ERB Institute & Implementing Sustainable Initiatives

http://www.facebook.com/group.php?gid=69840849282

Introduction

Many companies around the world have discussed development of socially and environmentally responsible strategies and initiatives to both facilitate a more tightly-knit community connection as well as help their bottom line. William R. Blackburn, author of The Sustainability Handbook, states that once an initiative “or other key indicator is set, organizational and stakeholder support is garnered, and the administrative details are planned, the goal or indicator can be rolled out for implementation. But just as care must be taken in developing a goal, it is also essential for its rollout. Indeed, that care can be the difference between an organization’s success and failure in achieving its own objectives and pushing toward sustainability.”[1]

Follow-up Checklist for Action: Selecting Goals and Indicators

Blackburn has developed a checklist to help companies that have developed initiatives toward sustainability. This list of five things that companies should be mindful of during the implementation stage of an initiative includes: 1) resolve what terminology to use to cover objectives, goals, metrics, indicators, and related items. 2) Include discussion of indicators and goals in planning meetings. 3) Planning teams consider indicators and goals appropriate for key objectives. 4) Planning teams and management assure the clear assignment of responsibilities noted in figure 7.10 for developing, measuring, and reporting on identified goals and other key indicators. 5) Reevaluate effectiveness of goals and other indicators in follow-up planning sessions.[2]

NEEFUSA

According to the National Environmental Education Foundation (NEEF) based in Washington DC, “in response to the threats of climate change, water scarcity, and other pressing environmental concerns, companies are prioritizing sustainability as a core business issue. Companies have learned that environmental sustainability initiatives offer competitive opportunities, improved efficiency, and access to new markets. This study provides new insight on how managers can increase the likelihood of having successful sustainability initiatives by considering company culture in the initiative planning and implementation process.”[3] In a report compiled by the University of Michigan, the implications of which are detailed below:

IMPLICATIONS

These findings have implications for practitioners involved in planning and implementing sustainability initiatives:

1. A company’s sustainability initiatives are more likely to be successful if the initiatives are developed and implemented in a way that is consistent with the company’s culture, particularly its level of collaboration.
2. Cultural dimensions should be considered when designing and implementing sustainability initiatives. Study findings point to the importance of companies first understanding their culture, and then designing and implementing sustainability initiatives accordingly.[4]

Case Study

The ERB Institute for global sustainable enterprise sites an anonymous case study. “Company X is a multinational chemical company. The 17 U.S.-based employees that rated the company’s culture and sustainability initiatives represented diverse corporate functions and business units. Respondents scored the company culture highest in the Compete and Control quadrants, as is often the case in large companies. The more successful initiative (rated 6.88/7) sought to grow revenue from products that reduce greenhouse gas emissions, driving towards an ambitious revenue target. Participants scored this initiative similarly to the company culture, emphasizing the Compete and Create quadrants. In contrast, the relatively less successful initiative (rated 5.29/7), which provided employees with information on how to reduce and offset their carbon footprints, was strong in the Collaborate quadrant and much weaker in the Control and Compete quadrants. This initiative was not implemented in a way that matched the company culture, as demonstrated by the chart on the previous page. Based on the findings from this study, this type of initiative may have been more successful if it had incorporated competitive and process-oriented elements that characterize the Compete and Control quadrants.”[5]

Conclusion

Developing a company-wide initiative can be a large and complicated endeavor for any organization. While sustainable initiatives require specific planning, they not any more or less complicated than any other. Such initiatives should neither be viewed as overly daunting or excessively easy. Blackburn’s checklist for successful implementation of sustainability initiatives is not only a good benchmark to assess goals for implementation; the checklist is an additional measure of transparency. Successful implementation of any sustainable initiative requires transparency. For companies that are founded on sustainable principles, this is rarely a concern. However, for companies that are more traditionally ‘bottom-line’ based this refocus on sustainability and by proxy added transparency can be an additional challenge. It is important to note that transparency in this case, does not simply mean financial transparency or transparency to shareholders. Successful transparency and implementation of a sustainability initiative also requires effective and complete transparency to managers, supervisors and all employees in a company.

