when signing the contract and to obtain adequate measures. Of sustainability criteria are incorporated into the contract. Increasingly, there are social and environmental criteria in tender

4. According the project life cycle You have to take account the 3 different life cycles:


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A relevant question could be: where do you introduce sustainability in the project? In the process? In the whole business? In the product? In the Project trajectory (PMI)? The subject of this thesis is about the methodology for the implementation of CSR indicators in sustainable project management. That’s why we will focus on project stages especially initial stage. In the life cycle of project, it should be noted that the majority of impacts are identified in the initial stages when the project is set (Pre-feasibility and feasibility phases). Indicators of sustainable performance must be determined very early in the project process. For example, majority of environmental impacts are determined in the early design phase:

Source: Sustainability and Project Management course part 3 in MSc. PPMBD -‐ Skema Business School – Philippe Vaesken, 2012 In the PMI methodology, we therefore focus on process groups or domains: Initiating, Planning and Monitoring and control. PMI process is set of interrelated actions and activities performed to achieve a pre-specified product, result or service. Project management process aims to ensure the efficient flow of the project throughout its existence include the tools and techniques involved in the application of skills and abilities described in the areas of knowledge related to the scope of the project. Product oriented process specify and create product produced the project and generally defined by the project life cycle and vary depending on the application are related to the scope of the product. These overall performance indicators are strongly related to various internal and external stakeholders and should hence evolved in relation to different phases of the project concerned. It is good to know that over the project progresses, the cost of changes increases. Sustainability should be introduced at the early stages of the project.


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Source: Risk Management course in MSc. PPMBD -‐ Skema Business School – Alex Barnes, 2012

D. STRUCTURE OF THE THESIS: THE MAIN PARTS

1) Contextualization and Stakes a. Sustainability in projects b. Taking into account all stakeholders c. Opening the scope of projects d. New indicators, new reporting

2) Theoretical and Practical approaches

a. Standard methodologies b. Feedbacks from the ground

3) Some solutions and recommendations

4) Conclusion and opening

III. CONTEXTUALIZATION AND STAKES

A. SUSTAINABLE DEVELOPMENT, TRIPLE BOTTOM LINE, CSR AND CSV The company is evolving from an ownership policy to a partnership strategy. In addition, their strategy goes from a short-term vision, purely economic, to a long-term vision integrating economic, social and environmental issues. Thus, a manager who integrates sustainable development in its strategy is not only committed to ensure the profitability of its business but also to minimize the impacts of its activities on the environment and to take into account the interests of its stakeholders. “The term CSR is a brilliant one; it means something, but not always the same thing, to everybody.” (Votaw, 1973)


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To have a CSR strategy is for the company is a strategic way to reduce risk exposure (including environmental and social). It is also a way for the company to differentiate itself from its competitors and gain market share. Indeed, some consumers are willing to pay more for a product, which respects some values. CSR seeks ultimately to promote morality in business, to consider the existence of a number of business partners and allows the company to argue either for purely financial framework but within a framework overall. It is therefore to measure the overall performance of the company and not just its economic performance. John Elkington developed the notion of Triple bottom line in 1999; it helps to understand how the overall performance is measured.

It is to implement a comprehensive policy combining economic (profit), social dimensions (people), and environmental (planet).

• Intersection between economic and environmental dimensions = viable; here, the approach the company aims to control costs and save resources, for example, to develop eco-design and industrial ecology or recycling waste.

• Intersection between the economic and social dimensions = equitable; to combine economic efficiency and social equity is to promote equal opportunities, encourage training and promotion of staff, denied any form of discrimination or introduce expression groups or an employee shareholding system.

• Intersection between the environmental and social dimensions = bearable; this translates to business for example through participation in local life, local hiring or consulting residents.

The TBL approach is certainly a promising way to integrate external financial reporting. For this, the use of indicators is needed. We have to look for prosperity rather than wealth. The question of the time scale to take into account is essential: do we want quick or long-term return on investment? Mark Kramer is the co-author of the article in the Harvard Business Review, Creating shared value (CSV): Redefining Capitalism and the Role of the Corporation in Society, with Michael Porter, published in early 2011 in the Harvard Business Review. "Value creation is an idea that has long been recognized in business, where profit is revenues earned from customers minus the costs incurred. However, businesses have rarely approached societal issues from a value perspective but have treated them as peripheral matters. This has obscured the connections between economic and social concerns.”


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They stressed the idea that "societal and corporate success are inextricably linked". They also stressed the importance of measuring the value created, going beyond simple reporting, and measuring the impact of actions. To be successful in the long term and to create value for its shareholders, the company must create value for society. CSV encourages businesses to create economic and social value simultaneously by focusing on the social issues. When an organization incorporates sustainability practices into its processes, it takes responsibility for the impact of its activities on customers, employees, shareholders, communities, and the environment through all aspects of operations. A sustainable focus recognizes the interdependence between companies and the broader society and encompasses the following aspects: - Human Rights: discrimination of vulnerable groups, civil rights, and fundamental rights and principles at work - Labour Practices: conditions of work, health and safety, and development and training - The Environment: sustainable resource use, pollution prevention, and climate change mitigation - Fair Operating Practices: anti-corruption, fair competition, and respect for property right - Consumer Issues: fair contractual practices, dispute resolution, and fair marketing - Community Involvement and Engagement: employee training and skills development, wealth and income creation, and community involvement The first responsibility of a project manager is to achieve the defined objectives but we must wonder how to do and especially what to do.

B. SUSTAINABILITY IN PROJECTS

1. Some reminders about project management Project management is the discipline of planning, organizing, securing, managing, leading, and controlling resources to achieve specific goals. According the Project Management Institute (PMI), « a project is a temporary endeavour undertaken in order to create a unique product, service or deliverable. » A project is a temporary endeavour with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverables), undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value. We can define five characteristics about project:

• Change: projects enable this • Temporary: projects ended when change achieved • Cross functional: multi-functional, people with different skills working together

impacting more than one area • Unique: projects will not be the same • Uncertainty: threats & opportunities

2. Reasons for sustainable project management The concept of sustainability will become more and more paramount in the project management field. Sustainable development is a main business objective, and sustainable management of project requires looking projects in a whole new way. For too long, project


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managers worked on their projects as if they were in an island, unrelated to the strategy organization and governance and unrelated to the community. Project managers must be fiscally sustainable: Project managers have to manage the three constraints - quality, time and budget as well as socially and environmentally sustainable, they manage resources. Notwithstanding, sustainability is not just being "green" and be aware of the impacts on the environment. Project managers also need to assess the risks associated with labour practices, human rights, fair trade business and consumer issues. The objective is to integrate sustainable development into project management practices; project manager can make a difference according to Jennifer Tharp, PMP, Global sustainability and Project management. For Kerry Griffiths, sustainability consultant, a framework for sustainability project management ensures that the project is able to incorporate environmentally friendly practices in the phases of design, construction and operation of the project. The framework considers the social and economic aspects of project performance and provides management with a tool to measure, manage and reward outstanding performance on the project.

Social, Environmental, Economic and Societal benefits & costs of projects must be taken account in the measure of project performance

3. The position of project management The temporary nature of projects may seem to contradict the long-term orientation of sustainability. However, projects help firms to realize long-term investment objectives. Projects and project management take place in an environment that is broader than that of the project itself. Understanding the framework in which the project takes place helps ensure that work is carried out in alignment with the goals of the enterprise and managed in accordance with the established practice methodologies of the organization. (PMI, PMBoK, 2008, p. 45)


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Sustainability: Strategic Context for Project Management

Responsibility for economic sustainability means moving beyond the simple ROI for the project and ensuring that it fits into the overall strategy of the firm. Project manager should ask: What are the organization main economic drivers? How will this initiative, once deployed, contribute to the long-term fiscal viability of the organization? Ensuring a project is socially sustainable involves reflecting on organizational culture, structure, and processes, existing human resource skills and personnel practices, both inside the firm and throughout the value chain. Reaching toward environmental sustainability requires a mature evaluation of capital equipment and facilities requirements, use of resources, purchasing practices, contract management, and industry standards. None of these are entirely new concepts. The PMBOK® Guide suggests doing an environmental analysis of factors around the projects to understand the business context (PMI, 2008, p. 44). Just as the project manager must understand the business benefits the project yields, he or she is also accountable for any long-term impacts of his or her projects.

As project managers, we focus on getting from an idea to an implemented project, getting to a steady state. We’re not focused on longer-term issues like what happens to the product as it’s being manufactured, used, and disposed of. Project managers need to take a broad view of their role and to evolve from “doing things right” to “doing the right things.” This implies taking responsibility for the project results, including the sustainability aspects of that result. The developed product or service does not go away once we hand it over. It has an impact on the world, a useful period of operation, and ultimate disposal. In his book, Green Project Management, David Shirley explains to the Project Manager to think green means to look of the projects processes if he can make them greener. The benefits are multiple: more efficiency, better resources management (example: energy savings), better team work, … According the author, there are three ways to integrate green in project management: in the product delivered, in the process and in the organization. Green project management is not a new discipline, which does not give more work to think green.

4. Two approaches of sustainable project management We can distinguish two different approaches concerning sustainable project management:


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-‐ A top-down approach: the Corporate Social Responsibility strategy of the organization determines the way to manage sustainably the projects.

-‐ A stakeholders approach: the project management bear in mind the expectations of stakeholders both internal and external, and determines the level of sustainability of the project thus determining its impacts on the organization (bottom-up) and its environment.

It implies to widen the scope of project management: sustainable project management should consider more stakeholders (internal and external as Society) and forecast the consequences and impacts of the project beyond the deliverable.

Source: Sustainability and Project Management course part 3 in MSc. PPMBD -‐ Skema Business School – Philippe Vaesken, 2012


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5. Sustainability monitoring and controlling Quality standards will be used in the development of a base line and as the basis for monitoring and controlling. Sustainability must be defined within the organizational quality standard. The management plan will establish thresholds for sustainability quality measurements to help in managing corrective and preventive changes for the project. Project communication management: Build sustainability and responsibilities into the communication plan; Give everyone something to manage and contribute to standards (ISO 14000, 26 000, GRI) can be used to help develop the reporting requirements along with roles and responsibility for monitoring and controlling the information flows. Project procurement management: Sustainability planning scope must not be compromised in procurement. The project manager and project management team must ensure proper management and oversight from beginning to end of the project life cycle. Project human resources management: The sustainability roles and responsibility for each project team member must be defined and tied to performance metrics used in the project community. Sustainability requirements must be developed in the human resource plans.

C. STAKEHOLDERS CONSIDERATION

1. Definition Each stakeholder brings into the project his or her world, culture, language, and history. The stakeholder must be comprehended ... but how? Let’s start, one more time, with the definition of stakeholder. According the PMBOK® Guide, 4th edition, « stakeholders are persons or organizations (e.g., customers, sponsors, the performing organization, or the public), who are actively involved in the project or whose interests may be positively or negatively affected by the performance or completion of the project. Stakeholders may also exert influence over the project, its deliverables, and the project team members. The project management team must identify both internal and external stakeholders in order to determine the project requirements and expectations of all parties involved. » In the 5th edition of PMBOK, there is an additional knowledge area: Project Stakeholders Management. The definition of stakeholders is very broad: « an individual, group or organization who may affect, be affected by, or perceive itself to be affected by a decision, activity or outcome of the project. »


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Source: Presentation PMI Nord about stakeholders -‐ Skema Business School – Philippe Vaesken, 2013 Stakeholders are actively involved in the project; their interests may be positively or negatively affected by the performance or completion of the project. Which verbs relate to stakeholders according to the PMBOK® Guide? It is a very useful exercise to search and count in the text the occurrence of the word stakeholder (176 times in the fourth edition!) and collect the verbs that are near or referring to the word stakeholder. It is a linguistic trick to help us to answer to the question: “What should we do with stakeholders?”,

§ Managing § Identifying § Defining their risk tolerance § Interviewing § Requirement gathering § Communication § Influencing § Reporting

That’s enough to teach us that the kind of comprehension the stakeholders need to receive is a complex one. This is already a very rich lesson we can obtain by taking words in our hands and playing with them, but there are also new lands to explore “beyond” the traditional approaches. The project management team must identify both internal and external stakeholders in order to determine the project requirements and expectations of all parties involved (asking questions, recording result, understanding needs). Furthermore, the project manager must manage the influence of the various stakeholders in relation to the project requirements to ensure a successful outcome. Here are the PMI process groups where you have to deal with stakeholders:

-‐ 3.3.2 Identify Stakeholders -‐ 3.4.2 Collect Requirements -‐ 3.4.13 Develop Human Resource Plan -‐ 3.4.14 Plan Communications


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-‐ 3.5.3 Acquire Project Team -‐ 3.5.4 Develop Project Team -‐ 3.5.5 Manage Project Team -‐ 3.5.6 Distribute Information -‐ 3.5.7 Manage Stakeholder Expectations

Project success is a subjective vision: success is in the eye of the beholder.

