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The Triple Bottom Line of Business. Joe Kresse Steve Attinger San Jose State University December 2, 2003. Agenda. History of “Sustainability” and the “Triple Bottom Line” CERES and GRI Models for Sustainability The Triple Bottom Line Business Case Sustainability Ladder Case Examples.

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the triple bottom line of business

The Triple Bottom Lineof Business

Joe Kresse

Steve Attinger

San Jose State University

December 2, 2003

agenda
Agenda
  • History of “Sustainability” and the“Triple Bottom Line”
  • CERES and GRI
  • Models for Sustainability
  • The Triple Bottom Line Business Case
  • Sustainability Ladder
  • Case Examples
history of sustainability
History of Sustainability
  • 1962: Rachel Carson publishes “Silent Spring”
  • 1970:
    • First Earth Day celebration – April 22nd
    • Nixon establishes EPA
      • Fueled by industrialization and overpopulationimpacts
  • 1972: First UN conference on the Human Environment in Stockholm, Sweden
history of sustainability4
History of Sustainability
  • 1983 – UN establishes World Commissionon Environment and Development
    • Purpose: examine world’s critical environment and development problems and formulate solutions
  • 1987: Brundtland Commission Report
    • 3 components of Sustainable Development:Environmental protection, Economic growth,and Social equity
    • Defined Sustainable Development as…

“Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

history of sustainability5
History of Sustainability
  • 1992: Rio Earth Summit
    • Over 178 governments adopted…
      • Agenda 21: a global blueprint and plan of action for sustainable development in the 21st century
      • The Rio Declaration on Environment and Development
        • 27 principles that express the rights and responsibilities of nations as they pursue human development and well-being
      • The Forest Principles
        • A guide for the management, conservation, and sustainable development of all types of forests
  • 2002: Third UN conference on Environment and Development, Johannesburg, South Africa
the triple bottom line
The Triple Bottom Line
  • People, planet, and profits
  • Equity, environment, economy
  • TBL coined by John Elkington of “SustainAbility” (UK) in 1995
    • Cannibals With Forks: The Triple Bottom Line of 21st Century Business (1997)
    • The Chrysalis Economy: How Citizen CEOs and their Corporations Can Fuse Values and Value Creation (2001)
    • www.sustainability.com
ceres
CERES
  • Coalition for Environmentally Responsible Economies (1989)
    • 10 principles for environmental management
    • Endorsing companies
      • American Airlines, B of A, Ben & Jerry's,Coca-Cola, Fleet Boston Financial, Ford, GM, Interface, Nike, Polaroid, The Timberland Co., and others
  • Launched Global Reporting Initiative (1997)
    • www.ceres.org
the ceres principles
The CERES Principles
  • Protection of the Biosphere
  • Sustainable Use of Natural Resources
  • Reduction and Disposal of Wastes
  • Energy Conservation
  • Risk Reduction
  • Safe Products and Services
  • Environmental Restoration
  • Informing the Public
  • Management Commitment
  • Audits and Reports
slide9
GRI
  • Global Reporting Initiative (1997)
    • Voluntary globally applicable sustainability reporting guidelines
    • 341 organizations in 31 countries
    • Europe vs. US
    • www.globalreporting.org
models for sustainability
Models for Sustainability
  • The Natural Step www.naturalstep.org
    • 4 system conditions
  • McDonough Principles www.mbdc.com
    • Cradle-to-cradle design
    • Waste = Food
  • Natural Capitalism www.natcap.org/
    • Radically increase resource productivity
    • Redesign industry on biological models with closed loops and zero waste
    • Shift from products to services
    • Reinvest in natural capital
the tbl business case
The TBL Business Case
  • Short-term cost reduction
    • Energy efficiency and waste reduction
  • Longer-term return on investment
    • Investment in building improvements
  • Value creation - Existing markets
  • Value creation - New markets
sustainability ladder
Sustainability Ladder
  • Products and services
  • Processes
  • Business model
  • Company focus
  • Brand identity of company
  • Supplier web and value chain
  • Industry leadership and advocacy role
case examples
Dupont

BP

Shell

Agilent

HP

Interface

Nike

Chaparral Steel Company

Johnson & Johnson

IdleAire Technology Corp.

Lighting Components and Design Inc.

