Reinventing Responsibility

of 59/59
  • date post

    01-Mar-2016
  • Category

    Documents

  • view

    219
  • download

    0

Embed Size (px)

description

How to reduce carbon emissions without loss of quality of life or a reduction in profitability is a key issue. It is fair to say that consumers, business partners, companies and governments are increasingly critical about the effects that products and services have on society and our environment. These attitudes are major influencers on their spending patterns and are thus important developments to take into account as an industry.

Transcript of Reinventing Responsibility

  • FUTURE BRIGHT

    REINVENTING RESPONSIBILITY

  • CONTENTS

    5 Introduction by Mikael Hagstrm

    6 Alyssa Farrell: Five strategies for corporate sustainability

    12 Klaas van den Berg: Sustainability secures a place in the corporate strategy

    18 5 Questions for Dennis Pamlin

    20 Poste Italiane Group: A handful of data, a lot of energy savings

    24 5 Questions for Marc Cornelissen

    26 Kjell Nrdstrm: Sustainability management: how to overcome short termism?

    30 5 Questions for Ingrid Zeegers

    32 Henry Terlouw: The Hague wants to be climate neutral by 2050

    38 5 Questions for Marcel Werner

    40 Jonathan Hornby: Business analytics to measure corporate sustainability

    44 5 Questions for Bernd Jan Sikken

    46 Ruud Koornstra: Sustainability is not a trick, its a mindset

    52 5 Questions for Wubbo Ockels

    55 Profile SAS

    56 Colophon

  • How to reduce carbon emissions without loss of quality of life or a reduction in profitability is a key issue. It is

    fair to say that consumers, business partners, companies and governments are increasingly critical about the

    effects that products and services have on society and our environment. These attitudes are major influencers

    on their spending patterns and are thus important developments to take into account as an industry.

    Dont be mistaken, these attitudes on sustainability are long-lasting. This new approach is also resulting in a

    completely new relationship between customers and suppliers, which may greatly impact the business of your

    organization. This change requires a clear repositioning of responsibility. As senior management, you are not

    only responsible for your enterprise, but also for your environment. More and more companies recognize this

    and are searching for alignment between the three priorities of People, Planet & Profit in their strategic

    choices. And the advantages can be significant. The businesses adopting sustainable strategies are saving

    money, finding new business opportunities, becoming more innovative, being more energy efficient, using

    natural resources more intelligently and are better integrated with suppliers and partners. Strategic manage-

    ment of your environment pays off. Sustainability is everyones responsibility.

    The inspiring entrepreneurs and pioneers in this book confirm this vision. They are the new leaders who are

    achieving concrete successes with sustainable entrepreneurship. They are doing the daily missionary work to

    create a lasting awareness for durable sustainability in the organization, channels and industries they operate

    in. The visions that these pioneers share in this book are based on their ideas of sustainability being an

    integral and long-term strategy. Their goals are open and measurable, inspiring and relevant. And they show

    commitment. Those who embrace the opportunities know that sustainability is an inevitable choice and a

    smart business decision.

    Mikael Hagstrm

    Executive Vice President, EMEA and Asia Pacific

    SAS

    5

    OUR RESPONSIBILITY FOR SUSTAINABLE BUSINESS

  • Accelerate green initiatives through awareness, leadership,technology, stakeholder involvement and innovation

    Five strategiesfor corporatesustainability

    Gartner has highlighted 10 key predictions that would affect IT and business decisions in 2008 and

    beyond. Three of the items on the list were:

    By 2009, more than one-third of IT organizations will have one or more environmental criteria in

    their top six buying criteria for IT-related goods.

    By 2010, 75 percent of organizations will use full lifecycle energy and carbon footprint as

    mandatory PC hardware buying criteria.

    By 2011, suppliers to large global enterprises will need to prove their green credentials via an

    audited process to retain preferred supplier status.

    These and other green-related trends will have a profound effect on most businesses and

    government agencies over the next few years. How your organization reacts and communicates its

    efforts in environmental sustainability is important. How can you begin to balance the risks and oppor-

    tunities that environmental sustainability requires? What operational measures and behavioral

    changes can you pursue to improve enterprise-wide environmental sustainability? We offer the

    following five strategies.

    6

    There's no denying the factthat we're operating in aneco-aware economy. Glance at the cover of any major business or IT magazine andyoure sure to see at leastone article focused on thelowering of corporate carbonemissions or the greening ofIT practices.

  • By Alyssa Farrell

    7

    1. Increase your company's eco-awarenessEco-awareness begins with an evaluation of your organization's sustainability strategy. Start by

    measuring the consequences of your corporate activities in terms of tons of carbon, kilowatt hours or

    gallons of water. Once you've assessed your environmental impact, set realistic goals to reduce or

    offset those levels.

    The next step is to embrace a green accounting methodology that you can trust. It should be auditable

    and the data points collected can be used for what-if decision making.

    Another step that some eco-aware organizations have pursued is to establish a specific governance

    body or a sustainability council to guide green investments. To maximize corporate investment, this

    cross-divisional group coordinates strategies that might otherwise remain in functional silos.

  • 8

    2. Lead with green in mindThe more aware your organization becomes about sustainability issues, the more its strategic plans

    will begin to reflect this new awareness. In particular, your short-term and long-term planning should

    include an evaluation of environmental risks and opportunities.

    Executives should set goals and targets for sustainability and communicate these goals to everyone in

    the organization. Leaders should report on progress regularly and actively manage to reach goals by

    integrating environmental outcomes into business planning.

    Consider adopting a corporate sustainability report that complies with internationally recognized

    standards, such as the Global Reporting Initiative, which offers globally applicable Sustainability

    Reporting Guidelines for voluntary use. If you do begin following these standards, be proud of your

    accomplishments and integrate sustainability updates into your shareholder or annual reports.

    CASE: ConocoPhillips in Norway is one organization that is leading with green in mind. When

    working in potentially hazardous environments such as gas processing units, conditions can

    change and the risks to people and assets can multiply in the blink of an eye. At the same time,

    operations on this scale are costly to maintain and, with fluctuating energy prices, controlling

    costs without compromising health and safety is a major concern. With a decade-long history of

    SAS usage, ConocoPhillips Norway is now deploying SAS Strategic Performance Management to

    help target resources and manage its business more effectively. The system combines data on

    various events (triggers) and their day-to-day follow-up within agreed procedures. Flaring - when

    oil or gas is burnt off - is also covered. Garbage disposal is yet another example, with SAS soft-

    ware helping to ensure that targets for scrap metal and recycling are met.

    CASE: Cisco is an example of a company that has taken great strides to increase its eco-aware-

    ness and carbon conscience. The technology and communications leader made its environmental

    strategy a top corporate priority in 2007 and established the cross-departmental Cisco EcoBoard

    to develop a strategy for reducing the company's carbon footprint and delivering ecologically sound

    products. Currently, Cisco is driving environmental initiatives in three areas: customer solutions,

    responsible operations and product stewardship. All three areas are measured and monitored

    through an executive dashboard for sustainability.

  • 9

    3. Involve stakeholdersStakeholder engagement is a key ingredient in corporate sustainability. Customer advisory boards,

    nongovernmental organizations (NGOs) and supplier panels can all provide direct feedback to prepare

    you for market forces and demand transparency in your green initiatives.

    Stakeholders hold you accountable to follow through with commitments, and they can be the source

    of inspiration for new products, services and solutions.

    In particular, engaging your suppliers as stakeholders in your strategic planning for corporate respon-

    sibility is critically important. Their supplies and processes directly affect your indirect carbon footprint.

    Even more importantly, the supply chain can deliver powerful market pressures when all suppliers are

    working toward a common goal. The combined activities of your supply chain can have one of the

    most substantial impacts on reducing total greenhouse gas emissions.

    CASE: DuPont, a leading chemical manufacturer, worked with the Environmental Defense Fund to

    engage a broad stakeholder community in establishing a process for ensuring the responsible

    development of nanoscale materials. While nanotechnology holds great promise during the use

    phase of the product life cycle, more information was needed to ensure that nanoproducts were

    developed in a way that minimized environmental, health and safety concerns. The resulting Nano

    Risk Framework is a groundbreaking tool that will set a safe, level playing field for companies

    pursuing nanoscale materials.