2. Stakeholder theory Stakeholder theory is a theory of organizational management and business ethics that addresses morals and values in managing an organization. R. Edward Freeman originally detailed it in the book Strategic Management: A Stakeholder Approach. It identifies and models the groups which are stakeholders of a corporation, and both describes and recommends methods by which management can give due regard to the interests of those groups. In short, it attempts to address the "Principle of Who or What Really Counts". The stakeholder theory of Freeman is primarily created to offer an alternative vision of what the purpose of a business, its reason to exist. When he writes, "the dominant ideology", led by personalities such as Milton Friedman, is that the purpose of the company is to raise the profit to redistribute to shareholders. Ed Freeman said it was a mistake. The profit is a result of the company's business, not its root cause. For him, the logic of Friedman shows that the company focuses only on shareholders and not to others impacted by the company's business, such as customers, employees or suppliers. Yet without them, it would go bankrupt. Freeman concludes that the purpose of the company is to meet the needs of stakeholders, that is to say all people affected by decisions taken by the company, which will then make a profit. Freeman's vision is revolutionary because it allows having a completely different outlook on the company. His vision also includes three crucial points to make a coherent system:

-‐ Freeman supports the "names and faces approach”: stakeholders are people with names and surnames. The company must agree to negotiate with them (and for that, identify relevant stakeholders representing different stakeholders issues).

-‐ Freeman is pragmatic. In philosophical terms, Freeman believes that one should not

have absolute principles of decision. The company must agree to ask each of its points of view, to truly reflect the needs of stakeholders. Of course, she will not give up all its principles, but at least it will put the issue of relevance.

-‐ Freeman believes that a deal is still possible. In case of conflict of interests between

stakeholders, the company should not choose one over the other, but seek a compromise, a third way that would satisfy both interests. Freeman argues that CSR and carries innovation because it allows imagining new ways.

If on paper, this theory seems interesting, it is viewed from the outside more often with suspicion and there are few examples in business having taken the plunge considering its stakeholders as strategic assets rather than simple rooms recording institutional communication. In reality, behind the stakeholder theory is the latent opposition of thinking


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that the economic vision is hardly compatible with the inclusion of an ethical dimension. Interest, as the main motivation of human behaviour is the fuel economic engine, could it be that ethics comes enrich or replace it? It is noted by Amartya Sen, Nobel economy price by showing that "the modern economy has recovered significantly impoverished by the distance that the economy away from ethics." When we oppose the shareholder vision from partnership vision, our economies are profoundly mistaken in assessing the wealth before getting poorer. The stakeholder’s theory applied to organizations looking to get out of this impasse than the paradox between strategic managements and ethics, between short and long term.

3. Process of stakeholders classification First, project manager should identify stakeholders: it identifies all people or organizations impacted by the project and documents relevant information about each stakeholder. Project Manager proceeds to a stakeholder analysis to identify both the stakeholders and their requirements. A stakeholder analysis is done through interviews, questionnaires, facilitated workshops. Relevant information deals with:

-‐ Stakeholder & Roles: a pre-defined list that project team has to update when necessary (for example once a supplier is awarded),

-‐ Category of stakeholders: to select the relevant category of stakeholders among a pre-defined list of four categories: Project Management Team, Project Team Member, Performing organization, external stakeholders; Project management can distinguish internal / external and primary / secondary stakeholders.

-‐ Project impact on stakeholders: to select how stakeholders are impacted by the project

among: positively impacted, negatively impacted, neutral,

-‐ Project / Organization-related authority: select the authority over the project of each stakeholder among a qualitative scale: high, medium, low

-‐ Involvement in the project: select the involvement over the project of each stakeholder

among a qualitative scale: high, medium, low.


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Source: Project Communications and Project Configuration in MSc. PPMBD -‐ Skema Business School – Mary McKinlay, 2012 In the stakeholder management plan, project manager can build a board by stakeholder to determine the associated documents, ‘When do they act ?’, the requirements, the objectives, the management plan, the access, ‘How often to contact them?’.

4. Dynamic analysis tool: theory of stakeholder identification and Salience (Mitchell, Agle and Wood – 1997)

This is a proposal to classify stakeholders in a process of consultation (early phase of planning process) based on three major attributes: power, legitimacy and urgency.

-‐ Power is the capacity to influence the project deliverables (coercive, financial or material, brand or image)

-‐ Legitimacy is the perception of desirability, properness or appropriateness -‐ Urgency is the requirements in terms of criticality & time sensitivity for the

stakeholder These three criteria (legitimacy, emergency, power) would analyse the influence or non-influence of stakeholders on the management of the organization and how these stakeholders are included: "Which really counts."


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The question is should we consider each stakeholder as the same level of importance or priority? Indeed, it is logical to consider definitive stakeholder as the most important stakeholder for the project and to give a medium priority for dominant, dangerous and dependent stakeholder. Nevertheless, project team should also consider dormant, discretionary and demanding stakeholder because these attributes can be gained or lost during the time period of the project.

5. Examples of stakeholders Here is a non-complete list:

-‐ Project team - Project manager - Project Management team - Other project team members

-‐ Sponsors -‐ Customer / Users -‐ Sellers / Business Partners - vendors -‐ Suppliers - contractors -‐ Functional managers - Operations management - Portfolio manager - Program

manager - PMO -‐ Employees -‐ Shareholders -‐ Government -‐ Environment -‐ Society - Local Communities -‐ Competitors -‐ Trade unions -‐ NGO

It is important to update throughout the project the inventory of stakeholders. Here is an example of stakeholder mapping for the organization of London Olympic Games project:


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Source: Project Communications and Project Configuration in MSc. PPMBD -‐ Skema Business Scool – Mary McKinlay, 2012

6. Stakeholders pressure Stakeholders can impact the project and business:

-‐ NGO denounce the bad behaviour thanks to campaigns -‐ Consumers differentiate their buying -‐ Trade union call out about new fields (environment, human rights by suppliers,

employee savings scheme -‐ Local authority become inescapable

Project manager should seek to understand the potential impact on them and on the project. Here is a table that shows the different requirements for each stakeholder according the TBL:

Stakeholders Economical Environmental Social

Shareholders Financial results Risk management, anticipation, transparency

Reputation and crisis management

Public authorities Contribution to the national and local wealth

Regulation respect Labour law respect

Bank Economical durability, working capital requirement

Management of financial impact of environmental risks

Labour cost limitation

Insurer Compensation amount

Risk management Work-accidents

Employees Social fairness, wages

Local environment respect

Motivation, internal consultation, training, employability


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Clients Warranty, quality Consumption of resources

Ethic, fair trade

Supplier Long term relationships

Specific specifications

Ethical demands

Sub-contractor Fair remuneration, development perspectives

Environmental demands on process and product

Audit, control, social demands, working condition

Retailer Cost and margin control

Decrease of packaging and transport

Development of ethical products

Competitors Benchmark Respect of production rules

Respect of competition law, no social dumping

Local authorities Economical durability

Engagement in impact decrease

Taking into account local needs, actor employment area

NGO Corruption, bribery Engagement in impact decrease

Human rights, transparency

7. Recommendations, rules and responsibility All stakeholders, including external should be taken into account in the project and therefore in its reporting. The questions are: which associated indicators (scope, definition, choice)? Which methodology to put in place? A recommendation is to integrate external stakeholders in the project and the reporting as soon as possible. We need to make internal, external stakeholders, give them responsibility and integrate them into the project governance. Indicators must adapt according to the expectations of each party involved previously defined. Stakeholders are in demand of different and specific indicators. A wide range of communication channels are used to communicate some "customized" information to stakeholders: product information to customers, information on the risks and potential financial impact to investors, information on the environmental performance of a given industrial site for a waterfront, etc. It is called the reporting 360° of the sustainable development performance of a project. Rules in projects help to regulate and manage stakeholders’ behaviours and actions and to pursue goal accomplishment and project success. But rules may also support stakeholders in acting out on responsibility (respons-ability: ability to respond) because they give guidance to choices and allow actions to be effective. Could you imagine how useless any decision, thought, or initiative would be in a context without clear rules? Nothing would relate to cause and effect, no condition would be evaluable, and, in the end, no “answer” would be possible. It is then clear that rules are necessary for responsibility, but to allow responsibility to be fully exercised, comprehension is needed as the main requirement: promoting and enhancing awareness and understanding of all possible actions, comprehension really makes the practice of being “respons-ible” fully applicable. In this sense, comprehension brings freedom in projects, beyond rules and roles.


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Organizations around the world, and their stakeholders are increasingly aware of the need and benefits of socially responsible behaviour. The aim of corporate social responsibility is to contribute to sustainable development. The performance of an organization in relation to the society in which it operates and its impact on the environment has become an essential part of measuring its overall performance and its ability to continue to operate effectively. This is in part a reflection of the growing recognition of the need to ensure the health of ecosystems, social equity and good organizational governance. In the long term, the activities of all organizations depend on the health of the planet's ecosystems. Organizations and projects are subject to further their stakeholders review.

IV. NEW INDICATORS, NEW REPORTING

A. CLASSICAL PROJECT REPORTING AND KPI Project manager needs to take a good, long look at the numbers and indicators with proves.

1. Definition

a) Indicator An indicator is an assessment tool and a decision support (management, monitoring, controlling) thanks to we will be able to measure a situation or trend relatively objectively, at a given time, or in time and / or space. An indicator is an instrument linked to an outcome measure and an evaluative question. It is the measure of:

-‐ A goal -‐ A mobilized resource -‐ An achievement -‐ An effect

Evaluative question affects the establishment of criteria determining the different indicators to compare with the objective to monitor. As an example of an evaluative question: to what extent is the temperature considered satisfactory? The goal may be 19°C, the criterion is the temperature level and the indicator provides a measure of 22 °C. An indicator is a descriptor, a measure to quantify or qualify a state, an effect or a margin of progress, information about the achievement of a goal or a tool for monitoring and identifying changes. An indicator is a simplified representation of a complex reality. Indicators for monitoring and updating the initial state in the form of a dashboard (the repository) are related to effectiveness.


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Indicators of achievement or performance are used to measure the effort made and its consequences. They are related to efficiency. We can distinguish different levels of indicators

-‐ Context indicators -‐ Performance indicators (focus on execution) -‐ Monitoring indicators (according a repository)

Source: Course of construction of relevant indicators by Philippe Vaesken

b) Performance In the task execution, performance in the field of management, describes the end result produced by the company overall effort or project team. As part of an evaluation process, the performance analysis verifies that the organization achieves in an effective and relevant way (the good things), efficiently (quickly, at the right time, at the lowest cost) to produce the expected results and ultimately the needs and expectations of the customers or the organization.

c) KPI: Key Performance Indicator A performance indicator or key performance indicator (KPI) is a type of performance measurement. KPI’s are measurements used by a business to optimize and drive its performance. It is a selected indicator considered as key for monitoring the performance of the project. KPIs are commonly used by an organization to evaluate its success or the success of a particular activity as project. Accordingly, choosing the right KPIs is reliant upon having a good understanding of what is important to the organization. 'What is important' often depends on the department measuring the performance. That is why; project manager should make a study before choosing the KPI for the project according the stakeholders requirements.

d) CSF: Critical Success Factor Critical Success Factors (CSF) is what must exist or be created for a project to be successful. We can say that KPI set of values used to measure progress towards satisfying Critical Success Factors. For example, for a holiday project, "good weather" can be a CSF and "Hours of sunshine" the KPI.


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2. Indicators establishment To measure performance, project team should avoid impersonal indicators (related to a search for completeness and standardization) such as indicators batteries or standard indicators.

a) Be SMART An indicator has to be SMART. The letters SMART broadly conform to the words Significant Measurable, Acceptable, with a Responsible and Temporal.

