Last week’s blog outlines my four strategies to help capital markets embed environmental, social, and governance (ESG) strategies into the mindset of executives. I briefly referenced five concurrent ESG standards initiatives that are in play in capital markets to make this happen. They will lead to an ESG mindset in lenders and investors. Following the axiom that “what interests capital markets fascinates executives,” this will precipitate an ESG mindset in company executives.
Tag Archive 'sustainability champions'
My focus for the next two years will be to support these game-changing efforts in conjunction with my work with TNS Canada on a Gold Standard for a truly sustainable enterprise. I plan to align the Gold Standard criteria with the harmonized ESG KPIs developed by the above standards efforts. Where appropriate, I will encourage “zero” and “100%” metrics as goals against which company performance is assessed. For example, rather than rate companies on how much they have reduced their carbon emissions compared to their previous footprint, rate them against the aspirational “zero carbon footprint” benchmark in the Gold Standard, to spur quantum leap thinking and action.
If that is the case, why do I assume only a 2% improvement in employee productivity in the business case for sustainability described in The New Sustainability Advantage? Shouldn’t the six sustainability-related contributors to increased employee productivity that are summarized in the adjacent figure add up to more than 2%? Yes, they really add up to at least 20%, but there are five reasons that I deliberately forced them not to.
The Domini 400 Social Index, Dow Jones Sustainability Index, Sustainalytics’ Jantzi Social Index (JSI), and the Financial Times (London) Stock Exchange Index all track companies rated as sustainability leaders. These indices perform as well as, or slightly better than, indices for the rest of the market. Sustainability leaders do not seem to sacrifice financial market value for their efforts, nor are others missing market gains.
First, funds for many sustainability efforts are already in departments’ operating budgets. We are simply finding new ways to use those existing allocations, rather than requiring more “investment” money. If the payback period is less than a year, the dollars can be treated as a cost rather than a capital investment, and a cash flow-based internal rate of return (IRR) would be a more appropriate calculation.
March was a great month. I’ve been counting backward from that date for two years. I wanted to co-release four new interrelated business case resources for sustainability champions. It worked.
The New Sustainability Advantage has a recalibrated, and more compelling business case for sustainability strategies than described in its 2002 version. Based on recent case studies, it shows that if a typical company were to use best-practice sustainability approaches already being used by real companies, it could improve its profit by at least 51% to 81% within three to five years, while avoiding a potential 16% to 36% erosion of profits if it does nothing.
In addition to the new book, dashboard, worksheets, and slides that will be released together in March, I’m also creating a new Sustainability Advantage DVD that will encapsulate my talk these days on new business case for sustainability. It will be ready in the summer and will include footage of several talks that I am doing between now and then. I’m still on track to do another 80-100 talks this year. Last year, I did 93 plus wrote the new book, so paying attention to the bi-weekly blog was a bit of a challenge. For people who are unable to attend one of my talks, the DVD will provide an opportunity for them to experience it virtually.
The Occupy / We Are the 99% movements have awakened many people to unsustainable economic inequities. There has always been a gap between the have’s and the have not’s. It’s the widening of that wealth chasm during a recession and the co-opting of the political process by corporations that has aroused recent global protests.
Protestors are accused of being heavy on criticism and light on solutions. However, when they put forward well-thought-out proposals, they are ridiculed for being naïve and out of touch with “reality.” That is, they don’t have any good ideas. Oh, really? These three videos cleverly capture concrete proposals that would help address the underlying causes of unjust and dangerous wealth inequities.
In September, 165 university and college student leaders from across Canada came together for three days with national business and sustainability leaders to explore real sustainability solutions. The Co-Operators Group convened this amazing IMPACT! conference at the University of Guelph, Ontario. I was on an opening night panel with three other cross-sector panelists.