MEASURING THE COMPANY’S SUSTAINABILITY THROUGH BUSINESS MODEL

1. MEASURING
THE COMPANY’S
SUSTAINABILITY
THROUGH
BUSINESS MODEL
Prepared by
Anastacia Bohdan,
FEM, EPC – 504i
Research supervisor:
Batenko L.P.,
PhD, professor

2. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
Today series of indicators, methods and tools have been created,
but there is still a lack of understanding of how the numerous
approaches treat the different environmental, economic and
social dimensions that compose the sustainability and, the level of
influence of such initiatives on the firm’s sustainability assessment.

3. “
Introduction
Formulation of the
problem
Results of the
research
Conclusions References
The main problem of the article is to find out the way
of measuring sustainability of the company, enough
precise and understandable in its implementation.

4. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
1
2
Measuring sustainability has two mail goals:
Evaluation the company’s performance
Informing the stakeholders about the efforts in economic,
environmental and social areas

5. Firm's sustainability may be assessed at various level:
Introduction
Formulation of the
problem
Results of the
research
Conclusions References
3rd level: Firm may benchmarked against the state of the economy at a
national level.
2nd level: Firm is benchmarked against its peers in the same industry
1st level: Firm must be able to generate adequate income to cover its expenses

6. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
The most well-known tools for corporate
sustainability measuring:
• Ethods Indicators
• Global Reporting Initiative
• Green Management Assessment Tool
• IchemE
• Sustainability Assessment Model
• Sustainability Cost Accounting
• Sustainable Value Added
• Manufacturing Ecosystems Model
• Framework to assess the sustainability of
operation initiatives
• Indicators of sustainable development for
industry
+
-
Help to view on the level of
sustainability from different prospective
• No explanation of influencing on
special areas (economic, social, and
environmental) and how each
element of these tools contributes to
sustainability;
• No systematic description of
implementing the tools
• No clear understanding how insert
sustainability aspects in operational
activities.

7. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
Solution
It is proposed to use the evaluation of business model sustainability as the main
indicator of the general level of firm’s sustainability.
The business model breaks down company performance into pieces or building
blocks and put them together in systems or frameworks.
Examples of different pieces:
• the profit formula;
• processes;
• value propositions;
• resources;
• activities;
• etc.
Examples of frameworks or structures:
• Identifying New Business Opportunities
(INBO);
• The Business Reference Model;
• The Component Business Model;
• the Business Model Canvas (BMC)
• etc.

8. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
1. Schematic, more complete picture of business processes and their potential relation to
sustainability dimensions.
2. It is business easier to take into account industry specifications and bring corrective actions.
3. The model analysis allows detecting key vulnerabilities at an early stage when the company
may generate risks.
Measuring the BMs sustainability will bring such benefits:
Steps to embed sustainability aspects in the existing business model:
1) Add new blocks to existing frameworks.
2) Divide blocks of existing frameworks.
3) Modify the block-content of existing frameworks.
4) Modify the structure of existing frameworks.
5) Link elements (items or blocks) of existing frameworks.
6) Add views on existing frameworks.

9. Key Partners
• legal compliance
• corruption and
fraud
• business ethics
• socio-economic
targets
• socially responsible
investing
Key Activities
• performance evaluation criteria
• social impact & environmental impact
• waste productivity & generating
• product safety innovation capacity
• environmental risk assessing
Value
Proposition
• reputation and
transparency
• business
ethics;
• sustainability
pay link
• SROI ratio
• value creation
statement.
Customer
Relationships
• reputation and
transparency
• customer
privacy
Customer
Segments
• legal compliance
• business ethics
• socio-economic
targets
• product safety
• customer
privacy
Key Resources
• social education & training
• social disclosure
• employees compensation & productivity
• employees work-life balance&happiness
• non-discrimination and equality
• social risk management
Channels
• reputation and
transparency;
• legal
compliance
Cost Structure
• waste productivity & generating;
• socially responsible investing;
• employee’s compensation;
• compensation fairness; energy efficiency.
Revenue Streams
• SROI ratio;
• sourcing evaluation;
• socio-economic targets.
Introduction
Formulation of the
problem
Results of the
research
Conclusions References
Set of sustainability indicators:

10. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
Sustainability is a significant concept for modern business, which
includes not only the economic aspects but also environmental and social.
To measure the level of business sustainability it was proposed to
use business model sustainability measuring. It brings advantages and is more
understandable through Business Model Canvas.

11. Introduction
Formulation of the
problem
Results of the
research
Conclusions References
1. Lucila M. S. Campos, Simone Sartori. Analysis of Corporate Sustainability Assessment
Tools and Operations Management/ 2013. Available online:
https://www.pomsmeetings.org/confpapers/051/051-0426.pdf
2. Aldona Jočienė. Evaluation of sustainability of business models of Scandinavian Bank
subsidiaries. // Taikomoji ekonomika: sisteminiai tyrimai / Applied Economics: Systematic
Research 2015, nr. 9(2). Available online: https://eltalpykla.vdu.lt/handle/1/1157
3. Schoormann T.; Behrens, D.; Kolek E.; Knackstedt R.: Sustainability in Business
Models – A Literature-Review-Based Design-Science-Oriented Research Agenda. In:
European Conference on Information Systems (ECIS), Istanbul, 2016
4. Nina Heir. Sustainable Business Models. A Need for New and Sustainable Business Models
// Master thesis / Norwegian University of Science and Technology – June 2016.