• Significant: relevant to the subject-scale, proximity, correlation, purpose for the business

• Measurable: qualitative or quantitative rather questionable • Acceptable: by the stakeholders


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• With a Responsible: often the people responsible for the process • Temporal: continuous, repeatable over time, the value or outcomes are shown for a

predefined and relevant period. You can add these criteria:

-‐ Shared: understandable and easily explicable -‐ Easy to build and operate

Some other characteristics can be applied for choosing the right KPI: timely, have the capacity to test direction, sensitive, specific, valid, reliable, unambiguous, accurate, available, cost-effective, feasible.

b) Indicator description To build an indicator, it is necessary to define its description by identifying: The process information mode:

-‐ The scale (what) -‐ The frequency (when) -‐ The information holder (where)

The construction of information mode:

-‐ Media (picture, map, graph,...) -‐ Structures comparison (view changes)

The collection of information:

-‐ The process -‐ The cost -‐ Admissibility

The accountability: Who / where / what? Project indicators must be defined in the dictionary project. For example, we must explain exactly what is the '% of completion of the project' and the calculation rule: clear and common definition throughout the project. Similarly, we can define the ‘order of magnitude’: how far are we accurate about the numbers? (Tolerance interval)

c) Indicator formatting Indicators sheet:

-‐ The name -‐ The function (specify the object, what it is) -‐ The construction method -‐ The modes of interpretation (how it reads) -‐ Related indicators

Building media:

-‐ The dashboard / repository -‐ The computer tool collection of data -‐ The computer system management and operation


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d) Data collection Data gathered must be: timely, cost, effective, reliable, unambiguous, accurate, sufficiently sensitive, and motivational. It is important to standardize the data collection, for instance, in a table grouping the indicators: Designation of the indicator Electricity Repository ADEME Category - scope Heating Source of data Invoices Unit kWh Department concerned Maintenance department Progress (not relevant, not started, pending, completed)

Pending

Project team should evaluate the cost of the data collection and have a tool to consolidate them. Project manager should check the data availability and determine the frequency of measurement. Be careful: 'What I really need is Information'; it the data trap to collect a lot of data without sense.

3. The indicators necessity There’s no question that key performance indicators (KPIs) are needed to help drive operational improvements. KPIs are absolutely essential for organizations to present performance information for all levels of the organization. « The stronger the metrics, the stronger the business case. » Even, in the history... Already in the first legal text known as the "Code of Hammurabi", forty centuries old, called how to solve a dispute between a shepherd and the owner who confided his flock to him in whole or part. At the end of the season, the shepherd must bring as many animals and if he says that the beasts were attacked and eaten (any animals he can not bring back alive), he must provide the major bones to prove that wild beasts tore it. There is already in its oldest legal text the notion of due date, indicators and negotiated solution. KPI contributes of project success: they align project goals, implement change and drive behaviour.


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Source: www.haironfirepm.com/wp-‐content/uploads/2012/12/KPI-‐infrographic.jpg

4. Efficiency (“efficience”) and Effectiveness (“efficacité”) Efficiency is linked to means whereas effectiveness is linked to objectives. Efficiency is doing the things right (good process and execution) whereas effectiveness is doing the right things (good selection, success). "Efficiency is doing things right; effectiveness is doing the right things.” Peter F. Drucker Efficiency = a measure of how economically resources/inputs (funds, expertise, time, etc.) are converted to results. Effectiveness = a measure of how the objectives of the action were achieved, or are expected to be achieved, taking into account their relative importance. At the end, we can say that ‘Doing the Right Things’ is more important than ‘Doing Things Right’. For example, if you have a marketing department with an incredibly talented leader who knows SEO, SEM, social media. You can generate a ton of traffic to your web site. If the traffic is blurred you may actually be doing harm to your business rather than an advantage. Sales department should have someone to deal with these incoming requests. If the people


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who find themselves on your website are not well conducted to become customers, the work you have done to catch them is useless. And the reality is that you might be better off doing less activity but in doing the "right " activities really well. Smart people produce quality work. As manager, your job is to make sure that everyone understands how his or her efforts fit into the overall business strategy. Do the hard work and try to define your corporate goals and get them on paper. Everyone should be able to answer the question, "Why am I doing this? " Otherwise they are likely to be doing things right, but not the right things.

In a nutshell, Tactical thinking is “doing things right,” while Strategic thinking is “doing the right things.” Strategic thinking is usually leadership: creating the vision whereas Tactical thinking is management: implementing the vision.

5. Monitoring and controlling process The monitoring priorities are actions to bring the project back on schedule:

– Shorten the critical path – Reconsider the precedence requirements – Give priorities for activities with less than a specified float, high risk activities,

activities using critical resources

The control allow to answer these questions: – Is the project over achieving? – Is the project overspending? – What is the value of the work completed? – Have we been working on the right things? – Is the project over-staffed? – Were the estimates wrong? – Has the scope of work changed? – What is the new cost at completion?


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6. Regular project monitoring

a) Earned Value Management Performance measurement is a system for comparing the actual value of work accomplished against the planned value of work scheduled. Earned value technique was developed by cost accountants and is designed to help project staff keep better track of projects. EVM is a management methodology for integrating scope, schedule, and cost baselines (3 constraints of project), for objectively measuring project performance and progress. The puropose are to control cost, forecast Estimate-At-Completion and Estimate-To-Complete and find opportunities to get back the project on track. Performance is measured by:

– Determining the budgeted cost of the work performed (BCWP, i.e., earned value) Comparing it to the:

– Actual cost of work performed (ACWP, i.e., actual cost) – Planned value.

Source: Cost Management course in MSc. PPMBD -‐ Skema Business School – Thierry Verlynde, 2012 Budgeted cost of work scheduled (BCWS) is equivalent to the conventional concept of planned budget; it states what we have planned for a particular task (or work package) will cost.


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Actual Cost of work performed (ACWP) is equivalent to the conventional concept of actual costs. It states how much we have actually spent to accomplish a given effort. Budgeted cost of work performed (BCWP), is known as earned value (EV).

Source: Cost Management course in MSc. PPMBD -‐ Skema Business School – Sarah Ross, 2011 Earned Value Management allows converting in financial terms the progress of the project to check whether it is in the budget and whether we are ahead in time. The current assessment of project performance is compared to three classical constraints: time, budget and scope / quality

b) Top 25 Project Management KPIs of 2010 Here are some examples of frequently used KPI. The “Top 25 Project Management KPIs of 2010 ” report contains the top used KPI by project manager. It contains the KPI names and a detailed description of each KPI. While dominated by KPIs reflecting Project schedule and Cost performance, other popular KPIs come from categories such as Project delivery, Project reporting and Resource utilization:

1. # Earned man-hours 2. % Project resource utilization 3. % Project budget variance at project end 4. % Overdue project tasks 5. % Project schedule variance


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Source: New smartKPIs.com Report Ranks the Top Project Management KPIs of 2010

c) Reporting and dashboard The dashboard is a vital tool: as a decision tool and as a communication tool. It presents clear and concise deviations from the ideal of the project. It is the indispensable support for progress meetings or steering committee. The dashboard is frequently updated, at least on the dates of progress meetings. It responds to a series of specific questions:

-‐ Are we in advance or in late, and of which duration? -‐ In view of the results obtained (achieved deliverable), we have worked more or less

than expected? -‐ Expenditures for deliverables achieved are in line with budget? -‐ Do the deliverables comply with the requirements? -‐ Will the project be hold in good conditions?

(1) Style It is focused and useful: it is designed according to the recipient; It is reliable: it is up to date and reflects the reality; it is composed of non-contestable factual indicators; It is complete: it covers the Quality, Cost and Time aspects; It is synthetic: it is compound by a small number of indicators; It is legible: one page visual with colour codes and constant in its presentation.

(2) Content

The point of the progress:

-‐ Meetings calendar -‐ Status of the main tasks (pending, in progress or completed, early or late, delayed) -‐ Status of milestones (coming, forward, reached) -‐ Deliverables product and to produce or validate


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The point on the resources (in relation with the work performed)

-‐ Work: expected and observed -‐ Actual and future expenditures

The prognosis for the next part of the project:

-‐ End Date reassessed, budget to completion, remain work to be done Quality indicators:

-‐ Product quality: performance of deliverables in terms of functional requirements -‐ Project quality: respect of the commitments, report of the incidents, errors,

uncertainties, conflicts, the flow of information

B. SUSTAINABILITY KPI AND REPORTING

1. New indicators necessity

a) Introduction Every day our actions and activities create and destroy value. Although the value we create goes far beyond what can be captured in financial terms but it is the only type of value that is measured and accounted for. As a result, things that can be bought and sold take on a greater significance and many important things get left out. Decisions made like this may not be as good as they could be as they are based on incomplete information about full impacts. Understanding the nature of the wealth that is created by an organization in its eco-system becomes fundamental. Does this wealth fit into a sustainable dynamic for ourselves, our eco-system and beyond, for the planet? Since 2002, experiments valuation of wealth have increased mainly in local government as in the Nord Pas de Calais with the "indicators 21". Within companies the subject is treated so far


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in terms of the inclusion of intangible capital. Thus, for some years, the Observatory of Intangible has proposed new methods to evaluate this famous intangible capital. For the countries, we all have in mind the example of Bhutan, which defines an alternative indicator of GNP: the GNP = "Gross National Happiness". The trend continued in 2009 with the "Stiglitz" report to the president of the Republic, which advocates establishing new goals and subjective indicators (perception of well-being, happiness, worries...) and monetary indicators sustainable development for measuring natural resources. Why is it necessary to rethink wealth within the company? How to express the wealth beyond traditional financial indicators turnover, ROI, ROE... Which indicators put in place, to whom and how? The stakes are those of the sense of social cohesion, motivation of employees, working hours, teleworking, management, wellness, evaluation and primarily concerned with the leaders and especially Human Resource. In project, we just focus on financial value creation; NPV (Net Present Value), ROIC (Return On Invested Capital), market share, innovation portfolios and shareholder returns and not about sustainable value creation. We have long said that things we have taken for free will become the new gold: water, waste, carbon. Today, externalised costs are being forcibly internalised into cost structures, economies and incomes. To be able to deliver this transparency has required data, which in turn has the potential to trigger innovation. Combining different data sets can be a tool for empowerment; social change, new insights, new solutions. Sustainability and carbon impact reporting are providing the wedge that is pushing intangibles reporting forward. The increasing concern for the environment and social issues expressed by many stakeholders are finally forcing greater disclosure on many non-financial issues. The challenge is to go beyond measuring finances to measuring value. You could argue that value is simply a predecessor to financial outcomes, which are all that matter. However that approach falls short in a number of ways. When customers and investors say that value resides in environmental and social impact, it does. And as business strategy moves faster in a dynamic world, linking strategy and execution with effective measurement becomes a key driver of performance. As we have seen, the scope of project becomes wider; project manager has to consider cost, quality, time but also the environmental and social constraints of project.

b) Measurement of intangibles assets and monetization The question can be resumed: « when I have created one euro of value, how much have I destroyed? In natural resources consumption, in work accident, ... The measurement of intangible give value to elements not already highlighted. The challenge is to find indicators in order to make good decisions. Intangible assets are a new concept invented by Karl Erik Sveiby; they are becoming more and more important in the knowledge society because the knowledge society is about knowledge, which is immaterial, intangible and qualitative. Intangibles assets are for example: know how, reputation, trust in the project, structure of the project, strategy (balanced scorecards), relations with personnel, clients, civil society, relation to environment,


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quality of the networks, care for social inclusion, care for our collective future and genuine sustainability, CSR & sustainability are becoming the central intangible asset.

Source: New trends in management education in Eastern Europe – Marc Luyckx, 2012 There are diverse methods for measuring intellectual capital of an organization. These methods can be grouped under four categories: market capitalization methods, return on assets methods, direct intellectual capital methods, and scorecard methods.


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Methods for Measuring Intagible Capital (Sveiby, 2007)

Market capitalization methods calculate the intellectual capital as the difference between the organization’s market capitalization and stockholders’ equity. However, we can observe that it sometimes exists a big gap between the stock market of a company and its real valuation.

Return on assets methods measure the intellectual capital value based on the return on the organization’s assets. Direct intellectual capital methods estimate the monetary value of intellectual capital by identifying its various components. Scorecard methods identify various components of intellectual capital and generate and report indicators and indices in scorecards or as graphs. None of the methods can fulfill all purpose of measuring intellectual capital; the method should be selected depending on purpose, situation, and the audience.


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But do we need to monetize, to convert things in financial terms? There are 2 schools of thought on this topic: the first try to quantify the qualitative thing; the second chooses to not convert. Today, most of the strategic decision-making is based only on financial items, leaving a number of social and environmental parameters. In this sense, these choices cannot be truly enlightened and can even be destructive of value for the company itself and for the Community. The idea is to assign a monetary value to various issues (environmental, social, and societal) in order to integrate them into a global management: the management integrates all of these environmental and social costs called "eco-costs" in a search the economic optimum. The question is to know about what to invest to achieve the best possible compromise between the financial results for the company and for societal stakeholders? How to achieve the economic optimum in investment choices? Focus on the future rather than the present so avoidance costs or damage costs? The idea is to have a comprehensive review and make the link between sustainable development actions, indicators and economic performance of the company, this method actually allows to have quantified elements and not only qualitative in order to see the opportunities and risks and the impact in terms of contribution to earnings of the company. This means concretely that cross way we look at the impact on revenues and costs: what would I risk if I do not make this or what would I win? In other words, what are the actions to have the maximum sustainable results by implementing the principles of sustainable development? So that it speaks to business leaders; the amount of the monetized impact gives an indication of the potential investment and its possible return on investment in a comprehensive manner. This method gives weight to strategic CSR thinking action-oriented and profitable: it can make investment decisions and better use of the opportunities of sustainable development. Moreover, monetize social and environmental indicators, strengthens the supervision and management of the company by creating a new vision of performance drivers. Various methods and tools exist to assess the eco-costs and value creation. New accounting policies are in development. The Association of Certified Public Accountants is also working on this subject with the diffusion of the Universal Accounting. Whatever the methods: LCA (Life Cycle Analysis), measuring environmental impacts, or the ESR method (measurement of the dependence of a business to its ecosystem) or the SROI method (Social Return of Investment), measuring social performance investments); in all cases, it is to give a monetary value to data that have no market price. What matters is not so much the accuracy of the value but the process. The important thing is to evaluate agreeing with stakeholders on what will be measured, and then give a financial value and make a more informed decision that encourages them to take action. Project Manager should pay attention on the context and the chosen hypothesis to clearly manipulate monetization.