Case Examples
dupont
Dupont

An international corporation that manufactures healthcare products, electronics and other goods

  • Developed a “sustainable growth” mission
  • Reduced consumption of raw materials and energy
  • Used scientific and technical knowledge to create more environmentally-friendly products
  • Engaged stakeholders of the corporation
  • Created a “Carpet Reclamation Program” where they have reclaimed and recycled 90 million pounds of carpet
  • By combining the recycling and sorting process in one location, Dupont has vastly reduced both energy consumption and costs

Source: The BSD Global website http://www.bsdglobal.com/viewcasestudy.asp?id=123

slide18
HP
  • Packaging Initiative
    • Lighter paperboard sleeve for ink cartridges
      • Reduced packaging weight by 34%, reducing costs by more than $700,000 a year
    • Reusable transit packaging for inkjet cartridges
      • Reduced waste by 2,400 tonnes in 2002, saving $1.5M
    • Bulk packaging for desktop computers
      • Reduced waste by 86%, saving $1.1M in 2002
      • Expected savings of $4M in 2003

http://www.hp.com/hpinfo/globalcitizenship/gcreport/products/packaging.html

interface corporation
Interface Corporation
  • The largest commercial carpet manufacturer in the world
  • Vision:

To be the first company that, by its deeds, shows the entire industrial world what sustainability is in all its dimensions: People, process, product, place and profits — by 2020 — and in doing so we will become restorative through the power of influence.

www.interfaceinc.com

interface corporation20
Interface Corporation

The Seven Steps

  • Eliminate Waste — QUEST program
  • Benign Emissions —Elimination of molecular waste
  • Renewable Energy —Reducing overall usage; transitioning to renewables
  • Closing the Loop — Creating cyclical material flows.
  • Resource Efficient Transportation — Reducing movement of products/people in favor of data, e.g. plant location, video-conferencing, telecommuting
  • Sensitivity Hookup — A community within and around Interface that understands natural systems and our impact on them.
  • Redesign Commerce — Providing services rather than products
slide21
Nike
  • Created a “Transparency 101” Program, which ensures public awareness of Nike’s business practices
  • Transparency 101 also monitors its factories in each country to make sure its practices follow Nike’s code of conduct
  • Nike is phasing out the use of PVC and other harmful chemicals in its products through work with William McDonough
  • Created the “Reuse a Shoe”, a program that recycles shoes
  • Uses organic cotton in some of their clothing
  • Has certified its Oregon buildings in an effort to decrease energy use

Source: The BSD Global website. http://www.bsdglobal.com/viewcasestudy.asp?id=81

chaparral steel company
Chaparral Steel Company

Produces bar and structural steel products by recycling scrap steel

  • Created Systems and Technology for Advanced Recycling (STAR)
  • Collaborated with neighboring cement plant
    • Business opportunities for this technology in emission credit trading
  • Built advanced Automobile Shredder Residue (ASR) system
    • Plastics can be used as a clean, efficient fuel source.
    • Sale of clean plastics alone generates up to $500,000 a year.
  • Looking to market ASR for mining and selling of clean plastics (waste) rather than sending them to landfills

Source: The BSD Global website http://www.bsdglobal.com/viewcasestudy.asp?id=51

johnson johnson
Johnson & Johnson
  • Has made a major effort to be more energy efficient by reviewing the usage of all aspects of its buildings (lights, fans, motors, etc.)
  • Received 1995 Green Lights Partner of the Year Award for large corporations
  • Received 1996 Sustained Excellence Award for completing and maintaining lighting upgrades for more than 94% of its workspace
  • Involved in a variety of different programs, including “ClimateWise”, “Energy Star Buildings”, and “Energy Star Computers”

Source: The BSD Global website http://www.bsdglobal.com/viewcasestudy.asp?id=76

idleaire technology corp
IdleAire Technology Corp.
  • 1.3 million long-haul trucks in US waste 4.4B gals. of diesel annually when drivers leave engines idling when resting.
    • Represents 2.6 % of all imported oil
  • IdleAire created a technology that allows trucks to heat and cool their cabs without idling their engines, thereby reducing the amount of fuel used and emissions released
  • IdleAire installs individual heat and air units above parking spaces at truck stops, charging $10 for 8 hours of service
  • Truck owners also save as much as 40% on fuel costs

Source: Green Gazelles website http://www.geocities.com/greengazelles/new.html

lighting components and design inc
Lighting Components and Design Inc.

Engineering company that manufactures miniature lighting components

  • Created cross-functional team to create a template of energy efficiency improvements
  • Improved insulation of its facilities
  • Upgraded lighting to fluorescent lamps, including electronic ballasts
  • Upgraded HVAC system to reduce energy
  • Installed low-flow toilets and water-saving taps
  • Upgraded over 24 pieces of motorized manufacturing equipment with energy-efficient motors
  • Winner of the EnergyStar 2002 Small Business and Congregations Award
  • Result? Prevented over 300,000 pounds of CO2 emissions and saved $10,300 on utility bills per year

Source: EnergyStar website http://208.254.22.7/index.cfm?c=sb_success.sb_2002winners#lighting