Slides from Laura Musikanski's Triple Bottom Line Reporting workshop in Seattle, July 2010. See http://sustainableseattle.org/Programs/emergingppi/STARs/classes/20100715_TBL/ for background information and http://www.slideshare.net/sustainableseattle/getting-to-tbl-metrics for Burr Stewart's guest lecture at the same class.

1. Triple Bottom Line Reporting July 2010 Laura Musikanski, JD, MBA, CEM, CELR Executive Director, Sustainable Seattle [email_address]

10. Areas of focus in Our Common Future, 1987 Security Oceans Urban Growth Industry Energy Species & Ecosystems Population & Human Resources Food Scarcity Economy Sustainable Development

11. Defining Triple Bottom Line Reporting Sustainability is practiced by managing environmental, social and economic impacts. Social Economic Environmental SYNERGY

14. Establishing a common language Three Legged Stool

15. Establishing a common language - Graphics Economy Jobs, Prosperity, Wealth creation Environment Natural Resources Biodiversity Society Social Equity Sense of community Healthy Ecosystems Thriving Local Economy SUSTAINABLE DEVELOPMENT

18. And the issue of establishing a common language…. How do we do this? An Ecosystem Interconnected & interdependent

20. Terms Triple Bottom Line Corporate Responsibility Citizenship Reports Corporate Social Responsibility EMS Accountability Environmental, Social and Economic Stewardship Community Reports

24. Background Growth in reporting: 27 to over 3.600 from 1992 - 2009

25. Background Subject areas: Environmental: from 78% to 15% Sustainability & CSR - 70% in ‘09

26. Background First Time Reports: Over 700 in 2009 Just under 400 in 2005

27. Background Growth in reporting: Europe North & Central America Asia South America Australia African & Middle Eash

37. Short History of TBL Reporting 1790 Stock Market Crash SEC FASB & GAAP 1929 1902 Census Bureau Created Great Depression First US Census 1930 1972 1934 Securities Act 1933

38. Short History of TBL Reporting 1962 Silent Spring National Environmental Protection Act 1970 EMS Systems & Env Regs 1992 1983 Brundtland Rio Declaration 1989 Exxon Valdez GRI 1997 Kyoto Protocol 2005 Katrina Inconvenient Truth, IPCC 4 2006 AB-32: CA Global Warming Solutions Act 2000 Enron 2002 SOX

39. Short History of TBL Reporting 2008 Climate Action and Green Jobs (HB 2815) 2010 RGGI comes into effect American Clean Energy and Security Act (H.R. 2454) Passed in House Jun 26, 2009 – Senate? Cap & Trade, 17-percent emissions reduction from 2005 levels by 2020, 80% by 2050, Electric utilities- Renewable energy portfolio 20% by 2020. EPA to regulate GHG emissions from light vehicles 2009

40. Short History of TBL Reporting 2008 2010 Sweden- Swedish Annual Accounts Act, Accounting Modernisation Directive 2003/51/EC Amendment in 2007: state-owned companies to present, from 2009, sustainability reports, independent & in accordance with GRI 2007 France- Nouvelles Régulations Economique Australia Environment Protection and Biodiversity Conservation Act 1999, S516A - Australian Government agencies report on their sustainability performance as part of Annual Reports. 2001 2003 Denmark – Financial Statement Act. Large companies must disclose corporate social responsibility SEC –guidance on climate change risk disclosure ISO 26000 to be released Watch- - Africa & South America

45. Global Reporting Initiative Environment Labor Practices & Human Rights Communication Public Relations Social Service/Good Responsibility Economic & Financial Basic Sustainability Framework

46. Triple Bottom Line Subject Areas Social Economic Environmental Financial Performance Product Responsibility Consumer Issues Community Development Communication Materials Waste and Recycle Biodiversity Governance Fair Operating Procedures Labor Practices Human Relations Integration Energy Emissions Water