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[1] Blackburn, William R. (2007). The Sustainability Handbook. London, England. Earthscan. Page 254. [2] Blackburn, William R. (2007). The Sustainability Handbook. London, England. Earthscan. Page 254. [3] http://www.neefusa.org/pdf/culture_sustainability.pdf [4] http://www.neefusa.org/pdf/culture_sustainability.pdf [5] http://www.neefusa.org/pdf/culture_sustainability.pdf

Socially Responsible Innovation - Sustainability

https://www.svn.org/_data/global/enewsletter/Networker1002.html

Introduction

With both significant populations of both individuals and corporations are focused on sustainability around the world, perhaps an overlooked ingredient in all this is socially responsible innovation. Sustainability has become a powerful consumer driver market that focuses on everything from personal health and wellness, to corporate social responsibility and business efficiency. To meet this growing global trend, forward-looking companies are quickly recognizing the challenges, and opportunities, of socially responsible innovation. These companies are now “wrestling with several critical topics: tapping into ‘green’ technologies to rethink product/packaging formulation and manufacturing processes; consumer demands for non-toxic, family-friendly products; open accountability and transparent communications about their organization’s environmental impact; competitors’ ‘green’ claims (whether real or unfounded); and compliance with Government legislation and other industry standards.”[1]

Corporate Social Innovation (Not Responsibility)

Michael Karnjanaprakorn, Co-Founder of All Day Buffet, and author of an article on Corporate Social Innovation expounds on a documentary from 2003 called The Corporation. The film “looks at the rise of the corporate body as having the legal status of a “person” — albeit with no conscience — and its collective psychopathic raping of the planets’ people and resources due to a greed-based bottom-line motivation.”[2] According to Mr. Karnjanaprakorn, “Most critics argue that corporations should have some “responsibility” to society. That’s all good and well, except that the form that currently takes is pretty weak (some charity here and there, looking at supply chains at best).”[3] It is Mr. Karnjanaprakorn’s belief that traditional Corporate Social Responsibility (CSR) does not go far enough. For Mr. Karnjanaprakorn, multinational corporation like Nike that donate $22,000,000 (1.0% of their profit) to different charities over a given year are – while commendable – is not as ‘responsible’ as, say, investing in innovation so as to remove the need to donate to a charity that helps people deal with the pollution from a Nike plant, for example. Mr. Karnjanaprakorn has developed three tenets that he believes would define what it means to invest in Corporate Social Innovation (CSI) instead of CSR.

1. Innovation, not Responsibility: Looking at how corporations can come up with new and better solutions in an exponentially changing landscape to provide more value.
2. Impact over multiple bottom lines, not just one: Measure impact over people, profit, planet.
3. Investment into the long-term, not charity: Integrating budgets from “cause or CRS based” initiatives into innovative infrastructures that leverage the core competencies of the business to create real and much bigger change than one-off donations.[4]

Daimler Chrysler

Corporate social innovation is not a new concept. Authors Charles Holliday, Stephen Schmidheiny, and Philip Watts in their book Walking the Talk: The Business Case for Sustainable Development, state that, “ever since launching its first automobile, Mercedes-Benz has used components made of renewable raw materials in manufacturing its cars. The initial deployment of renewable raw materials at the beginning of the 20^th century includes the use of rubber in the production of tires and gaskets and as a binder in padding materials. With the end of World War 2, Mercedes-Benz began to use more and more natural fiber products in car interiors.”[5] Additionally, “Through R&D work, DaimlerChrysler has, for the first time, been able to deploy natural fibers within an entire process chain. This includes fiber selection and specification, fiber preparation and processing, component manufacture, materials and component approval, and recycling. This provides opportunities for beneficial technology transfer, as the procedures are transferable to developing countries. The use of locally grown natural fibers for the local production of plastic components is part of the global DaimlerChrysler strategy to increase the local content in different areas of the world.”[6]