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c) The Cost Benefit Analysis Cost Benefit Analysis (CBA), is a systematic process for calculating and comparing benefits and costs of a project, decision or government policy It has two purposes:

-‐ To determine if it is a sound investment/decision (justification/feasibility), -‐ To provide a basis for comparing projects. It involves comparing the total expected

cost of each option against the total expected benefits, to see whether the benefits outweigh the costs, and by how much.

d) Another approach: the entrepreneurial value The concept is developed by Denis Terrien, president of ‘Entreprise et Progrès’ and helps to find the direction of the company and the balance between economic and social development. At first, glance, it is an impossible mission to build sustain links between financial constraints and social cohesion as part of a business. But we must never forget that the company is first and foremost a human adventure. The company is a joint project between men and women working together and must have common values. When a manager is appointed, he must understand the intrinsic value of the company to take a long-term project. It often comes off the market value, which is too volatile and has little meaning. The challenge is to capture the correlation between the social value of an organization and economic value. Success does not depend on anything you can count; beyond what can be counted, there is what really matters: the entrepreneurial value. We can be based on three frames of reference to make decisions: - Use our head: calculating the financial value in the short term - Use our heart, CSR: responsibility towards other stakeholders - Use our pluck, entrepreneurial value, and intuition of a manager, ensuring long-term success For example, the turnover of consulting firm should between 10 and 20% of turnover

-‐ Less than 10%, it is the sclerosis -‐ Over 20%, it is a loss of skills


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All elements of the entrepreneurial value can be measured but they are not all related to the algorithm of the financial system or the extent of CSR. The challenge of entrepreneurial value is to propose other topics of interest, in every sense of the term and that are related to the activity, history and talents of the company. Subjects to cycle longer able to mobilize the energies and talents beyond the perspective of "quarterly result," can help project team to raise her eyes to see screens below conducive to give meaning to the numbers dashboards that she consults daily and the actions she undertakes in the businesses. It is inappropriate to apply a new catchphrase (new algorithm) to calculate this value entrepreneurial but to explain the key elements that leaders company retain in their decision to strengthen the long-term position of the company. As a first step, here are four components, ones that are crucial in terms of the objective of strengthening the duration of profitable business.

1. It is necessary to emphasize the social balance sheet key indicators and linked to value creation and business dynamics. The relationship between people and the results should be expressed. For example, learning a trade, co-responsibility in the work, capitalization and transfer of know-how, ...

2. Provided that the result makes clear, it is necessary to show how the result was clear: profit € all are not equal (eg through layoffs or innovation). For example, you must measure and report the loss of value caused by layoffs, project managers must go beyond finding "costs less" vs. "restructuring." While recalling that no redundancies pleasure.

3. The value of the ecosystem around the company and its evolution must be identified.

It could be defined as the sum of the values of the business ecosystem. For example, the measurement of cultural transformation created, the value created for residents and contractors territory ...

4. Measuring externalities, positive or negative, which began in sustainable

development initiatives must be pursued with better modulated according to the importance of factors for long term business. Less green washing and sincerity on the management of long-term risks. For example, the transfer of know-how to local maintaining their territorial wealth, social ties specific to their culture ...

Use of entrepreneurial value: There are at least six uses this value each entrepreneurial concerns related to one of the stakeholders of the company.

1. In the decision-making process: the first use can be made of the business value and its components are in the process of management decision. Systematically ask the question: "What will be the impact of such a project or decision on the business value?" As well as the usual issue of the impact on financial value.


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2. Frame a new and forward-looking dialogue with the social partners: the entrepreneurial value opens the door to a new kind of dialogue with employees on the medium-term policy of the company. Employee's speech is built "against the boss, representative of the shareholder."

3. Redefine the executive compensation: the entrepreneurial value creation to redefine

the value that should be rewarded, and in particular any value sitting executive compensation.

4. Open a new dialogue with the public sector: the entrepreneurial value could serve as a

bridge between business interests and those of public bodies. Recalling that the components of entrepreneurial value are the radiation component, which involves stakeholders outside the company, and in particular the government.

5. Communicate with investors: regardless of SRI based on the membership of the

business categories or use complex sets of indicators to produce synthetic notation, the calculation of the value entrepreneurial lends itself well to stock picking methods no less socially responsible because it is primarily based on combining criteria correctly with conventional financial criteria.

6. Lighting citizens: call on the business value would inform the fellow citizens about the

many contributions to the company, rather than see it as exclusively devoted to the defence of the interests of its shareholders.

There are already some approaches that measure social performance and corporate social ad entrepreneurial value approach wants to go further and propose a valuation that would build a dialogue on long-term relationships with stakeholders of the company. This method, bottom-up rather than top down, would go to the heart of the business, and measure its evolution is more important than the measure of financial value.

2. Sustainable KPI

a) Introduction Why should we measure the CSR performance? « This is sustainable development as diet: one that progresses to what is measured ». Ben Cohen Demonstrating the quantifiable value of a sustainability project starts with the business case, which must outline a measurable ROI that will deliver long-term strategic advantage. Earning buy-in for sustainability projects is no different than on traditional ones: The stronger the metrics, the stronger the business case. Sustainable indicators must be ‘customized’ for the project and embrace all the stakeholders expectations.

b) Definition SKPI are measures of how a project is meeting the sustainability targets set by the organization and for the project itself. There are new indicators not only based on cost, delay and quality.


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Project SKPI are reported regularly throughout the lifetime of a project. According the consulting agency Vigéo, an indicator means any information, including at least a fact or an aggregate, may account for the nature of the content or the specific result of the action taken by the company in connection with a goal or a principle derived from its responsibility in social, societal, environmental, governance and markets.

c) Objectives of Sustainability KPI An indicator of social responsibility is an information that:

-‐ Explicit the objective or principle of liability to which it relates, -‐ Describes the processes, methods and devices for collection and consolidation of data

dedicated to the objectives, -‐ Provides quantifiers or descriptions on the results of the action referred -‐ Measures the sustainability performance -‐ Allows communication and comparison, to guarantee the transparency

d) Straightforward guidelines for SKPI’s identification 1.Choose SKPI’s that matter and develop an effective metric for each SKPI (define criteria and weighting them) 2. Use the SMART test to validate the SKPI’s - Performance indicators that cannot be measured are ultimately useless to the organization 3. Measure performance in areas that are subject to evaluation 4. Less is more with SKPI’s in a project With a range of 100 CSR indicators, it does not measure anything. Only a few indicators focused on monitoring and the impact achieved on concrete actions can drive a CSR approach for the economic objectives of the company as well as societal goals of its stakeholders over time. To give sense, SKPI must be:

-‐ Comparable and reliable, -‐ More demanding than the law, -‐ In consultation with stakeholders, -‐ Limited to 15 and connected to the management strategy, -‐ Put into perspective with the local context, competition, legal requirements... -‐ Their evolution from one year to another must be explained.

Some other criteria: relevance, sustainability, reliability, stakeholders, completeness, balance, time phased Sustainability project management requires that:

1. SKPI’s must be relevant to the project From key themes adapted to the business sector and the expectations of stakeholders, we can choose a set of relevant indicators able to drive a CSR.

2. Targets that drive the fulfilment of SKPI’s must be established for each project 3. Parameters on how information is gathered for each SKPI must be set


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4. Appropriate reporting processes must be used that facilitates timely updates, decision-making and forecasting.

e) Examples of SKPI The table below shows a list of generic indicators that can be used in setting up a panel accompanying the implementation is up eco-efficiency initiatives, circularity, service centred on use and result. This list is compiled from source as the GRI, the "Cradle to Cradle" certification and indicators proposed by the United Nations. Far from being exhaustive, the table invites benefit the reader to imagine the type of indicators that can be deployed to support a transition to sustainable performance. Dimension Criterion Examples of indicators

Economic performance

Financial fundamentals Increase of sales / ROI / Dead Point following the establishment of a sustainable initiative / bottom line

Cost reduction Financial Economics garnered by the establishment of an eco-efficiency / initiative circularity

Material

Consumption of material in weight or in volume Amount of inputs / unit produced Percentage of materials used that are recycled input materials % Recycling Product / recycled per tonne Percentage of products sold and their packaging that are recycled or reused by category % Recycling Product / recycled per sold ton

Energy

Direct / indirect energy consumption by primary energy source kWh / h, m3 gas / produced unit, kWh / use cycle Energy savings through greater efficiency / the implementation of circular flows kWh ; CO2 reduction Share of renewable energy in the global energy mix % of renewable energies in the total consumption

Water

Total volume of water withdrawal by source

m3 water / produced unit; m3 water / duty cycle, % of blue water vs. % of grey water

Percentage volume of water recycled and used

Water footprint over the entire lifecycle of the product / service / process

Emissions, effluents et

waste

Total direct and indirect emissions of greenhouse gas emissions by weight (teq CO2)

CO2 ton / turnover; CO2 / produced unit, CO2 ton / use cycle

Other indirect emissions of greenhouse gas emissions in weight (teq CO2)

CO2 footprint over the entire life cycle of the product / service / process

Emissions of substances that deplete the ozone layer in weight CFC / produced unit NOx, SOx and other NOx emissions / unit of output


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significant air emissions by type and weight Total water discharge by type and destination In unit of considered volume / turnover unit Total weight of waste by type and mode of treatment

kg waste / produced tons; kg waste / turnover, % biodegradable product ; % of compostable product

Social

Generation preservation / relocation of jobs following a sustainable development initiative

Jobs created / investment, number of jobs / production site; jobs / unit produced

Link between diversity in human resources and economic performance

Profitability / diversity in human resources (e.g. : % Women-Men Worker, % of disabilities; etc.).% of women in the executive committee

Monitoring of suppliers and subcontractors on respect for Human Rights

% of suppliers have signed the charter of respect for Human Rights, number of controls by supplier and subcontractor in relation to book of specification, % of compliance

Type of information on products and services required by procedures, and percentage of significant products and services subject to such information requirements

Labelling the following information (yes / no): origin of the components of the product / composition, especially for substances that may have an environmental or social impact; safe use of the product, product disposal and environmental / social impacts

Nature, scope and effectiveness of any programs and practices that assess and manage the impacts of operations at any stage of advancement of the communities

Measure (yes / no) the impacts of activities: health and safety of the community in terms of infrastructure, materials, emissions and hazardous waste, and the forced removals, physical / economic relocation and rehabilitation of the environment; and respect for the local culture, gender, indigenous peoples and cultural heritage

Decoupling Decoupling of resources following the establishment of eco-efficiency, circularity, a service-oriented uses and/ or service-oriented results

Calculation of factor X decoupling between wealth creation and consumption of environmental resources (before / after): rate of resources (materials, energy, water, land footprint) used / unit of product or service value / use of resources; increase in turnover / ROI of investments / break-even point after the implementation of a decoupling initiative

SKPI’s can included:

-‐ Target for total carbon footprint for a project -‐ GHG emission targets -‐ Resources management targets (water, power, waste,...) -‐ Raw material – recycled or bio-based -‐ Ethical supply chain measures -‐ Local supply target

f) Best Practices Which best practices to take as an example?


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-‐ Identify key issues facing the company, -‐ Transpose CSR strategy in a dashboard, -‐ Define key performance indicators of project, -‐ Define indicators related to subcontractors, -‐ Compare to others in the same sector on the basis of common sectorial indicators, -‐ Develop social indicators, -‐ Dealing with sensitive topics such as customer complaints, process failures, fines for

non-compliance with regulations... Do not multiply indicators and focus on their relevance: need to select a limited number of relevant indicators (fifteen for example). Directions of sustainable development are more often related to the general management.

g) Conclusion In selecting these indicators there is no set formula: some are fairly universal (consumption of water, energy, CO2 emissions...) but many depend of the business sector. Consultation between project team in the same sector is necessary to identify indicators that make sense in a business and more importantly, allow the comparison of a project to another. These indicators should not "make the measure to the measure." They have a role in managing the process, in line with the overall business strategy. This work reporting must use innovation objectives of a project.

