Corporate Sustainability Innovation & Competitive Advantage
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Reneker-Saas What is Corporate Sustainability? Many definitions: -
“Eco-efficiency.” (World Business Council for Sustainable Development, Schmidheiny 1993, DeSimone and Popoff 1997)
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“Meeting the needs of the present without compromising the ability of future generations to meet their own needs.” (Brundtland, 1987)
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“An economy in equilibrium with basic ecological support systems.” (MIT,
Stivers, 1976)
“Time is probably the most important dimension of sustainability. Whether a fossil fuel company is sustainable or not, depends on how fast it can turn itself into a renewable energy company.” (Mark Wade, Shell Corporation, 1998) Bottom-line: Corporate Sustainability is a dynamic process, a journey, rather than a tangible outcome or end state
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Reneker-Saas The Three Spheres of Corporate Sustainability
Corporate Sustainability ‘Shear-Zones’
Pr Soc od ia uc l tiv ity
Ec
o-E
ffic
ien
Sufficiency
cy
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Reneker-Saas ‘Shear Zones’ Eco-Efficiency -
Shear zone of economic and environmental sustainability. The notion that economic and environmental goals may be reached at the same time is increasingly being accepted.
Social Productivity -
Shear zone of social and economic sustainability. ‘Good ethics is good business’. The majority of publications refer to social responsibility.
Sufficiency -
Shear zone of environmental and social sustainability. What level of consumption is sufficient in the face of limited environmental resources? Ethical dilemma in case the right (sustainable) thing to do is not the profitable choice.
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Reneker-Saas Enterprise Management Perspective
R Op eso tim urc isa e tio n
Gr
ow th
Social Enterprise
Innovation
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Reneker-Saas Corporate Sustainability: Demands new and innovate choices and ways of thinking Creates meaning and motivation in the workplace to achieve sustainable economic, environmental and social benefits Is of consequence across all financial, operational and human dimensions of a modern enterprise Depends on effective internal and external stakeholder participation and collaboration Requires standard and integrated approaches to measurement, reporting and managing opportunity and risk Can and should be leveraged to build sustainable competitive advantage
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Reneker-Saas Corporate Sustainability – Investor Perspective Sustainability and Corporate Social Responsibility (CSR) are commonly part of an Enterprise Risk Management process. However, Corporate Sustainability needs to be given special recognition Corporate Sustainability initiatives are not inhibiting growth – enterprises that are committed to Corporate Sustainability are making good investments -
Carbon Disclosure Project
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Dow Jones Sustainability Index
A report released by Goldman Sachs (June 2007) demonstrated that enterprises who are implementing sustainability strategies designed for competitive advantage outperformed the overall stock market by 25%. Within their own sectors, 72% of these enterprises outperformed their peers
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Reneker-Saas Corporate Sustainability – Consumer Perspective
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Reneker-Saas Life Cycle of Corporate Sustainability – Baseline Competitive Relevance
Strong competition for recognition as pro-active Leader advantages for best practice
First mover advantages for 1st mover possible
Issue is being accepted as the cost of doing business; no more positive recognition
f e o ion n Zo cret s Di
Potential threat, so far no costs or profit associated
latent
emerging
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growing
mature
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decline
Reneker-Saas Life Cycle of Corporate Sustainability – Deviations Competitive Relevance
An issue that has not been solved bounces back
f e o ion n Zo cret s Di Voluntary industry agreements to avoid further transformation
latent
emerging
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growing
mature
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decline
e-novation Competitive Advantage
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Reneker-Saas Sustainability Reporting Corporate Sustainability Reports -
“While there are examples of social and ethical accounting and auditing initiatives which include elements of financial and environmental issues, data and perspectives, they tend to involve compilation rather than the required integration.” (Zadek & Gonella, 1998)
“If we at British Telecom add an environmental and a social report on top of the financial report this does not automatically result in a sustainability report.” (Tuppen, BT, 1998) Organisations need to understand the interplay between economic, environmental and social consequences across their business strategies, tactics and plans Corporate Sustainability is about systems analysis, integration and holistic thinking
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Reneker-Saas Critical Success Factors Innovation -
Harnessed correctly, innovation can deliver absolute competitive advantage
Life-Cycle Perspective -
Assess upstream and downstream enterprise impacts
Relevant Impacts -
Assess potential and latent problems
Reduce Complexity -
Do not get overwhelmed by the shear amount of data and information Tools must be easy to handle by non-specialist line managers Tools must be relevant to decision-makers
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Reneker-Saas Strategies Product Service Systems (PSS) -
Shared use of resources to save money, increase access and reduce carbon footprint, e.g. taxis and Software as a Service
Product Re-Use -
Recycling and ‘Up-cycling’ to reduce solid waste and emissions
Evangelising sustainability into the supply chain -
Working collaboratively together with suppliers and partners to adopt sustainable business strategies
Investor-driven innovation -
Integrate Corporate Sustainability into Corporate Governance
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Reneker-Saas Reneker-Saas Approach
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Reneker-Saas Credentials
Value Chain Management
Corporate Sustainability
Corporate Governance
The World Conservation Union Unisys Honeywell Westpac CSIRO Coca-Cola Campbells Arnott’s Allianz ActewAGL
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Risk Management
Service Management
Reneker-Saas More Information Reneker-Saas Australasia & Head Office. Suite 2, 18 Quadrant Street Rhodes NSW 2138 Tel: +61 (2) 95332335 Email:
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Reneker-Saas Europe 25 Lawrence Moorings, Sheering Hill Lane, Sawbridgeworth, Hertfordshire CM21 9PE Email:
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Reneker-Saas United States Suite 3, West Balboa Boulevard Newport Beach, CA 96623 Tel + 1 1-732-287-5022
Reneker-Saas Greater China 256 Fa Yuen Street Kowloon Hong-Kong Tel: +852 2759 3906 Fax: +852 2758 3009 Email:
[email protected]
Reneker-Saas South-East Asia 1 Raffles Quay, Level 25 (North Tower) Singapore 048583 Tel: +65 6622 5668 Fax: +65 6826 4044 Email:
[email protected]