    4. Invest in technologyHow can you use your existing business intelligence and performance resources to help with

    environmental sustainability? If you have invested in a technology infrastructure that allows you to see

    and manage performance indicators throughout your organization, make it a priority now to add green

    goals to the list of things you're already measuring. Continue to break down information silos and

    learn how to leverage your intelligence platform to integrate and manage data assets that are related

    to your green initiatives. Understand what data is required for you to measure your corporate footprint

    with the Greenhouse Gas Protocol and to meet reporting standards of the Carbon Disclosure Project.

    You should also work to understand data correlations so you can identify which metrics are the most

    important to improving sustainability, capitalize on talents in your human capital, and improve

    transparency internally and externally.

  • 10

    5. Focus on innovationAwareness, leadership, technology and stakeholder involvement are important in your green

    initiatives. But the most important factor in environmental sustainability is innovation. You have to set

    out to change paradigms, create new solutions and collaborate with customers in ways you never

    have before. Your corporate spirit attracts talent and capital to your organization. If you can lead and

    communicate with innovative green initiatives, youll also attract new customers and better retain

    existing customers.

    CASE: Waitrose is a company continuously looking at ways to reduce waste as part of their

    sustainability strategies in addition to conserving energy and water. Waitrose is one of the UKs

    best-known grocers, with a brand promise based on high-quality products, from fresh fruit and

    vegetables to packaged goods, combined with outstanding customer service. With some 190

    branches carrying over 15,500 product lines - and 30 percent of the range new each year -

    Waitrose needs to ensure it predicts demand accurately to supply the right products to the right

    stores in a timely way. Ordering the correct stock is essential to maximize sales and ensure the

    least waste possible. Now, with the help of a SAS demand forecasting solution and support from

    SAS partners, Waitrose is achieving more accurate store replenishment, satisfying the needs of

    its valued customers and balance sheet alike. Since the system rolled out, the branches have seen

    a reduction in stockholding of at least 8 percent and a fall in wastage of up to 4 percent. We have

    achieved increased productivity, efficiency and financial gains across our 190 or so branches,

    says Gail Richmond, Manager of the Branch Ordering Development at Waitrose. We had originally

    estimated a 2 percent drop in wastage, so this is far better than predicted.

    CASE: Novozymes is a Denmark-based world leader in bio-innovation. One of the ongoing

    objectives of Novozymes researchers is to consistently improve the enzymes that render a more

    cost-effective and sustainable process for producing commercially viable biofuels. JMP statistical

    discovery software from SAS is an integral tool in Novozymes research; it plays a key role in

    designing experiments, analyzing data, and presenting the results of that data to colleagues and

    customers. The result of Novozymes research is a huge reduction in the cost of producing

    biofuels from corn and cellulosic biomass through the use of enzymes. When it comes to setting

    your organizations goals for sustainability, dont think small. Think like Novozymes and determine

    how your green initiatives can have the largest overall impact.

  • 11

    Green is here to stay

    Is corporate sustainability just a passing fad? We don't think so. It isfundamental to business performance today because of the constrainedenergy and labor markets, and it is a standard that consumers will continue to hold companies to more and more as time passes.The five strategies we've mentioned here can be combined to form acomprehensive management plan for sustainability, but you don't have totreat them equally. If you're just starting out in your green efforts, pickone of the five as your focus and work toward adopting the others in thefuture. The strategies you choose to emphasize through greater invest-ment of time and resources will offer unique value to your customersand shareholders - and for generations to come.

    Alyssa Farrell, Manager of Sustainability and Performance Management Solutions, has

    responsibility for SAS sustainability solutions. Farrell works with customers to understand best

    practices and solutions for managing their business with environmental responsibility in mind.

  • 12

    Klaas van den Berg leads Sustainability BarometerPricewaterhouseCoopers:

    Sustainability secures a placein the corporate strategy

    Entrepreneurs see concrete opportunities in higher margins, in more turnover and in growth markets.

    You also see this in the Sustainability Barometer of PricewaterhouseCoopers, says Van den Berg. But

    if companies claim their products and services are green, they have to be able to prove this. This claim

    must be credible both internally as well as externally. Organizing a reporting structure to underpin

    these claims and the corresponding independent testing are considerable challenges.

    Klaas van den Berg leads the Sustainability Advisory Group of PwC. As a consultant for more than two

    decades, he has been involved with management systems, responsible supply chain management,

    social reporting and with the verification of information on sustainability. He is also closely associated

    with the development of the Sustainability Barometer. The reason we set up this barometer was the

    desire to get a clear picture of the position of sustainability on the agenda of the Dutch corporate

    world, adds Van den Berg. That is why each quarter we ask Dutch key players in the business

    community questions about sustainability. Besides general questions on the focus on the topic of

    involved organizations, special themes are also addressed. Examples are the developments surrounding

    Green IT or sustainable purchasing. Since the second measurement, the effects of the crisis have been

    included in the barometer as well.

    The time for companies to embrace sustainability especially for the positiveeffect on their image seems behind us. Even so, sustainability advisorKlaas van den Berg finds that defensive motives, like compliance require-ments or cost considerations, still predominate. Yet, he believes that theturning point is approaching. More and more companies are now consciouslycommitting themselves to the development and marketing of sustainableproducts and services.

  • 13

    Balanced business caseFrom the barometer of Fall 2009, it emerges that the focus of participating organizations on sustaina-

    bility is fairly stable, despite the crisis. For 70 percent of the participants, sustainability initiatives and

    investments remain unchanged. More than half of this group also indicates that sustainability is an

    integral part of corporate policy. Van den Berg believes this is good news. But in my opinion it is

    much more encouraging that about 20 percent concentrate on sustainability even more than before.

    It seems that this group realizes that sustainable projects have a distinguishing capability and are of

    economic value. This outcome is in harmony with the developments that Van den Berg also comes

    across in his advice practice. There are already large companies that go one step further with their

    policy on sustainability. A company like Philips has set as a target for itself that 30 percent of their

    products and services have to be green in 2012. Carpet and artificial grass producer Desso is aiming for

    100 percent sustainability in 2020. The motives transcend idealism. These companies want to distinguish

    themselves by sustainable products and services, and by doing so they capitalize on an increase in

    market demand.

    The Netherlands is not demonstrating significant leadership in the area of sustainability. In realizing

    sustainable energy or climate targets, Van den Berg feels that government policy plays an important

    role. The Dutch subsidy policy gives insufficient stimuli concerning developments in sustainable

    Klaas van den Berg At the moment we are at the start of the third phase of sustainability in which thereare real opportunities for companies.

  • 14

    energy. We have subsidy budgets for investments that quickly become oversubscribed, and companies

    can only apply for these budgets when project preparations are already in an advanced stage. If the

    budget is exhausted at that moment, then an enterprise misses out. In Germany the subsidy regulation

    is financed from the energy profits. If there is great demand for this budget, then the increases the

    energy price in order to finance the subsidy. In this case it concerns marginal increases, yet with

    regulation like this, companies know for certain that they are eligible. Good ideas therefore have

    more chance on realization. The Sustainability Barometer also shows that the Dutch corporate market

    expects an active and stimulating role from the government. More than 90 percent of the participants

    expect a new green deal. Furthermore, a simplification of procedures surrounding sustainable projects

    can also have a stimulating effect on innovation and green entrepreneurship.

    Sustainable profileIf sustainability initiatives are to become more economical, they require a concrete business case. But

    how do companies set up such business cases? Enterprises have to be able to substantiate their green

    claim, both internally as well as externally. Internally to show that these products and services, and

    any additional efforts, actually result in a greater margin. And externally to prove that the claim is

    based on the truth and can be independently tested via assurance, Van den Berg explains. The profile

    of products and services will thus be expanded. Besides the obvious financial parameters, environ-

    mental and social aspects need to be intelligible too. Possible questions are: what are the raw

    materials, how much water is used, what is the energy consumption of production and transport, are

    acceptable labor conditions guaranteed?

    If companies succeed in making the product profile comprehensible and testable, and if it is also

    found that sustainable products result in a higher margin, then this has an adhesive effect on other

    Why is your organization focusing on sustainability now? (more answers possible)

    Basis: more attention for sustainability. (n=55)

    Source: Sustainability Barom

    eter PwC

    Customers are increasingly expecting this

    Gives us competitive advantage

    Sustainability will pay back in the medium to longer term

    Sustainable innovations are crucial to get through the recession

    It stimulates our results

    It gives us cost savings

    We want to increase our sustainability ratings

    Governments are tightening their purchasing demands

    Other

    56%

    55%

    51%

    40%

    36%

    35%

    25%

    20%

    13%

  • 15

    companies. It is up to the first movers to show that investments in sustainable operational manage-

    ment can also be economically justifiable. This leverage was clear when hybrid cars were introduced

    by Toyota about ten years ago. There was a lot of skepticism amongst other car brands. These cars are

    now part of a mature market segment, with very healthy margins and an enormous growth potential.

