Green” is perhaps one of the biggest trends to hit the modern marketplace.
Wal-Mart is going Green.
Hollywood celebrities are eco-evangelists.
The 2008 Olympics set the new gold standard for sustainable events.
Religious leaders are making the environment a moral issue.
GOING GREEN 11/16/2009 2 GO GREEN
Two Central questions to answer:
Is there a trade off between Going Green & Profitability?
Should firms take the initiative to Go Green.
DEFINING THE TOPIC 11/16/2009 3 GO GREEN
Triple Bottom Line
Corporate Social Responsibility
Humanity has the ability to make development sustainable--to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs. SUSTAINABLE BUSINESS
TRIPLE BOTTOM LINE
Social contract argument.
OBLIGATIONS TO GO GREEN 11/16/2009 7 GO GREEN
Stockholder theory :
Firms are obliged only to the stockholders
Stakeholder theory :
Firms have obligations to any person who is affected by a firm’s actions STOCK HOLDER VS. STAKE HOLDER 11/16/2009 8 GO GREEN
Firms are obliged to address any environmental issues that affect the stakeholders.
More realistic description of how firms operate - managers are not only concerned with stockholders.
Right thing to do because it corrects environmental problems caused by business.
STAKEHOLDERS’ ARGUMENTS 11/16/2009 9 GO GREEN
Contractual obligations with the society
Society expects that firms engage in socially acceptable practices in return for “allowing” them to conduct business activities.
Firms who do not use power (in ways that society deems responsible) will tend to lose it.
SOCIAL CONTRACT 11/16/2009 10 GO GREEN
GREEN IS ENTERING SOCIAL CONTRACT
90% of executives and consumers expect environmental issues to be top sociopolitical issue for the next five years (Mckinsey Global Survey 2008)
Singapore aims to be carbon trading hub (worth US$25b in 2006) in Asia (CNA 17 Nov 07)
FORTUNE 500 CEOs, including GE’s Jeff Immelt and Wal-Mart’s Lee Scott have initiated going green (Fortune 2 Apr 2007)
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Treaty initiated by United Nations (UN)
To stabilize greenhouse gas concentration level such that it will not harm the climate
Not legally binding
Includes provisional updates (Protocols)
Kyoto Protocol Legally binding United Nations Framework Convention on Climate Change (UNFCCC) 11/16/2009 12 GO GREEN
CONTROL OF VEHICULAR EMISSIONS
Diesel Vehicle registered after 1 Oct 2006
Comply Euro VI emission standard
Lower CO 2 and particulate matter
Alternatives for Taxi and Bus Companies
Natural gas CNG vehicles 11/16/2009 13 GO GREEN
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The “Equator Principles”
All things being equal, firms which are green will have easier access to capital
Bank of America
The Royal Bank of Scotland
Share prices of greener firms command higher premiums. (Harvard Business School Review)
WALL STREET & GREEN 11/16/2009 15 GO GREEN
ONGC is India’s ‘Greenest Company’, as per Business Today
ONGC is the first company to achieve zero-flaring in Offshore.
Adopted an eco-friendly process for de-sludging crude-oil storage tanks
On expanding green cover, maintaining biodiversity apart from creating aesthetically satisfying environment are key objectives of the company.
ONGC has developed a corporate mission statement on being carbon neutral, one of the few energy majors so far.
ONGC has formalized its corporate policy on Climate change and sustainability, the only PSU in India to have done so.
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India’s third greenest company.
Treated effluent water recycling and re-use and rain water harvesting
Re-circulating sea cooling tower systems instead of once through sea cooling water system thereby minimizing the sea cooling requirement and effluent discharge to the sea.
Minimize / eliminate fugitive emissions
Improvement in Energy Efficiency of the Refinery & distribution operation by use of new technology & modern instrumentation.
BPCL BPCL 11/16/2009 17 GO GREEN
The KB-series engines introduced in 2008-09 are the most fuel efficient and environment friendly engines. The Ritz, a new car with a KB-series engine is the first car in India that meets Bharat Stage - 4 emission requirements, ahead of the deadline of 1st April, 2009 set by Government.
