All of the companies I deal with on a daily basis have a green initiative of some kind. The programs exist on a broad spectrum from modest to massive, including employee-run recycling drives, increasing use of virtual meetings, major investments in alternative energy, adoption of virtualization technologies and more.
The formality and planning runs from self-organized, grass-roots employee groups to formal, management-sponsored teams, all the way to executive level Chief Sustainability Officers. And each is trying to make a difference in small ways and big ways that benefit the organization and the environment. I continue to be impressed by the range of programs, the creativity, and commitment.
What is interesting to me is that unlike proprietary and competitive programs that corporations are reluctant to divulge, corporate green initiatives are a source of pride for organizations. Sure, there are competitive dynamics at work but, for the most part, they are eager to share their progress with the buying and investing public in the form of sustainability reports – a practice that is already paying dividends. According to Goldman Sachs 2009 GS Sustain Report, green companies are good investments. The report is built on the premise that “We’re approaching a tipping point at which the issue’s (sustainability) importance to business performance and investors will escalate.”
That got me thinking… Are these sustainability reports an elaborate form of “green washing,” or are they genuine indicators of increasingly socially aware corporations, or are they just good business? And will these reports end up as another “corporate responsibility” fad? So I started to dig into a crop (check out SocialFunds web site as a good starting point – www.socialfunds.com). Quick observations:
- Many of these reports intermingle social and governance reporting with environmental reporting. I suspect that these will evolve independently from each other over time as sustainability reporting becomes more standardized.
- The Sustainable Investment Research Analyst Network (SIRAN), a working group of the Social Investment Forum (SIF), commissioned a survey that found that 66% of the S&P 100 published a sustainability report in 2008 (link = http://www.siran.org/pdfs/SIRANPR20091217.pdf). At the end of 2010, we should reach 100%.
- There are competing formats and agencies (e.g., GRI, CD project, UN, Clinton Global Intiatives). There was a call from the accounting folks at GAAP during Copenhagen to standardize and require disclosure (http://www.iasplus.com/resource/0912sustainability.pdf). In order to make this information useful to consumers and advocates there has to be some level of standardization and commonality.
- Amex calculates that 27% of its greenhouse emissions comes from business travel.
- Wainwright Bank tallies its electricity use on a site-by-site basis.
- The Gap is saving $2M annually from simply upgrading lighting across the company.
- Disney has a song dedicated to going green called “Friends for a Change.”
While sustainability reports may have started as a differentiator, they are clearly on a path to becoming table stakes for all public or public-facing corporations. The increased transparency and reporting has grown out of a greater emphasis on sustainability, organizations’ deepening understanding of the benefits, a commitment to accountability, combined with an effort to get in front of government mandates. I am signing up to read more of them in the year ahead and hope you will too.