The definitions of sustainability are the Do’s. These are the Don’ts. They are the “Operator’s Manual for the Planet,” like don’t make toast in the bath tub. They are scientifically based. They are what it takes to live within the laws and limits of Nature. It’s about “threshold management”—ensuring we do not exceed Nature’s thresholds of ability to absorb waste and regenerate itself, and people’s thresholds of tolerance for injustice. The definitions of sustainability are the Do’s. These are the Don’ts.
Animated version. See slide below for Notes.
Important stakeholders are swarming the corporate fortress, stirred up by the perfect storm of sustainability issues on the horizon. NGOs and Scientists are in parentheses because they are usually marginalized by corporations as not being important enough to listen to. Now their lonely voices are being joined by a chorus of important stakeholders, especially the ones circled, making these issues mainstream business issues. Failure to be more proactive jeopardizes the companies “social license to operate.” If the company’s reputation on social and environmental issues does not meet important stakeholders’ rising expectations, they’ll vote with their feet and the company will be out of business.
The detail behind these numbers is in the Appendix of The Next Sustainability Wave.
1. The Human Side of Sustainability Thought Leader Webinar Series #2: “ The Next Sustainability Wave: Building Buy-In and the Business Case” <ul><li>Welcome Everyone! </li></ul><ul><li>Before we get started, here are a few considerations that will help you make the most of your experience today: </li></ul><ul><ul><li>If you wish, type a brief introduction about yourself into the chat bar at the right of this screen </li></ul></ul><ul><ul><li>This is an interactive webinar. We value your questions and comments. Periodically during the session we will ask you for input. You are also welcome to type questions into the chat bar. </li></ul></ul><ul><ul><li>We will respond via email later to questions we do not address during the webinar </li></ul></ul><ul><ul><li>This webinar is being recorded for posting on our Transitioning to Green™ website </li></ul></ul><ul><ul><li>Out of consideration for fellow participants, please mute your line (*6) if there is background noise where you are, and un-mute (*6 if you wish to voice a comment) </li></ul></ul>This webinar is brought to you by Transitioning to Green™ • www.transitioningtogreen.com
2. The Next Sustainability Wave : Building Buy-in and the Busine $$ Ca $ e Bob Willard firstname.lastname@example.org www.sustainabilityadvantage.com Transitioning to Green Thought Leader Webinar Series #2 April 14, 2011
3. The “Sustainability Imperative” David A. Lubin and Daniel C. Esty, “The Sustainability Imperative,” HBR May 2010 Megatrend: “ A fundamental shift in the competitive landscape that creates inescapable threats and game-changing opportunities ... profoundly affects companies’ competitiveness and even their survival.” Over the last 10 years, the “ Sustainability Imperative” has emerged, magnified by escalating public and governmental concern about climate change, industrial pollution, food safety , and natural resource depletion , among other issues.”
4. Significant CEO Mindset Shift Survey of 766 worldwide CEOs, including 50 in-depth interviews UN Global Compact and Accenture study, “A New Era of Sustainability,” June 2010 … fully embedded into company strategy and operations CEOs Agree /Strongly Agree that sustainability should be …. … discussed and acted on by boards … fully embedded into subsidiaries’ strategies and operations … embedded throughout the global supply chain … the basis for industry collaborations and multi-stakeholder partnerships … incorporated into discussions with financial analysts 2010 Increase Over 2007
5. Stakeholders Driving Sustainability Survey of 766 worldwide CEOs, including 50 in-depth interviews UN Global Compact and Accenture study, “A New Era of Sustainability,” June 2010 Stakeholders who CEOs believe will have the greatest impact on the way they manage societal expectations Consumers Employees Governments Communities Regulators Media Investment Community Suppliers NGOs Boards Organized Labor Other