Conclusion

Although the concept of social entrepreneurship to many is much more appealing and sexy than mainstream commercial business, Ms. Tania Ellis insists that “we need the power of both to push the field of socially responsible and socially innovative companies forward.”[7] Ellis goes on to say that the new business revolution is, in fact, “being driven both top-down from some of the world’s largest companies - and bottom-up from entrepreneurial activists and social change makers. Because hardcore business people are realizing that they can increase their profits by incorporating social responsibility as a part of their business strategy, and hardcore idealists are recognizing that the use of market methods gives them the opportunity to create even more social value. To them there is no doubt: the blended value proposition of social, environmental and financial value all being parts of one essential value is the future way of thinking value creation, as already promoted in CSR, social investing (SRI), venture philanthropy and indeed social entrepreneurship.”[8]

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[1] http://www.innovation-point.com/socialinnovation.htm [2] http://www.alldaybuffet.org/2009/10/13/corporate-social-innovation-not-responsibility/ [3] Ibid. [4] http://www.alldaybuffet.org/2009/10/13/corporate-social-innovation-not-responsibility/ [5] Holliday, Charles O. Jr., Stephen Schmidheiny, Philip Watts. Walking the Talk: The Business Case for Sustainable Development. UK: Greenleaf Publishing Limited, 2002. Print. Page 215. [6] Holliday, Charles O. Jr., Stephen Schmidheiny, Philip Watts. Walking the Talk: The Business Case for Sustainable Development. UK: Greenleaf Publishing Limited, 2002. Print. Page 215. [7] http://thenewpioneers.biz/2011/01/24/a-business-force-for-good/ [8] Ibid.

Thailand Business Council for Sustainable Development - Green Label Scheme

http://www.tei.or.th/tbcsd/, http://www.plantoysusa.com/press/news/

Introduction

Labels and advertisements highlighting the preferential eco-benefits of products is nothing new. According to the authors of Walking the Talk: The Business Case for Sustainable Development, “eco-labeling, based on the use of labels or symbols to designate preferred products, is increasingly being used in the marketing of timber, foods, fish, and other products.”[1] The authors go on to say that, “certified products can lead to higher prices and expanded market share as well as to satisfy consumers’ concerns about the safety or environmental impact of such products.”[2] The first eco-label was the German Blue Angel certification. According to the Blue Angel website, the certification was “created in 1978 on the initiative of the Federal Minister of the Interior and approved by the Ministers of the Environment of the federal government and the federal states. It considers itself as a market-conform instrument of environmental policy designed to distinguish the positive environmental features of products and services on a voluntary basis.”[3]

Thailand Business Council for Sustainable Development

The Thailand Business Council for Sustainable Development (TBCSD) was established in 1993. Consisting of “representatives from 32 leading business organizations and operates as a non-profit group to promote sustainable development,”[4] Chaired by Mr. Anand Panyarachun as a TBCSD council project, the Thai Green Label Scheme was one of the first projects that the TBCSD took on.[5] According to the Thailand Environment Institute (TEI) “the Green Label is an environmental certification awarded to specific products that are shown to have minimum detrimental impact on the environment in comparison with other products serving the same function.” Additionally, the symbol “signifies environmental conservation. The flora (the leaves) and fauna (the bird) depicted are the living wonders of the world.”[6]

The Green Label scheme is intended to:

• Provide reliable information and to guide customers in their choice of products
• Create an opportunity for customers to make an environmentally conscious decision, thus creating market incentives for manufacturers to develop and supply more environmentally sound products
• Reduce environmental impacts that may occur during manufacturing, use, consumption, and disposal products[7]

The Criteria for Development are as follows:

• An environmental assessment of the product using life cycle consideration, taking into account all aspects of environmental protection.
• Solving specific issues of high political priority, e.g. reduction of waste production, and minimization of energy and water consumption.
• Capability to meet proposed criteria with reasonable process modification and or improvement
• Possession of appropriate test methods.[8]

Conclusion

Entitled ‘Sustainable Consumption and Production of Thailand’, Wilasinee Poonuchaphai, from the German Technical Cooperation (GTZ) made a presentation during a ‘Path of Good Governance Seminar’ held in South Korea during April 2010. Sponsored by organizations like: Green Growth, UN Project Office on Governance, UN Economic and Social Commission for Asia and the Pacific, Regional Helpdesk on Sustainable Consumption and Production in Asia and the Pacific, Wilasinee Poonuchaphai asserts that, while participation in Thailand Business Council for Sustainable Development Green Label Scheme, “there are 30 companies have been awarded the Green Label certification.”[9] Since 1993 TBCSD has made notable achievements in their efforts to highlight companies and products in Thailand that are committed to making strides to provide envirinomentally-friendly alternatives for everyday products and services. More work needs to be done of course, but if the accomplishments made thus far are any indication, the future looks hopeful for continued sustainable development in Thailand.

