Challenges in using environmental indicators for measuring sustainability practices

Many businesses are pursuing sustainability for a variety of reasons, ranging from increased financial competitiveness to meeting upcoming regulatory initiatives. Choosing the appropriate indicators to measure environmental progress, however, is a critical challenge. Using data from the automotive industry, this paper illustrates how indicators can be incorrectly selected, misused, or misinterpreted, resulting in misleading conclusions. Such issues are especially critical when using indicators in emerging tools, such as life cycle analysis, to assess the impacts posed by alternative designs. Furthermore, incorporating the impacts represented by the indicators into the decision-making process can be problematic, since these indicators will be used to assess the success or failure of design changes. The automotive sector is an ideal example because it has implemented a variety of measures to meet its environmental challenges: numerous indicators and decision approaches have been developed for or adapted to the industry and it has had to address important issues, such as the use of normalized metrics and appropriate weighting schemes. Key words: indicators, automotive industry, sustainability, environment, life cycle assessment, decision making.