The company has constructed Rain Water Harvesting structures within the factory premises to collect rain water and recharge back into the aquifer below ground level.
Zero waste water discharge company
Company has its own captive power plants to meet its power requirements .The major fuel used for power generation is natural gas.
The company promotes 3 R (Reduce, Reuse and Recycle) in its manufacturing facilities, supply chain and logistic operations
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30.6% of company’s energy come from renewable source.
Farm forestry project cover 90000 hectares .
ITC’s paper & paper product gets readymade material from carbon sequestration, which creates rural jobs.
ITC office in Gurgaon is LEED certified at highest level of energy efficiency.
ITC hotels use energy-efficient compact fluorescent lamps.
ITC 11/16/2009 19 GO GREEN
ITC sonar in Kolkata is world’s first carbon positive five star hotel. Its green initiative extends to rain water harvesting, recycling of waste and effluent. Contd…… 11/16/2009 20 GO GREEN
Nokia ranks in first place in taking “green” initiatives in electronic sector.
Aims to minimize the environmental impact of its products throughout all its operations.
First mobile handset manufacturer which had Eco declarations available for its products as early as 2001.
All devices use as little energy as possible, sourcing 25% of its energy from renewable resources and aiming to increase that amount to 50% by 2011.
NOKIA 11/16/2009 21 GO GREEN
Dropped the hazardous waste of its manufacturing operations by 30%.
To design the world’s first manned airplane powered by a fuel cell.
Remained a technology and aerospace leader as well as a responsible corporate citizen through its commitment to sustainability and innovation.
AEROSPACE (BOEING) 11/16/2009 22 GO GREEN
Large contributor to the global transmission and distribution of energy.
Claim to minimize the environmental impact through various efforts including solutions that allow for CO2 free energy generation for transmitting energy from environmentally friendly sources.
One of the largest supporter of nuclear energy.
Continues to support the construction of new reactors
AREVA 11/16/2009 23 GO GREEN
HP’s energy star qualified product save consumer money by reducing energy costs and help protect the environment.
Committed to offering products and services worldwide that help customers save money, conserve energy and improve the quality of environment.
Needs to eliminate e-waste and initialize some more recycling initiatives such as voluntary take-back program like the one NOKIA has in place.
HEWLETT PACKARD 11/16/2009 24 GO GREEN
Global manufacturer and retailer of naturally inspired, ethically produced beauty and cosmetics products.
First international cosmetic brand to be awarded the Humane Cosmetics Standard for their Against Animal Testing Policy.
Has their own fair trade program called Community Trade, making it the only cosmetics company with such a far-reaching commitment to trading fairly.
THE BODY SHOP 11/16/2009 25 GO GREEN
Launched aggressive program, push 60,000 suppliers to produce goods that don’t harm the environment,& to urge consumers to buy green
To encourage sustainability of the world’s fisheries, forests and farmlands, by slashing energy use and reduce waste.
Claims “they will reduce solid waste from U.S stores by 25% within 3 years”.
Cut energy use at its more than 7,000 stores worldwide by 30% and cut greenhouse gas emissions at existing stores by 20% in seven years.
WAL-MART 11/16/2009 26 GO GREEN
Believe it can earn lot of credits by saving energy, and it can sell them for millions of dollars to companies that cannot, and all of those savings will go into keeping the low prices of its products.
WAL-MART 11/16/2009 27 GO GREEN
Engaged in business activities under the guiding principle of “contributing to the development of a prosperous society through the manufacture of automobiles
In the manufacturing area production plants are being made sustainable by employing natural energy sources such as solar and wind power, and through ecological preservation by planting greenery around production sites
TOYOTA MOTOR CORPORATION 11/16/2009 28 GO GREEN
Toyota’s production system falls in the philosophy of the complete elimination of all waste in all aspects of production in quest of the most efficient production method.
Toyota is also engaging in social contribution, establishing the Corporate Citizenship Division to reinforce activities and functions, conducting educational programs to raise the awareness of global warming issues.
