ABSTRACT
Portfolio management provides a framework to facilitate embedding sustainability into an organization. Using portfolio analysis allows senior leadership to better select components (i.e., projects, programs, and subportfolios) that have strategic fit with the organization’s vision of a sustainable future. This process focuses on project benefits, assessment, and realignment to ensure that sustainability goals are achieved. Through a project matrix approach, portfolio managers identify project benefits and areas for new component opportunity in support of sustainable strategy. Developing a process of component criteria and assessment to promote sustainable strategy guides the processes toward alignment with strate gic vision. Supporting a portfolio process through effective organizational structure and communi cation helps to drive sustainability into an organization. Creating a body of sustainability knowledge and a portfolio process provides a means to incorporate lessons learned from early adoption components, assess component impacts, and realign resources to support priority components. Identifying a matrix of portfolio criteria against which to assess project proposals facilitates selection of projects that deliver benefits in line with strategic sustainability vision. This process facilitates selection of components that are material to the organization and align with long-term sustainability targets. Establishing project standards also facilitates communication of sustainability and business goals throughout the organization by providing a framework that focuses project sponsors on challenges and opportunities that align with strategic interests. It also provides a framework to address governance issues about policies, supplier standards, a code of ethics, and compliance standards such as client and regulatory requirement thresholds. For example, the directive on disclosure of nonfinancial and diversity information reporting required in 2018 by the EU member states will have a significant impact on large corporations operating within EU borders. For companies with operations that will be impacted by these requirements, portfolio standards need to be established to ensure that existing and future projects comply with these requirements. By incorporating a portfolio management approach, management aligns resource allocation with component selection in support of sustainable strategy and vision.