6. CEOs: Sustainability Drivers Survey of 766 worldwide CEOs, including 50 in-depth interviews UN Global Compact and Accenture study, “A New Era of Sustainability,” June 2010 Brand, trust, and reputation Potential for revenue / growth / cost reduction Personal motivation Consumer / customer demand Employee engagement and recruitment Impact of development gaps on business Governmental / regulatory environment Pressure from investors / shareholders Top 3 drivers of CEOs’ action on sustainability issues
7. Corps Are Investing in Sustainability <ul><li>59% of companies in all industry sectors increased their investments in sustainability in 2010 , versus 25% in 2009. </li></ul><ul><li>69% expect their organization to step up its investment in and management of sustainability in 2011 . </li></ul>MIT Sloan and the Boston Consulting Group winter 2011 research report, “Sustainability: The ‘Embracers’ Seize Advantage,” Feb. 2011
8. Definitions of Sustainability Sustainable Development (SD) Meeting the needs of the present generation without compromising the ability of future generations to meet their own needs -- Brundtland Commission, 1987 – Sustainability The possibility that human and other forms of life on earth will flourish forever -- John Ehrenfeld, Professor Emeritus. MIT – Sustainable Development (SD) Enough - for all - forever -- African Delegate to Johannesburg (Rio+10) --
9. The 4 DON’Ts of Sustainable Behavior ... buildup of substances extracted from the earth (e.g. heavy metals, fossil fuels, their life-cycle polluting byproducts) ... buildup of chemicals produced by society (e.g. 70,000+ chemicals, dioxins, PCBs, their life cycle byproducts) ... degradation of nature and its natural processes (e.g. over-harvesting, species extinction, peak soil, water security) ... conditions that undermine people’s capacity to meet their basic human needs and well-being (e.g. unsafe working conditions, chasm between the wealthy and the poor) Do not contribute to the … http://www.naturalstep.org/the-system-conditions; Darcy Hitchcock, “Sustainability Buzzwords,” ISSP Insight, October 2009
10. Core Concepts of Sustainability Futures Thinking Intergenerational responsibility (Eco-)Systems Thinking Carrying capacity of the planet to absorb waste and support life Social Justice Equity, Dignity, Basic services, Human rights, Stakeholder voices ************************************ Economic, Environmental, Social/Cultural responsibilities
11. Sustainability 3-Legged Stool Sustainability Economic Leg Good Jobs Fair wages Security Infrastructure Fair Trade Social Leg Working conditions Health services Education services Community & Culture Social justice Environmental Leg 0 Pollution & Waste Renewable Energy Conservation Restoration Quality of Life / Genuine Wealth / Genuine Progress
12. Corporate Sustainability 3-Legged Stool Sustainability = Sustainable Development (SD) = Environmental, Social, Governance (ESG) = Corporate Social Responsibility (CSR) = Corporate Responsibility (CR) = Green = Triple Bottom Line (TBL) = 3Es = 3Ps E conomy - P rofits Growth, Jobs, Taxes Products Services E quity - P eople Employees Community / Culture World E nvironment - P lanet Eco-efficiencies Eco-effectiveness
13. Smart Business 3-Legged Stool Asset Management Economic / Financial Capital Built / Manufactured Capital Natural Capital Human Capital Social Capital Sustainable Value Creation
14. 5-Stage Sustainability Journey 5. Purpose/Passion Values-driven founder / CEO 2. Compliance Regulatory enforcement 1. Pre-Compliance 3. Beyond Compliance Save on eco-efficiencies Avoid PR crisis Avoid threat of new regulations 4. Integrated Strategy Enhanced organizational value
15. The 3 R’s of Justifying Sustainability R ISKS R ESPONSIBILITIES R EWARDS BUSINESS CASE + + Based on Alan AtKisson, The IRIS Agreement , p. 127
16. Risks to Financial and Natural Capitals: Big-5 Sustainability Storm Fronts Climate Change and Energy Crises Poverty and Social Injustice Species Extinction and Overharvesting Food and Water Crises Waste, Toxicity, and Health