TOYOTA MOTOR CORPORATION 11/16/2009 29 GO GREEN
Spending $750 million of its advertising budget in 2006 to promote this new green image
GM is responding to environmental pressures to remain profitable, as it still largely engages in producing gas-consuming SUV’s and even maintains its attempts to increase the new fuel economy standards put on vehicles
Toyota beat General Motors in 2008 and became the global leader in vehicle sales which proved that designing a sustainability strategy has a triple bottom line effect, i.e. profit, community and environment
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SOME MORE CASES McD's restaurant's napkins, bags are made of recycled paper
Coca-Cola pumped syrup directly from tank instead of plastic which saved 68 million pound/year.
Badarpur Thermal Power station of NTPC in Delhi is devising ways to utilize coal-ash that has been a major source of air and water pollution.
New Delhi, In 2002, a directive was issued to completely adopt CNG in all public transport systems to curb pollution.
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Bush Administration's Clear Skies Initiative, which environmentalists have argued actually weakens air pollution laws.
Google has been criticized for claiming its data centers are extremely energy efficient, while refusing to publish any figures on this topic because such information could aid its competitors.
Many food products have packaging that evokes an environmentally friendly imagery even though there has been no attempt made at lowering the environmental impact of its production.
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The Comcast ecobill has the slogan of "Paper LESS is MORE" but ComCast uses large amounts of paper for direct marketing.
The Poland Spring ecoshape bottle is touted as "A little natural does a lot of good", although 80% of beverage containers go to the landfill.
The Airbus A380 airliner is described as "A better environment inside and out" even though air travel has a high negative environment cost.
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32% of the nation’s electricity, or over 908 billion kilowatt-hours, goes towards lighting, heating, cooling, and providing other electrical needs for office buildings.
• That equals 804 million tons of carbon dioxide. And you thought cars were big polluters.
• It costs businesses $66 billion.
ENERGY EFFICIENCY – WHY IS IT IMPORTANT 11/16/2009 34 GO GREEN
Energy Efficiency Efficiency - Turning Things Off Digital Thermostat • Use a programmable thermostat to make sure heating is turned down after hours. This can save $570, around 10% a year on heating and cooling energy.1 4.5 tons That means ~$100/yr. and 3/4 of a ton of CO2 CO2 Motion Sensors in Conference Rooms saved • Can save ~$100/yr. and 3/4 of a ton of CO2 each Lighting Policy • An office of 20 people that leaves a quarter of its lights on at night can save ~$340 and 2 1/2 TONS of CO2 by turning these off Computers, printers, etc. • Turn off computers, printers, etc where and when you can Source: 1. U.S. Department of Energy 11/16/2009 35 GO GREEN
Energy Efficiency Efficiency - Lighting The future, LED lighting 11/16/2009 36 GO GREEN
ENERGY EFFICIENCY COOL ROOFING ENERGY STAR™ compliant roofing materials with high emissivity can reduce peak cooling demand by 10-15%• This also reduces urban ‘heat islands’. The heat island effect can raise temperatures 2-10° F in urban areas.For each degree the temperature rises above 70 in L.A., 3% more smog is created.2 Source: 1. Energystar.gov; 2. U.S. Green Building Council 11/16/2009 37 GO GREEN
Energy Efficiency Tree shading • The shade from a mature tree correctly positioned to shade the building can reduce cooling costs by 20-40%. One of the benefits of deciduous trees (trees that lose their leaves in the autumn) is that they allow sunlight to reach and warm the building during winter. • Could save $400 and 3 tons of CO2 per year 11/16/2009 38 GO GREEN
Energy Efficiency Renewable Energy •Vestas Wind Systems has more than 30,000 wind turbines generating electricity globally and its high-tech systems are 80 per cent recyclable. It also sources 68 per cent of its energy requirements from renewable sources 11/16/2009 39 GO GREEN
Resource Use REDUCE, REUSE, RECYCLE AROUND THE OFFICE • Printing, Marketing materials - FSC Certified • Paperless Office •100% post-consumer recycled paper is now very comparable in price and quality to regular paper. Here are the benefits for the environment compared to virgin paper: - 100% fewer trees used
Emits 37% fewer greenhouse gases -
Uses 43% less energy
- Uses 46% less water - Reduces solid waste up to 49% 11/16/2009 40 GO GREEN