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Making the business case fall 2010
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Making the business case fall 2010

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Prepared for BUS 215 Managerial Accounting

Prepared for BUS 215 Managerial Accounting
Cal Poly State University
Kate Lancaster

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Making the business case fall 2010 Making the business case fall 2010 Presentation Transcript

  • Making the Case for Sustainable Business Practices:An Introduction
  • Outline
    What does sustainability really mean?
    Why is sustainability such a hot topic?
    Making the business case for sustainability
    Accounting and sustainability
    What can you do?
  • What does sustainability mean?
    Your definition
    To me, sustainability is a future where beings (human and otherwise) live fulfilled lives as part of thriving ecosystems. Living sustainably means expanding the beneficial and minimizing the negative consequences of our actions on others in our community (and expanding our definition of community).
  • Definition of Sustainable Development
    Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two key concepts:
    the concept of 'needs', in particular the essential needs of the world's poor, to which overriding priority should be given; and
    the idea of limitations imposed by the state of technology and social organization on the environment's ability to meet present and future needs.
    http://www.worldinbalance.net/agreements/1987-brundtland.html,
    Gro Harlem Brundtland, Norwegian politician, diplomat, and physician
  • Definition of Sustainable Development
    Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two key concepts:
    the concept of 'needs', in particular the essential needs of the world's poor, to which overriding priority should be given; and
    the idea of limitations imposed by the state of technology and social organization on the environment's ability to meet present and future needs.
    http://www.worldinbalance.net/agreements/1987-brundtland.html,
    Gro Harlem Brundtland, Norwegian politician, diplomat, and physician
  • WHY NOW?
  • http://www.sustainablescale.org/images/uploaded/Population/World%20Population%20Growth%20to%20205.JPG
  • The 209 toxins found in mother’s milk of Inuit women living in North Alaska
    TRASH
    4.4 pounds/person/day
    38 Billion water bottles/year >$1B
    125M phones/year, 65,000 Tons
    http://www.nytimes.com/2005/01/09/magazine/09TOXIC.html?pagewanted=all&position=
    http://safemilk.org/
  • North Pacific central gyre - A floating island of plastic larger than Texas
    Albatross on the Kure-Atoll
    LA River after a storm
    http://www.5gyres.org
  • http://ohvec.org/index.html
  • Impact on other species
    http://www.earthend-newbeginning.com/
    http://www.jimmau.com/CONSEQUENCES/
    http://greenoc.freedomblogging.com/2010/03/11/starving-dying-sea-lion-pups-wash-ashore/20937/
    http://www.ngoilgas.com/news/gulf-of-mexico-spill-dome-sent-to-contain-leak/
  • http://www.biologicaldiversity.org/programs/climate_law_institute/350_reasons/index.html
    Species Extinction
  • Starving bear on Vancouver Island.
    Very reduced salmon run Spring and Fall, 2008.
  • http://data.giss.nasa.gov/gistemp/2005/
  • http://www.mirror.co.uk/news/top-stories/2010/08/10/pakistan-flood-disaster-could-be-worse-than-the-boxing-day-tsunami-kashmir-earthquake-and-haiti-earthquake-combined-115875-22476903/
    http://www.latimes.com/news/nationworld/world/la-fg-aussie-duststorms24-2009sep24,0,418657.story
    http://www.usatoday.com/weather/news/2009-07-12-iraq-sandstorms-drought_N.htm
    http://www.xray-mag.com/en/content/coral-reef-growth-grind-halt
  • Where is our food produced?
    http://ukiahcommunityblog.wordpress.com/category/dave-smith-blog
  • l
    http://transition-times.com/blog/2009/12/21/will-2010-food-crisis-bring-financial-armageddon/
    http://www.commondreams.org/headline/2010/08/06-4
    http://www.permaculture.org.au/images/water_crisis_india.jpg
  • The Role of Business
  • “We are all passionate about making real progress regarding the environment.  By working together, we can help each other save money, reduce greenhouse gas emissions and pass the savings on to our customers.  Sustainability is good for the environment, and it’s also good for business.”
    "We asked ourselves: If we had known 10 years ago what challenges we would face today, what would we have done different? What struck us was: This world is much more fragile than any of us would have thought years ago."
    Who said this?
  • Lee Scott, Walmart CEOJuly 12 and Sept 25, 2006
    http://www.walmartstores.com/GlobalWMStoresWeb/navigate.do?catg=355
  • If Wal-Mart was a country it would rank as the 21st largest in the World
    1 in 120 people work for Wal-Mart in US, 100,000 global suppliers – How’s that for reach!
    http://exinglobal.typepad.com/going_global/2006/09/the_country_of_.html
  • It is not just WalMart
    http://www.unglobalcompact.org/news/42-06-22-2010
    http://www.nicholasinstitute.duke.edu/globalcompact/
  • http://www.wbcsd.org/templates/TemplateWBCSD5/layout.asp?type=p&MenuId=MTEzOQ&doOpen=1&ClickMenu=LeftMenu
  • The Business Case for Sustainability
    Risk Management
    Climate Change
    Consumer Activism
    Legislation
    Business Opportunities
    Demand for “green” products
    Cost savings
  • Clean Technology
    • develop new competencies
    • pursue leapfrog innovation
    Base of the Pyramid
    • meet unmet needs
    • raise the base of the pyramid
    Product Stewardship
    • lower product life cycle impact
