An odd couple? HR and sustainability

savitz(5)Today’s guest post comes from Andrew Savitz, the author of a new book called  Talent, Transformation and the Triple Bottom Line: How Companies Can Leverage Human Resources to Achieve Sustainable Growth (Wiley 2013). As you can guess from the title, Andy argues that employees are the key to creating sustainable companies, but that they–and their colleagues  in human resources–are often overlooked when companies embark on environmental programs. I think he’s onto something. I’ve long thought that the single biggest business driver of corporate sustainability initiatives is the way they help better companies attract better people and motivate the ones they have.

Andy has been his career working with companies on social and environmental issues. A lawyer by training (and before that a Rhodes scholar at Oxford), Andy has been a congressional staffer, the general counsel for the Massachusetts Office of Environmental Affairs and head of the environmental advisory practice at PriceWaterhouseCoopers (PwC). Since 2005, he has led a consultancy called Sustainable Business Strategies.

Here’s our online conversation:

Marc: You say that you’ve written the book “in large measure to bridge the gap between sustainability and HR.” HR? Really? Why do we need human resource people to get involved with sustainability? They don’t know anything about carbon emissions, say, or LED lighting, do they? [click to continue...]

Corporate sustainability, by the numbers: Who’s up, who’s down, who cares?

This has been a big week for corporate sustainability rankings, with the Dow Jones Sustainability Index (DJSI) and the Carbon Disclosure Project releasing new reports. Vote Solar and the Solar Power Electric Industries Association showcased the  top 20 corporate users of solar power in the US. A book called Good Company just landed on my desk, along with its own 2012 Good Company Index. And October will bring the World Series, Halloween and, of course, the annual Newsweek “green” rankings of big public companies.

All of which raises a couple of questions.

Do these ratings and rankings matter?

More important: Should they?

Undeniably, they do matter, mostly but not entirely because of the prestige they confer upon companies that do well. Press releases are flying! “Carbon Disclosure Project Salutes Con Edison” (Really?) “PepsiCo Earns Sustainability Accolades.” “GM Named Top Solar User in the U.S. Auto Sector.” This is all well and good. Some middle-management executive had to fill out those CDP forms or buy those solar panels, and why not recognize their efforts with a salute or an accolade? [click to continue...]

Ratings, rankings and the world’s most sustainable company

I’m skeptical about efforts to rank and rate green or sustainable companies, and I have been for a time. [See 100 Best Corporate Citizens? What a CROck!] It’s terribly difficult to compare big and small companies, retailers with manufacturers, software firms with oil companies, etc. We once tried at FORTUNE, and gave up because we decided it couldn’t be done right.

Having said that, I’m impressed with the rigor and methodology used by a Canadian magazine called Corporate Knights to produce its 8th annual list of Global 100 Most Sustainable Companies, which it calls “the most extensive data-driven corporate sustainability assessment in existence.” The ratings are transparent and they encompass social as well as environmental metrics, among them energy, carbon, waste and water productivity, diversity and employee turnover, safety and, interestingly, the ratio between CEO and average worker pay–a revealing metric that most such rankings do not include. Disclousre: While I played no part in putting the list together, I did write a profile of Novo Nordisk, the top-ranked company, for Corporate Knights.

A couple of things to note about the list. First, US companies perform poorly. There’s not one US-based company in the top 10. Intel (No. 18) Life Technologies (No. 15) is the highest ranked US-based firm, followed by Intel (18), Agilent (59), Johnson Controls (64), Procter & Gamble (66) and IBM (69). Lest you suspect a Canadian bias, our neighbors to the north did no better. The top-ranked Canadian firm was Suncor (48), which calls itself an “oil sands pioneer. Go figure.

Of the 22 countries with companies that made the list,  the UK led the way with 16 Global 100 companies, followed by Japan with 11 and France and the US with eight. Northern European countries (Denmark, Netherlands, Norway, Sweden) punched above their weight, which isn’t surprising.

Int [click to continue...]

We need to fix the food system. But how?

“Today’s food system is unfair, ineffective and operates beyond ecological limits,” Mark Lee says, via email.

“Unfair in that some 925 million are malnourished…

“Ineffective in that there are enough calories out there to feed everyone, but we fail to do so (and if we fail to do so for 7 billion, how will we cope with 9-10 by mid-century?)…

“Beyond ecological limits in too many ways too count – freshwater use, soil degradation, climate impacts, you name it.”

Mark is not an environmental activist. He’s the executive director of SustainAbility, a think tank and strategy consultancy that has worked with such food industry clients as Chiquita, Coca-Cola Kellogg’s, Mars and McDonald’s, Nestle, Starbucks and Unilever. He approached me because Sustainability recently released a report called Appetite for Change, about the food industry and how to fix it.