    Other brands are now also fully devoted to this market.

    Three phases of sustainabilityThe production of green products concretely means that a company has to collect, integrate, monitor,

    validate and report on a lot of information. This a complex process, as it includes very different

    aspects, and each one has its own accounting units. In this process Van den Berg sees a logical

    continuation of earlier reporting obligations, as the necessity for this is increasing. He recognizes three

    phases in which companies can find themselves. According to Van den Berg, companies are first of all

    compliance motivated, then they have a cost efficiency focus and are finally driven by strategic oppor-

    tunities. Initially, companies focused on compliance with regulation and would make the obligatory

    visit to all departments and compose the sustainability report with information on energy consumption,

    emission and waste. Internally, this was usually seen as additional work but at least the company

    complied with the rules. The next dimension has a slightly more economical point of view as it focused

    on cost savings. When a company uses less energy, optimizes the logistical processes or drives back

    the amount of waste, then this results in money. In this case, performance improvement is the central

    issue. Currently, we are at the start of the third phase, in which companies see sustainability as a

    business driver. This includes being distinctive in the market, getting better margins on products or

    even opening up new markets.

    But even if companies recognize the potential of sustainable products and services, they remain

    Sustainable entrepeneurship in the financial crisis, the government should take a lead by giving the right example.

    Source: Sustainability Barom

    eter PwC

    20% 52% 26%

    8% 70% 21%

    6% 59% 32%

    38% 56%

    32% 63%

    30% 58% 9%

    Disagree strongly Disagree Agree Agree strongly

    21% 70% 9%

    Especially now, non financial results should play an increasing role in rewarding top management

    The crisis has a negative effect on financing sustainable (energy) projects

    Shareholders will have less attention for sustainability than before the crisis

    The recent crisis measures of the government show a sustainable ambition

    The 2 billion euro governmental investments in wind parks in sea is enough

    Green plans will be scrapped on a major scale because of the recession

    Investors will really start rewarding sustainable companies

  • 16

    reticent in investing in the information and reporting systems that at first glance do not provide any

    concrete financial information. We notice that the sustainability paragraph in the annual report is

    insufficient reason to opt for a valuable and robust monitoring system. The burning platform or the

    urgency is still often lacking. Management does not yet ask for this information, nor do share-

    holders insist on this.

    Van den Berg believes this situation will change when it is clear that non-financial information

    becomes crucial in strategic management decisions. In combination with other product specifications,

    data on the social and environmental aspects of products will then turn into management information

    on which operational management is based. The information then becomes valuable and the gap

    between the sustainable reporting and the financial reporting gets smaller. Large retail chains like

    Walmart and Tesco have already started this. They have made their strategy open, and obviously they

    have the scale to demand this product or production information from suppliers. This is certainly a

    burning platform for the latter group. Not presenting this data could possibly mean the loss of an

    important customer.

    The pressure to pay more attention to Corporate Responsibility is back at its level of a year ago. Do you feel more

    pressure to look at CR within your organization?

    49%

    45%

    6%

    October 2008 (n=233)

    50%

    48%

    2%

    February 2009 (n=209)

    63%

    31%

    6%

    June 2008 (n=165)

    58%

    39%

    3%

    May 2009 (n=229)

    Yes

    No

    Dont know

    Source: Sustainability Barom

    eter PwC

  • 17

    Charting your own courseData quality, availability of data and willingness within organizations are determining factors in

    gathering relevant sustainability data, and in improving the transparency surrounding green products

    and services. Important in this context is that management is also evaluated on these performances.

    When sustainability KPIs are part of an assessment system within companies, then this information

    automatically gets a different status. The essence in this case is to bring the data together in a logical

    and seamless way. This is a major challenge for many organizations because the data is acquired from

    various departments sometimes working with different systems. There is the uncertainty about the

    criteria that are to be monitored and the corresponding metrics. Which information do companies

    have to record in order to correlate relevant connections and to monitor sustainable activities?

    A system with corresponding authorizations, controls and critical reviews is an important precondition

    for an assurance provider to base his judgment on.

    Certainly at the beginning of the professionalization of sustainability, Van den Berg feels it is wise to

    not give all sustainability aspects the same status. Doing business is about making choices, and this is

    no different in the case of sustainable entrepreneurship. One cannot drive on a hundred parameters, a

    focus on a couple of relevant KPIs often offers enough insight and improves the internal capacity.

    Ensure that these KPIs are embedded well within the organization, communicate about this clearly in

    reports and make sure that these data are as reliable as financial data. Companies will initially have to

    develop information and reporting systems themselves. Trial and error is unavoidable here. The oppor-

    tunities for sustainable products and services are for the taking, it is up to the companies to execute.

    The pressure comes from (more answers possible)

    Basis: feels pressure to pay more attention to CR within the organization (n=145)

    Board

    Employees

    Customers

    Government

    Consumers

    Shareholders

    NGO

    Suppliers

    Other

    57%

    42%

    37%

    36%

    24%

    20%

    8%

    8%

    14%

    Source: Sustainability Barom

    eter PwC

  • questions for 5

    Dennis PamlinSenior associate at the Chinese Academy for Social Sciences

  • 19

    Dennis Pamlin is senior associate at the Chinese Academy for Social Sciences. Asa strategic economic, technology and innovation advisor, he works with companiesand government on sustainability initiatives such as IKEA goes renewable. He alsoinitiated World Wildlife Funds (WWF) Trade and Investment Program work in theBRIC countries. It is time to move beyond incremental improvements and tap intothe potential that the new generation of technologies provides.

    What are good examples of sustainable business initiatives?

    My heart goes out to organizations that are making changes that will allow them to keep making profits,

    whilst reducing the overall resource consumption. BYD for instance, that built the world's first mass-produced,

    plug-in hybrid car. In Baoding, a relatively small city in China, 150 new alternative energy companies have

    emerged, making use of wind and solar power, bio-diesel, and energy efficiencies. Telecom operators and

    major ICT companies such as Cisco, Ericsson, HP, IBM and SAS also offer interesting solutions to deliver real

    sustainability.

    How has sustainable entrepreneurship taken shape within your organization?

    Were the first generation of global citizens. The global economy and challenges require that we think as

    such. Also, the new network economy is not about competition, but about collaboration. My mission is to

    make sure that making and saving money go together. I help companies and governments see the same map

    of the same economy and to move from concept to reality and find new markets and customers.

    Who in the organization should be responsible for building sustainability strategies?

    The CEO and board must be fully committed. Also, it must be clear that everyone in the organization is

    involved. Sustainability will never happen if only Environmental Health & Safety and Corporate Social

    Responsibility departments are held responsible.

    What are reasonable sustainability objectives for most businesses?

    Enterprises need to shift from a product to a services perspective, applying life cycle approaches that support

    cradle-to-cradle strategies along all value chains and using ecosystem services sustainably. Also, they need to

    make sure that they offer something that 9 billion people can use. In the end, its all about developing new

    things and increasing sales.

    How sustainable are you?

    Material things dont matter much to me. My pleasures are meeting friends, reading books, listening to

    classical music and visiting the theatre. I am a vegetarian. To me, sustainability isnt a matter of being perfect

    or feeling guilty, but a journey wherein transparency can help us. Transparency is like a Dracula strategy. You

    need to drag beautiful things into the light in order to save them. Thats why we have to differentiate

    emissions. My own big bad emissions such as air mileage must be an investment in a more transparent society

    through clean technologies such as videoconferencing.

    Dennis Pamlin

  • Energy manager Luciano Blasi, Poste Italiane Group:

    Based on energy models, we can providelocal energy managers with performanceindicators for energy usage.

    20

  • SAS helps manage demand and increase energy efficiency

    Poste Italiane Group:a handful of data, a lot of energy savings

    In 2004, anyone who wanted to talk about optimizing energy costs would havehad a hard time finding a sympathetic audience among a company's employeesor its board of directors. At that time, the Poste Italiane Group was also com-mitted to continuing its transition from a typical government-run administrationto that of a private organization, which follows a profit-generation approach.