17. The 3 R’s of Justifying Sustainability R ISKS R ESPONSIBILITIES R EWARDS BUSINESS CASE + + Based on Alan AtKisson, The IRIS Agreement , p. 127
18. Risks to Financial and Social Capitals: Stakeholders’ Rising Expectations Waste, Toxicity, and Health Climate Change and Energy Crises Poverty and Social Injustice Species Extinction and Overharvesting Food and Water Crises Employees Customers Media Economists (Scientists) (NGOs) Competitors Markets Governments Insurers The Public Investors Banks Risks to Reputation re Corporate Responsibilities Social license to operate
19. The 3 R’s of Justifying Sustainability R ISKS R ESPONSIBILITIES R EWARDS BUSINESS CASE + + Based on Alan AtKisson, The IRIS Agreement , p. 127
20. One More Goal … or an Enabling Strategy? Innovation Speed to market New markets Talent wars Productivity Motivation Brand image Managing risks Compliance Supply security Profit Share price Growth Revenue Customer care Expense savings Competition Market share Leadership Governance RELEVANCE
21. The 3 R’s of Justifying Sustainability R ISKS R ESPONSIBILITIES R EWARDS BUSINESS CASE + + Large Companies: At least 38% more profit SME Companies: At least 66% more profit
23. 3M Eco-Efficiency Savings Pollution Prevention Pays (3P) Up-front waste prevention : Product reformulation, process modification, equipment redesign, and recycling and reuse “Fourth P”—People. Employee suggestion program generated $1.4B in first-year savings through 8,100 voluntary projects over 35 years (1975-2010 ) http://solutions.3m.com/wps/portal/3M/en_US/3M-Sustainability/Global/Environment/3P/
24. Employees Are Key to Eco-Efficiencies <ul><li>Community Centre Conservation Challenge (CCCC) 8 Community Centres; June – August 2009 Annual verified energy savings of $90,000 </li></ul><ul><li>“ Low cost / No cost” employee engagement approach </li></ul><ul><ul><li>Classy “no pizza boxes” luncheon to launch the challenge </li></ul></ul><ul><ul><li>Trained maintenance staff and programs facilitators </li></ul></ul><ul><ul><li>Engaged staff in inventory of plugs and savings ideas </li></ul></ul><ul><ul><li>Presented winning team leaders with trophies at Council </li></ul></ul><ul><ul><li>Classy thank-you closing luncheon for all participants </li></ul></ul><ul><ul><li>Results included in City’s Leisure Guide </li></ul></ul>Ernie Davies and Suzanne Elston, Oshawa Environment and Energy Mgmt Services Presentation to the Durham Region Roundtable on Climate Change, June 2010
25. The 3 R’s of Justifying Sustainability R ISKS R ESPONSIBILITIES R EWARDS BUSINESS CASE + + Climate Change & Energy Crises Employees Customers Economists (Scientists) (NGOs) Governments Insurers Investors At least 38% to 66% more Profit
26. The New Economy <ul><li>New ownership models: employees, customers, co-ops, social venture funds, government funding </li></ul><ul><li>New company purposes: “Social enterprises,” “B Corps,” “Hybrid organizations,” “Flexible purpose corporations” (California Bill SB 201, Corporate Flexibility Act, Feb. 2011) </li></ul><ul><li>Responsible consumption / thrift vs. over-consumption </li></ul><ul><li>Low / No-growth model vs. “grow or die” model </li></ul><ul><li>Services vs. products </li></ul><ul><li>“ Dematerialization” vs. physical goods, processes, or travel using “virtual” alternatives like videoconferencing or online shopping” </li></ul><ul><li>Low-carbon economy vs. fossil fuel-based economy </li></ul><ul><li>Local supply chains vs. global supply chains </li></ul>
27. In Summary … Sustainability is smart business Important stakeholders’ expectations are rising New market forces & risks are in play Relevant to existing organizational priorities Can protect & enhance organizational values Many willing, helpful partners Opportunity for leadership … by example
28. The Next Sustainability Wave : Building Buy-in and the Busine $$ Ca $ e Bob Willard email@example.com www.sustainabilityadvantage.com Transitioning to Green Thought Leader Webinar Series #2 April 14, 2011
29. We thank you for participating with us today! Bob Willard: [email_address] [email_address] Jeana Wirtenberg, CEO: [email_address] Linda Morris Kelley, Host: [email_address] www.TransitioningToGreen.com