I’ve been writing a lot about food lately because it interests me, because food and agriculture matter a great deal if you care about climate or global poverty or health, and because there’s so much debate about what the path forward should be. Organics? Farmers markets? Genetically engineered crops? Vegetarianism? Local? [click to continue...]

Smart Grid: On its way…slowly

Today, President Obama travels to Arcadia, Florida, home to one of the nation’s biggest solar power plants, to announced 100 grants providing a total of $3.4 billion in recovery-act funding for the smart grid. The federal money will unleash $4.1 billion of private investment that, according to the government, that will bring smart meters to about 18 million American homes, or 13% of homes. It’s a big deal.

Nelson_River_Bipoles_1_and_2_Terminus_at_RosserWhat would a smart grid mean to you? In theory, you could save money by running appliances like dishwashers or dryers at night when electricity is cheaper. You’d know how much it costs you to watch that big-screen TV. (Care to take a guess? Read on.) If you installed solar panels on the roof, you could sell electricity back to the grid. Or recharge that electric car you may buy in 2010 or 2011.

The laudable goal is to empower consumers to buy electricity the way we buy groceries or gasoline or airplane tickets –where we know what we are getting and what it costs when we make purchasing decisions. Right now, we consume electricity without knowing how much we are using, understanding where it’s going or knowing the price until an unintelligible utility bill arrives in the mailbox once a month.

The trouble is, layering intelligence and transparency into the electricity grid requires action by two of the slowest-moving entities in all of America–the federal government and the regulated utilities. So you can be certain this won’t be an overnight transformation.

In fact–irony of ironies–the news that Uncle Sam was going to be subsidizing smart-grid rollouts has inadvertently slowed down the process, albeit temporarily. About 570 applications were filed seeking a total of $14 billion in grants. While waiting to see who got the grants and who didn’t, some utilities put their plans on hold. [click to continue...]

IBM: CSR is good for business

IBM has some advice for companies that are tempted to ease up on their commitment to corporate social responsibility during the recession: Don’t.

To the contrary, IBM argues companies need to get better at collecting data that measure their social and environmental impact, whether that be a carbon footprint, the results of factory inspections or life cycle analyses of products they sell.

In a new report issued today, based a survey of 224 senior executives, IBM says there are “significant gaps” between the corporate responsibility goals of companies and their ability to achieve them. The survey found:

–Companies aren’t collecting and analyzing the right information about CSR or aggregating it often enough.

–Few are collecting CSR data from their suppliers.

–Most don’t understand the concerns of their customers when it comes to CSR.

“There is a gap between the aspirations and the capabilities that are necessary to realize those aspirations,” says Eric Riddleberger, IBM’s business strategy consulting global leader, who heads up the company’s corporate social responsibility consulting efforts.

You won’t be surprised to hear that IBM is ready to help companies close those gaps. Riddleberger heads up a group of about 3,500 business strategy consultants, most of whom do some work around corporate responsibility and sustainability.

You can find the IBM survey here.  To me, what’s more interesting than the survey is the fact that IBM is putting so much of its intellectual capital, as well as its marketing dollars, behind sustainability. My FORTUNE colleague Jeffrey O’Brien wrote a terrific story recently about the substance behind IBM’s Smart Planet campaign; if you missed it, it’s well worth checking out. IBM’s consulting work, meanwhile, is driving sustainability deeper into hundreds of other companies.

IBM’s view—again, not surprising for an IT company—is that the spread of the Internet has made CSR a front-burner issue. In a report called Attaining sustainable growth through corporate social responsibility, IBM says:

Companies are more visible, more exposed, than ever before, especially as they expand their sphere of operations and their markets. Watchdog organizations are working hard to keep people aware of what businesses are doing.

Since 1990 the Web has spurred the growth of more than 100,000 new citizen groups devoted to social and political issues. And the torrid pace of information traveling the Internet is transforming consumer expectations as customers gain continuous access to special-interest action plans and third-party scorecards that rate companies on environmental practices and ethical concerns. In fact, companies can easily lose control of their own brands and reputations.

Customers are joining with activist NGOs and advocacy groups, who no longer depend on door-to-door canvassing and street demonstrations to bring environmental and fair trade issues to worldwide attention. They use blogs, podcasts, text messaging, MySpace and YouTube to proliferate their messages.

Whatever the reason, the people at IBM are persuaded that CSR helps drive shareholder value. Businesses that get CSR right

will have a significant advantage attracting investors, talent and customers, developing new products and services, and gaining access to new markets and new opportunities. It also will help them improve operational efficiency and reduce costs, and meet regulatory requirements, which can allow them to qualify for incentives and avoid penalties.

All this would indicate that CSR is going mainstream, right? Well, maybe. Harvard Business School graduates its class of 2009 next week and, according to The New York Times, about 20 percent of them have signed a student-led pledge called “The MBA Oath” that says the purpose of a business executive is to “serve the greater good by bringing people and resources together to create value that no single individual can create alone.”

That’s nice, but what about the other 80 percent?