DeloitteSustainability Value Methodology   Copenhagen, 28 June 2006   Preben Soerensen   Sam Vaseghi    © Deloitte & Touch...
Leading companies understand that there is not always a trade-off between Shareholder & Stakeholder value                 ...
Our Sustainability service offerings span across allStakeholder and Shareholder Value Drivers                             ...
Our Sustainability service offerings span across allStakeholder and Shareholder Value Drivers                             ...
The Sustainability Value Methodology       1. Map Stakeholders’ Values                                      4. Map Shareho...
First StepMap Stakeholders’ Values and Define Sustainabilty Issues                                                        ...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:1. Changing demographics and the   emergence of new consum...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Environmental Issues1. Chan...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Environmental Issues1. Chan...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Environmental Issues1. Chan...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Social Issues1. Changing de...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Environmental Issues1. Chan...
Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:                               Social Issues1. Changing de...
Example: Identifying together with youyour relevant and material Sustainability Issuesaligned with your corporate strategy...
Second StepDesign Business Case and map shareholder Value                                                               SH...
Proposed value framework for integration of key  stakeholder issues                                              3. Design...
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
Sustainability Value Methodology_Deloitte, 2007
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Sustainability Value Methodology_Deloitte, 2007

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Sustainability Value Methodology_Deloitte, 2007

