3 Companies that Are Making Money by Embracing Sustainability
by
Alex Perera - 
Superstorm Sandy and the subsequent Nor’easter were the biggest news this week and last. The combination of two powerful forces resulted in unprecedented and widespread damage. Our thoughts are with those who have been impacted.
I can’t help but draw the connection between our recent extreme weather and businesses today—corporations are increasingly recognizing that they, too, are navigating two powerful forces. One force demands financial results, while the other requires increasingly sophisticated techniques to respond to climate, energy, resource scarcity, and other sustainability risks. The ways businesses navigate both these forces will determine whether they are truly viable over the long-term.
3 Pioneering Businesses Focused on Profits and Environmental Stewardship
On the eve of Hurricane Sandy, I moderated a Net Impact conference panel titled “Driving Bolder Investments in Sustainability.” This panel brought together representatives from Waste Management, Intel, and Pepsi to discuss how sustainability is no longer an add-on, but is becoming core to business planning. These three companies are incorporating environmental initiatives in order to shield themselves from business risk and boost their profits.
WRI's Next Practice Collaborative
WRI has been working with partners in the Next Practice Collaborative to determine how corporate “pioneers” are making the business case to integrate sustainability into their models. This group of companies spanning multiple sectors is sharing information on how sustainability helped create business value. Watch out for a working paper this winter with insights and examples from these companies on how they have been able to drive bolder investment in sustainability.
Some of the stories companies shared included:
Pepsi’s water conservation techniques have helped reduce water and energy costs in the company’s operations by $45 million since 2006. Working with NGOs and other local partners, Pepsi is sharing this expertise with its network of farmers to build a supply chain that’s less susceptible to water risk and more sustainable. The company also has a facility where it’s testing solar, biomass, and other renewable energy technologies, with the goal of learning what types of technologies it can apply across its facilities to reduce its footprint.
Waste Management is collaborating with its customers and making investments in advanced technologies like pyrolysis, turning the waste stream it’s managing into an asset – clean energy. The CEO wants to create more value out of the materials they manage than the competition does. By looking to develop technologies that can help turn the waste stream into higher and higher value products, what was once considered “waste” could become important “revenue.”
Intel is experimenting with factoring social and environmental costs into financial projections for capital projects like new factories. Intel has increased the payback time for some projects that help reduce energy or water risks. By integrating sustainability considerations into the heart of its budgeting process, companies like Intel may be better positioned to not only make financially sound investments, but ones that reduce business risk and stand up to the sustainability pressures of tomorrow.
What We Can Learn from Corporate Sustainability “Pioneers”
These examples show the importance of using a sustainability compass to navigate business growth and environmental risk and opportunity. As John Elkington noted in the New York Times earlier this year, ”Today’s pioneers in sustainable food, energy, water, infrastructure, or finance have gotten in on the ground floor of tomorrow’s economy.” These companies are starting to show how it can be done.
To read more insights from the recent Net Impact conference, check out these posts: