Entries by Bob Willard

3 Reasons Banks Fear ESG Laggards

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How lenders respond to a company’s request for financial assistance is somewhat driven by the applicant’s environmental, social, and governance (ESG) track record. Borrowers require financial capital in order to purchase equipment or new premises in which to produce its goods or services. Some of these capital improvements may be for pollution prevention equipment to comply with tougher environmental regulations, with energy-saving retrofits, for water conservation and treatment, or for new green production lines. Some of the loans may have nothing to do with green projects. Regardless, one cold reality applies to any loan request: Your ESG track record can be a stumbling block. Read More

Aligning ESG Benefits with the Standard 2-Part Business Case

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There are only two reasons a company changes: to avoid risks and / or to capture opportunities. They go for the upside, and / or run from the downside. They are attracted to the carrot, and / or want to duck the stick; the yin and / or the yang. Trying to convince a company to fully embed sustainability into its strategies and operations requires a very compelling business case. The standard business case is made up of these same two parts, shown in the figure below.
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Aligning ESG Benefits with the Income Statement

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click on image to enlarge

We need to make it easy for CEOs, CFOs, and others in the C-suite to see how embedding sustainability strategies into the company’s strategies and operations will contribute to the firm’s success. That is, we need to connect the dots between typical financial statements and the benefits that can be realized from smart environmental, social, and governance (ESG) approaches and programs. Aligning ESG benefits with income statement elements helps executives see the relevance of sustainability initiatives to their current financial priorities.
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Aligning ESG Benefits with Executives’ Top 10 Priorities

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What is the secret of selling executives on using sustainability strategies? Show how the benefits of those strategies help them achieve their existing priorities on which they are already being measured. Executives are juggling way too many key focus areas to welcome adding another one like “sustainability” to the batch. That means sustainability champions need to align the set of benefits that are yielded by smart environmental, social, and governance (ESG) / sustainability strategies with executives’ top priorities.
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4 Reasons It’s Time to Raise the Standards Bar for Companies

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How would we recognize a sustainable enterprise if we saw one? That question has been nagging at me for years. When we celebrate companies ranked as being the most sustainable (see my April 5, 2011, blog: 5 Lists of the Most Sustainable Companies), are they really just the best of a bad lot? When a company is certified as making significant progress towards its aspirational sustainability-related goals (see my April 19 blog: 5 Reasons ULE 880 is a Bellwether Sustainability Standard), are those goals setting the bar high enough?Are we ready for a more rigorous assessment of where Mother Earth would position a company on its journey toward being a truly sustainable enterprise? I think so, for four reasons.
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5 Reasons ULE 880 Is a Bellwether Sustainability Standard

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What if a company wants to be branded as a sustainable company, to improve its reputation with businesses, customers, employees, and investors? In my recent blog, 5 Lists of the Most Sustainable Companies, I showed the need for a standardized process for assessing and rating organizations as sustainable enterprises. Wouldn’t it be nice if there were certification process for sustainable companies, as there is now for some products and buildings? ULE 880 intends to fill that vacuum for manufacturing companies. There are five reasons it could be a bellwether sustainability standard.
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5 Lists of the Most Sustainable Companies

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Who’s the most sustainable company?” I am asked that “mirror-mirror-on-the-wall …” question a lot. The winner depends on who the judges are, their assessment criteria, and the intended audience for their selections. Lists that are done for investors identify companies that are doing the best at avoiding sustainability-related risks and capturing sustainability-related opportunities. Based on publicly available data, here are five lists of the most attractive sustainable companies for investors to consider.
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5 Realities vs the “We’re-Not-Allowed-To-Do-Sustainability” Myth

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I love this Navajo proverb: "You can't wake a person who's pretending to be asleep." Corporations sometimes defend their inaction on their social and environmental impacts by hiding behind Milton Friedman’s adage that “The business of business is business.” They claim that being more proactive on sustainability issues would be violating their fiduciary duty to shareholders. Nice try. They are just pretending that they are unaware of five realities that reveal that they could do more if they wanted to.
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5 Reasons Why a GPI Should Replace the GDP

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Economists deny that Gross Domestic Product (GDP) was ever intended as a metric of overall country progress or well-being. However, that’s how it is being used. Leaders express alarm if the GDP—the value of all goods and services produced within a nation in a given year—falls. Countries are ranked by GPD or GDP per citizen, implying that countries with higher rankings are doing better overall than countries with lower rankings.

What nonsense. We need a better metric for improved quality of life and progress. We need a Genuine Progress Indicator (GPI) that accounts for not only monetized economic wealth but, more importantly, includes vital environmental and social factors. Here are five reasons why it’s time we replaced the GDP with a GPI. Read More