28
October

The New Metrics of Sustainable Business: In With The Old, In With The New . . .

October 20, 2011—Many companies that closely follow market trends make the mistake of deciding they need a “sustainability strategy.” Yes, sustainability is a transformative market trend and, yes, a strategy is always advisable. However, businesses would be much better served if they instead create a “business strategy that is sustainable.” This is a subtle yet incredibly important distinction.

Not surprisingly, under this viewpoint the “new” metrics of sustainable business look a lot like the “old” metrics of business. Financial and social indicators – such as revenue, profitability, margin, customer satisfaction, employee engagement – all continue to matter. In addition, environmental indicators have become much more prominent in both corporate disclosures as well as corporate decision-making. So, what is so different about the “new” metrics and why should you care? In this article I highlight three trends that are becoming best practice around the “new” metrics and identify three areas where “next” practices are still emerging.

Best Practices for a Business Strategy that is Sustainable

1)      Materiality

The first issue that companies need to address is that sustainability can mean many things, or even everything, to different stakeholders (see the 6-paragraph, 24-citation definition on Wikipedia if you haven’t experienced it yourself). A business strategy that is sustainable needs to clearly define what is material to each of a company’s stakeholders and provide a mechanism for remaining relevant over time. As a practical matter, this means that material issues may differ greatly for different companies, but should begin to converge at the industry/sector level.

SAP has addressed this issue by creating an interactive materiality matrix as part of our online sustainability report (Figure 1). This matrix allows stakeholders to easily provide comments using any web 2.0 log-in (Facebook, Twitter, Linked-In, etc.) and allows us to track and document evolutions in stakeholder views over time. Incorporating stakeholder engagements such as this, SAP has chosen to transparently report and track goals on eleven material sustainability indicators, a relevant, yet manageable number for our business.

Figure 1

2)      Radical Transparency and Real-time Engagement

Technology has completely changed the way businesses must interact with their stakeholders. Brand risk has risen significantly as the world gets more unwired and connected. There are now more wireless devices in the U.S. (>320 million) than there are people, more than 800 million active Facebook users, and over 1.1 trillion text messages sent in the U.S. alone. This allows nearly instantaneous feedback from stakeholders, both good and bad, to a large global audience.

SAP has addressed this issue by providing radical transparency and real-time engagement around our sustainability report. We have chosen to publicly provide a green arrow/red arrow dashboard around our material indicators (Figure 2) and devote 1/3 of each page to real-time stakeholder comment.

Figure 2

As one speaker at the WRI value chain launch in NYC noted, customers have a much greater trust in businesses that are transparent in their disclosures. There is a strong sense in this age of connectivity that even if one customer doesn’t independently confirm the information provided, someone has likely reviewed it.

This is not only becoming a best-practice in the corporate world, but in government as well. The American Recovery and Reinvestment Act of 2009 required creation of a website “to foster greater accountability and transparency in the use of funds made available in this Act.” This site includes not only a massive repository of data to prevent fraud, waste, and abuse – it also allows users to analyze the data on spending and jobs across 15 different categories at the state, congressional, county, or even city level through Recovery Explorer, including providing this transparency on a platform where users are increasingly likely to consume it – as free apps for the iPhone and iPad.

3)      Turning Data into Business-Relevant, Actionable Information

Analytics applications, such as Recovery Explorer, allow users an unprecedented view into correlations between different data sets and the ability to identify trends that were previously unapparent. Last year SAP worked with the U.S. EPA to provide similar capabilities for the public around emissions data for the electricity sector through the Clean Energy Experience site [Figure 3]. These tools allow easy visualization and analysis of the data and allow identification of trends such as how technology improvements, corporate policy, and state policy affect emissions across different regions.

Figure 3

 

The key to creating value from sustainability data is the transition from data to business-relevant actionable information. For example, at SAP we load our carbon and energy data into analytics tools and are easily able to globally benchmark data centers, identify those that are underperforming, and introduce and track corrective actions. An increased focus on energy use and identification of these types of opportunities has provided us savings of approximately a quarter billion dollars from business-as-usual trends over the past four years.

Many global companies are not only using this data to improve their corporate bottom lines, but to identify new business opportunities for their customers. As a business process software company, our largest opportunity is through helping our customer base become more efficient within their operations. This is beginning to lead to a significant global impact. Other companies, such as GE (>$85B in ecomagination revenues over past five years), and Proctor & Gamble ($26.5B in sustainable innovation product revenues) have found material improvements to revenue from new customer opportunities as well.

