Therase Keating investigates the takeup of triple bottom line by local government.
What's driving local councils to go green? There is currently no Australian triple bottom line standard or regulation enforcing councils to change their ways. Perhaps this new consciousness is in response to community pressure and the general acknowledgement of sustainability as a major issue for the future.
Environmental and social factors are increasingly becoming as important as financial measures in local government decision-making processes.
Whatever the drivers, local councils are pushing the boundaries to incorporate economic, environmental and social reporting to measure their progress. They are getting in early and not waiting for legislation, accounting standards or other regulatory guidelines before implementing reporting systems that are far broader than ever before.
The local government focus on going green is not necessarily a knee jerk reaction to community pressure says Councillor John Ross, president of the Australian Local Government Association. Ross says that for local government in Australia, the triple bottom line is not necessarily a new agenda as councils have been pursuing more sustainable forms of development for some time through the strategic planning of our cities and towns.
According to Stella Whittaker, executive manager environment, Hornsby Shire Council's key triple bottom line inspired projects originated from the community demanding that Council take on board a strong environmental focus. She says this mandate was also championed by elected councillors who continue to push management to adopt new environmental and sustainability programs.
'Under the broad banner of triple bottom line, we've tailored a number of major projects to directly respond to environmental and social demands.
'Council has recently resolved to use the triple bottom line framework and toolkit developed by Melbourne City Council. This will be used to supplement our current Community Sustainability Indicators project and sustainable management system. Some of these community driven measurements are already key performance indicators of Council and will soon be aligned to form an integrated Council and Community vision which is in essence a sustainability vision for the Shire,' she said.
CPA Australia's public sector policy adviser, Adam Awty, says that many local governments already collect and report on the financial and non-financial impact through the Australian Bureau of Statistics State of the Environment report. He believes this is one sustainable opportunity all local councils should be taking advantage of. 'Councils already have this information at their fingertips and this existing information could be used in broader reporting systems to enhance decision making. The focus should be on information to enhance management rather than just financial reporting.
'The key to success in local government is the integration of financial information with non-financial information and translating this into useful data for all stakeholders, from councillors to the community,' he says.
Baulkham Hills and Sutherland Shire Councils' are also active and are in the early stages of piloting an eco-accounting project in partnership with the International Council of Local Environmental Initiatives. The project is based on aligning the physical and financial accounts of the municipalities' natural resources and determining if the financial accounts of council are consistent with its environmental policies. The outcome will allow decision making to be viewed within the context of sustainability.
Victoria Critchley, sustainability program coordinator, Baulkham Hills Shire Council, says that traditionally, environment and community reports rarely impact decision making, which is largely guided by economic concerns.
Critchley believes this is now shifting and can be demonstrated through the innovative approach of their eco-accounting project.
'We're measuring targets through economic indicators such as revenue generation, operating and capital costs. Environmental indicators measure environmental resources in metric terms such as tonnes of solid waste and greenhouse gas emissions, while social indicators include community satisfaction and awareness of services provided by council.
'To achieve sustainability in the triple bottom line concept, not only are new accountability and reporting mechanisms required but also new forms of accounting. For an organisation to function sustainably there is a need to develop accurate, useful and credible indicators of progress for measuring economic prosperity, environmental quality and social equity,' she says.
Councillor Ross is not surprised by local government activity directed at sustainable development. He says cities are densely populated hubs of commercial activity. 'They consume more than their fair share of natural resources and contribute disproportionately to environmental and social issues such as global warming and impacts on community health.
'Cities are also the venue for intense interaction between government, business and the community and local government is a natural conduit and an active participant in these exchanges. The application of triple bottom line at local government level has the ability to influence and achieve more sustainable outcomes for the communities that they represent,' he said.
Ross highlights the City of Melbourne as another local council making significant inroads in applying a triple bottom line approach to the management of its core business to create a more sustainable organisation and facilitate the development a sustainable municipality.
To this end, he says the City of Melbourne developed a number of triple bottom line tools including sustainability assessments for council reports and capital works which are being applied to planning, decision making, governance and reporting processes.
A toolkit has also been provided to other councils as a starting point, so they do not have to reinvent the wheel when it comes to adopting a TBL approach.
While there are a number of benefits of incorporating TBL in council reporting frameworks, Critchley says Baulkham Hills Shire Council encountered numerous challenges when collecting data for the physical and financial indicators based on eco-accounting, being a relatively new concept. She says it took some time and considerable research to finalise a methodology and expected outcomes of the project.
Furthermore, Critchley says it is essential that councils' financial and environmental teams work closely together to develop an appropriate data management system. 'A real danger lies in constructing a system based on establishing a financial or market value for ecological commodities or social structures as this approach often understates the actual, potential and intrinsic worth of natural and social systems.
'Baulkham Hills eco-accounting project does not attempt to value natural assets but rather measures the cost to Council of meeting identified sustainability policy targets.
'Negative impacts on sustainability are indirectly accounted for as they have the potential to increase the cost of meeting the targets while positive actions reduce the net cost to Council,' she said.