    The organizations proposal to examine and reduce energy costs in this climate was considerable. Italys

    largest employer with approximately 150,000 employees had energy distribution channels throughout

    the territory, a lack of information standardization among suppliers and a special nature of its assets,

    some of which were built in the Middle Ages. Despite the many challenges, Poste Italiane Group made

    the courageous decision to start Progetto Speciale Energia (the Special Energy Project), headed by

    expert Energy Manager, Luciano Blasi, and with the support of the companys IT department.

    The goal was simply defined: monitor and optimize electric energy, fuel and water consumption at all

    government real estate properties. The broader project objective would define a program - developed in

    three separate stages - that studied and analyzed energy consumption with a special focus on training,

    information sharing and full accountability for responsibilities.

    Blasis team started counting and classifying each asset and supplier type based on the energy con-

    sumption of the parent company, Poste Italiane SpA. We are dealing with an overall structure that

    includes 14,500 buildings, half a terawatt per year in electric power, 8.5 million liters of heating oil

    and other heating fuels, and gas consumption of more than 20 million cubic meters, specifies Blasi,

    with a procurement policy involving various players. Furthermore, the buildings can be classified

    into three macro groups in terms of energy consumption. The vast majority, such as administrative

    offices, have much less of an impact on consumption than automated facilities, such as postal centers

    which operate 24/7.

    The automated facilities are where Blasi will concentrate his efforts going forward. So far, the Poste

    Italiane Group has decreased its energy consumption by 1 percent per year, in addition to reducing its

    overall carbon dioxide emissions by 7 percent. These are significant results for the company, but Blasi

    still sees a lot of room for improvement. My main purpose is to reach our energy efficiency goals in

    at least 250 facilities, Blasi explains. Including those with the highest energy consumption, such as

    data processing centers, executive centers and perhaps the largest branches. Of course, reducing costs

    is a goal, but that is preceded by goals for awareness, consumption control, sustainability and

    reducing our environmental impact.

    21

  • 22

    Poste Italiane Group provides postal and express

    services, integrated communications, logistical services

    and financial products in Italy. The organization has

    15,000 locations of which 200 sorting and distribution

    centers scattered over Italy. The services are provided by

    150,000 employees, a fleet of 50,000 vehicles and

    11 airplanes. The broad offering of services and products,

    among which also internet and mobile telephony, are

    offered via a range of channels.

    The project team wants to increase the local awareness on responsibility for energy usage.

    The IT aspectIn 2004, our IT structure was centered on an individual productivity platform with fully integrated

    databases, recalls Blasi. At the time, their purpose was mainly management control rather than

    energy monitoring. The billing statement served as the starting point for a preliminary analysis of

    consumption and subsequent monitoring, as it contained simple data elements that wouldnt require

    a complex, shared platform.

    A billing statement contains two necessary and sufficient data items: consumption and charges. Even

    today, billing statement data is the basis for reporting and analyzing results. An accurate analysis of

    consumption can identify peaks or anomalies - and thus points of intervention - by informing the

    facility manager, who directly reviews energy costs. Before 2006, the calculations were made para-

    metrically, based on occupied square footage. A further complicating factor is the large number of

    buildings in operation, which makes it impossible for Poste Italiane to use a traditional, off-the-shelf

    energy audit tool for analysis, demand management and efficiency improvement.

    Therefore, Post Italiane needed a business intelligence tool that would process only the acquired data

    and could produce forecasts based solely on this data. In 2006 we started to exchange ideas with

    SAS to draw up a business intelligence plan, and in the spring of 2007, we completed the definition of

    the tender, states Blasi. We had no doubts in selecting a technology partner because their solution

    ensured that a balance would be obtained between performance and ease of customization and

    management, preventing the need for long and costly consulting. At the start, we worked directly

    with SAS to define user needs and the required level of customization, says Blasi.

  • 23

    Subsequently, with the help of consulting partner Crisma in Rome, the organization started imple-

    mentation. In this initial stage, SAS Business Intelligence analyzes demand and provides information

    on users macro behavior, Blasi explains. With SAS we should be able to get to stage two, which

    moves from using billing data to accurately collected measurement data. Therefore, it will be possible

    to correct operation and maintenance behavior for systems, and indirectly, for our larger facilities.

    Future developmentsCurrently, the system is a virtual distributed structure where data pertaining to the individual locations

    is stored and analyzed. But the future intent is to allow each territory manager to directly input and

    receive information from SAS and monitor his own consumption by means of a Web-based tool.

    This is the second stage of the project Sistema di Flussi Integrati per la Gestione Energetica (SFINGE)

    or Energy Management Integrated Flow System, and Blasi expects significant developments in various

    areas. For example, the process of instilling responsibility in the facility managers will lead to the

    definition of energy performance objectives, and hopefully the appointment of energy managers

    within each territory. Blasi says he will also continue with the policy of taking small steps that can add

    up to real energy savings. Right now, he says, 90 percent of the lamps used by the group already

    use low-energy bulbs and the plan is to switch soon, wherever possible, to LEDs.

    Blasi recommends small steps because giant strides are impossible. The problem of energy dispersion

    from structures, for instance, is extremely complex. Retrofitting using cutting-edge insulation

    technology is absolutely out of the question because of the huge investments it would require. Blasi is

    satisfied, in this instance, to be consulted about the finalization of guidelines and specifications

    pertaining to the purchase and management of energy-consuming assets. This too is a small but

    significant victory. Blasi concludes, of course, top management focuses on business objectives and

    also on the search for a correct balance between investments that are made and energy savings that

    are achieved.

    A great win is that we are now involved with the procurement process because wehave insight in usage.

  • Marc CornelissenPolar Explorer and Sustainability Pioneer at Icentials

    questions for 5

  • 25

    As an expedition leader, Marc Cornelissen witnessed the impact of climate changeon the North pole with his own eyes. He has since been actively devoted to climateresearch and the sustainability of society. He initiated the Ben & Jerry's ClimateChange College in 2005. This European project supports environment-mindedyoung entrepreneurs. Via his company Icentials, he helps companies design andrealize sustainable growth strategies.

    What are good examples of sustainable entrepreneurship?

    What inspires me, are companies that have shaken up an industry with their approach to sustainability. Ben &

    Jerrys is such an example, as their energy-neutral ice-cream is made with sustainably acquired dairy products.

    And the company has already been discussing energy issues with both their suppliers and society since 1978.

    Patagonia, producer of outdoor sportswear, has also noticeably influenced its industry. They use plastic bottles,

    organic cotton, reusable polyesters and environment friendly dyes for their sustainable and recyclable fleece

    jackets. I certainly respect the way in which Tendris is creating an acceleration in innovation within the light

    industry. These trendsetters are not put off by paying the price of ones mistakes.

    How has sustainable entrepreneurship taken shape within your organization?

    We use wind energy, compensate for our carbon emission, meet via conference calls and have eliminated

    the need for commuter traffic as much as possible. The profit for society is helping organizations in making

    their primary processes sustainable. This especially involves continuity, and we investigate which products and

    Innovations are needed to ensure that we still have a market in the future. In order to deploy the transition to

    a circular economy, companies have to explore new forms of collaboration and unknown territories. They

    have to start thinking differently, and must organize processes in a completely different way.

    Where should the responsibility for sustainability lie within an organization?

    Sustainability is often still considered a separate branch of the Corporate Social Responsibility department.

    If sustainability is embedded in the core activities of an organization, then everyone is jointly responsible for

    sustainability performances. This includes an assessment and rewarding of the board and top management with

    regard to these performances.

    What are realistic targets to set within an organization?

    The targets depend on the context and maturity of the organization. In order to establish targets, companies

    must first show how they manage the dimensions of people, planet and profit. They can subsequently assess how

    this corresponds to the best practices in their sector. By measuring with key performance indicators, companies

    can measure their progress and celebrate successes. Once again the old principle applies: to measure is to know.

    How sustainable are you in daily life?

    People nearly expect me to have a sustainability aureole, but I too am confronted with the same daily dilemmas

    as everyone else. I do live a sustainability-conscious life, though I also book air holidays for my family. Besides,

    the North pole is difficult to reach without a plane. Creating a smaller footprint will not solve everything. In my

    opinion, the solution can be found in working together to create a society in which we can live together and do

    business in a sustainable manner.