“Next” Practices for a Business Strategy that is Sustainable: What Areas Remain to Explore?

1)      Correlation/Causation of Environmental, Social and Financial Performance

Additional data is becoming available every year that sustainable companies outperform the market. Recently the Carbon Disclosure Project and Bloomberg released data in the Global 500 Report that show companies on the CDP Leadership Indices significantly outperformed the index. (Figure 4)

Figure 4

This adds to data released by EPA a few years ago showing correlation around energy performance leaders in various sectors and stock price. There is also an interesting Wharton study around how employee satisfaction relates to improved market performance. The recent distinction of SAP as a “Bay Area Top Workplace provides some additional correlation for our own operations.

Reasonable questions remain around whether environmental and social performance is just strongly correlated to returns (i.e. well-managed companies manage energy use well, along with other material risks and opportunities) or whether it is a root cause of this performance (i.e. implementation of best and next practices leads to new business opportunities that would not have otherwise been identified). My personal view is the latter; however, more studies in this area are certainly needed.

2)      Holistic Look at Supply/Value Chain

Another area that leading companies are beginning to address is a much more holistic view of risk and opportunity across the supply chain. Many of the same factors relevant to corporate efforts apply in the broader value chain: managing business and reputational risk, increasing efficiencies to lower costs, and innovation around safer and more sustainable products that can lead to new revenue streams.

A number of companies have created supplier “codes of conduct” to manage expectations, either voluntarily or under pressure from investors. Regulatory efforts such as the European Commission’s REACH program around chemicals of concern has been a major business driver and managing recall concerns has more companies looking at full product and batch traceability in their supply chains. For “next” practices, SAP recently piloted the WRI/WBCSD value chain protocol and now has a more holistic view of carbon/energy use across our entire value chain.

There remain many challenges around a holistic view of value chains, from standardization of data/reporting to willingness to share potentially confidential business information with customers, and the potentially vast amounts of datapoints required from continuously evolving supplier and customer relationships. There are many organizations working to create consensus around multi-stakeholder engagements, such as The Sustainability Consortium, WRI/WBCSD, Sustainable Apparel Coalition , and Carbon Disclosure Project , however, there is still a great need for harmonization of this work around different industry sectors, inclusion of multiple impact factors (from human rights, to chemicals, to calculated impacts around embedded energy/climate effects, etc.), and minimizing impact on small business.

3)      Accounting for Non-Financial Indicators: Integrating Financial and Non-Financial Reporting

A final issue of vital importance to the “mainstreaming” of sustainability is the relationship between traditional financial and non-financial indicators, or “what belongs on the balance sheet?” Investor interest in the issue has increased immensely over the past decade with investors representing over $71 trillion requesting data through the Carbon Disclosure Project  and investors representing over $20 trillion calling for policy action to stimulate private-sector investment in climate change solutions.

SAP provides an online sustainability report that goes into significant depth around our sustainability performance based on the GRI Reporting Framework at the A+ level (including third-party financial auditor assurance of the data). We have also chosen to include sustainability data in our Annual Report as “non-financial key performance indicators” and to discuss these topics on financial analyst calls since our quarter-billion dollar savings is significant to our business. However, much work remains around accounting for non-financial indicators let alone exploration of moving towards a more integrated report.

There is a lot of interest in additional research and developing frameworks for this topic. The International Integrated Reporting Committee is moving forward with piloting an overall framework for integrated reporting. The Dow Chemical Company and the Nature Conservancy have announced a partnershipon developing valuation for “Eco-System Services”, and groups such as HIP Investor are moving forward with pilots on “Human Resource Valuation.”

Next Steps

Great work has been done in many of these areas and much hard work remains to be done as we continue our journey towards a more sustainable business and more sustainable economy. In-depth discussions around many of these next practices will take place at Wharton next Monday during “Redefining Value: The New Metrics of Sustainable Business” and I look forward to continuing our progress there.


Jim Sullivan brings over 19 years of experience to his role as Vice President, Sustainability Management & Strategy at SAP.

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24
October

The ‘Occupy’ movement and your investment portfolio

 

Ted Rechtshaffen, President & CEO of TriDelta Financial Partners, and a weekly columnist for The Globe & Mail, Canada’s National Newspaper, explores the connections between Occupy Wall Street… the Sustainability movement…. and possible investment strategies for Investment Portfolios.

