- Read Time: 5 min
Investors are beginning to see a strong link between corporate sustainability performance and financial performance. That’s creating a bigger demand for better data, and better business models.
Register free for 3 free articles per month, commenting privileges and free updates.
Showing 1-20 of 20
The G7 summit in June of 2015 and the G20 meeting in November both upheld the idea that businesses have a responsibility to respect environmental and human rights principles. As such concerns take center stage, business leaders must recognize their role in navigating the new regulatory environment. As environmental and human rights risks rise in importance, board members are at risk of being seen as negligent if they fail to ensure that their companies comply with the G20/OECD Principles and the standards to which the Principles refer.
As sustainability becomes a driving force in the evolving marketplace, many products and technologies are unable to compete within the new parameters. The recent scandal involving Volkswagen’s falsifying of its diesel cars’ emissions is a case in point: If your business model can meet the ever-higher standards of sustainability only when customers reduce consumption of the product, it is by definition unsustainable. What does this mean for managers committed to products with questionable sustainability?
In the 2014 Sustainability Report, new research by MIT Sloan Management Review, The Boston Consulting Group and the UN Global Compact, shows that a growing number of companies are turning to collaborations — with suppliers, NGOs, industry alliances, governments, even competitors — to become more sustainable. Our research found that as sustainability issues become increasingly complex, global in nature and pivotal to success, companies are realizing that they can’t make the necessary impact acting alone.
Information systems are designed to help companies use enterprise resources more efficiently. But what if companies used information systems more broadly — not just to measure profits but also to account for the needs of people and the environment?
Most mainstream investors are unconvinced that sustainability leadership translates into profits and marketplace success. Despite rising importance on the corporate agenda, sustainability —as currently understood and measured — interests only a small niche of investors. The authors argue that a “back to basics” approach for measuring sustainability’s direct impact on revenue growth, productivity and risk would provide mainstream investors with the data that’s critical to their decisions.
When a conservative think-tank challenged Apple’s sustainability programs at a recent shareholder meeting, CEO Tim Cook didn’t back down, refusing to bow to its calls to suspend any activities that didn’t “add to the bottom line.” Apple’s shareholders rewarded him with resounding support. If sustainability is to increase its profile as a business priority, more executives will need to follow Cook’s lead.
When hotel chain Hilton Worldwide looked at supply chain sustainability, it lacked tools to help weigh sustainability factors. Hilton partnered with sustainability consultant BSR to create the Center for Sustainable Procurement. In this interview with MIT SMR’s David Kiron, Hilton’s VP of supply management William Kornegay and Eric Olson of BSR discuss how the initiative evolved.
At AT&T, John Schulz, a director of sustainability operations, had to make the company’s energy and water use data visible before the company could formulate a plan to reduce those numbers. The company’s definition has now broadened and evolved to include the social perspective on sustainability.
Timberland LLC, a global boot and outdoor apparel manufacturer, goes beyond simply telling the world about its sustainability work. According to Betsy Blaisdell, the company’s senior manager of environmental stewardship, it has creative new ways to involve employees and to partner with suppliers — and competitors. In this interview, Blaisdell talks about the environment “nutrition label” it’s developed for its footwear, and its partnership with 60 plus apparel and footwear brands, retailers, suppliers and NGOs (from Adidas to Patagonia to DuPont to the World Resources Institute) to develop an environmental index called the Higg Index.
Marks and Spencer’s business case for sustainability is built around its five year old Plan Plan A, a commitment to tangible steps to make the company more sustainable. T-shirts for associates featured the slogan, “There is no Plan B.” Plan A includes 180 commitments. All to be achieved by 2015. Their ultimate goal is to become the world’s most sustainable major retailer.
Trying to create reporting standards that integrate environmental, social and governance performance along with financial information is “fraught with conflict” and an “almost political adjudication process,” says Harvard Business School’s Robert Eccles. That’s why he loves it.
Sixty-eight percent of respondents to MIT SMR’s third annual global survey say their organizations increased their commitment to sustainability in the past year. That’s a dramatic increase from 2009, when only a quarter of respondents said that. Those are among first highlights featured in the current issue of MIT SMR.
We asked: Are organizations spending more on sustainability? Does it merit more attention from the top? More than 4,700 managers responded. Here’s what they told us.
The timeline of energy development projects now is largely driven by sustainability and social performance issues, says Marvin Odum, president of Shell Oil. That’s prompting innovations in how the company involves external stakeholders, incentivizes employees and drives changes throughout the entire energy industry.
Is spending up or down? What does the C-suite think? Who’s ‘world-class?’ More than 3,000 managers responded. Here is an early sample of what they said.
Showing 1-20 of 20