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Sustainability - Draft
 

Sustainability - Draft

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  • ????
  • Eddie will be 101 in 2050!
  • Emerging markets . . . 65 years ago both of these countries economies were totally destroyed. Brilliant job of recovery!
  • Plus also the population was a lot less . . .
  • How much does a garbage truck carry?
  • If we fail to manage that aspect of our life and business model then we will be bankrupt of resources
  • Please explain these
  • What about SC companies too???
  • What is a CJO
  • What is this legislation?

Sustainability - Draft Sustainability - Draft Presentation Transcript

  • Sustainability
    A TRIPLE BOTTOM LINE STRATEGY
  • Mono-cropping is endangering genetic diversity
    20 plants now supply 80% of humanity’s food
    Source: IDRC Briefing
    Did you know?!
  • Did you know?!
    Chronic Water shortages:
    201031 countries > 500 million
    2013 36 U.S. States > 100 million
    203550 countries > 3 billion
    Only 3% of earths water supply is drinkable and 95% of it is frozen
    Source: Economist, Panjiva & Watersense
    Embedded water use 30x
    Canadian importation
    1:6 1.8 million
  • Ogallala aquifer water source:
    33% of Corn crops
    30% of irrigated farmland
    80% CO, KS, NE, NTX, OK, SD, WY drinking water supply
    It is being pumped dry at the rate of 325 billion cubic meters a year
    Source: Kerr Center & U.S. EPA
    Did you know?!
  • U.S. Gov’t study oil and gas supplies will not keep up with demand over next twenty-five years. Translation alternative energy, energy reduction, energy efficiency and rising energy prices.
    If China begins to use the same amount of oil per capita as the U.S., China alone would consume 100% of the world’s oil production
    2010: 12k cars per day
    2015: 150 million
    (18 million more than U.S.)
    Source: WSJ, People’s Daily & Morning Star
    Did you know?!
  • Did you know?!
    Major Non-Renewable Resources are depleting world-wide:
    Antimony
    Barium
    Bismuth
    Cobalt
    Gallium
    Manganese
    Nickel
    Platinum
    Titanium
    Zinc
    What does this mean?
    Computers, Communication, Healthcare and Solar power
    Source: Annual Vital Signs Report World Watch Institute & U.S. Geological Association
  • U.S. economy consumes in excess of 100 billion tons of raw materials per year in excess of 90% of this ends up as waste
    Did you know?!
    Various forms of waste—solid and liquid—including plastics and petro-chemical disbursed through the air and ground waters can travel thousands of miles and end up in:
    soil
    water
    rainfall
    impacting local health and eco-system survivability
    Source EPA
  • What is basis to "problems”
    Global population is ever increasing
    9+ billion by 2050 (adding 2 to China’s)
    Income is increasing world-wide; new middle class
    Population + Income = Consumption
  • $430 billion annual advertising budget
    4x increase China, India, Venezuela, Brazil, Argentina, South Korea, Taiwan,
    Indonesia and Thailand
    Top 20% Malaysians and Chileans have higher average incomes than German or Japanese counterparts
    Source: AMA & Yankelovich
    Did you know?!
  • The Business Paradigm
    Many Businesses & Organizations still operate with a world-view that has not changed since
    Industrial Revolution
  • Natural resources >
    Labor was <
    The Paradigm
    People limiting factors of production
  • In spite of our best labor efforts, economy as a whole is enormously inefficient:
    Bad News: Increased waste tonnage from 250 million in 1990 to over 500 million today
    Good News: Capacity
    Unknown News: ?
    WASTE
    U.S. Economy
    4.5 lbs. per person per day = .821 tons per person per year
    Source: US EPA
  • How do we manage waste ?!
    Current or Old Paradigm was
    "end-of-the-pipe"
    remediation efforts
  • What has this Paradigm resulted in?
    Regardless of one’s
    “political” persuasion
    How weoperate is
    unsustainable (NJR)
    Stewardship: Current growth model (indiscriminate consumption via obsolescence ) is not sustainable
  • Some Simple Facts
    The Changing Paradigm
  • Paradigm is Shifting
    Natural resources <
    Labor is >
    Natural resources limiting factors of production
  • Next “Industrial Revolution”, like the first, will be in response to:
    changing patterns of scarcity
    and influenced behavior
    Natural Capital—Sustainability
    The New Paradigm
  • Sustainability Another Word for:
    Corporate Social Responsibility
    Equity(able)
    Environmentalism
    Green
    Lean
    Sustainable Development
  • Core to contemporary Sustainability are the
    Four (E’s)
    What is Sustainability?
  • 1st E Ecology & Environment
    2ndE Economy & Employment
    3rd E Equity & Equality (social)
    4th E Education
    4 E’s or Core to Sustainability
  • Fad
    Movement
    Revolution
    Sustainability: How Real?
  • A definition:
    Economic Development + Social Wellbeing + Environmental Protection = Sustainability
    “Meet present needs without compromising the ability of future generations to meet their needs"(WECD, 1987).
