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UPDATED: Sustainability and Business Strategy, Sofia November 11 2012


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Presentation for the AmCham Business Ethics and Sustainability Conference, 12 November 2012, Sofia. Updated

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UPDATED: Sustainability and Business Strategy, Sofia November 11 2012

  1. 1. Companies integrating sustainability intobusiness strategy: Case studies andconclusionsNovember 2012Toby Webb, Founder, Ethical Corporation and Stakeholder IntelligenceLecturer, Corporate Responsibility, Birkbeck College, University of /
  2. 2. Marks & Spencer Plan A
  3. 3. Marks & Spencer Plan A (2007)Goal: Worlds most sustainable major retailer“Plan A”: 180 environmental/ethical commitments by 2015Focus: Climate change, Waste, Natural resources, Health andbeing a Fair partner Cost neutral/positive Award winning Growing customer trust Now launching new products and campaigns: Energy, customer loyalty (Shwopping)
  4. 4. Unilever Sustainable Living Plan (2010) Ten year journey towards sustainable growth with 50 targets Aim to bring safe drinking water to 500 million people 2011: Increased the proportion of portfolio that meets highest nutritional standards from 22% in 2010 to 25% in 2011 Aim: Halve the greenhouse gas impact of products across the lifecycle by 2020 2020 aim: Source 100% of agricultural raw materials sustainably Sustainably sourced raw materials increased from 14% in 2010 to 24% in 2011
  5. 5. Timberland and ‘Earthkeepers’
  6. 6. Timberland and ‘Earthkeepers’ (2007) 2007 looking "desperately" to try and grow the business Developed successful "Earthkeeper" line of footwear and apparel Designed with a core philosophy of environmental stewardship Objective: "make our values valuable" : Mike Harrison, Chief Brand Officer Earthkeepers product line is now 10% of sales Gone from one boot in 2007 to entire line sold around the world: Engaged heavily with customers online and using social media
  7. 7. Skanska and greener construction
  8. 8. Skanska and greener construction (2009) Empire State building: Ambitious $500m renovation plan, paid for with savings from “deep green retrofit” Skanska: 57% reduction in energy consumption. Reduction of 15-18% employee absenteeism Renovation costs recouped in as little as five years By 2015: Building’s owners say they are confident they will save $4.4m a year: A 38% reduction of energy use Development business unit focusing on green: 10% of the company’s overall $17bn annual revenues, 1% deep green
  9. 9. Vodafone in Turkey
  10. 10. Vodafone and Turkish Farmers (2011)Vodafone/ Accenture 2011 research: Mobile-based agri services could boostagricultural income by $34bn by 2020Vodafone Farmers Club offers special rates & info to farmers: Mobile tech toimprove incomes & increase efficiency/sustainability 500,000 signed up to the Farmers Club so far. Participating farmers have increased productivity by about €100mSMS alerts with government information on: New regulations and financial support Weather forecasts Market price quotes linked to location and productionPartnership with Sekerbank: Farmers pay mobile phone bills post-harvest,annually. Benefits to Vodafone: Customer loyalty, mass revenue streams
  11. 11. Siemens and Green Business Strategy 2011: Products and solutions in Environmental Portfolio generated revenue of €29.9 billion: 41% of total revenue Objective: Grow annual revenue to €40 billion by 2014 – with new, innovative products and exceptional growth in fields like renewable energy. These include: Combined cycle power plants and intelligent building technologies: far more energy-efficient than comparable solutions Renewable energy systems and components: wind turbines, steam turbines for solar-thermal power plants. Environmental technologies for cleaner water and air
  12. 12. Conclusions 1: What does this mean for stakeholder engagement? Employee engagement drives innovation NGO partnerships bring ideas and credibility Communities have increasing power & influence Social media means no company escapes scrutiny Big business want a long term vision from Governments: And policies and incentives that enable investment and longer term planning
  13. 13. Conclusions 2: What does this mean for financial returns?London Business School and Harvard Business School researchfinds that: Firms with better CSR performance face significantly lower capital constraints Better stakeholder engagement and transparency around CSR performance, are important in further reducing capital constraints That the relation is driven by both the social and the environmental dimension of CSR"CORPORATE SOCIAL RESPONSIBILITY AND ACCESS TO FINANCE" Available at:
  14. 14. Conclusions 3: The takeaways… CSR/Sustainability/Responsible business = Smarter business Consumers want to trust brands, not products Leading companies turning sustainability into opportunity all over the world: New products / motivated people / cost savings It is early days! But 9 billion people means less resources and innovation will be essential: Sustainability = risk reduction Corporate roles in changing inefficient systems will be vital: The winning companies recognise CSR is systems change
  15. 15. Further resourcesThe Smarter Business Blog: tobywebb.blogspot.comEthical Corporation: / / Harvard Kennedy School CSR Initiative: Centre for Corporate Responsibility:http://doughtycentre.infoMIT/Sloan Management Review: Intelligence: Training and