47. GRI

48. GRI

49. GRI

50. GRI

51. GRI

52. GRI

57. Sustainability Integration Curve Percent organizations Sustainability Integration

59. TBL example- GRI

60. TBL example- GRI

61. TBL example- GRI

62. TBL example- GRI

63. TBL example- GRI

64. TBL example- GRI

65. TBL example- GRI

66. TBL example- GRI

67. TBL example- GRI

68. TBL example- GRI

69. TBL example- GRI

71. TBL example-GRI accord

72. TBL Example- Profit and Sustainability

73. TBL Example- Profit and Sustainability

74. TBL Example- Profit and Sustainability

75. TBL Example- Profit and Sustainability

76. TBL Example- Profit and Sustainability and Operations

77. TBL Example- Profit and Sustainability

78. TBL Example- Profit and Sustainability

79. TBL Example- Profit and Sustainability

80. TBL Example- Profit and Sustainability United Nations Millennium Development Goals www.unmillenniumproject.org

81. TBL Example- Profit and Sustainability

82. TBL Example- Profit and Sustainability

83. TBL Example- Profit and Sustainability

84. TBL Example- Profit and Sustainability

85. TBL Example- Profit and Sustainability

86. TBL Example- Profit and Sustainability

87. TBL Example- Profit and Sustainability

88. TBL Example- Profit and Sustainability

89. TBL Example- Profit and Sustainability

90. TBL Example- Profit and Sustainability

91. TBL reports – Water and Basic Needs

92. TBL reports – Water and Basic Needs

93. TBL reports – Water and Basic Needs

94. TBL reports – Water and Basic Needs

95. TBL reports – Water and Basic Needs

96. TBL reports – Water and Basic Needs

97. TBL reports – Water and Basic Needs

98. TBL reports – Water and Basic Needs

99. TBL reports – Water and Basic Needs

100. TBL reports – Water and Basic Needs

101. TBL reports – Water and Basic Needs Foreign Policy, Washington Post

161. Drivers: The Triple Bottom Line Social Economic Environmental Reduce Costs & Increase Revenues Emerging markets Manage risks Resource Limitations Regulations & Laws Attract & retain quality talent License to operate Reputation HIGHEST POTENTIAL

162. Drivers Ethics Quality of Life Long term value Alignment with Organization First to Market Goodwill Branding Departmental and Agency Directives Stakeholder Expectations Shareholder Resolutions Regulations and Requirements

170. Greenhouse Gases Greenhouse Gas CO2 equivalent units Carbon dioxide 1 Methane 21 Nitric oxide 310 Hydroflorocarbons 1,300 Perflorocarbons 6,500 Sulfur hexfloride 23,900

185. GHG Emissions Partner with Bonneville Environmental Foundation Green Tags Program 1. Employee survey of Employees atHQ – sample size of 750 - actual miles traveled, type of transportation & the number of days for each type. 2. Sample process for distribution center 3. Estimates for nationwide based on initial survey and sample Company Travel booking software and CO2 estimates from Climate Neutral Network Based on estimates from identified activities i.e.hydrofluorocarbon gas that escapes from air-conditioning systems during routine maintenance 2008 REI Stewardship Report

186. GHG Emissions Goods Inbound: Sea Shipments : calculation based on container loads based on the container-miles. CO2 per container mile data published by the clean cargo group accounting for the average of all container ships. Truck Transport : ton-mile calculation used the vendor location, distance of the shipment and the freight weight to arrive at a total ton-miles of freight CO2 impact per ton mile derived from the average values published for "less than truckload" freight shipments and based on company calculations Direct Delivery- total ton-miles of freight multiplied by the average impacts of parcels and company calculations 1. Goods inbound - from vendors or factories to our distribution centers or stores 2. Intra-company transfers - shipments from our distribution center to our stores, between stores, or from stores back the distribution center. Inter-company transfers Compute total freight “ton-miles” based on total tons of cargo, number of deliveries and the distance from the distribution center to each store & use national average truck fleet data for fuel mileage (7 miles/gallon) and truck hauling weight) along with a standard conversion from diesel fuel gallons to pounds of CO2 (22.2 pounds/gallon) to arrive at a factor for pounds of CO2 per freight ton-mile. 2006 REI Stewardship Report

187. GHG Emissions Kilowatt hours from electricity bills for stores, headquarters and distribution center, with CO2 estimates based on the EPA Power Profiler, except in WA – based on Washington State Department of Community Trade and Economic Developments (CTED) for 2005 . Natural Gas: Not stated Direct Fulfillment; Ground- assumed the average shipping distance is 1342 miles CO2 based on average package weight shipped with used the same CO2 factor computed for truck delivery. Air- adjusted the average weight of a package compared to a person with CO2 estimates based on Climate Neutral Network. 2008 REI Stewardship Report