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[1] Holliday, Charles O. Jr., Stephen Schmidheiny, Philip Watts. Walking the Talk: The Business Case for Sustainable Development. UK: Greenleaf Publishing Limited, 2002. Print. Page 178. [2] Ibid. [3] http://www.blauer-engel.de/en/blauer_engel/index.php [4] Holliday, Charles O. Jr., Stephen Schmidheiny, Philip Watts. Walking the Talk: The Business Case for Sustainable Development. UK: Greenleaf Publishing Limited, 2002. Print. Page 190. [5] http://www.tei.or.th/greenlabel/about.html [6] Ibid. [7] Holliday, Charles O. Jr., Stephen Schmidheiny, Philip Watts. Walking the Talk: The Business Case for Sustainable Development. UK: Greenleaf Publishing Limited, 2002. Print. Page 190. [8] http://www.greengrowth.org/download/2010/korea/Country.experience.on.SCP.Thailand.pdf [9] http://www.greengrowth.org/download/2010/korea/Country.experience.on.SCP.Thailand.pdf

Setting Corporate Sustainability Goals

http://www.socialfunds.com/shared/reports/1213731409_DuPont_2015_Sustainability_Goals.pdf

Introduction

Setting company goals is nothing new. According to Mr. William R. Blackburn, “goal-setting should be part of the strategic and tactical planning process. Goals that are inspiring and simple, measurable, achievable, relevant and time-based (SMART) should be included with each strategic objective so everyone can know whether or not the objective was achieved.”[1] Blackburn goes on to say that a plan goals “framed around sustainability issues brings a company’s sustainability policy to life; without such goals, the company statement becomes a mere “trophy policy,” which – like the moose head hung on the wall to impress visitors – is simply dead.”[2] However, despite the best laid plans, goals-set does not always mean goals-realized.

Why Goals Fail to Deliver Performance

Mr. Blackburn, in figure 7.1 in his book details 11 reasons ‘Why Goals and Other Indicators Fail to Deliver Performance,’ they are:

1. The measures aren't credible with intended data users because:

a. the measures are based on unreliable, sparse, or old data

b. the measures are being collected, compiled, and/or reported by people who are not trained or held accountable for doing so

c. the meaning of the measures isn't clear

d. the measures are not thought to be valuable of a priority by those who must perform to produce the desired results, or are not linked to important objectives of those people

e. the people whose performance is needed for results are not aware of the measured results

f. there are confounding factors other than those intended to be stimulated or controlled that affect the results; the cause-effect relationship is unclear; the actions needed to improve performance under the measures are not clear

2. The use of the measures isn't readily visible, management isn't interested in the results

3. There are too many measures or they are reported too frequently, which overwhelms data compilers and users

4. Results are reported too infrequently to keep the organization on course

5. There are too measures and their context relative to other factors isn't well understood, e.g., having sales figures without profit figures

6. Not enough time is allowed for corrective actions to take effect, goals are to short term

7. There is no accountability of recognition for performance under the measure

8. Goal targets are unrealistic

9. The goals drive the wrong performance

10. The results aren’t reported clearly or with sufficient detail and explanation

11. The results aren’t used to make business decisions[3]

Numerous companies have set goals and fail to achieve those goals in recent years. General Motors, for example, set a target in the early 2000’s that they would “recapture 29 percent of the American market, the share it had ebbed past in 1999.”[4] GM never did regain 29 percent of the market. And while the “causes of GM's woes are many - from poor design to high labor costs to a prostrate economy - industry analysts argue that one of the most damaging things the company did was to set that goal.”[5] According to Drake Bennet, writer for the Boston Globe, “in clawing toward its number, GM offered deep discounts and no-interest car loans. The energy and time that might have been applied to the longer-term problem of designing better cars went instead toward selling more of its generally unloved vehicles. As a result, GM was less prepared for the future, and made less money on the cars it did sell. In other words, the world's largest car company - a title it lost to Toyota last year - fell victim to a goal.”[6]