3. Sustainable reporting Thanks to social reporting, economic relations can finally rely on sustainability objective data. Making CSR performance enforceable, they now constitute a basis for discussion and agreement negotiations.

a) Stakes of CSR reporting Like the financial reporting, CSR reporting is an opportunity for the project team to make specific statements about the results of its CSR policy. This is a proof that is not only declaration of intent and a serious evaluation of the conducted results. Internally, CSR reporting is a management tool that allows project manager to consider adjustments and implement incentives, rewards and sanctions). Externally, it is a medium of communication with stakeholders. Reporting is a structured approach based on indicators. The project management may seek outside counsel to conduct the evaluation. It can learn from models that provide guidelines for the preparation of sustainable development report. The most common model is the GRI: the Global Reporting Initiative. CSR reporting is a valuable tool to register the company with a view to continuous improvement of the overall performance. Its benefits are multiple: to understand risk and to create value, to reduce water, carbon emissions and water use, to improve efficiency, to reduce costs, to enhance equality and diversity within the project, to attract and retain staff, investors and clients, new insights and determine strategy for the future.


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b) Purpose of a sustainability reporting Sustainability reporting is the practice of measuring, disclosing, and being accountable to internal and external stakeholders for organizational performance towards the goal of sustainable development. ‘Sustainability reporting’ is a broad term considered synonymous with others used to describe reporting on economic, environmental, and social impacts (e.g., triple bottom line, corporate responsibility reporting, etc.). A sustainability report should provide a balanced and reasonable representation of the sustainability performance of a reporting organization – including both positive and negative contributions. It can help project manager to set goals and measure how he is progressing towards them. The reporting on your project sustainability performance will give internal and external stakeholders a clear idea of its impacts; and can increase the efficiency and improve the performance of the project.

c) 8 principles

-‐ An "inclusive" approach to meet the expectations of stakeholders, -‐ The interdisciplinality and completeness -‐ The comparability -‐ The regularity -‐ A beyond managerial approach to performance measurement (indicators of means) -‐ The transparency and accessibility of information -‐ The verifiability of information (internal or external) -‐ Continuous improvement

d) 360° reporting The idea is to "customize" the presentation of performance indicators for a "reporting 360" configured with information aimed at all. "Customize" the presentation of the performance indicators is used to meet the needs of each stakeholder.

e) Integrated reporting The current dominant trend is to connect sustainable development reporting and financial reporting. The IIRC (International Integrated Reporting Committee) aims to bring together the two types of reporting. Integrated reporting <IR> is a comprehensive approach to the performance of the company and its impacts (inputs / outputs) on different assets (environmental, human, societal, financial...) Current reports are not enough anymore: the non-financial indicators are too few, often incomparable one company to another, and annual financial reports provide information too voluminous, too technical, uncommented only retrospective, with no formatting in perspective, with few risks and interdependencies, and not explaining the strategic choices. Finally, in practice, few investors are using all of these reports to analyse companies, and few


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shareholders and directors read these documents. Many work for the realization of these reports for... nothing! Value Creation must be explained; 6 categories of values interact in the business: financial capital, technical, social (with value chain and territories), human, intellectual and natural capital. All together contribute to the overall performance of the company.

Source: Consultation draft of the International Framework – IIRC, 2013 Present the business model of the company by type scheme of integrated thinking: six key components come into play to transform inputs into outputs. Explain them can develop common architecture integrated reporting:

Source: Consultation draft of the International Framework – IIRC, 2013 Some recommendations: - Coherence between financial and non-financial data / e.g. Electricity cost & electricity consumption - Merger between financial and non-financial reporting - Be based on principles rather than on rules - Reporting of intangible


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- Communicating vs. compiling - To measure the expectations and performance of external stakeholders, you have to integrate them The indicators should not be static, but must necessarily be discussed to demonstrate the continuity of the strategy Try to measure carefully way to create value for the various communities involved in the activity A key word: concision. An integrated report should be short enough to be read and understood. We can summarize the integrated support incorporating the value created by the turnover, by the human capital, by the social dimension, and the value created for the community, for all stakeholders, with whom these values are shared. This new report will be prospective and demonstrate that the company will be as projects to contribute to its overall performance. He will speak first to the shareholders and investors, but will be clear enough to address all stakeholders. It will show how the company will be "sustainable", how his business will last.

f) Measuring to unlock shared value Another approach is proposed about the measure of shared value. The proposed process is: 1. Identify the social issues to target 2. Make the business case 3. Track progress 4. Measure results and uses insights to unlock new value

Source: Measuring Shared Value, How to Unlock Value by Linking Social and Business Result -‐ Michael E. Porter, Greg Hills, Marc Pfitzer, Sonja Patscheke, and Elizabeth Hawkins, 2011 The study makes the difference between impact assessment and sustainability: Impact assessment is the long-term social and economic development impacts of operations and/or philanthropy. Track and demonstrate the social and economic impacts of operations.


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Sustainability is efficiency in the use of input factors (e.g., natural resources and labour) and improved product and community impact. Track and minimize the use of input factors and product-community impacts (negative externalities and augment positive impacts).

4. The Balanced Scored Card

a) Definition A very common way for choosing KPIs is to apply a management framework such as the balanced scorecard. That can be used by managers to keep track of the execution of activities by the staff within their control and to monitor the consequences arising from these actions. The "Scorecard approach" or "Balanced Scorecard" is a management and strategy tool.

Design of a Balanced Scorecard ultimately is about the identification of a small number of financial and non-financial measures and attaching targets to them, so that when they are reviewed it is possible to determine whether current performance 'meets expectations'. The idea behind this is that by alerting managers to areas where performance deviates from expectations, they can be encouraged to focus their attention on these areas, and hopefully as a result trigger improved performance within the part of the organization they lead. The four steps required designing a Balanced Scorecard; where they assert four steps as being part of the Balanced Scorecard design process:

1. Translating the vision into operational goals; 2. Communicating the vision and link it to individual performance; 3. Business planning; index setting 4. Feedback and learning, and adjusting the strategy accordingly.

A strategic map for listing the strategic objectives of the company from four perspectives: financial and customers (domain short-term), processes and know-how (through field and long term) A table on which you place the different indicators monitoring and numerical target for each strategic objective A major contribution of the tool is to ensure consistency of the most comprehensive manner possible:

-‐ Corporate Strategy,


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-‐ Indicators dashboards -‐ Projects and Developments

Four "perspectives" are proposed:

1) Financial: encourages the identification of a few relevant high-level financial measures. In particular, designers were encouraged to choose measures that helped inform the answer to the question "How do we look to shareholders?"

2) Customer: encourages the identification of measures that answer the question "How do customers see us?"

3) Internal Business Processes: encourages the identification of measures that answer the question "What must we excel at?"

4) Learning and Growth: encourages the identification of measures that answer the question "How can we continue to improve and create value?".

b) Scorecarding and KPI

Scorecarding is still seen as an executive or senior management tool. Stories abound of scorecarding projects, which fail to deliver tangible benefits or are only implemented a couple of levels down in an organisation. That doesn’t need to be the case. Often the block to effective scorecard implementations is identifying the correct KPI’s. We all know that “you get what you measure”, hence the reluctance to roll-out scorecards to a wider audience without confidence over the choice of the KPI’s. Choosing the correct KPI’s at every level in the organisation requires an intimate understanding of the operation of the business.

c) Sustainable Balanced Scored Card The integration of information, other than financial, in the measurement of the performance is only recently emerged as a necessity. Approaches "sustainability balanced scorecard " (Hockerts 2001, Bieker 2002) or " total balanced scorecard " (Supizet, 2002) are steps in the matter. Just outlined in the initial version of the "balanced scorecard", the issue of corporate social performance is now highlighted by its designers, like other authors seeking to develop and


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disseminate the concept of "sustainability balanced scorecard." Thus, Kaplan and Norton believe that the ability of the company to become citizen is an integral part of the performance measure under the axis internal business processes. They also suggest extending the axis customers to all business partners (Kaplan and Norton, 2001). By adopting a similar approach of Kaplan and Norton, Hockerts (2001) offers an example of "sustainability balanced scorecard" composed in part of indicators to measure environmental and social performance of companies. For its part, Bieker (2002) suggests adding a fifth dimension to the "balanced scorecard", namely the societal dimension. Supizet (2002), meanwhile, assumes that the company must satisfy seven clients: shareholders, customers, and customers, the firm itself as a corporation, partner person, the staff and the community. This prerequisite in mind, it offers a "total balanced scorecard " whose model is based on a series of six causal relationships between stakeholders.

d) The Skandia browser The browser, theorized by Edvinsson and Malone (1997) and implemented at Skandia AFS (Edvinsson and Malone, 1999), reflects one of the aspects of social performance, specifically those concerning to employees and customers. The real novelty contained in the browser is in the attention paid to human resources. These are positioned in the heart of the device to create value and have an identical number of indicators to other dimensions of performance. Part of the social performance related to employees of the company, is taken into account in the browser. Human axis corresponds to the skills of employees and the commitment of the company to sustain the level.

Sources: La performance globale de l’entreprise et son pilotage : quelques reflexions -‐ Christophe Germain, Audencia Nantes – école de management, et Stéphane Trébucq, Université Montesquieu Bordeaux IV


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5. Notes about the difficulties of these new KPI From our discussions with companies, we were able to observe the difficulty of characterizing criteria called CSR. Indeed, for a given subject (eg work accidents), the indictor can be seen as a CSR standard or criterion only within the HR policy. We can expect a huge cost to implement the collection data tool. Indeed, it will identify the drivers of each of the key indicators, and measure the cost inducers. As these costs are very complex because many are based on scientific data and estimates, we can expect a considerable work. In practice, overseeing key performance indicators can prove expensive or difficult for organizations. Some indicators such as staff morale may be impossible to quantify. As such dubious KPIs can be adopted that can be used as a rough guide rather than a precise benchmark. It is also more difficult to get information when stakeholders are external. Another difficulty is the variety of methods to calculate the social and environmental performance, which greatly reduces the value of the comparability of the tool. Thus, as there are no prescribed rules, users can place little reliance on these measures. For example, absenteeism in Solvay company is not calculated in the same way in different countries; maternity leave are integrated in the calculation. This invites us to the question: What are we trying to measure? What is the definition of absenteeism for our project? Key performance indicators can also lead to perverse incentives and unintended consequences as a result of employees working to the specific measurements at the expense of the actual quality or value of their work. For example, measuring the productivity of a software development team in terms of source lines of code encourages copy and paste code and over-engineered design, leading to bloated code bases that are particularly difficult to maintain, understand and modify.

C. STANDARDS AND METHODOLOGIES A number of reporting guidelines or standards have been developed to serve as frameworks for social accounting, auditing and reporting.

1. The GRI: Global Reporting Initiative

a) Definition The Global Reporting Initiative (GRI) was established in 1997 by the Coalition for Environmentally Responsible Economies (CERES) in collaboration with the PNUED, it aims to develop guidelines for sustainable development reporting and to create a framework reference to reflect and assess the economic, social and environmental performance of companies and organizations. It guarantees the quality of the information provided by companies and also complements the Global Compact as it is a tool for companies who use to measure the impact of their CSR strategy and to communicate this strategy. Global Reporting Initiative (GRI) is a network-based non-governmental organization that aims to drive sustainability and Environmental, Social and Governance (ESG) reporting. GRI produces the world’s most widely used sustainability reporting framework to enable this drive towards greater transparency.


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b) Vision and mission The Global Reporting Initiative’s (GRI) vision is that disclosure on economic, environmental, and social performance becomes as commonplace and comparable as financial reporting, and as important to organizational success. The GRI’s vision is : "What you cannot measure, you cannot manage, what you cannot manage, you cannot change." Relevant (or ‘material’) topics for reporting organization should include organization’s economic, environmental and social impacts. It is also important to explain how to collect the data, the history of how you get them. GRI’s mission is to create conditions for the transparent and reliable exchange of sustainability information through the development and continuous improvement of the GRI Sustainability Reporting Framework.

c) Framework The framework, incorporating the G4 Guidelines, sets out the principles and indicators that organizations can use to measure and report their economic, environmental, and social performance. GRI is committed to continuously improving and increasing the use of the Guidelines, which are freely available to the public.

The G4 Key focuses on materiality. Boundaries can vary for material aspects There are three different types of disclosures:

• Strategy and Profile: Disclosures that set the overall context for understanding organizational performance such as its strategy, profile, and governance.

• Management Approach: Disclosures that cover how an organization addresses a given set of topics in order to provide context for understanding performance in a specific area.

• Performance Indicators: Indicators that elicit comparable information on the economic, environmental, and social performance of the organization.

