The term “Life Cycle Analysis” (LCA) is largely assumed to be the technique used for the assessment of the total environmental impact associated with a product or process. This assumption does, however, neglect the inclusion of the other sustainability pillars which form a total “Life Cycle Sustainability Assessment”— social and economic impacts. Making truly well-informed decisions for sustainable development requires the consideration of all three aspects.
The dominance of Environmental Life Cycle Analysis (ELCA) in product assessment is partly owed to the development of International standards and guidelines, such as ISO 14040 and 14044. Social Life Cycle Assessment (SLCA)- despite inciting significant of discussion and interest- has gained less traction. This is largely due to a lack of methodology standardisation and tool availability for conducting social impact assessments.
The positives for generating SLCA methods are undisputed. In terms of sustainable development, the social impacts of a product are equally as important as the environmental. As evidenced by the growing trend in “green purchasing”, consumer pressure and awareness of socially responsible products and practices is growing—people want transparent information on where their purchases are coming from and what their impacts are. In fact, it might be argued that the social dimension could act as a stronger impetus than environmental concerns for driving more conscientious consumer choices. Many people feel a stronger emotional connection to each other than to the physical environment; we derive a sense of satisfaction from making a difference to the lives of others.
The interest in SLCA development spans a wide range of stakeholders including decision-makers in investment, industrial management, and design, as well as policymakers and consumers. Despite this attention it still lags ELCA in its application as an analysis and communication tool. SLCA has largely been held back by the inherent complexity of developing a standardised methodology which incorporates such a wide range of social (and often subjective) impacts. Environmental assessments can be complex; social assessments are even more so.
To illustrate the difficulties in developing SLCA tools, it was attempted to summarise the key steps and discuss the primary contentions faced in the four stages of the standard methodological framework outlined by the UNEP-SETAC Life-Cycle Initiative Cross-Cutting Taskforce. These steps are similar to those involved in ELCA: define the analysis goal, set its boundaries, gather the relevant data and calculate overall impact.
Step 1: Goal Definition. The first step in conducting an SLCA involves defining the primary goal and objective of the analysis. As with ELCA studies, there are two main classes of identifiable goals. The first concerns using product, process or company comparisons and benchmarking for decision-making. For example, consumers choosing which product to buy, or investors looking for socially responsible investment decisions. The other class of goals use SLCA results to identify potential areas for product or process improvement; such studies can highlight target areas or best practice approaches for improving the social dimensions of the production process. Although the two main classes may have slightly different inclusions and possibilities, the methodological approach is largely similar. They are typically viewed as complementary to each other—there’s no reason why the approach can’t be utilised for both.
Step 2: Scope Definition. The second step in LCA is to define the boundaries of the study i.e. how broad or narrow the assessment is. This involves several considerations, including the physical system boundary setting, as well as the number of social indicators assessed. This is where some of the differences of SLCA start to arise. The environmental impact of a product is most closely reflected in the nature of the processes involved in its manufacture; as a result, ELCA focuses predominantly on the types of processes involved in its supply chain. It has been argued that social impacts, on the other hand, are much less closely linked to the processes themselves, but rather to how the companies perform them. SLCA is therefore less concerned with process, and more with company conduct. SLCA scope should be focused on the companies involved in the product system.
Supply chains can be complex and involve a number of different companies. The question arises: how much of each company’s social impacts should be attributed to the final product score? One option is a weighting approach based on a proxy for the share of how much each company has contributed to the product e.g. based on the number of labour hours spent. Such an approach assumes that the specific social impacts of a company can be directly attributed to a single product—in a business involved in the manufacturing of multiple goods, such attribution could be difficult.
In defining the system boundary, it must be decided on how much of the full value chain is included. In an ideal world a full-chain study would provide the most transparent analysis. This can be incredibly complex, and it’s sometimes preferable for the company conducting the assessment to include only its closest suppliers for which it has sufficient control or degree of influence over to incite change. How broad or narrow this system boundary is would vary on an individual basis (arguably creating issues for fair product comparison and benchmarking) but must be explicitly defined.
The final aspect of scope definition involves the selection of social impact indicators. This is the most subjective and disputed aspect of the SLCA methodology. There are two levels to this selection process. The first is defining the broader impact categories which will be included; these might include issues such as “child labour”, “wages”, “physical working conditions”, “health and safety”. Within each of these categories, specific indicators will then be selected to assess them; for example, “health and safety” might include indicators on the number of lethal and non-lethal injuries per year; “wages” may include an indicator on the number of employees earning below the living wage.