    Marc Cornelissen

  • 26

    Kjell Nordstrm

    Stop thinking in short terms.

  • 27

    Sustainability management:

    How to overcome short termism?

    Kjell Nordstrm

    Most businesses have accepted sustainability as a mainstream concern and tryto integrate it into strategy and execution. According to professor Kjell Nordstrm,sustainability should be a guiding line for innovation. Business leaders shouldovercome short termism and take the drivers seat in sustainability developments.

    Kjell Nordstrm is ranked number nine among management thinkers in the world and number one in

    Europe with co-author Jonas Ridderstrle. He inspires business leaders all over the world with his sharp

    views on successful business models in an information- and knowledge-laden world. In his vision,

    competing in todays market economy requires a temporary monopoly and acute awareness of social

    change and responsibilities. Business leaders also have to learn how to practice infinite innovation:

    continuous pursuit of value for all stakeholders. Sustainability management clearly plays a part in this.

    Taking responsibilityA much-used definition of sustainability is the explanation by the World Commission on Environment

    and Development. This describes sustainability as forms of progress that meet the needs of the present

    without compromising the ability of future generations to meet their needs. Sustainability at manage-

    ment level means taking responsibility for the entire business impact up and down the value chain.

    Nordstrm sees climate change as a big issue on the worlds agenda. We have changed the climate

    in our society beyond comprehension. And we have something similar going on in our economic and

    social systems: the amount of information we distribute. This information overload can be as noxious

    to personal lives as carbon emission to the climate.

    Sustainable innovationNowadays, more often means more of the same: a surplus of similar companies, producing similar

    things according to similar best practices. Companies need to be different. Not only is a green corporate

    spirit a good way to get noticed by potential customers, it will also help attract talent and capital to

    your organization. According to Nordstrm, its even sexy. Business leaders clearly feel the same, but

    let emphasis on short-term economics is paralyze actual initiatives. In the end, laws and standards

    set by consumers will hold companies to more and more responsibilities. Truly funky businesses need

    to take the drivers seat themselves, and drive the development and even the law.

  • 28

    The constrained energy and labor markets are pushing sustainability upwards on the corporate agenda.

    In Nordstrms vision, technology, institutions and values are important drivers of green initiatives.

    But the key factor will be innovation. To make real changes, we have to rethink our basic assumptions

    and break free from the logic of the past. A good example of innovation along sustainability lines are

    restaurants serving house-made sparkling and still water in reusable bottles. Thus, they have found a

    way to make money while reducing the environmental costs of both manufacturing and transporting

    bottles of water and waste management.

    Seven principlesIn his latest book Funky business forever, Nordstrm offers seven principles for organizing businesses.

    The firm of the future is small. 60% of all employment will be offered by companies with now more

    than 150 members. Its also flatter and temporary in the sense that people work in projects and small,

    creative teams. It works horizontal and circular, which is about organisational democracy. The future

    company is also increasingly networked in order to cooperate productively with customers, suppliers

    and even competitors. It has identified in what areas its really world-class and buys the rest from

    world-class partners. Thus, the network becomes the relevant unit of analysis and action. Control will

    become more indirect. Information systems will be used to increase control by measuring more

    things, at multiple levels and at a greater frequency.

    Dr. Kjell Nordstrm is not only professor at the Institute

    of International Business at Stockholm School of Economics.

    He is also the enfant terrible of the new business world.

    His speeches and presentations are always dynamic,

    challenging and current. On the world wide ranking of

    business thinkers, Nordstrm ranks 13th and he tops the

    European list. With his partner dr. Jonas Ridderstrle, he

    encourages companies to win customers by being different.

    Together, they wrote the bestsellers Funky business,

    Karaoke capitalism and Funky business forever.

    Sustainability requires goals than challenge people to go further that they thought possible.

  • 29

    Explore the unknownBoth innovation and sustainability require appropriate goals to challenge people to perform beyond

    what they thought to be possible, is Nordstrms opinion. Business intelligence solutions enable

    organizations to identify strategies that address environmental, human and economic issues. They can

    also help them to identify the right metrics and find the right data to describe and measure green-

    related metrics. All this makes it easier to move relevant knowledge from individual levels to group

    and organisational levels.

    Nordstrm states that the only way to break out of short termism is by measuring in other terms than

    financial results. Define success and what to measure it on. Separate the main issues from the smaller

    ones. For this purpose, the market offers extremely sophisticated sustainability management tools. In

    fact, the possibilities they offer go beyond our imagination. The fact that we cant get our head around

    the technology has become the limiting factor. Most people are genuinely bad in mathematics. That

    makes it extra hard to fantasize about unknown things like measuring environmental impact and return

    on decency. While Leonardo da Vinci could only dream of flying, today theres so much that we can do!

    Kjell Nordstrm enfant terrible

  • Ingrid ZeegersDirector Sustainable Business at Philips Electronics

    questions for 5

  • 31

    Ingrid Zeegers is responsible at Philips development and design of sustainablebusiness. Zeegers is one of the exponents of the principles of cradle-to-cradle inThe Netherlands, and under her supervision the Electronics division now has adifferent view on the use of materials, energy efficiency and product propositions. A view that leads to considerable savings. Innovative solutions, like the EnergyCarevacuum cleaner, have been developed under the Philips Green logo. Sustainabilityrequires systems innovation and is a shared responsibility of the entire organizationand its value chain.

    What are good examples of sustainable entrepreneurship?

    A new generation of companies is completely focused on sustainability. Very inspiring are the hybrid tuk-tuk

    (a motrized mini taxi in Asia) and the energy generating dance floor of Enviu. Innovaders is doing well with the

    Wattcher. This smart gadget gives an insight into the energy consumption at home, and helps private

    individuals with saving energy. Fashion brand Kuyichi has become internationally successful with organic cotton,

    including clothing and bags that have been produced according to fair trade principles.

    How has sustainable entrepreneurship taken shape within your organization?

    The first environmental activities began in 1972 after the publication of the report The limits to growth:

    a global challenge by The Club of Rome. Frits Philips was also involved with this. Since 1994, improving the

    environment has been a core objective of our company, and sustainability has become integrated in corporate

    processes. The EcoVision 4 program runs from 2007 to 2012 and contains ambitious targets. For instance, 30

    percent of the turnover in 2012 must come from green products. In order to realize this target, a technical

    innovation program for the entire value chain has already been ongoing for two years. We are sharing know-

    ledge with suppliers and waste processors and are thinking of new business models together.

    Where should the responsibility for sustainability lie within an organization?

    Philips wants to embed sustainability in all positions. After all, everyone can think along on how we can do

    things smarter.

    What are realistic targets to set within an organization?

    It is important to articulate a serious ambition. Our goal is to realize 30 percent of the total revenue in 2012

    via green products, with a 25 percent higher efficiency in energy consumption than in 2007. Furthermore,

    1 billion Euros has to be invested in sustainability. We use sustainable performance indicators to measure this.

    Philips annually accounts for all of these aspects in the sustainability report, which is checked by an accountant.

    How sustainable are you in daily life?

    I do notice that I am becoming increasingly sustainable in my daily routine. I go to the health food store, I no

    longer have a car, I use energy-saving bulbs and eat less meat. I recently bought the Wattcher, which is so

    much fun. Just as in my work, I notice that it is still quite difficult to find the right solutions. This is a process

    that has to become more and more fun, as well as easier.

    Ingrid Zeegers

  • 32

    Henry Terlouw realizes an ambitious climate policy in the court capital

    The Hague wants to be

    climate neutral by 2050

    The environment and climate issues have been high on The Hagues list of priorities for many years.

    As a city on the sea front, subjects like climate change and rising sea levels are literally very close to

    home, says Henry Terlouw who represents the council. He explains why The Hague is so ambitious

    and what he feels is necessary for these plans to actually be realized. Considering our location directly

    on the sea front, we certainly cant ignore this development. And even though The Hagues emission

    levels are peanuts on a worldwide scale, we have consciously opted to take responsibility. We see it

    as the councils task to boost sustainable developments and to be well prepared for all the possible

    effects of climate change for our town and residents. We also want our council to set a good example.

    This is why we have defined a substantial but realistic objective. The organization of Hagues local

    government will be completely carbon dioxide neutral as of January 1st, 2010.