Another way that organizations often fail to achieve goals and strategic planning targets is because they are “set top down, by executives who lack crucial information and are out of touch with staff challenges. The goals are unrealistic and they fail to consider organization resources and capabilities. Staff members don't believe that the rewards they will receive for goal accomplishment will equal the energy they invest to achieve them. Frequently, managers are intimidated when they fear job loss for failure.”[7]

According to Susan M. Heathfield, a former Siebel Systems executive said, "My favorite goal setting story of all time was how Siebel set sales goals for its District Managers: everyone's quota was $3.5 million. There, no more thought needed to go into it, no discussion - just do it or you're fired! So the District Manager calling on Citibank had the same quota as the District Manager calling on the States of Louisiana, Mississippi and Alabama. Guess which guy got fired?

I also remember how I used to spend the last day of every sales quarter at Siebel performing unnatural acts to close business and save my job. At the end of the year, I had to work until 10:00 p.m. on the last day of the sales quarter (while we had company over at home) to get one last deal closed. This deal saved my job. I was one of two state and local district managers that avoided the axe two weeks later."[8]

The Need for Goal-Setting

Despite the risks involved in setting goals, “It is a given in American life that goals are inseparable from accomplishment.”[9] America has been home to several, seemingly impossible goals over the years, President Kennedy's 1961 “promise to put an American on the moon by the end of the decade is held up as an example of a world-changing goal, the kind of inspirational beacon needed to surmount immense societal challenges. Among psychologists, the link between setting goals and achievement is one of the clearest there is, with studies on everyone from woodworkers to CEOs showing that we concentrate better, work longer, and do more if we set specific, measurable goals for ourselves. Goal-setting is one of the seven habits of highly effective people, says self-help guru Stephen Covey, and even Henry David Thoreau, the philosopher of dropping out, celebrates the work of goal setting. "If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them," he writes in Walden.”[10]

Blackburn details a list of eleven ‘Benefits and Purposes of Measurable Goals,’ they are:

1. Focuses organizations on a common mission, enhances teamwork
2. Helps define accountability for action
3. Documents accomplishments; marks point of success
4. Serves as basis for granting rewards
5. Motivates people to perform
6. Provides early warning device for alerting organizations if performance is slipping
7. Helps organizations manage and improve processes
8. Reveals the strengths and opportunities for improvement in tactics, programs, processes, people, and organizations
9. Makes personal performance evaluations more objective
10. Guides organization in allocating resources
11. Demonstrates responsiveness to stakeholders

Conclusion

While setting unrealistic goals and goals that cannot be adequately managed to ensure completion can surely bad goals that have the capacity to cause great harm to a company, the goal that is modest and well managed has the potential for huge potential. America was founded on setting goals that seemed wild and perhaps unrealistic. The America ability to accept risk as a natural byproduct of success is part of the reason why the United States has such a high rate of entrepreneurship. While the emphasis and types of goals has changed due to increased interests in CSR, desires at delivering an environmentally friendly product, and creating sustainable communities, the potential failures of goal-setting is still the same.

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[1] Blackburn, William R. (2007). The Sustainability Handbook. London, England. Earthscan. Page 227. [2] Blackburn, William R. (2007). The Sustainability Handbook. London, England. Earthscan. Page 227. [3] Ibid, page 226. [4] http://www.boston.com/bostonglobe/ideas/articles/2009/03/15/ready_aim____fail/ [5] Ibid. [6] Ibid. [7] http://humanresources.about.com/cs/strategichr/a/aadark_goals.htm [8] Ibid. [9] http://www.boston.com/bostonglobe/ideas/articles/2009/03/15/ready_aim____fail/?page=1 [10] Ibid.