Check out today’s article… http://www.theglobeandmail.com/globe-investor/personal-finance/ted-rechtshaffen/the-occupy-movement-and-your-investment-portfolio/article2210097/

 

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24
October

A Social Contract: The “We First” Solution to Brand – #occupywallstreet Collaboration

 

October 21, 2011—The #occupywallstreet movement cites a wide selection of grievances directed at a common target – corporate America. Unfair business practices and the resulting economic inequality have inspired thousands to take to the streets in hundreds of cities around the world. So how does corporate America respond? How do they at once acknowledge and answer these concerns while also discharging their responsibilities to shareholders and bottom lines? One simple answer is a reframing of the relations between those brands and their customers through a meaningful social contract.

Social contracts serve as an explicit articulation of the values-based agreement between brands and consumers to regulate the behavior of both parties as sustainable capitalism and shared prosperity is a mutual responsibility. With that in mind, here is the start of a Social Contract that can be customized by companies and crowdsourced among customers to reach an agreement that brands can use to start addressing the concerns of the #occuptwallstreet movement.

 


Sample Social Contract Between [insert Name of Your Brand] and Customers

We are seeking a new way of looking at the world we live in. We believe that a better future depends on the integration of profit and purpose. To that end, our company and its customers intend to become partners in social change to build a better world. This partnership is guided by this social contract between us. We agree that the following principles will direct our behavior and the relationship between us:

.    We believe companies have a right to innovation, entrepreneurship and profit-making while citizens and our consumers have a right to a healthy society and planet for living.

.    We recognize an interdependent, global community requires an expanded definition of self-interest that acknowledges the needs of all inhabitants of the planet.

.    We define success through prosperity, which means the well-being of many, not the wealth of a few.

.    We believe that future of profit is purpose. We will commit ourselves to working with our customers to create meaningful results that impact the world in positive ways.

.    We believe that the interests of companies and consumers are best served through the sustainable practice of capitalism — economically, morally, ethically, environmentally, and socially.

.    We believe that corporations and consumers owe each other an equal duty of transparent, authentic, and accountable communication.

.    We believe that social technology, business, and shopping have the potential to change our world through new modes of engagement, collaboration, and contribution.

.    We believe in the following values for our daily practice of capitalism: sustainability, fairness of rewards, fiscal responsibility, accountability, purposefulness, engagement, and global citizenship.

.    We believe that corporations and consumers are duty-bound to serve as custodians of global well-being for this and all future generations.

.    We believe that the private sector must cooperate, collaborate and coordinate with governments and NGOs to create a unified force for social good.


Simon Mainwaring is the founder of We First, a social branding consultancy that helps companies, non-profits and consumer groups build a better world through changes to the practice of capitalism, branding, and consumerism using social technology

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24
October

Ben and Jerry’s Takes Bold Stand with Occupy Wall Street

 

October 21, 2011—The Occupy Wall Street movement drew its first corporate statement of support this week from Vermont-based ice cream company Ben and Jerry’s, which posted a statement of “solidarity” on its web site.

Ben and Jerry’s is owned by the international corporation Unilever, and some believe the company risks being labeled a hypocrite for supporting a protest movement that, while lacking a singular message, criticizes the financial system for favoring corporate entities and their handlers over the other “99 percent” of the population.

However, both Ben and Jerry’s and Unilever have track records that support the stance. As Ben and Jerry’s notes in its message, the company pays living wages to its employees, directly supports family farms and is working to source fairly traded ingredients for all of its products. As reported earlier this week, Unilever is one of a handful of large corporations that deserves its reputation as a sustainability leader for continually addressing not only the low hanging fruit, but also the difficult systemic problems that must be overcome in order to provide for the planet’s increasing population and preserve natural resources.

“We know that words are relatively easy but we wanted to act quickly to demonstrate our support,” writes Ben and Jerry’s Board of Directors.

“We know the media will either ignore you or frame the issue as to who may be getting pepper sprayed rather than addressing the despair and hardships borne by so many, or accurately conveying what this movement is about. All this goes on while corporate profits continue to soar and millionaires whine about paying a bit more in taxes. And we have not even mentioned the environment,” they add.

It will be interesting to see what other brands have the courage to face the scrutiny demanded by such a statement. My sense is that only those who know they are doing all they can to achieve sustainability will dare to raise their heads up at this moment.