    Sustainability
    • Borneo (diesel to hydro)
    • Tigray Region (women agriculture)
    • Curitiba, Brazil (bus system 8-1.9)
    • Bavaria, Germany (solar 9k)
    • Adele, Australia (solar city)
    • India (biogas and time)
    • NYC (1 Yr &1k Bldg Supers)
    • U.S. Gov’t (green leasing)
    • USGBC (green property mgt cert)
    • Madison, WI (local dollars)
    • MIT, Oberlin, UNC, Furman, Stanford, Liberty, Bates, etc.
    • Alexandria VA School system (healthy schools)
    • State NC (project green 156)
    • Faith Based Organizations (social entrepreneur)
    What’s Going On Out There
  • U.S. States RPS Targets
  • A definition:
    An alignment of an organizations’
    products, services & processes with
    expanded stakeholder expectations
    resulting in a re-definition of profit.
    Profit=economic +environmental + social value
    realizedthrough optimal utilization of
    natural & social capital
    Corporate Sustainability
  • What’s Going On Out There
    • Mattel Corporation (logistics programs)
    • Safeway Stores (Renewable energy)
    • Wal-Mart (Green Products, renewable energy)
    • Nike (new product design)
    • Fruit of Loom (waste water)
    • Lowes (LfP GBM)
    • Marriott (CY Design)
    • KKR & EDF (Portfolio Best Practices)
    • UMMC Hospital System (weekend audits)
    • UPMC (healthy children)
    • Grove Park Inn (waste)
    • Carnhagan Car Wash (water reuse)
    • Shorebank (Community model)
    • Bank of America SC/NC (100+ cool roof)
    • South G’ville Fire Dept (water re-harvesting)
    • Jarden Process Solutions (packaging)
    • Cox Wood (renewable energy)
    • Hartness Intl (LCM)
  • The concept of sustainability is gaining traction
    • Customers
    • Supply-chain (up/down)
    • Employees
    • Regulators
    • Other Stake-holders
    Any miscalculation or misjudgment can have serious
    repercussions
    Sustainability
  • What is driving Sustainability?
    New Paradigm emerging realization that:
    • waste reduction
    • energy efficiency
    • pollution prevention
    • product innovation (naturally)
    • social responsibility-equity
    make economic and social sense!
  • Some argue it’s just a re-badging or extension of Lean manufacturing
    Continuous improvement: increasing efficiency, reducing waste, easing environmental impact, and boosting workplace safety
    Is Sustainability Something New?
  • Others argue lean is precursor to sustainability
    Much larger context and external issues:
    • resources & constraints
    • government regulation
    • societal intervention & responsibility
    • marketing strategies
    • expanded profit definition
    • shareholder value/linkage
    Is Sustainability Something New?
    • Ignore---no top manager in CJO role
    • Adhere---doing minimally required
    • Lip Service---remedially oriented
    • Strategic---strategic positioning
    How are Businesses dealing with Sustainability ?
    Modest Efforts in terms of compliance, employee volunteerism and corporate philanthropy
    Motivating force for change in processes & positioning Core drivers/practices to insure value
  • Strategic Positioning via Sustainability
    Moving from a passive cost-based
    mind set to building
    Strategic
    Advantage
  • Two Legs and One of Three Outcomes
    Do it Better or Do it Different
    Increase Revenues, Decrease Costs or Build Good Will
    Strategic Advantage
    Outcomes
    It can be price, quality, service, innovation, technology, process, affinity, etc.
  • One strategy that can leverage all (3) outcomes:
    Increase revenues
    Decrease costs
    Build value
    Ideal Strategic Advantage
  • By addressing both sides of the
    Sustainability Equation
    Production
    And
    Consumption
    Sustainability Strategy: How is Strategic Advantage being built?
  • Minimally define and alter
    Eco-footprint
    as well as
    Innovative business processes, products/services and life cycles
    Production Side
    Strategy 1x lower operating cost/cost-structures
    to
    3X build value
  • Re-thinking sustainable consumption in terms of “experience”:
    (3) three broad categories
    1st Innovation
    2nd Choice Influencing
    3rd Choice Editing
    Consumption Side
    Moving from Strategy 1x lower costs to
    2X generate new revenues
  • Consumers Choices Defined by Innovation, Editing and Influence
  • Extended Producer Responsibility or Product Stewardship
    More than 21 States have joined together to enact 50 product stewardship laws addressing 7 products in the United States
    • No one size or approach fits all business cases
    • Strategy is half the game execution is the other half
    • Societal case doesn’t always equal business case
    • Opportunity still trumps responsibility
    • Finding or driving systemic value requires more than low-level fruit
    • Measuring and reporting can create culture
    • Management as process versus a program insures change
    How is Sustainability defined & implemented: The Furman Strategic Framework Approach
  • 1st What shade of green is best ?
    Internal/External considerations, goals & alignment
     