The lack of objectivity and standardisation in this selection process is a complex issue for SLCA—indicators vary in type between quantitative, semi-quantitative and qualitative/descriptive, as well as differing in the number of measurements used. Some approaches use midpoint indicators, while others use endpoint indicators (the difference between these depends on where the indicators lie in relation to the final impact). For example, an endpoint indicator may involve a measurement on the company impact on numbers enrolled in education. Although not explicitly defined as an end goal, job creation might be seen as a mid-impact contributor in this case—higher family incomes may provide more educational opportunities. In this case, job creation would be seen as a midpoint indicator, and education enrolment as an endpoint. It’s still debated as to which is the preferred choice for SLCA; some argue that midpoint indicators are closer to the company influence and more directly attributable, others argue that it’s ultimately the final impact which is most important. The complexity of the issue arises because social impacts are so tightly connected by cause-effect pathways—delineating them to individual stand-alone indicators is a difficult task.
Indicator selection is complicated further by the choice of direct or proxy impact measurements. An example commonly referred to regards the reporting of working accidents. The number of reported accidents isn’t necessarily a reflection of the level of company safety standards: a low number of reported accidents may reflect a company with high-quality safety practices, or one who is poorly managed and incidents go unreported. The opposite may actually be true: a company with a higher number of reported incidents may in fact have the highest management practice standards. Some have suggested that in this case a proxy indicator of the management effort (and therefore the will of the company to avoid negative impacts) may be preferable to an assessment of the number of reported incidents themselves.
Step 3: Inventory analysis. Once the boundaries and indicators have been identified in the scope definition, the next step involves gathering the necessary data for analysis. Beyond the issue of indicator identification, data collection is probably the most challenging aspect of SLCA. In a conventional LCA study, there is often a choice between using generic quoted impacts, or site-specific measurements collected by the study coordinators. As previously discussed, environmental impacts are most tightly linked to the types of industrial processes—therefore, in ELCA, generic data gathered on relevant processes can often be used. Since social impacts are more consequential of the conduct of the company rather than the nature of the process, generic data becomes almost irrelevant. A transparent, representative result in most cases would require data which is specific to the local or site-level. Gathering this resolution of data across a full supply-chain is incredibly demanding, especially in countries where such reporting is lax or poorly monitored.
There probably needs to be a trade-off somewhere in how a fairly accurate assessment of the social impact of a product can be conducted with a level of effort that is manageable and reproducible. Until this degree of trade-off in resolution and accuracy can be agreed upon, a transparent, standardised methodology for SLCA will fail to be established.
Step 4: Impact Assessment. The final step in a LCA study is to aggregate this set of inventory results into a single measure for each impact category (e.g. eight indicator scores within the “health” category would be aggregated to give a single score). Even ignoring the issue that some indicators are qualitative and therefore cannot be distilled into a numeric metric, the approach for quantitative aggregation process is still debated. Some have called for a standard single weighting for all indicators (therefore meaning all are considered equally important). Others have called for a more complex process of distilling each into a metric of the reduction in average wellbeing, termed ‘Quality Adjusted Life Years’ (QALYs); in this assessment, each indicator would have an incidence, severity factor and duration which would be multiplied to calculate the total reduction in wellbeing (expressed in years). There is yet to be a clear industry standard on the best approach.
Stepping back from the specifics within each of the methodological stages, it’s clear that there are a few key hurdles in wide adoption of SLCA as a key decision-making tool:
- a concrete, standardised methodological framework needs to be agreed, as has been achieved for ELCA;
- reputable, reviewed indicator databases need to be developed and made easily-accessible. The Social Hotspot Database is one example of this data availability—the project aims to highlight key risk hotspots in supply chains through country or sector-specific data availability tools;
- standardised software tools for company and product assessment need to be developed if widespread uptake is to be achieved. Software tools have made ELCA easy for companies to incorporate into their product assessments; SLCA needs to be made as easily available;
- specific case studies of how social assessments of products have been conducted in practice need to be made available to communicate the process, its benefits and learning outcomes.
The importance and need for better analysis of the total social impacts of products is evident. There is a growing demand from consumers for a transparent look at the products they buy—they want to feel they’re making responsible choices in these purchasing decisions. The potential for this to drive positive, more sustainable change should not go untapped; for this reason alone, it’s regrettable that SLCA is lagging so far behind ELCA. Perhaps we’re trying too hard to develop a ‘perfect’ SLCA measure which manages to tick all the boxes when, in truth, there isn’t one. Sometimes accepting that we’ve developed the best measure we feasibly can is enough- surely that’s better than not measuring at all?
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