Bart King is a PR consultant and principal at Cleantech Communications

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13
October

Virgin Atlantic Plans to Use Jet Fuel Made From Waste Gas

 

October 11, 2011—Virgin Atlantic Airways announced that within three years it will power commercial flights with a low-carbon aviation fuel made from recycled waste gas. Partnering company LanzaTech will produce the fuel by capturing waste gases from industrial steel production and converting it into jet fuel through a fermentation technology developed by Swedish Biofuels.

Virgin Atlantic says the resulting fuel will have half the carbon footprint of standard jet fuel. Furthermore, the waste gases would otherwise be burned off at the point of production, releasing carbon dioxide, if not converted into jet fuel.

Currently the technology is being piloted in New Zealand. However, Virgin Atlantic intends to use the fuel on flights from Shanghai and Delhi to London Heathrow to take advantage of production facilities planned in China and India. A demonstration facility will be commissioned in Shanghai this year, and the first commercial operation is expected to be in place in China by 2014.

If implementation is successful, a wider rollout could include operations in the UK and the rest of the world, the airline says.

LanzaTech estimates that its process can apply to 65 percent of the world’s steel mills, which would overcome the complex land use issues associated with some earlier generation biofuels.

LanzaTech also believes the conversion process can be applied to metals processing and chemical industries, growing its potential considerably further.

“With oil running out, it is important that new fuel solutions are sustainable, and with the steel industry alone able to deliver over 15 billion gallons of jet fuel annually, the potential is very exciting,” says Virgin Atlantic President Richard Branson. “This new technology is scalable, sustainable and can be commercially produced at a cost comparable to conventional jet fuel.”

Virgin Atlantic will be the first airline to use this fuel and will work with LanzaTech, Boeing and Swedish Biofuels towards achieving the technical approval required for using new fuel types in commercial aircraft. A ‘demo’ flight with the new fuel is planned in 12-18 months.

Virgin Atlantic says the new fuel will take the airline well beyond its pledge of a 30% carbon reduction per passenger-kilometer by 2020.

Article written by Bart King for Sustainable Life Media

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12
October

Future Consumers in a Sustainable World

We can be sure of one thing about the future: it will be radically different from today. The global recession shows how quickly things can change – and we face much greater challenges to our economy and way of life, such as scarcity of key resources, rapid population growth, climate change and loss of biodiversity. These problems of sustainability affect our consumers and suppliers around the globe and are putting ever-increasing pressure on our business models. They make it essential for us to reorient our global economy around sustainable, low-carbon patterns of consumption.

Over the next 10 years we can expect major changes to the consumer retail sector. Demand for basic resources such as oil, water and staple crops is likely to increase and prices will rise. Consumers’ behaviour and expectations will change: we expect growing demand for manufacturers and retailers to operate responsibly and to demonstrate this through transparent value chains. Successful brands will need toinnovate to meet challenges like these, develop sustainable products, services and business models, and work with consumers to make them a success.

This represents a huge opportunity for forward-thinking brands to position themselves at the heart of the new, green economy, evolving the market to meet consumer needs in different, sustainable ways. Many brands have built a trusted relationship with millions of consumers, andwith it brand loyalty, which can last a lifetime. We believe this gives them both the power and the responsibility to help people lead better, more sustainable lives. In fact, it’s hard to see sustainable consumption becoming mainstream unless brands take the lead.

Businesses and brands should start taking action now to prepare for a rapidly changing economic, environmental and social climate.

Here are our five key recommendations:

1. Take innovative business models to market

In all of our scenarios, brands and businesses have evolved and adapted their new business models to address challenges such as resource scarcity, changing consumer demands and the need to build resilience into value chains threatened by the accelerating impacts of climate change. Companies should be ready to innovate and to develop, trial and learn from experimenting with new, sustainable business models. The companies that do this today will be the ones profiting tomorrow.

2. Work with your value chain to find new solutions

Manufacturers and retailers operate in a complex system, and the challenges of shifting to sustainable consumption are too great for any organisation on its own. Companies should collaborate across their value chain, incentivising farmers, suppliers, designers, producers, retailers and others to work with them to find innovative solutions to bringing goods and services to market.

3. Strengthen local brands and local production

There is no guarantee that global brands will continue to win the hearts and minds of consumers. In two of our scenarios, communities have built up resilient systems to source the products and services they need. Brands that embrace and boost local production and have a local authentic story will resonate with consumers.