    2nd When & How best to move into this area ? Shift bench-marks & stakeholder engagement
      3rd What to target? How to measure and report?
    Issues mapping and SMS Reporting
      4th What processes or tools to use? How best to think and act to insure on-going success?
    Footprints, audits, value-streams, systems thinking and process management
    How is Sustainability defined & implemented: The Furman Strategic Framework
  • Sustainability Business Tools/Processes
    • Foot printing, Auditing & Value-Stream assessment
    • Life-cycle Management
    • Sustainable Product-Service-Process Design
    • Process & Label Certification
    • Green Product Marketing
    • Environmental Managerial Accounting
  • Foot Printing, Mapping, Auditing & Value-Streams
    Activity or Area: Energy
    Current State (Bench-mark)
    Sustainable State
    Future (Minimization/Reduction)
  • Life Cycle Analysis: Product Decisions, Design & Management
    McDonough & Braungart
    Biomimicry Institute
  • Process and Label Certification
    400+ Labels world-wide and growing
  • Green Product & Service Marketing
  • Green Accounting & Reporting
    • Managerial Accounting Processes
    • Activity Based Cost Accounting
    • Consultancy
    • Certification
    • Reporting Practices
  • What is the business case for aSustainability strategy?
    • Lower risk (lower costs)
    Operationally
    Financially
    • Increase opportunities (drive revenues)
    New products/services
    New target markets
    Higher margin products/services
    • Build a stronger balance sheet (increase leverage)
    Good will
    Transparency
    Brand/Reputation
    Corporate valuation
    • Laws and Regulation (increasing)
    Proactive versus Reactive
  • Sustainability Tactic or Strategy
    “Green Organization” concept is evolving
    Program: Strategy:
    Feeling Good Measuring Good
    Recycling Life-cycle Decision making
    Nice to do Need to do
    Image Building Brand Integration
    Telling the Customer Teaching the Customer
    Ignore natural cycles Mimic natural cycles
    Human Resources Human Capital
    Organization as machine Organization as brain
    Shareholder Stakeholder
    CSR Adherence Embedding CSR
  • Sustainability: CPA Roles and Competencies
    BIG
    Public
    Practice
  • Revenues
    Operating Costs
    Good Will/Valuation
    SustainabilityTriple Bottom Line Strategy
  • Threat or Opportunity
    Tactic or Strategy
    Ignoring sustainability trends
    can impede ability to achieve let alone compete.
    Do you have a plan?!
    Sustainability