    Lack of definitionsTerlouw also confirms that The Hague as a town wants to be climate neutral by 2050. The interim

    objective is for emissions across the city to be reduced by 30 percent by 2020. The council organization

    needs to be carbon dioxide neutral in 2010. These ambitions have been included in a project plan.

    However, Terlouw does feel this plan has a number of snags. The tricky thing is that there is no fixed

    Picture The Hague in 2050.This climate neutral town hascompletely emission freetransportation. The Hague hasno carbon dioxide emissions.Plus, all of The Hagues energyis generated cleanly. This situation sounds like autopia at the moment. Buthowever ambitious these goalsare, the councils Climate Policy Advisor Henry Terlouwmeans business.

  • 33

    definition for the term climate neutral organization. There are a number of different interpretations.

    In our case it means that we will be generating 70 percent of the energy requirements in a carbon

    dioxide neutral way and that the remaining 30 percent will be compensated for in the The Hague

    Climate Fund. It also wasnt easy to establish the scope of the council organizations and the associated

    emissions. So which organizations should be considered part of the council bodies and which

    shouldnt? We have opted for a practical approach and are focusing on the civil service and the council

    services, including buildings and vehicles. Our largest emission sources are therefore gas, electricity

    and heating in the 120 buildings, electricity for public lighting and water pumping stations and finally

    the fuel used by vehicles.

    The amount of emissions of council organizations have been based on energy usage, which amoun-

    ted to 41,000 tonnes of carbon dioxide. This amount is not easily eliminated or compensated for.

    Collecting this information was not exactly easy, according to Terlouw. The fuel information relating

    to the 550 vehicles was largely available via the leasing companies, even though they use various

    different systems. The energy usage within our buildings was harder to map out. In many cases,

    managers could only supply outdated and fragmented details and in many cases the data was related

    to different years. What we were left with was a very rough estimate.

    Henry Terlouw Its difficult that theres no clear definition for climate neutral organization.

  • 34

    Progress controlThis estimate was sufficient as a starting point. But in order to effectively safeguard the projects

    progress, Terlouw needed reliable information. Its very important to use data from the same year

    and based on the same measurement units. This is the only way to effectively and carefully calculate

    the carbon dioxide equivalents. And the scale is important too. We not only want to create an accurate

    image for the entire council, but also per individual building. A reliable image of gas usage in cubic

    meters, electricity in kilowatt hours and town heat in Gigajoules. We will be using this information to

    determine the emission levels at various different milestones in the project. Furthermore, its just as

    important for us to be able to easily monitor the progress of the carbon dioxide neutral organization.

    This is de only way we have the possibility of determining causes and making the necessary adjust-

    ments if there are any changes or other special circumstances. The council is also considering the

    introduction of smart energy meters in its buildings, in order to be better equipped to measure usage

    and emission levels. However, certain measures need to be introduced before anything can be monitored

    in the first place. The Hague will be focusing on three different areas: savings, sustainability, or rather

    using as much clean energy as possible, and compensating for the remaining greenhouse gas emissions.

    The scale of measures differs enormously within these objectives, according to Terlouw. We can

    instantly realize major changes where new buildings are concerned. The Hague is growing and there

    are currently plans in place for 30,000 to 40,000 new homes. These buildings will have a 50 to 100

  • 35

    year life span. By thinking ahead about the different measures for driving back emission levels means

    that the 2050 objective is becoming more tangible. This is somewhat different for existing buildings.

    These demand a clear action plan in which we need to join forces with building societies in the public

    market, the business community and residents. Working together in this way gets an additional boost

    as the local government will be setting up discussion platforms and provide focused information. And

    we will introduce an energy label which is compulsory for all buildings that the council rents. The category

    of this label will certainly contribute towards the eventual choice.

    The Hague Climate FundWith this last comment, Terlouw touches on the subject of sustainable purchasing. The purchasing policy

    is responsible for direct and indirect emissions. For example, we only purchase green electricity. This

    has instantly reduced emission levels to 16,000 tonnes. Plus, we also need to consider the indirect

    effects of our purchasing activities. For example, flights are now also included in the mobility section of

    the project. Climate neutral operations mean we need to limit these trips and always compensate for

    them. In such cases we consciously opt for an own compensation regulation in the The Hague Climate

    Fund. Not for participation with initiatives elsewhere in the world. The council deposits the compensation

    fees into the Climate Fund, which is subsequently solely used for local energy saving projects. This

    approach is actually more expensive compared to regular methods. But we are really contributing to

  • 36

    our own objectives, plus the compensation is guaranteed to benefit the climate. In order to increase

    the scope of the fund, the council is encouraging other large organizations in the city to participate.

    Saving costs moneyThe compensation costs represent one of the financial aspects of The Hagues ambitions. Driving back

    the energy usage in itself will result in lower emission levels as well as less expenditure. However, in

    many cases those savings will require investments and so a realistic timescale to recover these invest-

    ments is a central focus point. This is why investment funds and subsidies has been applied for in order

    to finance the saving measures. The funds will be paid off using the savings. All measures with a

    recovery period of less than 25 years will be considered for this. In order to demonstrate the potential

    savings, it was necessary to subject the buildings in question to energy performance research. This

    showed that a 20 percent saving is certainly very realistic. Various adjustments have since been carried

    out or planned into the maintenance or renovation plans. The Hague will always opt for innovative

    techniques wherever possible. We are the first in The Netherlands to be using geothermal heating for

    homes. A special installation pumps the water up from a depth of around two kilometers. The waters

    temperature is approximately 70 Celsius and this heat is used to heat 4,000 homes in The Hagues

    South Western area. We use sea water, with an average approximate temperature of 11 Celsius, to

    heat 800 homes of the Duindorp community along the coast.

    Consideration for innovationsThe Hagues goal of being climate neutral by 2050 isnt trendsetting in the Netherlands. Other cities

    have announced comparable objectives and endorse the Climate Agreement between the government

    and the Dutch city councils. Yet The Hague is definitely a trendsetter with its ambitions for 2010. We

    are certainly one step ahead with our concrete approach, Terlouw proudly says. We have clearly

    opted for a realistic objective, which we are realizing with the possibilities available to us now. The

    ambitious character of our plans does mean we will be considering the expected innovations where

    energy usage and savings are concerned. This is not something we want to gamble on. We need every-

    one in and around the town to reach our goals. However, in many cases we will need to win over the

    business community and the residents for them to also provide a contribution within their capacities.

    Low emissions by business community An important argument for participating is the fact that the subject touches everyone, both the busi-

    ness community as well as the residents. Lower carbon dioxide emission levels almost automatically

    mean a healthier living climate. We will need to reach a climate agreement with the town, which is

    why discussions have started with all those involved. The key questions are; what do we need to reach

    the goals and what can we do about it together? The communication is currently still quite fragmented.

    The Hague is focusing on three tracks:savings, sustainable energy and compensationof greenhouse gases.

  • 37

    We will first need to create an unequivocal image. For example, The Hagues climate ambitions were

    recently distributed in a public leaflet. We wanted to clearly show why we mean business and that this

    is in literally everyones interest. The business community, large and small, also represents an essential

    chain in this initiative. The Hagues business sector has a relatively favorable emission picture. The

    city isnt home to a great deal of industry, but mainly can boast many business services. Plus quite a

    few of the offices in The Hague are managed by the Dutch Government Building Department, which

    has its own objectives where climate neutrality is concerned. We have regular meetings with the

    business community and we use the Sustainability Platform to discuss how we can jointly design the

    climate policy. We want to persuade them to play an active role in our objectives.

    Terlouw feels The Hague is very much on the right track. Even though the goals are ambitious and the

    sustainability subject has many different aspects. The short term objective of a climate neutral council

    organization is now within our reach. However, this doesnt mean that we will subsequently sit back

    and relax. One part is still based on the compensation and energy usage needs to continue to drop.

    This is essential because our horizon is still much further away. Keeping a clear sight on the final objective

    remains crucial and we must show all those involved every milestone we pass. This way, being a

    climate neutral city by 2050 is certainly no utopia for The Hague.

    Henry Terlouw The emissions of businesses in The Hague are relatively favorable.

  • Marcel WernerManager Corporate Social Responsibility at Teijin Aramid

    questions for 5

  • Teijin Aramid is a worldwide leader in the market of aromatic polyamides, or aramids.These fibers are used in products that require strength, light weight and sustainability.The company considers Corporate Social Responsibility in all of its important decisions.At Teijin Aramid, Marcel Werner is responsible for Corporate Social Responsibilityand in this position acts as the companys social conscience. Our technology drivenmarket consists of countless sustainable innovations, adds Werner.