    • increase transparency/accountability
    Pollution Prevention
    • minimize process waste
    • enhance resource productivity
    The Sustainable Value Portfolio
    Tomorrow
    Internal
    External
    Today
    From presentation given by Stuart Hart
  • http://money.cnn.com/magazines/fortune/fortune_archive/2006/10/16/8390307/index.htm
    Adobe
  • http://money.cnn.com/2006/08/22/news/economy/pluggedin_gunther.fortune/index.htm
  • Consumer Activism
    Nike
    Levi’s
    McDonald’s
    Starbucks
    Wal-Mart
  • EU Directives
    ROHS – Restriction of Hazardous Substances (Atrazine)
    REACH – Registration, Evaluation and Authorization of Chemicals
    WEEE - Waste Electrical and Electronic Equipment
  • Increasing Number of Consumers Interested in Sustainable Goods
    http://foodfreedom.wordpress.com/2010/02/01/gmo-crops-super-weed-time-bomb-explodes/
  • http://www.guayaki.com/index.php?p=about&id=86
  • http://www.clifbar.com/ourstory/document.cfm?location=environment&websubsection=recycled
  • Measure What Matters
    Challenge
    All Aspirations Annual Report
    Qualitative stories
    Quantitative metrics (including financial and supply chain input/process/output measures)
    Evaluated against the 5 Aspirations
  • Clif Bar’s Triple Bottom Line
    Sustaining our Brands
    Sustaining our Business
    Sustaining our People
    Sustaining our Community
    Sustaining our Planet
  • Interface’s Triple Bottom Line
    http://www.interfacesustainability.com/
  • Interface’s Triple Bottom Line
    http://www.interfacesustainability.com/
  • Biomimicry – Fuel efficient design
    • Mercedes lowers the air resistance of concept car by modeling the car after the Box fish.
  • Solar Stoves in Somalia
    http://www.tucacas.info/sunfirecooking/index.htm
  • http://design-for-india.blogspot.com/2009/02/world-economic-forum-sustainability.html
  • Triple Bottom Line
    http://www1.indstate.edu/facilities/sustainability/
  • Mark Albion, Founder, Net Impact
    • A good business uplifts the human spirit and helps alleviate poverty and suffering on the planet.
    • The Good Life
    http://www.youtube.com/watch?v=k7JlI959slY
  • Accounting Discipline’s Contributions
    Disclosures and Reporting
    Decision-making
    Market Mechanisms
    Investment Analysis
    Other
  • Accounting Discipline’s Contributions
    Disclosure of Environmental Liabilities
    GAAP Guidelines
    Reporting on Sustainable Business Practices
    Voluntary disclosure
    Global Reporting Initiative guidelines
    Costing Issues and Cost-Benefit Analysis
    Waste minimization
    Energy Consumption Reduction
  • Founded in 1997 by the Coalition for Environmentally Responsible Economies
    Supported by United Nations Environment Program
    Permanent Institution in Amsterdam
    Now works with United Nations Global Compact
    First Guidelines (G1) established in 2000
    Revised in 2004 (G2)
    Revised in 2006 (G3)
    1000+ Corporations spread across 60 countries participate in the GRI
    Global Reporting Initiative
  • GRI Measures…
    Performance Indicators:
    Economic
    Environmental
    Social
    Labor Practices
    Human Rights
    Society
    Product Responsibility
    “Sector Supplements” provide additional reporting requirements fore specific industries
    Reporting Reference
  • Decision-making
    Costing Issues and Cost-Benefit Analysis
    Waste minimization
    Energy Consumption Reduction
    Proper allocation of environmental costs to products for product introduction, retention and elimination
    Financing and Costing a Cleanup site
    Development of a Balanced Scorecard
    Qualitative Issues
  • Investment Analysis
    Social Return on Investment
    A compliment to the financial bottom line
    Computed on the same investment as financial ROI
  • Other
    Eco Efficiency
    Guideline areas
    Water use, Energy use, Global warming contribution, Ozone depleting substances, Waste
  • What can you do
    Learn as much as you can
    Question the status quo
    Get involved at Cal Poly
    Invest proactively
    Consume conscientiously
  • What can you do?
    • Vote with your $$$$
    • Shop Local
    • Rethink – Use less stuff
    No more plastic bottles
    • Reduce – Turn things off, shorter showers
    • Reuse – Use 2 sides of paper
    • Recycle – Paper, glass, cardboard, etc.
    • Share –
    • Study – Environmental Studies minor
    http://storyofstuff.com/, http://studentlife.calpoly.edu/ori/wow/newstudents/sustainability.asp
  • http://www.cleanair-coolplanet.org
  • http://www.focusthenation.org/
    http://focusthenationslo.pbwiki.com/
  • http://www.focusthenation.org/
    http://focusthenationslo.pbwiki.com/
  • Empower Poly Coalition - 24 student Clubs
    http://www.empowerpoly.calpoly.edu/
  • College of Business – Undergraduate Chapter
    Thursdays, 11-12, 03-114
  • Summary
    Sustainability means living within the earth’s natural limits.
    Businesses are finding there are benefits to reducing their footprint and are creating business opportunities
    You have much to offer: critical thinking, assessing performance, measuring what matters
  • Cell phones, coltran, and lowland gorillas
    http://homepage.mac.com/wildlifeweb/gorillas/news/index.html
    http://www.epa.gov/epaoswer/education/pdfs/life-cell.pdf
  • Career Opportunities
    “Sustainability is everywhere. With that in mind, jobs in sustainability are everywhere.”
    Treehugger Jobs
    GreenBiz
    SustainableBusiness
    http://www.emagazine.com/view/?3943
    http://ask.metafilter.com/60029/Where-are-the-green-jobs-going, April 5, 2007
  • Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.
    Margaret Mead
    US anthropologist (1901 - 1978)