Calculation methodology to integrate sustainability content into Enterprise Valuations, taking into accounts the cumulated ecologic footprint over 2 cycles.

1. Price For the
Planet Concept
(P4P)
Copyright H. Sturzenegger & Sons Sàrl
Full
Circularity
Process
By H. Sturzenegger & Sons
Geneva
Sustainability Services
for SME

2. A. Basics
The green background shows the « scope
of analysis ». On the horizontal axe, the
«Time» in years and vertical the
«Monetary Value» in FIAT currency.
Interval of time between T-1 to T0 is one
product life cycle, same between T0 to
T+1 . The present is T0 . The black line is
the Company revenue. Black line during
Life Cycle 1 are historic and Life Cycle 2
are projected revenues. To determine the
P4P engagement, the P4P methodology
requests two Life Cycles as timeframe.
B. Average Revenues « AR »
A point is the Company revenue, at the
begining of the product life cycle, 3 years
ago for a mobile phone or 20 years ago
for a luxury watch Company. B point is
the revenu expected at the end of a new
life cycle (Life Cycle 2).
Average revenue is the sum of all
revenues over two Life Cycle periods,
divided by the number of Time unit (ie 2
Life Cycle of 3 years is 6 Time units).
Page 2/ 9
P4P Concept
by H. Sturzenegger & Sons ©
P4P Concept is a methodology which
determines the global engagement of
a Group or Company in front of its
environmental obligations.
Producing consumer products creates
obligations to the society, to the
environnent and to the Planet.
After its Life Cycle, products are too
often thrown away and rest in a
landfill, without any recycling.
The scope of analysis request two
complete Life Cycles periods, in order
to properly determine this global
engagement to the Planet.
H. Sturzenegger & Sons Sàrl ©

3. P4P Concept
by H. Sturzenegger & Sons ©
C. Costs, Prices and P4P
Costs and Prices are average prices of all
products & services of the Company,
including its complete industry Supply-
Chain. It shall be declined in product lines,
based on raw material processed. Raw
Material Price represents the average
costs in monetary value (also in %) of the
commercial product. Same as per the
Costs Price, which excludes (Public Selling
Price). These are Costs, Prices and P4P at
present time (T0), based on a yearly basis.
D. Average Price For the Planet
The Average Price For the Planet (P4P) is
the Company’s Average Revenues added
to the Cost of Recycling (same as an
average cost), on a yearly basis.
It is take as assumption that the P4P is
growing in parallel to the Average
Revenue of the Company. This
assumption is measured as a monetary
value (FIAT currency) and not in
production volumes (units), as P4P is a
monetary value.
Page 3/ 9
P4P Concept takes into consideration
Costs and Prices, of the product
category analysed.
Costs are calculated as percentage of
the total product sold. It includes
Recycling Costs (costs for collection
and recycling transformation of a
product).
Price is identified as the « Sale Price »
to the final consumer (the money
spend to purchse the product).
P4P represents the sum of Sale Price
and Recycling Cost of the product
category, on a yearly basis.
H. Sturzenegger & Sons Sàrl ©

4. P4P Concept
by H. Sturzenegger & Sons ©
E. Cumulated P4P
During the Life Cycle period, the P4P is
cumulating, as far no Recycling is
performed. Each year, the yearly P4P is
adding another year of P4P value. It is
called the «Cumulated Price For the
Planet» which represents the real
engagement of the Group or Company to
our Planet, over the Life Cycle period.
If Revenues are increasing without
Recycling, then the Cumulated P4P shall
increase exponentially as end-of-cycle
products accumulate in the landfill.
F. Future Monetary Gap (yearly)
On a projected yearly basis, the interval
of value between P4P and Revenues
represents the difference of the real price
to be paid, in case recycling costs are
integrated within the price and the
consumer Selling Price.
Such difference can be significant,
representing a percent, as well as a
multiple of the Selling Price. So the
product is considered as Toxic, when
complex product have a recycling costs
higher than the Selling Price.
Page 4/ 9
Cumulated P4P Concept is the real
engagement (obligation) of Groups or
Companies to the environment and
the Planet.
During the Life Cycle, P4P value is
cumulating exponentially, as far as no
Recycling is performed.
Yearly Gap between P4P and Selling
Price represents the hidden Costs of
Recycling.
If Recycling Price of a product is higher
than the Selling Price, this product is
considered as Toxic. Actions must be
taken (R&D, Recycling Industry…).
H. Sturzenegger & Sons Sàrl ©