Sources: GRI G3.1 Guidelines Incl. Technical Protocol


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The Global Reporting Initiative recommends companies to define the scope of the report and its periodicity, and then consider qualitative characteristics such as:

-‐ The relevance of the information provided; -‐ Reliability (choice of indicators to measure); -‐ Clarity (information are they understood by those to whom they are intended?) -‐ Comparability (over time and between companies in the same sector)

GRI recommends 5 step process:

1. Prepare: which impacts? Action plans? 2. Connect: identify key stakeholders and engage them 3. Define: internal assessment with management both internally and externally (scope of

organization influence) 4. Monitor: check processes and systems, record data, follow up 5. Report: write your report and communicate, follow progress

d) Examples of performance indicators suggested by the GRI Economic:

-‐ Financial implications and other risks and opportunities due to climate change (EC2) -‐ Local hiring (EC7)

Environmental:

-‐ Materials used (EN1) -‐ Materials used that are recycled input materials (EN2) -‐ Energy consumed (EN3/4) -‐ Energy saved and initiatives to reduce energy consumption (EN5/7) -‐ Impact on biodiversity in protected areas (EN12) -‐ Greenhouse gas emissions (EN16/17) -‐ Amount of waste (EN22) -‐ Environmental impact associated with transportation (EN29)

Labour:

-‐ Total workforce (LA1) -‐ Employees covered by collective bargaining agreements (LA4) -‐ Health and safety measures (LA7) -‐ Hours of training (LA10) -‐ Governance body/employee diversity (LA13)

Human Rights:

-‐ Human rights screening on suppliers and contractors (HR2) -‐ Violation of indigenous rights (HR9)

Society:

-‐ Impact on community (SO1) -‐ Training against corruption (SO4)

Product Responsibility:

-‐ Life cycle assessment of products/services (PR1) -‐ Customer satisfaction (PR5)


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2. ISO 26000 ISO 26000 is the first international standard about Corporate Social Responsibility. ISO 26000 provides guidelines for any organization seeking to take and report the impacts of its decisions and activities on society and the environment. CSR recommends that company must be responsible and have a positive impact through its activities in its environment on its internal and external stakeholders: shareholders, clients & customers, employees, suppliers, communities and society. ISO 26000 recommends two fundamental practices to understand the Corporate Social Responsibility that are:

-‐ Identification of impacts of decisions and activities of the organization in relation to the core issues of ISO 26000

-‐ Identification of stakeholders and dialogue with them Both practices are intended to identify relevant areas and priority actions for an organization from:

-‐ Impacts on the entire value chain and product life cycle -‐ The mainstreaming of 7 core issues


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-‐ An expanded scope of responsibility: its sphere of influence -‐ The expectations of its stakeholders.

This is a standard recommendation: The standard is by definition voluntary therefore not constraining. We cannot be ISO 26000 certified, as can be an industrial site with ISO 14000 for example.

Sources: Discovering ISO 26000 ISO 26000 does not provide recommendations for performance reports on social responsibility, but it covers a range of very similar to those of the GRI guidelines for the reporting areas. The ISO recommendations provide a framework for companies to organize their activities, which may affect their reporting process... ISO 26000 acknowledges that to be credible, a social responsibility report must cover the organization’s social responsibility performance against objectives, and says that one of the most common methods of measuring performance is with indicators. Indicators require specific qualitative or quantitative information about performance results or outcomes associated with the organization that are generally comparable and demonstrate change over time. ISO 26000 does not provide guidance on specific indicators, nor on any other framework for comparing performance, either year-on-year or with other comparable organizations. However, GRI offers widely used specific indicators dealing with a range of economic, social and environmental topics. It exists a publication aimed at establishing a link between the guidelines of ISO 26000 on social responsibility and the GRI Guidelines for Sustainability Reporting.


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For example, the indicator EN6 in GRI: 'Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives.' has an equivalent subject in ISO 26000: ' The Environment Sustainable resource use' in clauses: 6.5 6.5.4.

3. Other guideline or standards It exists a lot of different other framework helping companies to realize their CSR reporting and structure their sustainable strategy. For instance: the Global Compact by UNO, the Agenda 21, the SME Key, the CJD global performance, SA 8000 or SD 21000 by AFNOR.

4. Best in class approach Assessment tools have been developed from the perspectives and the specific interests of different stakeholders. Thus, companies use most of the sets of standards, even if different stakeholders such as governments, NGOs and the business world itself developed them. However, some assessment tools have been designed according a particular stakeholder. For example, to meet the demand for socially responsible investors, banks offer the opportunity to invest in mutual funds invested in equities of companies deemed responsible. Specialized agencies (EIRIS Asset4 Vigéo) assess companies in this way. We are often talking ESG assessments (Environment, Social and Governance). The objective here is not to find the best companies in terms of CSR, but companies that are best in terms of CSR in their business. This approach is called: Best in class. The objective is to encourage companies to change their behaviour, but to assure investors that their investments are not the capital of irresponsible companies. Specifically, banks often combine the best in class with exclusion criteria (such as the violation of human rights). In conclusion, it seems difficult to classify the various assessment tools of CSR since they are not necessarily designed for all business, but especially to the extent that their goals are not always the same. However, we can evaluate the performance in terms of CSR precisely, if we take into account the institutional context and constraints, industry and company size.

5. CSR Best Practice framework from Réseau Alliances Réseau Alliances has developed a CSR Best Practices framework, inspired by the 7 core issues of the ISO 26000, the international CSR framework:

1- Organizational governance: Transparent corporate management 2- Human Rights: Respecting the fundamental rights of human beings 3- Labour relations / working conditions: Put people at the cornerstone 4- Environment: Preserve the Planet 5- Fair Operating Practices: Being a fair and responsible player in the

marketplace 6- Clients and consumers: Respecting everyone's interests 7- Community involvement: Combining business and community interests

This standard enables the association to prioritize CSR company’s commitment level and to


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write CSR Best Practices, available on line on the search engine, called BipiZ': http://www.reseau-alliances.org/en/search-engine/#

6. Conclusion On a theoretical level, the integration of social dimensions of performance to measure the overall performance should be better defined and clarified. The proposed management tools distributed in the literature remain, in fact, partial and questionable. This is because they deviate from certain fundamental principles of control by failing to specify the objectives pursued.

At the operational level, the question is to what degree and in which form the companies engaged in a social process measure performance. We can also question the specificity of information systems such companies compared to those who remain indifferent to this issue. If nothing differentiates them, then it could mean that the social performance is only subject to assessment and external ratings, and does not constitute an integral part in the business strategy. If there are many companies that develop appropriate tools to control their sustainable performance, it would be interesting to identify their characteristics and analyse their know-how in terms of performance measurement. Beyond this preliminary stage, we could understand a more concrete and tangible way too abstract concepts such as responsibility or societal performance. The convergence of CSR bases has recently been marked by a series of agreements between the GRI, ISO 26000, OECD and the Global Compact (UN), to use the GRI data as a platform to work a single integrated reporting.

D. FEEDBACKS FROM THE FIELD

1. Interviews

a) Questionnaire about project sustainable performance indicators

The purpose of the interview is to have a concrete example on sustainable management of project business. Do not hesitate to spice up your life examples answers.

CLASSIC PROJECT PERFORMANCE INDICATORS How would you qualify a good KPI (Key Performance Indicator)? Performance indicators serve to measure the effort realized (means used) in regard to the effective result; they are linked to project efficiency. Have you defined a methodology to determine your project performance indicators? (Stages, types of indicators, scope, process) Generally, how many performance indicators you do follow per project?


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TOOLS Did you define a common reference table describing every indicator with their meaning? Do you use specific forms of typical indicators? Have you a project reporting system? What type of representation do you use? (Dashboard,...) Have you a computerized solution? If yes, which one?

SUSTAINABLE PROJECT PERFORMANCE INDICATORS How would you define a sustainable performance? At a corporate level, do you realize a RSE reporting? If yes, since how long? At project level, besides classic aspects (quality, costs, deadlines) do you take into account environmental, social and societal aspects? What specific methodology do you use to follow up your projects CSR indicators? (In house Methodology or international reference tables such as GRI or ISO 26000) In what purposes do you use these indicators RSE? (Piloting and following up the projects, decision-making support, communication) What profits and which difficulties did you notice in the implementation and the follow-up of CSR indicators?

TYPOLOGY OF CSR INDICATORS What specific indicators and universal indicators do you use? Do you set up rather quantitative or qualitative CSR performance indicators? Did you create composite indicators (consisted of several indicators) to indicate a global trend in a domain? (Example: global note on the environmental performance of the project)

STAKEHOLDERS &CSR INDICATORS How do you take into account internal and external stakeholders to your projects? Did you define specific indicators by stakeholder integrating the CSR aspects?

MEASUREMENT OF SUSTAINABLE PERFORMANCE How do you measure your qualitative CSR performance indicators? What are the difficulties to obtain this type of measure? Do you apply a specific method to estimate the immaterial aspects of a project? (Example: transcription environmental data into financial terms)


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PROJECT SITUATION

Could you describe the implementation and the follow-up of sustainable performance indicators for a precise project? Stakes and governance of the project, identified sustainable development criteria, implementation of indicators, the concern of stakeholders, reporting system, measurement tools, profits and difficulties

b) Interview of Marie-Noëlle Duforest, ïdgroup

(1) The golden triangle of the project according to ïdgroup The project has to be linked to the global project of the organization (i.e.: its directions, values and corporate development plan). It is important to ensure consistency between local projects and global projects of a company. ïdgroup call this projects RESSEME. The project also has to satisfy economic performance and human aspects: it is the condition for a real sustainable performance.

The golden triangle of project according ïdgroup

The duality local/global, economic and social performances have to be managed within the consistency with the corporate development plan.


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Each objective has 3 dimensions: consistent with Directions, Economic and Human. The economic objective is never the only one. We put the emphasis on employees’ energy and their creativity, involving the teams and mobilizing the people to the project. The employees have the right to take initiatives. CSR indicators can only be defined in regards to the organization objectives. A successful project is a project, which had succeeded in releasing employees’ energies. Distinction has to be made between Debt (contract to be fulfilled) and Gift (which refers to something beyond contract, transcendence, passion, and something wider, additional spirit sensitivity. We need some indicators based on criteria we will never give up. A set of questions is better than to trust only indicators.

(2) Management of the stakeholders and collective meshing

Marguerite or constellation of stakeholders according ïdgroup

The project is not a barony, it can’t be self-centered. It is necessary to place it in front of all the stakeholders to let the global project as well the other people grow. For example, the person in charge of the company day-nursery project has to take into account the financial and human aspects by meeting the various company departments.

(3) Elaboration of indicators The KPI are co-built with the stakeholders concerned by the result of the project and those who are going to make it (the project team). In a spirit of co-construction, we take into account paradoxes and we go beyond simple criteria. We first define the product major criteria: ethical, esthetical, practical, and ecological.


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Then, we analyse what already exists in order not to reinvent everything. We use known reference tables: CSR Europe proposed by Alliances Network, GRI and ISO 26000 standards, Great place to Work' Method elaborated by companies (to widen their performance beyond the economic profitability). We analyse the project through the ISO 26000 criteria:

• Governance: co-construction of the project, participative management • Human Rights: a management opened to diversity (no discrimination towards

disabled, older/younger people...) • Social relationships: well-being of the team members, the staff • Environment: transport, wasting, resources savings (water, energy) • Best Business practices: partners and suppliers of the project • Customers / consumers: what quality? What pedagogy? Just or beyond the law? • Society: indirect and external effects

The economic indicators of the projects are generally already fixed and known. The others indicators are obtained by a coherent questioning. The purpose is to have criteria consistent with various projects and several companies in the perspective of a global economic transformation (benchmarking with other companies as in World Forum Lille).

(4) Example of the method Great place to Work Method The indicator of this method is composite and allows the comparison with other companies. A questionnaire is sent to employees to collect their perceptions and to measure the performance of teams and employees. To ïdgroup, there are regularly appraisal interviews (once a year and after each project). The self-assessment of the employee is confronted with the evaluation of the manager. In October 2010, the group launched its first survey with Great Place to Work for 2100 French employees from the brands Okaïdi, Obaïbi, Jacadi, Véronique Delachaux. ïdgroup is ranked in 9th position. The results are sent to employees at the Forum Group in February 2011. Action plans are ongoing about staff training and communication on earnings.

(5) The example of the Social Clause Initiative The Social Clause Initiative now includes 20 active member retailers. Member retailers work together to sustainably improve people working conditions, and responsibly support suppliers to empower them to become self-reliant agents in their progress. ICS is a group of experts representing retailers who are committed and involved at the grassroots level. ICS promotes responsible trade by promoting social responsibility among manufacturers for retail and distribution brands that import products from at-risk countries. Retails companies formed a group to audit suppliers on the basis of the International Labor Organization criteria. They share the audits among themselves. The methodology is based on social and environmental indicators. For example: child labor indicator.


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The limit of the ICS: the sustainable partnership created with a supplier is more effective than the simple audit. An objective can be the % of sustainable and steady suppliers However, a simple indicator can mask more complex realities. For example: children's presence on holidays in a workshop. The solution is the creation of a place for children in the factory The company wrote a charter with the suppliers and can check if the charter is applied.

