A PCA-based method for construction of composite sustainability indicators
- 1k Downloads
Sustainable manufacturing is practiced globally as a comprehensive strategy for improving the sustainability performance of the manufacturing industry. While sustainability is characterized into such three dimensions as economic, environmental, and social, currently, there is no quantitative method yet to measure the so-called “sustainability” in the manufacturing industry. The objective of this research is to develop a comprehensive and effective quantitative method to measure the overall sustainability performance of manufacturing companies.
In this paper, an integrated methodology is presented for the development of composite sustainability indicators based on principal component analysis (PCA). In developing this integrated approach, both industry and academia surveys are conducted to identify what sustainability indicators are favored by the sustainable manufacturing community. A unique index is then generated to measure the overall sustainability performance of industrial practices. The methodology can be used for benchmarking the overall sustainability performance of various manufacturing companies.
A case study is conducted on a total of 11 global electronic manufacturing companies. The overall sustainability performance of these companies are measured, benchmarked, and ranked. The results showed that PCA is an effective approach for constructing composite sustainability indicators across environmental, economic, and social dimensions.
From this research, it is found that industry and academia have different views on the sustainability measurement, evidenced by different weights put on the same indicator in industry and academia. The case study demonstrated that the methodology presented in this paper is an effective tool for comprehensive measurement of sustainability performance of manufacturing companies. Strengths and weaknesses of each company can be identified. Then, the recommended improvements can be suggested based on the study of each of the individual indicators.
KeywordsCorporate sustainability Industry and academia surveys Life cycle assessment Sustainable development Sustainability indicator
The authors would like to thank the research institutions, universities, and the companies for their participation and support in our survey. The project is funded by the National Basic Research Program of China (grant no. 2011CB013406).
- Aras G, Crowther D (2007) Sustainable corporate social responsibility and the value chain. In: Crowther D, Zain MM (eds) New perspectives on corporate social responsibility. MARA University Press, Kuala Lumpur, pp 109–128Google Scholar
- Erhard M, Van Minnen J, Voigt T (2002) Proposed core set of climate change state and impact indicators in Europe, technical report no. XX. EEA, ETC on air and climate change, European Environment Agency, CopenhagenGoogle Scholar
- Jolliffe IT (2003) Principal component analysis. Springer, New YorkGoogle Scholar
- OECD (Organisation for Economic Co-operation and Development) (2002) Indicators to measure decoupling of environmental pressure from economic growth, The OECD Environment Programme. OECD, ParisGoogle Scholar
- Pearson K (1901) On lines and planes of closest fit to systems of points in space. Philos Mag 2:559–572Google Scholar
- Quarrie J (1992) The United Nations Conference on Environment and Development-Earth Summit 1992. Rio de Janeiro, BrazilGoogle Scholar
- SAIC (Scientific Applications International Corporation) (2006) Life cycle assessment: principles and practice. EPA, WashingtonGoogle Scholar
- Shaw PJA (2003) Multivariate statistics for the Environmental Sciences. Hodder-Arnold, LondonGoogle Scholar
- Soler RJ, Soler RP (2008) Assessment of aggregated indicators of sustainability using PCA: the case of apple trade in Spain. Proceedings of the 6th Int. Conf. on LCA in the Agri-Food Sector, Zurich, November 12–14, pp 133–414Google Scholar
- WCED (W. C. o. E. a. D.) (1987) Our common future. Oxford University Press, OxfordGoogle Scholar
- Wei J, Zhao YT, Xu HQ, Yu H (2007) A framework for selecting indicators to assess the sustainable development of the natural heritage site. J Mater Sci-Eng 4(4):321–330Google Scholar