5. P4P Concept
by H. Sturzenegger & Sons ©
G. Historic Monetary Gap (yearly)
The green background shows the « scope
of analysis ». On the horizontal axe, the
«Time» in years and vertical the
«Monetary Value» in FIAT currency.
Interval of time between T-1 to T0 is one
product life cycle, same between T0 to
T+1 . The present is T0 . The black line is
the Company revenue. Black line during
Life Cycle 1 are historic and Life Cycle 2
are projected revenues.
G. Projected Cumulated Gap
A point is the Company revenue, at the
begining of the product life cycle, 3 years
ago for a mobile phone or 20 years ago
for a luxury watch Company. B point is
the revenue expected at the end of a new
life cycle (Life Cycle 2).
Average revenue is the sum of all
revenues over two Life Cycle periods,
divided by the number of Time unit (ie 2
Life Cycle of 3 years is 6 Time units).
Page 5/9
Group or Company have historical
activity (production & sale). During a
Life Cycle, without recycling, Group or
Company already have a
environmental debt to the Planet.
This historic environmental debt to the
Planet is determined by the cumulated
Gap between the yearly Average P4P
less the Average Revenues.
By extrapolation of this historic debt
to the future, Cumulated P4P explains
this exponential engagement in the
future. Without actions, the
engagement can represent a multiple
of the Group or Company Revenues.
H. Sturzenegger & Sons Sàrl ©

6. P4P Concept
by H. Sturzenegger & Sons ©
I. Cumulated Monetary Gap
The Cumulated Montetary gap between
P4P and Average Revenues over the
complete Life Cycle determines the
complete engagement of a Group or a
Company to the environment and so the
Planet.
Theorically, this engagement could be
higher than the Average Revenues of a
Group or a Company. On a yeartly basis,
it could represent a multiple of the Group
or Company Revenues. A high risk !
Action I: Minimize Toxicity
Product complexitiy (Transformation I &
II) and use of Non-Recycling raw
materials (Extraction) makes products
potentially Toxic for the environment and
the Planet. High product toxicity creates
higher Recycling Costs.
By optimizing product R&D and enhanced
product recyclability, Group or Company
shall reduce significantly its negative
impact, and in consequence its
obligations to protect our environment.
Page 6/ 9
Calculation of the P4P over the Life
Cycle determines the total
engagement of a Group or Company
to the environment and to the Planet.
It is its obligations to reduce this
exposure (risk) and act in due course.
P4P gap could represent a multiple of
the yearly Revenues of a Company.
This is the major area of actions.
Actions shall be implement to
minimize the product toxicity, in order
to lower Selling Price under its
Recycling Costs. Reducing product
toxicity can ease recycling and reduce
Recycling Costs significantly.
H. Sturzenegger & Sons Sàrl ©

7. P4P Concept
by H. Sturzenegger & Sons ©
Action II: Increase Recycling rate
Over the projected Life Cycle 2 period, in
increasing product category Recycling
rate from 0% to more than 80% shall
sharply decrease P4P Group or
Company’s engagement to the Planet.
Recycling more (boost Recycling rate)
creates significant reduction of P4P’s
engagement levels and drives Group and
Company close to an efficient Circualrity.
And circularity is key to reduce raw
material consumption, so extraction.
L. Non-Compressible Gap
When acting to increase Circularity at
industry level, there is a bottom line,
which is the minimum costs of recycling
of the product category.
Recycling is a retransformation of the
existing product. There are minimum
transformation costs to recycle any
product. This non-compressing gap is the
«Recovery rate bottom line». By
increasing recycled volumes and process
efficiency, the Recycling industry shall
reach this line (as a percent of Selling
Price). Page 7/ 9
Actions shall be implemented within
the whole industry supply-chain, in
order to increase Recycling rate.
Investments shall be made at industry
levels.
By increasing Recycling rate, Group or
Company increase Circularity of its
activity and sharply reduce its P4P
engagement.
Recycling industry must process
volumes to increase its efficiency and
to reduce costs at minimum. It is the
Recycling rate bottom line. When the
recycling industry reaches it, recycled
materials shall reach its cheapest level.
H. Sturzenegger & Sons Sàrl ©

8. P4P Concept
by H. Sturzenegger & Sons ©
Action III: Increase Productivity
Each Group or Company must increase its own
internal production process productivity. In
optimizing its supply of recycled raw materials,
in reducing production process waste and
modifiying end-consumer habits (5R concept), it
must reduced significantly its P4P engagement
to the Planet.
Reach Efficency in Circularity
Finally, the most efficient way to reduce dramatically
the Group or Company’s engagements to the Planet and
assume its ecologic responsabilities, is to increase the
Circualrity of their own products and support financially
the investments in an efficient recycling industry by
increasing volumes and reducing Recycling Costs.
By reducing recycling costs, recycled raw materials
become more affordable and in consequence more used
! All together shall determine our DCF – Green Risk. The
DCF – Green Risk affect the Enterprise Value (EV).
Page 8/ 9
Each Group or Company must act to
lower use of non-recycled raw
materials, reduced product complexity
to reduce waste and modifiy end-
consumers habits (5R concept).
Producing consumer products creates
obligations to the society, to the
environment and to the Planet.
The P4P analysis and the
determination of the Group or
Company total engagement to the
Planet shall support us in calculating
the DFC – Green Risk in Enterprise
Valuation (EV).
H. Sturzenegger & Sons Sàrl ©

9. Contact
M. Patrice Müller
Partner
H. Sturzenegger & Sons
Rue de Grenus 7
CH – 1200 Geneva
pmuller@stgger.com
+41 79 616 08 61