(6) Difficulties in measuring • Harmonization of indicators between the various projects • Subjectivity of the measure for qualitative and social criteria: due to the quality of the

people questioned in connection with the confidence mutually constructed • The measure of immaterial items is led and not formalized; for example, we know that

if there is a good atmosphere in a sales team in a store, the performance will be better.

c) Interview of Rodolphe Deborre, sustainable director, Nacarat The eco-construction tool ASAP developed by NACARAT

(1) Definition ASAP is a tool for sustainable building design; "ASAP" (As for Sustainable As Possible), is developed in-house by Nacarat (turnover of € 330 million in 2012, 215 employees), real estate developer, a subsidiary of Rabot Dutilleul group. The strategic challenge of the company is: "Let’s build together the city for human and thus contribute to a sustainable world." The goals of the ASAP tool are to:

• Systematically improve the sustainability performance of real estate transactions and communicate it with stakeholders

• Ask the right questions and determine the desired level of each real estate project in terms of sustainable development ambitions - whether position on each project on issues of sustainable development

• Have the most environmental friendly and most realistic project with a relevant economic approach (intrinsic quality performance of projects on its territory) - design and construct buildings that enhance the sustainability of an area (ecology, employment, economy...)

(2) How?

1. Consultation with local stakeholders: • Identification of customer expectations • Profiling customers into 3 categories: expert (sustainable development and to

promote labels) / ‘weak underbelly’ (looking for simplicity) / resistant people indifferent about sustainable development that influence the marketing process


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2. Checklist of 15 questions (= criteria) to evaluate the real estate project manager (operations manager) in five levels of ambition

• Give yourself a note in relation to projects: comparison with global best practices o Example of thermal performance: comparison to the label Passiv Haus, BBC

standard o Example of mobility: the functional diversity and promote soft mobility,

hinder car, down the number of parking spaces (eg. indicators 'less than 1 parking space per housing')

o Example of project ‘Arboratum’ in Lille: urban biodiversity has to be the maximum level

• Rating on all stages of the project, from its inception to its completion • Topics covered:

o Biodiversity o Soil using o Energy consumption o User behaviour o End of life Building o Mobility o Social justice o Renewable energy o Choice of materials o Drinking water consumption o ....

• Levels of evaluation:

o 0: question untreated o 1: conventional level - within the legal framework o 2: performance level - beyond regulation o 3: Innovative level - expert o 4: World Champion - "business tourism"

• Partner Search:

Nacarat is permanent partnership approach with suppliers producing eco-design services. For example, in the system of car sharing, social network proximity, shared laundry in residence, scalability housing that accompany their owners in their ageing, education for sustainable development ... The aim is to improve the welfare residents. Example about the independence of older people with my Vivalib and myresidence.fr

(3) Features of the demarche

• Mandatory and systematic: for each real estate project, the tool is applied to any type of project: new, rehabilitation, shops, offices, apartments...

All projects, before being launched, go through the filter of ASAP.


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• Focus on control and management: a result from ASAP is often a good indicator of the overall quality of a project. It allows the comparison of the performance of the real project from the levels determined on ASAP.

• Simple: completed in less than 2 hours

(4) Results

• 80 real estate projects treated in 2012 - the tool is become the norm in the company • Quality development of real estate projects with trends expectation – Improvement of

building design / long but significant progress • Incitement to get skills outside the company's business - more than 30 partners • Rise in competence of the entire team - Pride contribute to the sustainable

development commitment Nacarat • Gain positioning statement and choice of sustainable development vis-à-vis its

customers • Nacarat won the Responsible Economy Trophy 2013 of Réseau Alliances for its Best

Practice: "ASAP: A sustainable building design tool developed by Nacarat"

(5) Management of sustainable project / Sustainable project management

ASAP can manage a sustainable project from A to Z in terms of eco-design. The tool also contributes to sustainable management of the project as it is a catalyst for CSR of the company and it is compatible with the ISO 26000 process. A sustainable performance responds to both questions: "Does the project concretely exist? Are people happy?" and "Does the project meet the challenges of sustainable development?" The project should be replicable, ‘copyable’ to change scale. Methodology for the introduction of the tool:

1. Learning about sustainable performance of a real estate project • The issues (conceptually) • The Best world Practices (which is better) • The global standards of eco-construction (eg Living Building Challenge)

2. Experimentation and test

"In the culture of the company, it always starts with projects to implement the vision of management."

• Field Survey (from 30 people): iterative improvement and use of the tool

3. Deployment of the tool • Change management • Name and design of the tool - conceptual ease further improved the ergonomics of

the IT solution • Decisive support of general management of the company


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(6) Reporting / Project management The reporting system enables to gather data on an assessment phase (for example, statistics on 25 finished projects). It can control the results, but not the performance of projects. It comes in a quality process that requires skills in accounting (rigour of the measure, audit, accuracy). It is necessary to have a system for aggregating data compiled statistically.

The performance project management is not an accounting process and therefore it is not necessarily to be very accurate. It involves the 'how' of the project and hence focuses on operational. It reflects the challenges of the project on the field: we will calculate carbon footprint for example, or use HQE label as too heavy to use but will use good concrete practices (you can touch with hand) such as: cycles offered, building with low maintenance, windows in wood. The performance indicator must determine the range of possible (ie. Where is the zero point and the maximum) and should be easy to understand to prevent against nonsense.

(7) Sources

• Interview of Rodolphe Deborre, Nacaract sustainable director, the 9th October 2013

• Detailed CSR analysis of Nacarat by Réseau Alliances: http://www.reseau-alliances.org/images/stories/D%C3%A9marches%20RSE%20prim%C3%A9s/2013/08.Dossier_Demarche%20RSE_NACARAT_PublicBP.pdf

• Nacarat’s best practices by Réseau Alliances: http://www.reseau-alliances.org/en/bonnes-pratiques/recherche-avancee.html?business_sector=&cid=&company=292&company_size=&country=&transmitter=0&year=

• Video of the best practice ASAP of Nacarat by Réseau Alliances: http://www.youtube.com/watch?v=pLAj_JXcL1Y

2. Case studies

a) Bonduelle The case of Bonduelles's sustainability reporting is particularly significant towards a total transparency.

Bonduelle has defined its approach to sustainable development progress in 2002-2003 based on conventional methodology of project structured in several phases:

-‐ Phase 1: establish and validate targets and communicate throughout the organization; -‐ Phase 2: implement improvement initiatives to achieve these goals; -‐ Phase 3: managers field related to their networks and validated with operational

developed measure and monitor results - indicators on the priorities of the sustainable development of Bonduelle.

The complete reporting aims to give support for management. The results are analysed by the Steering Committee of "sustainable development" and the Steering Committee of the


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Bonduelle Group to determine the objectives for the following year. The control of reporting is provided by the Director of External Relations and Sustainable Development Group and the leaders of the five areas concerned by the reporting (transportation, quality-nutrition, agriculture, natural resources and people and safety). Together they provide the animation of an international network on the basis of a multilingual reference base (seven languages). Indicators are selected according to the requirements of the GRI, the specific issues to the activities of Bonduelle and requests expressed by the stakeholders. Coordinators based in each subsidiary and deposited from 2011 to 2012 collect them annually on the exchange Intranet platform group called “e-space”. The responsible areas validate these data. Data reporting are managed and consolidated into a database run by the management control group. The coordinator and data management control group provides consistency checks and data analysis. These indicators were selected on the basis of sustainable development commitments Bonduelle crossed with the GRI version 3 has resulted in the creation of a repository Bonduelle own reporting. Bonduelle has established its Table of compliance of the Corporate Social Responsibility Report with Global Reporting Initiative requirements. GRI hereby states that Bonduelle has presented its report 'registration document' (2012) to GRI's Report Services, which have conceded that the resort fulfils the requirement of Application Level B+. The report has been verified by the GRI (version 3.1 Food GRI Sector Supplement). In order to integrate an external audit on the reliability of reporting for that year, the firm Deloitte joint statutory auditors also controlled the reporting process and 18 indicators.

b) Danone I have also studied the sustainability strategy and organization of Danone. It is a French food-products multinational company, which produces dairy products (Activia, Danette, Taillefine), water in bottles (Evian, Volvic, Badoît), infantile nutrition (Blédina, Aptamil) and medical nutrition (Nutricia, Milupa, Fortimel). The main values of the company are the opening, enthusiasm, humanism and proximity. How is sustainability managed in the organization? Danone has integrated the sustainability concept in its strategy. The CEO, Franck Riboud, says: “My vision for Danone: a company that creates economic value while creating social value ”; the “dual economic and social project” that is the foundation of the Danone way of doing business is almost forty years old. « Whatever the agents and their role, our real purpose is to create shared value. » Danone has developed a sustainable development management tool for Country Business Units (CBU) called Danone Way Following the Danone Way evaluation process each CBU receives from the corporate team their “Scorecard” or “Dashboard” containing their own results, as well as elements of


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benchmark, with respect to their results for the previous year and compared to averages for the Division and the region where the CBU operates. According to their results, the CBU then has the opportunity to identify priorities and develop concrete action plans.

How is sustainability integrated in project management? We can notice that, since 2008, criteria used to evaluate the performance of the company’s 1,400 managing executives are based on a three-part bonus system:

-‐ 1/3 for economic objectives -‐ 1/3 for social and environmental objectives -‐ 1/3 for individual performance objectives.

It looks a good mean to motivate project manager who is the most important actor for installing sustainability in project management.

With the establishment at the group level, of three Funds (danone.communities, Danone Ecosystem, Danone Fund for Nature), Danone is seeking to accelerate and support ambitious social projects in terms of impact and sustainability.

Danone Supporting Life is the new platform that regroups all of the various local initiatives developed by Danone Country Business Units that will benefit their communities. It serves as a network that supports and facilitates the honing of the process surrounding the construction and management of a social-societal programme. In this manner Danone Supporting Life contributes to the acceleration and achievement of the impact expected in this area.

c) Essilor’s Global Value Essilor International Group (Varilux, Crysal, Definity Xperio), founded in 1972, designs, manufactures and sells glasses vision correction in more than 100 countries. Serving all to "see the world better," Essilor's activity contributes to sustainable development. Along with its economic success, the group provides the means to monitor its social and environmental performance.


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Since 2006 an annual index of overall performance on a scale of 0.7 to 1.40, measures the contribution of the 11 social and environmental indicators of the group's economic performance (eg, governance, education, environmental management, community involvement and functions purchase and trade). An external agency, BMJ Rating, developed the Global Value model, monitoring and fed by non-financial data provided by the financial managers of the group.

The objectives are to:

-‐ Encourage the consideration of sustainable development by managers -‐ Have measurement tools for sustainable progress measurement -‐ Create a transparent communication with stakeholders

In 2011, the BMJ Ratings agency gives the note 1.29 to Essilor International, noting that the action of the Group in the areas of sustainable development is likely to strengthen its economic performance. Essilor International is a high profit takes its environmental commitments, social and governance.

d) Nature & Découverte N&D introduced expense CO2 invoices: each service has a CO2 emissions quota it are not allowed to exceed; the expense CO2 invoices enable measurement and emission control by service. The company launched in 2005 its carbon footprint that gradually structure (90 people responsible in the business environment today and 8% of its payroll dedicated to sustainable development). Each service has a carbon quota for the year and each employee fills in an 'expense CO2 invoice" to monitor all emissions associated with travel. These actions, combined with support providers to make their own carbon footprint thanks to a web interface, allowing Nature and Discoveries follow more finely this key indicator.

e) McDonald’s McDonald's is testing a pilot project with the Synergence consulting firm of establishment of a universal accounting, that is to say, an accounting that reflects in the economics: social, environmental... The example of the indicator on greenhouse gas emissions has been developed. By encrypting the carbon cost of 109 € per tonne, McDonald's was able to incorporate in its classic book bundle the cost of CO2 emitted by restaurants but also on a global basis (which includes all upstream and downstream sector). A real painstaking, exciting, conducted today on the fields of nutrition, governance and social...


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E. CSR KPI MODELING

1. Some sustainable project KPI So, we can say that project managers are looking for operational KPI in a practical approach. Indicators must be ‘customized’ for the project and embrace all the stakeholders expectations. Here is a list of sustainable project KPI and ground rules, which could directly be used by project managers:

• Electronic distribution of all project materials is the default method; paper copies are only provided on request

• Virtual attendance and work in encouraged to minimize travel and reduce carbon footprint, central locations for meeting are chosen

• Recyclable and/or reusable office containers (...) are requires for team meetings. • All end product resources used by for prototyping and trials are reused and/or recycle

with zero waste • All the resources used by the team are from renewable sources • All electronic charger s will be unplugged when not required to charge an electronic

device • Screensavers are not used • PCs will be turn off when not it use (after work hours or week-end or holidays) • Office lights will not be used when staff are not in the room, during night and ton the

week-end We also propose a new rule: the integration of CSR criteria determining the calculation of the remuneration of the project manager and the project team. To strengthen their sustainable development and encourage their employees to daily engage in politics of sustainable development, some companies have chosen to integrate CSR criteria into the variable remuneration of their executives and managers. CSR indicators concern both environmental carbon footprint and the number of social accidents, the percentage of women, the rate of training of teams, turnover and societal: choice of purchases from the protected sector for example. To launch this system is not without raising questions:

-‐ How to ensure that the indicators selected with CSR are aligned with business strategy?