  1. 1. DeloitteSustainability Value Methodology Copenhagen, 28 June 2006 Preben Soerensen Sam Vaseghi © Deloitte & Touche Weidekampsgade 6 2300 Copenhagen V Denmark Tel.: +45 (0) 33 76 32 39 Fax: +45 (0) 33 76 39 40
  2. 2. Leading companies understand that there is not always a trade-off between Shareholder & Stakeholder value Positive Create pure Environmental & Create Social Value Sustainable At the expense of ValueStakeholder Value: economic value Social & Environmental Value Create pure Economic Value Destroy At the expense of Value environmental and social value Negative Shareholder Value: Negative Economic Value Positive Our approach aims at maximizing the benefits of converging value drivers in order to create sustainable value for both shareholders and stakeholders. Source: Adapted from Sustainable Value Partners Seite 2 © 9/27/2005 Deloitte & Touche
  3. 3. Our Sustainability service offerings span across allStakeholder and Shareholder Value Drivers SHAREHOLDER VALUE Revenue Operating Asset Expectations Growth Margin Efficiency Operational Corporate Impact Strategic Environment, Governance & Planning for Health and Transparency Sustainable Safety VALUE Development Products & Services Reporting & Disability & Performance Work Measurement STAKEHOLDER Attendance Management Production Efficiency Human Capital Management & Enterprise Employee Operational Productivity Excellence Sourcing Material Seite 3 © 9/27/2005 Deloitte & Touche
  4. 4. Our Sustainability service offerings span across allStakeholder and Shareholder Value Drivers SHAREHOLDER VALUE Revenue Operating Asset Expectations Growth Margin Efficiency Operational Impact VALUE 1. Map Stakeholders’ Values 4. Map Shareholder Value Products & Services STAKEHOLDER 2. Define Sustainability Issues 3. Design Business Case Production Efficiency Sourcing Material Seite 4 © 9/27/2005 Deloitte & Touche
  5. 5. The Sustainability Value Methodology 1. Map Stakeholders’ Values 4. Map Shareholder Value •Identify/reassess and characterize stakeholders • Apply ValueMap to map value from business cases • Proactively identify/reassess stakeholder expectations • Apply ValuePrint to evaluate/assess business cases •… •… 2. Define Sustainability Issues 3. Design Business Case • Define/Refine key issues from stakeholder perspective • Track via ValueMap • Translate definition of issues into shareholder perspective • Assess Risks and Opportunities •… • Design appropriate business cases by ValueMap •… Seite 5 © 9/27/2005 Deloitte & Touche
  6. 6. First StepMap Stakeholders’ Values and Define Sustainabilty Issues SHAREHOLDER VALUE Revenue Operating Asset Expectations Growth Margin Efficiency Operational Impact VALUE 1. Map Stakeholders’ Values 4. Map Shareholder Value Products & Services STAKEHOLDER 2. Define Sustainability Issues 3. Design Business Case Production Efficiency Sourcing Material Seite 6 © 9/27/2005 Deloitte & Touche
  7. 7. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend:1. Changing demographics and the emergence of new consumer and labour markets.2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.3. Preserving the natural resource base.4. Doing business in a globalized, interconnected economy.5. Earning the license to operate.6. Changing geopolitical risk landscapes. Seite 7 © 9/27/2005 Deloitte & Touche
  8. 8. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Environmental Issues1. Changing demographics and the  New markets for environment-friendly and energy-efficient products in emergence of new consumer and emerging economies labour markets. Social Issues2. Boosting innovation for efficiency and reduced impact on  New markets for emerging consumer needs in emerging economies environmental and climate systems.  Workplace health and safety*  Labour standards*3. Preserving the natural resource  Human rights issues* base. Corporate governance issues4. Doing business in a globalized, interconnected economy.  Complying with local laws, while upholding global corporate5. Earning the license to operate. governance and responsibility standards6. Changing geopolitical risk landscapes. Seite 8 © 9/27/2005 Deloitte & Touche
  9. 9. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Environmental Issues1. Changing demographics and the  Carbon constraints (climate change) emergence of new consumer and  Environmental liabilities labour markets.  Pollution prevention2. Boosting innovation for efficiency  Reducing emissions and resource use and reduced impact on  New markets for environment-friendly environmental and climate and energy-efficient products systems.3. Preserving the natural resource base.4. Doing business in a globalized, interconnected economy.5. Earning the license to operate.6. Changing geopolitical risk landscapes. Seite 9 © 9/27/2005 Deloitte & Touche
  10. 10. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Environmental Issues1. Changing demographics and the  Product stewardship emergence of new consumer and  Waste and toxic release management labour markets.  Accident and spills management2. Boosting innovation for efficiency  Efforts to incorporate external costs in planning and accounting and reduced impact on environmental and climate systems.3. Preserving the natural resource base.4. Doing business in a globalized, interconnected economy.5. Earning the license to operate.6. Changing geopolitical risk landscapes. Seite 10 © 9/27/2005 Deloitte & Touche
  11. 11. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Social Issues1. Changing demographics and the  HR management (including compensation, training, etc.) emergence of new consumer and labour markets.  Attracting and retaining employees  Workforce diversity and equal2. Boosting innovation for efficiency opportunities and reduced impact on environmental and climate systems.3. Preserving the natural resource base.4. Doing business in a globalized, interconnected economy.5. Earning the license to operate.6. Changing geopolitical risk landscapes. Seite 11 © 9/27/2005 Deloitte & Touche
  12. 12. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Environmental Issues1. Changing demographics and the  Environmental governance and management systems emergence of new consumer and labour markets.  Accidents and spills management2. Boosting innovation for efficiency Social Issues and reduced impact on  Community and NGO relations environmental and climate  Government relations systems.  Investor relations3. Preserving the natural resource  Management of crisis situations* base. Corporate governance issues4. Doing business in a globalized,  Board structure and accountability interconnected economy.  Accounting and disclosure practices5. Earning the license to operate.  Audit committee structure and independence of auditors6. Changing geopolitical risk  Executive compensation landscapes.  Management of corruption and bribery instances  Business ethics policies Seite 12 © 9/27/2005 Deloitte & Touche  Corporate citizenship engagement
  13. 13. Deloitte Generic Catalogue of Sustainability IssuesGlobal trend: Social Issues1. Changing demographics and the  Human rights, community and government relations in politically emergence of new consumer and unstable countries/conflict zones labour markets. Corporate governance issues2. Boosting innovation for efficiency and reduced impact on  Policies and systems to manage risk in politically unstable environmental and climate countries/conflict zones systems.3. Preserving the natural resource base.4. Doing business in a globalized, interconnected economy.5. Earning the license to operate.6. Changing geopolitical risk landscapes. Seite 13 © 9/27/2005 Deloitte & Touche
  14. 14. Example: Identifying together with youyour relevant and material Sustainability Issuesaligned with your corporate strategy Aligned with the Strategic Planning for Sustainable DevelopmentEnvironmental Issues  Environmental and safety management of production processes  Declining capacity of eco-systems to sustain intensive harvesting and production methods  Business in a carbon-constrained worldSocial Issues  Changing consumer preferences, new needs in emerging markets  Management of global workforce  Labour practices and HR management  Community relations, corporate citizenship engagementCorporate Governance Issues  Corporate governance framework  Transparency in relation to sourcing and production methods  Government relations, business ethics Seite 14 © 9/27/2005 Deloitte & Touche
  15. 15. Second StepDesign Business Case and map shareholder Value SHAREHOLDER VALUE Revenue Operating Asset Expectations Growth Margin Efficiency Operational € Impact VALUE 1. Map Stakeholders’ Values 4. Map Shareholder Value Products & Services STAKEHOLDER 2. Define Sustainability Issues 3. Design Business Case Production Efficiency Sourcing MaterialSeite 15 © 9/27/2005 Deloitte & Touche
  16. 16. Proposed value framework for integration of key stakeholder issues 3. Design Business Case 4. Map Shareholder Value Issue Litigation and regulatory risks Risk premiums Issue Operational risks Reputation and brands Issue Costs WACC Operational efficiency StrategyStakeholder Policies Shareholder value Innovation value Management- Systems Access to new / Free cash Existing markets Revenues flows Access to knowledge Issue and skills Access to ressources Other (tax, Issue reinvestment Others rates) Issue Seite 16 © 9/27/2005 Deloitte & Touche

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