Your sustainability KPI cheat sheet: Track benchmarks and performance

1. The essential ESG KPIs — and their financial parallels

2. What a good sustainability KPI looks like

Think of this the same way you assess a financial metric, accuracy, relevance, and decision-usefulness matter more than sheer volume of data. A “good” KPI has these attributes:

1. Clear definition and scope
   
   • Just as “gross margin” is universally understood, a KPI like “Scope 2 GHG emissions” must be defined in line with recognised standards (e.g. GHG Protocol).
   • Avoid vague labels like “energy efficiency” without specifying units, boundaries, and methodology.
2. Quantifiable and comparable
   
   • Can be expressed as an absolute number and, where relevant, as an intensity (e.g. per €m revenue, per unit produced).
   • This is the ESG equivalent of presenting both total revenue and revenue per share.
3. Relevant to value creation and risk
   
   • Measures something material to the company’s operations, sector, and strategy,  not just “what’s easy to measure.”
   • If the KPI can’t influence investment, operational, or strategic decisions, it’s a vanity metric.
4. Consistently measured over time
   
   • Uses the same boundaries, data sources, and methodologies year-on-year to enable trend analysis.
   • Changes in definition must be documented, just like restating prior-year financials.
5. Aligned with external standards
   • These should complement business relevance: a KPI must drive value creation internally while also aligning with external standards for comparability whenever possible.
6. Able to be benchmarked
   • Structured so it can be compared to credible peer data, normalised for size, geography, and sector.

3. Aligning KPIs with regulatory and strategic goals

For CFOs, this is like mapping your chart of accounts to IFRS or GAAP standards.☑ Map each ESG KPI to disclosure requirements (CSRD, ISSB, EU Taxonomy)

• ☑ Link each KPI to strategic drivers (e.g. emissions reductions tied to cost savings, diversity tied to market growth)
• ☑ Assign internal owners and ensure data collection methods are documented, just like your audit trail for financials

4. Benchmarking: Your ESG version of peer financial comps

In finance, you would never assess performance without comparing it to peers. ESG is the same.

Why it matters:

• Tells you whether your “ESG margins” are competitive
• Signals to investors that your targets are grounded in market reality
• Reveals both performance gaps and potential differentiators

Best practice:

• Use verified, comparable datasets, just like using audited financials for comps
• Adjust for sector, region, and company size, as well as the specific needs of your business and its operations.
• Review multiple different benchmark scenarios on the fly, allowing you to expand your scope of comparison or shrink it for unseen insights.

5. Using benchmarks to set targets

This is the ESG equivalent of forecasting EBITDA margins, you use market data to set realistic, competitive, and investor-reassuring goals.

Example:

• If sector GHG intensity averages 35 tCO₂e per €m revenue and you’re at 48, model the cost and capital access benefits of hitting 30 within three years.
• If peer median renewable energy share is 45% and you’re at 25%, quantify the long-term energy cost savings of closing the gap.

6. Avoiding the common pitfalls

• Data silos: ESG data sits in operational teams, finance never sees it
• Non-standard definitions: Two plants measuring “energy use” differently = unusable totals

Benchmark mismatches: Comparing a European industrial manufacturer to a global consumer goods giant gives misleading results.

Taking this to the next level with benchmarking

KPI setting within the context of your own organization is one thing. But something that all competitive CFOs want to understand is how their own performance compares to peers or competitors in their industry.

This can add another dimension to your objectives within sustainability, and align it to your organization’s desire to be the top performing brand within a specific sector, industry, or vertical that you view as business critical.

Where this can get challenging, though, is in understanding not just how your competitors are faring within the services you provide, but how much more resilient, compliant, or sustainability-driven they are.

As you can see above, there are a lot of verticals to consider, from Scope 1-3 emissions to governance. But this is where our software can help, as we provide a comprehensive benchmarking tool as part of our complete ESG management software.

You’ll be able to benchmark specific disclosures and how you fare by industry, company size, and location, giving you crucial insights into understanding the full picture of your sustainable competitiveness.

We would love to show you how it works and discuss how the rest of our platform can help you report faster, smarter, and with greater efficiency, all while capitalizing on the sustainability data within your operations.