188. GHG Emissions 2006 REI Stewardship Report

189. GHG Emissions – Global Source: European Commission, Joint Research Centre (JRC)/Netherlands Environmental Assessment Agency (PBL). Emission Database for Global Atmospheric Research (EDGAR), release version 4.0. /2009 . http://edgar.jrc.ec.europa.eu

196. GHG Emissions Source: http://www.pewclimate.org/what_s_being_done/in_the_states/regional_initiatives.cfm

199. Renewable and Alternative Energy:

201. Climate Change To date, 1042 mayors have signed the U.S. Mayors Climate Protection Agreement.

214. Life Cycle Analysis

215. Life Cycle Analysis

217. Life Cycle Analysis Timberland’s Eco-label Climate Impact Resource Consumption Chemical Use The Timberland Company, 2006 Corporate Social Responsibility Report

218. Life Cycle Analysis Unilever 2006 Sustainable Development Report

219. Adapted from Office of Sustainability and the Environment Lifecycle Social Benefit Assessment Lifecycle Fiscal Assessment Building community and enhancing social capital Improved pedestrian access Indoor environmental quality and occupant health Future proofing Public art / improved aesthetics Deconstruction of existing facility/ building re-use Water efficiency, rainwater harvest Stormwater management and water recharge Energy and atmospheric impacts Habitat diversity and ecological function Advancing thriving economy and social justice Crime deterrence Initial capital costs Energy costs Facility flexibility -- costs to upgrade or adapt Disposal costs Materials and resource selection Water costs Staffing costs Janitorial costs Maintenance costs – equipment durability Integrated universal access Preservation/ enhancement of neighborhood character Green Building and Sustainable Development Ordinance TBL LCA for Infrastructure Lifecycle Environmental Assessment Meeting needs of historically underserved Community/neighborhood economic development contributions Transportation connectivity Inclusive public involvement process Revenue generation capacity

220. The Stream King County Equity & Social Justice Initiative, Equity Report 2008 Upstream: Everyone in all communities should have these conditions Midstream: Move people from conditions that decrease health & well-being to conditions that support them Downstream: Act to change behaviors or conditions causing stress and poor health Pro-Equity Policies No Racism Affordable Housing Access to Transportation Good Paying Jobs Quality Education Healthy Environment Low Birth Weight Incarceration Need action at Societal Level Need action at Individual and Family Level Safe Neighborhoods Obesity Untreated Mental Illness Access to Healthcare Poor Health Status Homelessness Fair Standards of Living Physical Activity Need action at Community Level

222. Stakeholders Stakeholders: Present And Future Customers, Indigenous & Vulnerable Peoples & Media & Public Shareholders & Investors Employees Governmental Agencies & Law Enforcement & Elected Officials Suppliers & Distributors & Transportation Agencies Industry Partners & NGOs & Associations

225. Paper or Plastic: LCA

233. GRI- Sustainability Report 2007/2008

234. GRI- Sustainability Report 2007/2008

235. GRI- Sustainability Report 2007/2008 – Environment Emissions

236. GRI- Sustainability Report 2007/2008 – Labor Practices

237. GRI- Sustainability Report 2007/2008 – Labor Practices

240. Global Compact

241. United Nations Millennium Development Goals www.unmillenniumproject.org

242. Access to Medicines Index www.atmindex.org

243. Merck 2008 CR report

244. Merck 2008 CR report: Labor Practices- Diversity & Equal Opportunity

245. Merck 2008 CR report: Society – Corruption & Public Policy

246. Merck 2008 CR report: Economic – Indirect Impacts or Product Responsibility- Customer Health & Safety?

247. Merck 2008 CR report: Economic – Indirect Impact or Product Responsibility- Customer Health & Safety?

248. City Development Sustainability Report 2009

249. City Development Sustainability Report 2009

250. City Development Sustainability Report 2009

251. City Development Sustainability Report 2009 – Environment: Energy & Water

252. City Development Sustainability Report 2009 – Environment : Emissions, Energy & Material