4. Build up long-term trust through transparency

Consumers can find information on the origins of products and services more easily than ever before thanks to social media and advances in information and communication technology (ICT), and this trend is likely to continue. Companies are unable to keep environmental or social skeletons in their closets in any of our scenarios. In this world, ‘green’ and ‘ethical’ are no longer niche, and robust standards on environmental and social performance are mainstreamed into everyday products and services.

Companies should prepare for a world where society demands absolute transparency from brands. Businesses which open up their value chains for scrutiny now will earn the most trust from consumers.

5. Use the power of marketing to accelerate sustainability

Don’t wait for consumers to demand more sustainable products and services. Savvy brands will make money by accelerating the transition to a more sustainable world. Companies should use their marketing, communications and innovation skills to create consumer demand for sustainable and profitable products and services. Brands need to understand possible future consumer needs better and to positively influence the things that consumers buy and how they use and dispose of them.

Exerpt of Summary Findings from the Consumer Futures 2010 Report, published in 2011 by “Forum for the Future” – action for a sustainable world.

To find out more and download the Consumer

Futures toolkit go to: http://www.forumforthefuture.org/project/consumer-futures/overview

 

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12
October

India launches “world’s cheapest” tablet computer

October 5, 2011 – New Delhi

(Reuters) – India launched what it dubbed the world’s cheapest tablet computer Wednesday, to be sold to students at the subsidized price of $35 and later in shops for about $60.

Most of India’s 1.2 billion people are poor and products such as Apple Inc’s  iPad are beyond the reach even of many in the fast-growing middle class.

“The rich have access to the digital world, the poor and ordinary have been  excluded. Aakash will end that digital divide,” Telecoms and Education Minister Kapil Sibal said. The government is buying the first units of the lightweight touch-screen  device, called Aakash, or “sky” in Hindi, for $50 each from a British company which is assembling the web-enabled devices in India.

A pilot run of 100,000 units will be given to students for free, with the first 500 handed out at the launch to a mixed response. It supports video  conferencing, has two USB ports and a three-hour battery life but some users said it was slow.

India has a reputation for creating affordable products that are easy to use and sturdy enough to handle its rugged environment — from Tata Motors’ $2,000 Nano car to generic versions of pharmaceuticals.

Two years in development, the paperback book-sized Aakash may help the government’s goal of incorporating information technology in education, although  critics were doubtful of its mass appeal.

Despite being a leader in software and IT services, India trails fellow BRIC  nations Brazil, Russia and China in the drive to get the masses connected to the Internet and mobile phones, a report by risk analysis firm Maplecroft said this year.

The number of Internet users grew 15-fold between 2000 and 2010 in India, according to another recent report. Still, just 8 percent of Indians have access. That compares with nearly 40 percent in China.

The Aakash is aimed at university students for digital learning via a government platform that distributes electronic books and courses.

Testing included running video for two hours in temperatures of 48 degrees Celsius (118 degrees Fahrenheit) to mimic a northern Indian summer, said  DataWind, the small London-based company that developed the tablet with the Indian Institute of Technology.

Rajat Agrawal, executive editor of gadget reviewers BGR India, said the 660 mhz processor from U.S. company Conexant Systems was “decent” for the price, but warned the machine seemed slow and the touch screen not very agile. “Because of the price there is a lot of excitement,” he said. “People might use it initially but if it is not user friendly they will give up within a week.”

After first giving them out for free, the government aims to sell them to students for $35 next year. A retail version will be sold in Indian shops for about $60.

The device uses resistive LCD displays rather than a full touch screen and connects via wireless broadband. DataWind CEO Suneet Singh said future versions would include a mobile phone connection, making it more useful in rural areas.

The launch last week of Amazon’s Kindle Fire shook up the global tablet market, with its $199 price tag and slick browser a serious threat to Apple’s iPad.

Like the Kindle Fire, the Aakash uses the Google Android operating system.

Some of the mainly middle-class technology department students at the event said it needed refinement but was a good option for the poor.”It could be better,” said Nikant Vohra, an electrical engineering student. “If you see it from the price only, it’s okay, but we have laptops and have used iPads, so we know the difference.”

Some 19 million people subscribe to mobile phones every month, making India the world’s fastest growing market, but most are from the wealthier segment of the population in towns.

 

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10
October

Business in a post-green world

A few months ago, Joel Makower of GreenBiz wrote an eye-opening article. He observed that with few exceptions, green brands had failed to capture more than a sliver of their markets. The piece was thought-provoking, with a clarion call to rethink the way we position brands with strong sustainability credentials.

