Measuring the actual impact by any company is always a precarious task. EBITDA OR Earnings Before Interest Tax Depreciation and Amortization has historically been considered the benchmark for sound business analysis. But now Accounting for Impact has become mainstream thanks to the efforts of the IWAI or Impact Weighted Accounts Initiative undertaken by the Harvard Business School. Technology and big data are making all this possible. This could have major implications. Environmental costs for instance, varies from the mere five percent of the EBITDA for Nestle to sixty- two percent as in the case of the Associated British Foods. This may not all be negative for profit- making companies, as some have even smartly introduced the IWAI measures to expand their recruitment. Intel has been one such example. Such an index will also allow the various governments to tax the major defaulters per segment rather than imposing blanket taxes on the entire population.

Source:https://hbr.org/2020/09/how-to-measure-a-companys-real-impact?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert_actsubs&utm_content=signinnudge&deliveryName=DM95464

Uploaded Date:29 September 2020