    What are good examples of sustainable entrepreneurship?The CSR strategy of postal company TNT fully concretizes sustainability via the Planet Me environment

    program. Employees consequently have an active role in limiting carbon emissions, and they are very likely to

    apply energy saving measures in their homes too.

    How has sustainable entrepreneurship taken shape within your organization?Teijin Aramid is a frontrunner in using Eco Efficiency Analysis (EEA) as a strategic compass for R&D and product

    development. Via this instrument we can quantify the financial, ecological and social values of products and

    production processes. Our researchers for instance assist in the development of testing methods for leprosy

    research. Their knowledge of synthetic threads is very useful here. Generally speaking, we have pursued a solid

    program on ethics and integrity over the past years, in order to appoint the most important values together

    and to increase the awareness of these values. CSR is an integral part of the new strategic targets that have

    recently been formulated. Our CSR ambassador platform acts as a generator of ideas and will certainly help to

    anchor CSR further in the organization.

    Where should the responsibility for sustainability lie within an organization?The final responsibility lies with the CEO. If he does not believe in sustainability, then you can forget about it.

    The top managers fulfill a pivotal role in translating the strategy into practice. But employees also have to take

    and carry responsibility for sustainability initiatives. The CSR manager or department helps in anchoring these

    initiatives as a process within the organization, and in making the targets transparent.

    What are realistic targets to set within an organization?Whether or not targets are realistic all depends on the type of organization. Our objectives have been recorded

    in the CSR report of 2008, and include for instance an improvement of 2 percent in energy efficiency and a 2

    percent decrease in carbon emission. From 2010 onwards, we also want to carry out an EEA for every investment

    request of 5 million euros and more, as well as for many existing processes and products. These are realistic

    targets, but quite a lot still needs to be done. We ultimately want to be at the same level as the top 25 chemical

    companies in the Dow Jones Sustainability Index.

    How sustainable are you in daily life?At home we try to live energy consciously - to the extent that this is possible with two adolescent daughters

    and two small children, and in a house that is more than a century old. I frequently cycle the 15 kilometers to

    my work. I am fairly sustainable in daily life, but I am definitely not a super freak.

    Marcel Werner

    39

  • 40

    The art of the possible

    Business analytics to measure corporate sustainability

    In the abstract, business analytics presents a range of powerful optionsto uncover meaningful insights that promote action. And that promise iscompelling to virtually any organization. But the case becomes even morepersuasive when we consider how it can be applied to one of the fastest-emerging issues in corporations today: sustainability and the corporateenvironmental footprint.

    Today, companies are seeking to strengthen the so-called triple bottom line that conceptually

    expands the traditional financial framework to encompass rigorous reporting on the organizations

    performance on sustainability issues such as the carbon footprint, community development, occupa-

    tional safety and dozens of other metrics.

    Three planning challengesUnfortunately, significant barriers have impeded decisive corporate action. In the first MIT Sloan

    Management Review Business of Sustainability Survey, researchers articulated three major roadblocks.

    The first is a basic lack of information upon which to base sustainability efforts and decisions. Despite

    the high profile for sustainability, managers often find themselves forced to speculate about drivers of

    sustainable performance and lack a deep understanding of issues that are relevant for their industry.

    Accessing, interacting with and analyzing the fundamental data about energy, water and waste is a

    nonnegotiable premise for effective sustainability.

    Second, companies often have conflicting definitions of precisely what sustainability means to their

    organizations. This makes it extremely challenging to develop a meaningful business case for

    sustainable investments and presents an often insurmountable barrier to the effective cross-functional

    collaboration that is necessary for success.

    Third, without that business case based on accepted definitions, companies struggle with precisely

    By Jonathan Hornby

  • 41

    Jonathan Hornby Accessing, interacting with and analyzing the fundamental data about energy,

    water and waste is a nonnegotiable premise for effective sustainability.

    Traditional reporting and analysis can often fall short.

    how to measure the ROI of sustainability efforts. Whats more, tangible and intangible costs and bene-

    fits abound in the sustainability discipline - but they can be especially challenging to forecast because

    the goals for greenhouse gas emissions reductions established by governments are often in 10- and

    20-year time horizons, far exceeding the typical one to three-year payback period.

    Traditional reporting and analysis can often fall short when attempting to predict future impacts of

    sustainability investments. Business analytics plays a critical role by enabling the organization to

    balance todays ROI objectives with longer planning horizons. These challenges are not uncommon for

    emerging business issues. Sustainability is a new discipline for most organizations, one where there

    isnt a generation of tested and proven models to call upon and modify. As a result, many organi-

    zations forego the effort to model the intangible benefits that may result from sustainable practices.

    Or, they minimize important externalities such as environmental or societal costs and benefits - all of

    which can become tangible with business analytics.

    The ROI mattersDespite these challenges, creating the strongest possible business case is an essential mandate for

    todays sustainability directors. Thats because although few observers fail to see the importance of

    efforts to reduce carbon output and minimize environmental impact, these benefits are highly unlikely

    to achieve primacy in profit-driven enterprises. In a report from the Economist Intelligence Unit,

  • 42

    researchers report that the top three motivations for sustainability initiatives are brand enhancement,

    revenue growth and cost savings - in other words, outcomes that have a direct impact on profitability.

    Environmental protection only placed fourth on the list, amply demonstrating that pragmatism and

    not altruism is the dominant motivator.

    However, while the pro forma income statement in the analysis is paramount, the attention organi-

    zations are paying to sustainability matters is definitely not merely pro forma. The actions, when

    implemented, are far-reaching and transformational. For example, GE announced that its Ecoimagination

    program to reduce environmental impact generated a 17 billion dollar revenue stream and reduced

    costs by more than 100 million dollars since 2005. And the US Army reports that 80 percent of its

    construction meets Leadership in Energy and Environmental Design (LEED) standards, reducing its

    energy costs by 8 percent.

    Delivering green analyticsTransformational organizations require a combination of descriptive and predictive insight - the ability

    to track meaningful green indicators, validate strategies and costs before investing, identify causal

    relationships and forecast outcomes. And in these areas, business analytics can make the difference.

    Such a business analytics framework can empower the organization to:

    Measure sustainability activities using accepted methodologies and protocols.

    Report on environmental performance to shareholders and regulators.

    Improve sustainability metrics using analytical techniques such as optimization, forecasting and

    data mining to deliver metrics that matter.

    Reduce resource usage by accurately forecasting resource requirements needed to reach desired

    outcomes for a department or enterprise.

    With business analytics, we start to see the art of the possible with respect to sustainability. You can

    measure emissions and resource consumption throughout a value chain or product life cycle. You can

    ensure regulatory compliance. And you can build green strategies with predicted ROI. You can deter-

    mine which conservation efforts or greenhouse-gas reduction strategies will have the greatest impact

    - physically and financially. And you can identify ways to profit from environmentally respectful goods

    and services.

    Undoubtedly, embracing sustainability initiatives will lead to meaningful - sometimes profound -

    changes to processes and culture. This transformation can be an exciting opportunity to innovate and

    redefine, to explore new business models and markets. By providing the right information and

    insights, business analytics can be a key enabler of strategic sustainability initiatives.

    In a report from the Economist Intelligence Unit, researchers reportthat the top three motivations for sustainability initiatives are brandenhancement, revenue growth and cost savings in other words, out-comes that have a direct impact on profitability. Environmental protectiononly placed fourth on the list, amply demonstrating that pragmatism andnot altruism is the dominant motivator.

  • Sustainability has remained a top priority with SAS precisely because of its potential to deliver

    tremendous business value. Its not just the right thing to do; its the smart thing to do.

    In addition to employee engagement practices, from health care to expanded job opportunities,

    SAS has made great progress in reducing its environmental footprint. For example, a 1 megawatt

    solar array is providing clean, renewable energy to the public energy grid for the local utility.

    Several construction projects at SAS offices around the world utilize low-environmental-impact

    design principles. Notably, SAS is pursuing Leadership in Energy and Environmental Design (LEED)

    certification for a new conference facility and a new cloud computing facility located at its global

    headquarters.