-‐ Which people this system has to be applied (leaders / managers / team)? -‐ Which geographical area? -‐ What criteria to select? -‐ Do managers and leaders have the means to achieve CSR objectives? -‐ How to integrate this system with other human resource driver (annual performance

appraisal, training, social barometer,...)? The first step is to fix the expectations and challenges: which direction does the company want to give to the enrichment of this remuneration policy?


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Then, the implementation of the process: which people will be affected? Which CSR issues are taken into account in the criteria of remuneration, what part of the variable remuneration will be dedicated to CSR? Finally, monitoring of implementation, particularly to study the return on investment (allocated budget, results,...). The integration of CSR criteria in the variable remuneration is one of the possible tools to mobilize leaders and project managers about CSR issues. This is a step that shows the willingness of the company to put CSR at the heart of its strategy.

2. Methodological advice The criteria have to be defined according to the project sector, and with respect to the selected area. It is then interesting to compare the selected indicators to those of international standards such as the GRI. It is advisable to focus on indicators with a history (to see them change from previous years), meaningful for employees (employees must be able to have an influence, even indirectly, on their evolution) and with a reporting sufficiently reliable. The key to success is selecting KPIs that will deliver long-term value to the organization. Here are five rules for selecting the best KPIs to drive operational improvement: 1. Focus on the critical few, not the trivial many 2. Ensure that selected KPIs drive toward your strategic intent 3. Ensure that KPI are relatable on all levels of the organization 4. Ensure the data for KPIs are valid 5. Ensure controllable KPI are selected Sources: Five Rules for Selecting the Best KPIs to Drive Operational Improvement http://www.industryweek.com/lean-six-sigma/five-rules-selecting-best-kpis-drive-operational-improvement

3. Composite indicator But only a quantitative indicator approach is still relevant? Given the plethora of indicators for business, would it be possible to consider a synthetic indicator? We can imagine a composite global indicator to evaluate the triple bottom line of project in the same way of Earned Value Management: a sustainable value management. It implies to determine, which criteria do you count in the calculation of the environmental or social index.


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It exists an other index: the Dow Johns Sustainability Index, based on an analysis of corporate economic, environmental and social performance, assessing issues such as corporate governance, risk management, branding, climate change mitigation, supply chain standards and labour practices. We could establish a score for each criteria and weighting in order to give a global note for the project in each dimension: economical, environmental and social. The main benefits of the composite indicator are to give a quick view of the status of project. However, all depends of what you want to explain behind the indicator. The interesting thing is to view the evolution of the indicator to compare past and present situation.

Global view about the environmental aspects of a project

4. The form of the reporting A good example is the Vigéo model that determines for each criterion of the referential the level of commitment on a scale of four levels:

1 - No tangible 2 - Initiated 3 - Convincing 4 - Advanced

The presentation of results of the evaluation is synthetic with colours for each level to indicate the level of commitment of each criterion of the referential for the three attributes: Policy (visibility, content, support), Deployment (process, means, monitoring / reporting) and results (indicators, views of stakeholders, controversies). An overall score is thus given by criteria with its evolution compared to the previous analysis.


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Sources : Exemple Vigéo de présentation synthétique des résultats d’évaluation – Vigéo

Sources : Un référentiel de management pour l’amélioration continue – Vigéo One could also imagine doing an environmental display projects with global criteria of measurement: energy consumption, CO2 emission...


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However, there is a danger in these formatted tools, and letters ABCDE, which are based on multi-criteria approach because it is difficult to weigh the different criteria (water, carbon,...). It would also require that all displays of projects are made with the same method, to really compare two similar projects. Another issue to integrate the sustainable reporting of projects in habits is to have CSR indicators in the ERP system for an automatic reporting. Some ERP now include cross considerations such as sustainable development. Thus, the calculation of the carbon footprint for each project of the company will allow the reporting and certification for companies engaged in the reduction of greenhouse gas emissions. Business trip or express delivery by air will be analysed beyond the simple calculation of cost, providing complete visibility of the environmental management of the company.

V. CONCLUSION To conclude, in order to change towards the sustainable project management, project manager needs to have indicators and measure in order to manage the sustainability in project management. My difficulties in this thesis were to make a distance between the strategic and the project level: a lot of things exist about the CSR at the strategic level in enterprise but not a lot about project management. "In business, there are many believers but not many practitioners." It is incongruous to attribute a moral conscience to a project. The project concept is a shortcut of course. Attributed responsibilities to the project apply to people, who together decide on the project. Sometimes it is not easy to assess the precise responsibility of an individual in a collective structure. But the fact that we cannot accurately reflect the responsibility of each of the project team does not mean that the team is not responsible or that nobody is responsible. If the responsibility should apply to the project, then it should apply to people who manage it. We can criticize the notion of performance: a questioning about the "total performance" that evaluates a project, how to manage it and its objectives and that dictates, by the figure, the


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acts and attitudes. Under the appearance of neutrality, the certainty of figures favours consensus, but mask debates or paradoxes. The solution:

• Real consultation of individuals and citizens in the democratic construction of indicators,

• Plural and not univocal performance: plurality of meanings, objectives, conflicting projects, paradoxes

• Do not be limited by only quantization When you quantify, the actors tend to "keep a low profile" to make the counters rather innovation. But where are the notion of trust, adaptability to context, empathy, if the tasks are standardized and measured? Where is the value of "time", which is often the value of the service? Some solutions:

• Set the priority of the mission, the common good, the public interest • Choose a complex multidimensional evaluation, relying on in-depth interviews; not be

limited to a numerical measure • Prefer collective performance to individual performance

The figure has a "magic power", fetishist, unreal neutrality that depersonalizes social relations. The ‘ratiocratie’, the scientific figures, its simplicity and immediacy enhance the short term at the expense of sustainability. To get out of the dictatorship of the figure, choose a " deliberative " system: democracy in the construction of indicators, performance measurement negotiated, involvement of stakeholders, multi dimension criteria. Some new fields about sustainable project management should have to be earned to be study as LCA (Life-Cycle Analysis) of project or Green project management (CtoC project): how to get a circular project management and not a linear life cycle anymore? It is mainly an issue of knowledge management and lesson learned to reuse for new projects. An evaluating system to evaluate the maturity of the organization about sustainable project management could be imagined: what is the level of maturity of project management in sustainable development? Another stake is to think about a new governance of project more opened and collaborative. In order to take account the expectations of external stakeholders and implicate them, a solution could be to invite them to participate in directly the governance. If a stakeholder can have an influence or an interest for the project deliverable, it is interesting to have this stakeholder in the process of decision as in a cooperative business model. Ultimately, building a strategy that benefits both the environment and the organization requires looking across the entire project portfolio through a new lens. You should always look at your projects from all angles. The same old take on sustainability won’t do. Balancing financial goals with sustainability goals is a given, but the key is to have bold and insightful innovators on your team. The projects must contribute to the achievement of the business strategy of companies. They convert to sustainable development. Projects must so be graded on their ability to generate sustainability. Sources: Book La performance totale - Florence Jany-Catrice


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VI. REFERENCES Thesis

• Project Management and Global Sustainability, Jennifer Tharp – PMP, 2012, published as a part of 2012 PMI Global Congress Proceedings – Marseille, France

• Getting to the Bottom of “Triple Bottom Line”, Wayne Norman and Chris MacDonald, March 2003, in Press Business Ethics Quarterly

• The Sustainability Balanced Scorecard - Theory and Application of a Tool for Value-Based Sustainability Management, Frank Figge, Tobias Hahn, Stefan Schaltegger & Marcus Wagner

• Measuring and Managing Intellectual Capital: An Examination of Critical Success Factors, Gülsun Hoscanoglu

• Project sustainability management in infrastructure projects, Kerry Griffiths

Articles • « L’investissement socialement responsable fait partie de notre identité », Jean-Yves

Gilet (FSI), http://www.smartplanet.fr/smart-people/jean-yves-gilet-fsi-linvestissement-socialement-responsable-fait-partie-de-notre-identite-6676/

• World Forum Lille Institute, CSR indicators seminar, http://www.worldforum-lille.org/fr/organisateur/le-think-tank/actualites/119-conference-debat-les-indicateurs-rse.html

• Why Investors Should Consider Sustainability Risk Management, http://blogs.hbr.org/cs/2009/10/investors_consider_sustainabil.html

• Creating Shared Value: Redefining Capitalism and the Role of the Corporation in Society, January 2011, Michael E. Porter and Mark R. Kramer, http://hbr.org/2011/01/the-big-idea-creating-shared-value/

• PMNetwork, From Green to Black, July 2012, http://www.pmnetwork-digital.com/pmnetworkopen/201207?sub_id=23xBjEtvPaEe#pg1

• KPI Infographic: www.haironfirepm.com/wp-content/uploads/2012/12/KPI-infrographic.jpg

• Dynamic analysis tool: theory of stakeholder identification and Salience, 1997, Mitchell, Agle and Wood

• Measuring Shared Value, How to Unlock Value by Linking Social and Business Result, 2011, Michael E. Porter, Greg Hills, Marc Pfitzer, Sonja Patscheke, and Elizabeth Hawkins

• La performance globale de l’entreprise et son pilotage : quelques reflexions, Christophe Germain, Audencia Nantes – école de management, et Stéphane Trébucq, Université Montesquieu Bordeaux IV

• Five Rules for Selecting the Best KPIs to Drive Operational Improvement : http://www.industryweek.com/lean-six-sigma/five-rules-selecting-best-kpis-drive-operational-improvement

• Doing the Right Things is More Important than Doing Things Right: http://www.bothsidesofthetable.com/2010/07/14/doing-the-right-things-is-more-important-than-doing-things-right/

Books

• Green Project Management, David Shirley • Strategic Management: A Stakeholder Approach, R. Edward Freeman • Osez le marketing durable, Christophe Sempels


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• La performance totale, Florence Jany-Catrice Studies and Organizations

• ORSE (l’Observatoire sur la responsabilité sociétale des entreprises), Analyse comparative d’indicateurs de développement durable, http://www.industrie.gouv.fr/pdf/devdurable1.pdf

• The SROI Network, A guide to Social Return on Investment, http://www.neweconomics.org/publications/guide-social-return-investment

• Institut de l'Innovation et de l'entrepreneuriat social, http://entrepreneuriat-social.essec.edu/axes-de-recherche/evaluation-de-l-impact-social

• Global Reporting Initiative (GRI): www.globalreporting.org, GRI G3.1 Guidelines Incl. Technical Protocol

• Centre for sustainable technology practices (CSTP): http://www.aiche.org/IFS/Centers/CSTP/index.aspx

• The International International Reporting Council (IIRC) : http://www.theiirc.org/the-iirc/

• ISO 26000 : http://www.iso.org/iso/home/standards/iso26000.htm • Réseau Alliances : http://www.reseau-alliances.org/bonnes-pratiques/moteur-de-

recherche.html • Vigéo: http://www.vigeo.com/csr-rating-agency/ • Bonduelle : http://developpementdurable.bonduelle.com/ • Essilor : http://www.essilor.com/en/Group/Sustainable/Pages/OurPolicy.aspx • Danone : http://www.danone.com/fr/developpement-durable.html • Quel progrés!: La mesure de la performance Indicateurs de suivi extraits de 39 rapports

RSE Courses and Presentations

-‐ Project management and Sustainability, Philippe Vaesken in MSc. PPMBD - Skema Business School

-‐ Risk Management, Alex Barned in MSc. PPMBD - Skema Business School -‐ Cost Management, Thierry Verlynde in MSc. PPMBD - Skema Business School -‐ Cost Management, Sarah Ross in MSc. PPMBD - Skema Business School -‐ Project Communications and Project Configuration, Mary McKinlay, in MSc. PPMBD -

Skema Business School -‐ Construction of relevant indicators, Philippe Vaesken -‐ New trends in management education in Eastern Europe, Marc Luyckx, 2012 -‐ Presentation PMI Nord about stakeholders, Philippe Vaesken - Skema Business School, 2013 -‐ Intégrer le développement durable dans la gestion de l’entreprise, JM. Cardebat -‐ Les fondements théoriques de la Responsabilité Sociale des Entreprises, Jean-Pascal Gond

thèse professionnelle sur les indicateurs de performance rse et le management de projet

Education