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How Collaboration Advances Your Sustainability Efforts

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The Boston Consulting Group, MIT Sloan Management Review, and the United Nations Global Compact joined forces to provide an inside look at how companies are dealing with sustainability issues: http://on.bcg.com/1Ci1R8l.

Published in: Business

How Collaboration Advances Your Sustainability Efforts

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  2. 2. 1 Our research partnership on corporate sustainability • Survey, interviews, case studies • >38,000 executives, managers and thought leaders • >110 different countries 2011 2010 2012 2009 2013 2014 Report launched Tuesday, 13 January
  3. 3. 2 Companies stepping up Source: 2010 – 2014 BCG-MIT SMR-UN GC Sustainability Survey (based on commercial data-set); BCG analysis.
  4. 4. 3 Only minority not aware of business case Source: 2009 – 2014 BCG-MIT SMR-UN GC Sustainability Survey (based on commercial data-set); BCG analysis.
  5. 5. 4 90% say collaboration necessary Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on commercial data-set with 2,587 responses); BCG analysis.
  6. 6. 5 Development towards more collaborations over time Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 749 responses); BCG analysis
  7. 7. 6 Reputation and innovation top reasons Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  8. 8. 7 Collaborations often strategic or transformational Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  9. 9. 8 Seriously engaged firms act more across sectors Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  10. 10. 9 Netafim: Transforming the irrigation market in India The Challenge: Raise production of rice The Solution: Drip irrigation for rice Food for nearly half of the world’s population • Over 95% is grown by smallholders • Plots up to 2 hectares in size We’re talking about small farmers, and there is no way we can reach them on our own. We need partners who know the farmers and the culture and can help us sell to and train them. ... There’s no way we can do it alone. Naty Barak, Netafim Chief Sustainability Officer " " • R&D with governments and universities on cultivation of rice • Netafim Agricultural Financing Agency (NAFA) providing smallholders with loans quickly • 3-day conference on drip irrigation in rice with Water Technology Centre 201120102007 CAGR >10% Netafim sales $M Sales growth 2011 +34% EBITDA growth 2011 +59% Source: Permira, Netafim Sustainability report, MIT SMR, BCG analysis The Benefit: Growing more with less $26.2M $25.6M $51.8M + Savings due to lower resource consumption (water, fertilizer, energy) Additional productivity benefits due to increased yields and higher quality crops Overall benefits of growing more with less to 60,000 Indian farmers
  11. 11. 10 Also, difference between industries Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  12. 12. 11 What companies give (and what they receive) Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  13. 13. 12 Only 47% active in collaborations – 61% with success Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  14. 14. 13 Learning curve on sustainability collaborations Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  15. 15. 14 Keys to success in sustainability collaborations Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis Success with internal collaboration Have a shared language Secure board engagement Timely engagement (not all players have to be involved all the time) Due diligence Right entrance and exit strategies Practice, practice, practice, … People matter
  16. 16. 15 Board commitment necessary Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  17. 17. 16 But, board engagement can be higher Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis
  18. 18. 17 Asia Pulp & Paper with Greenpeace in the boardroom "Bear witness to the forest destruction caused by companies like Asia Pulp and Paper" • Greenpeace campaigned against APP • One of largest pulp and paper companies APP customers stopped sourcing APP paper • Hasbro, Kraft, Staples told suppliers to avoid sourcing paper and packaging from APP Sources: Greenpeace website; press search; MIT SMR interview with Aida Greenbury, managing director for sustainability for Asia Pulp & Paper (APP). APP lost clients following Greenpeace campaign against deforestation activities APP met shareholders and Greenpeace in boardroom to discuss deforestation policy • Non-profit The Forest Trust (TFT) helped APP • ‘Sustainability Roadmap Vision 2020’ published in 2012 2013, APP launched Forest Conservation Policy • Greenpeace suspended active campaigning • Many clients came back after implementing zero deforestation policy Many came back as result of collaboration with Greenpeace and TFT
  19. 19. 18 Key takeaways Sustainability top management agenda item Management consensus that • business should collaborate on sustainability • board involvement key But, boards still untapped resource Source: BCG-MIT SMR-UN GC 2014 Sustainability Survey (based on company data-set with 2,587 responses); BCG analysis

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