    SAS and corporate sustainability

  • Bernd Jan SikkenAssociate Director World Economic Forum

    questions for 5

  • Bernd Jan Sikken leads multi-stakeholder initiatives at The World Economic Forum(WEF) that aim to find solutions for fundamental issues such as demographic shiftsand environmental sustainability. As an Associate Director Sikken plays a role inthe independent organization that is committed to improving the state of the worldby engaging leaders in partnerships to shape global, regional and industry agendas.

    What are good examples of sustainable business initiatives?

    There are many good examples. An interesting one to highlight is Interface, a modular carpet manufacturer.

    Interface has undergone a major transformation while maintaining a clear business focus. The company is well on

    its way to realize its Mission Zero commitment to eliminate any negative environmental impact by 2020. Chairman

    Ray Anderson initiated this journey to what he calls - Mount Sustainability in 1994. Interface has defined seven

    fronts of sustainability, including waste elimination, use of renewable energy, and closing the loop. Also financial

    institutions such as Rabobank, APG and HSBC offer powerful examples. Through their sustainable investment

    strategies, they help recognizing and rewarding companies that move society towards sustainability.

    How has sustainable entrepreneurship taken shape within your organization?

    As part of our mission to improve the state of the world, we work with leaders from governments, business and

    NGOs to address a broad range of global challenges. We currently have a portfolio of 33 multi-stakeholder initiatives

    of which more than a third focus on driving environmental sustainability. Furthermore, our Annual Meeting of the

    New Champions in September 2010 will focus exclusively on sustainability. The program centers on how to

    increase energy efficiency, lower carbon emissions, develop green technology, and rebuild basic infrastructure.

    We expect that over 1,500 leaders from business, politics, science and technology will participate.

    Who in the organization should be responsible for building sustainability strategies?

    I believe that, in the next decade, most companies will fully integrate sustainability into their core business

    strategies. I also believe that, in order to transform effectively, corporate sustainability needs to be a broad,

    collective responsibility within companies. Still, top management plays an important role as it not only needs to

    make sure that sustainability is fully integrated into the business strategy, but also needs to set the example and

    provide the institutional support.

    What are reasonable sustainability objectives for most businesses?

    The objectives depend on the type of organization and industry. Whats important is that companies set bold, yet

    realistic objectives. Keeping it simple is another imperative: define a select number of well understood targets instead

    of many. Furthermore, sustainability requires a lifecycle approach with consideration of the environmental impact

    across the whole value chain. Shifting the burden is relatively easy; reducing it collectively is a bigger challenge!

    How sustainable are you?

    The pursuit of a sustainable lifestyle is a journey wherein you constantly learn and discover how you can do better.

    For me, it took off with simple choices such as eating less meat, buying more local and biological food, and

    recycling and reusing as much as possible. Just like corporate sustainability can impact a companys bottom line, a

    sustainable lifestyle may also reward consumers with other advantages such as saving money and healthier living.

    Bernd Jan Sikken

    45

  • 46

    Ruud Koornstra on sustainable innovations and the new way of business

    Sustainability is not a trick,its a mindset

    TV producer Ruud Koornstra became an overnight multimillionaire in 2000 by selling the company that

    is now called IDtv. The former student of Child Psychology and rugby player was 36 years old at the

    time, yet he was not planning on becoming rich and lazy. Together with partners, he founded Tendris

    Holding, an initiation company for sustainable initiatives and companies. We wanted to fill the

    missing link in sustainability by translating ideas into companies and to actually carry out these ideas.

    Sustainability means making things better than they are today, without this resulting into losers,

    explains Koornstra. To improve society from this point of view, one must not be afraid of questioning

    existing rules and structures. This requires guts, operation perspective, partnership and innovation.

    The latter one will, according to Koornstra, certainly not be initiated by large enterprises. The

    establishment detests revolutionary change. The larger the company, the more difficult it is to anchor

    a sustainable mindset in daily practice. Some companies have to reinvent themselves before there is

    talk of sustainability.

    There is an increasing awareness that one will not be better off at the expense of mankind, nature or

    the environment. Yet unfortunately many CSR managers are often frustrated by to the fact that there

    is still insufficient awareness on sustainability in the top levels of their company. You also see CEOs

    who have a near schizophrenic relationship with sustainability. They realize the importance of the

    concept as individuals, but they serve other interests in their position as director.

    The business card of entrepreneur Ruud Koornstra also states, besidesthe usual contact details, the three words Dream, Dare and Do. Koornstrais the founder of Tendris and dreams of a better world, in which peopledare to take responsibility. Do stands for taking action, something thatis necessary to kick start sustainable initiatives. Sustainability offers endless opportunities for a better world and for profitable entrepreneurship.The Pharox LED lamp is a shining example.

  • 47

    Plenty of solutionsSo where should the necessary innovations come from? They traditionally come from small companies

    and startups, from pioneers that are flexible enough to work in the new sustainable dimension. I will

    challenge anyone about the fact that there is a sustainable alternative for every non-sustainable product.

    Companies and people that understand the sustainability principles see more and more possibilities, and

    the scarceness in energy makes one creative too. It is up to Tendris, but it is also up to the government,

    NGOs, companies and consumers to support the parties and get them up and running.

    Can sustainability be combined with a free market? Entrepreneurship and sustainability go together

    excellently! There is ample evidence that good money can be made with this. Sustainability is not

    expensive. We also should get rid of the Calvinistic thought that man must do penance in order to

    improve the world. Sustainability is not about driving around in a car that you really dislike. Asking

    people to drive and fly less doesnt work either. Besides people, planet and profit, in my opinion you

    can also add the fourth p for pleasure. Isnt having a good time the highest goal? You just have to

    think of good ideas. When there are no longer any restraints, then there are plenty of solutions for lots

    of sustainability challenges.

    Besides people,profit and planet,there is also the fourth p for pleasure.

  • 48

    The right to speakKoornstra certainly has every right to speak. The first company that Tendris rebranded, was the energy

    company Durion, now called Oxxio. Oxxio shook up the energy market with well-oiled purchasing and

    sales teams, a minimum of overheads, as well as green energy. Subsidiary company RePay International

    developed the VISA Greencard that compensates for the carbon dioxide emission of the credit card

    expenses. In the most difficult credit card country in the world, the Greencard has proven that you can

    earn money by giving something back. The underlying concept is currently being rolled out worldwide

    and is known as ClimaCount. Climate compensation is in fact a waste of time and effort, although it is a

    very good forerunner of solutions that are better for the environment.

    Symbol for sustainable renewalOther initiatives from Tendris include the Agis health insurance policy for vegetarians, carbon dioxide

    neutral travel with Greenbookings and fuel savers for cars. Subsidiary company Lemnis Lighting is

    currently in the spotlight. The developer of sustainable lighting solutions based on LED technology

    introduced the Pharox LED lamp in November 2006, which is 90 percent more economical than a light

    bulb with the same output. According to Koornstra, the LED lamp is a serious competitor for energy

    savings light bulbs which contain mercury, as an intended successor of the traditional light bulb. For

    me, the LED light bulb is the symbol for sustainable innovation.

    The light bulb has been around since 1854 and has barely changed over the past century. More than

    19 percent of the total electricity consumption is used for lighting. A light bulbs output, or the usable

    light produced per unit of energy, is only 5 to 10 percent. This means that a 100 watt lamp converts

    only 5 to 10 watt into light. The LED light is twice as economical, lasts eight times longer and contains

    no dangerous materials, making it completely recyclable. Several preconceptions have to be dispelled:

    it is, for instance, not necessary to buy new fittings. The Pharox fits into a normal wide fitting, it gives a

    warm light color and does not get hot. Within two years, consumers can recover the purchasing costs

    via economical energy consumption. This technology has already been applied successfully in public

    areas, offices and in greenhouse farming. The use in horticulture enables a layered cultivation of small

    crops, which saves even more energy.

    Light or view?Unfortunately there is resistance from the establishment, for instance with regard to the ancient

    measuring method for public lighting. The Lemnis LED lights are very suitable for street and tunnel

    lighting, but they are not suitable for the measuring equipment of the officials responsible for lighting

    regulations. They work with a photopic light curve, whereas according to scientific data, it would be

    more logical to take as starting point a scotopic lumen curve. You actually measure the light level in

    a bucket, whereas you could also measure the view in the whole environment.

    However, Koornstra has respect for Philips, a company that has an interest of 10 percent in Tendris.

    There is ample evidence that good moneycan be made with sustainability.

  • This multinational is hereby taking sustainable innovation