Development of composite sustainability performance index for steel industry

Abstract

Abstract The steel companies are becoming increasingly aware about the sustainability challenges. In order to become a responsible corporate citizen, the industry has responded to these challenges through adoption of pillars of sustainability. The industry has made the beginning with identification of sustainability indicators. The indicators have been developed specifically for steel industry. Generally, it is quite difficult to evaluate the performance of company on the basis of large number of sustainability indicators. Integration of key sustainability indicators is quite essential for decision-making. Composite indicators are an innovative approach to evaluate sustainable performance. This paper presents a method for development of composite sustainability performance index (CSPI) that addresses the sustainable performance of steel industries along all the three pillars of sustainability—economic, environmental and societal. Organizational governance and technical aspects have also been considered fourth and fifth dimensions of sustainability. The objective of this paper is to introduce sustainability and to present a conceptual decision model, using analytical hierarchy process (AHP) to assist in evaluating the impact of an organization's sustainability performance. AHP has been used to determine the weights at various levels. Sub-indices have been evaluated and aggregated to form CSPI. The effectiveness of the proposed model is evaluated in a case study for a major steel company in India.