The subject deserves more analysis than an 800 word story can provide. Soinstead, I’ll touch on a few reasons behind consumer rejection of ‘green marketing as we know it’, and offer some thoughts on how we could build moreresilient, successful green brands in the future.

Six good reasons to reject green :

In 2011, OgilvyEarth released a study titled Mainstream Green. The research revealed that 82% of North American consumers had ‘good green intentions’, but only 16% acted on those intentions. Why? (http://www.ogilvyearth.com/thought-leadership/latest-research/) They feel guilty.

Using green products implied making sacrifices in things like efficacy and price. Buy a green cleaner, for example, and you feel bad about perhaps leaving the counters not-quite-so-clean.

It isn’t easy being green. Green = celebrity wannabe or crunchy granola hippie. Regardless of the moniker, making green choices means being labeled by your mainstream friends.

Green is the new pink. Half the population is male, and they think green is girly. Sure, green products used to tip the scales much more toward feminine (organics and spa products, for example). But today, green is energy, cars and lumber. Unfortunately, old impressions die hard.

Green costs. In some cases, it does cost more to make something green. But in a lot of cases it doesn’t. But similar to green being called ‘girly’, old perceptions die hard.

Green is confusing. When I got into green business, nobody could agree what the movement should be called: green, CSR, sustainable, and the list goes on. Sustainability may be a complicated, systemic issue, but our tendency to overcomplicate things like green certifications does the movement no favors.

Green suspicion. Why do more people buy Clorox Greenworks over Seventh Generation? Because they trust Clorox to get the job done. Mainstream consumers have a soft spot for mainstream companies. These are the companies who need to engage on the brand level.

Those are just a few of the reasons cited by OgilvyEarth for mainstream consumer reticence toward green. But is there a solution?

Futureproof brands

I believe we have to stop thinking about sustainability, and start thinking about futureproof brands.

Futureproof brands are brands that are resilient, that can thrive in a chaotic world. They’re brands that can weather storms created by sustainability issues (diminishing resources and punitive environmental legislation, for example). But they are also built for a world of cultural mashups, and a rapidly morphing communications landscape.

The following five pillars of futureproof brands may help us rethink our perspective on green for the mainstream.

Sustainability. Sustainability does make business sense. Unfortunately, as we see above, mainstream America isn’t buying it.
Smart brands like Nike believe the solution is to incorporate sustainability into every business decision, but not into the brand. That way, the promise of athletic performance is never diluted, but the company is positioned to perform more efficiently and sustainably.

Innovation. Many companies are ill-equipped to produce a steady stream of innovation. Most approach it haphazardly…a few pet projects in the pipeline, and little to no system for creating a steady stream of new products, services and business models. For a brand to be futureproof, it must have an innovation plan that not only encompasses short term cosmetic changes, but longer term shifts that will line up with consumer needs 5, 10, 20 years from now.

Design. More than ever before, cultures are mixing and ethnic groups intermingling. English is not the de facto first language, America is not the sole generator of popular culture, and ideas do not flow in one direction from developed to developing markets.

In this cultural cacophony, what do all of us understand? Design.

Good design creates a visceral reaction in people. It conveys beauty while aiding function. It generates feelings of wonder and drives desire.
Is your product well designed? Give it to a child or to someone who doesn’t speak your language, and see if they can understand how to use it. Even better, see if using it puts a smile on their face.

Perennial insights. Great brands are driven by great consumer insights.
It pays to hold up your key insights to scrutiny, and brainstorm on their relevance in the future. At worst, this exercise might provide you with the alarming news that people won’t need your product forever. At best, it will get you thinking with broader scope, and answering briefs that allow far greater innovation.

Social Interaction. I cut my teeth in an advertising world where brands were displayed in metaphoric show windows – consumers were only allowed to see them in their best light, and there was no interaction allowed. Today, brands, and companies, are like fishbowls. Consumers can look at them from every angle, even stick their hand in and slosh around the water. There are no boundaries.
We all tend to think of social interaction as synonymous with social media. As a new technology. That’s missing the point.  The point is, people are getting involved. Communication is a two way street. We’re not creating communication campaigns, but movements. Can your brand
embrace that?

And Your Brand?

Is your business ready for a post green world?  Here’s a good place to start looking for the answer.

I call it getting outside the jar.
Once you’ve been at a company for more than 6 months, or working on a problem for more than that time, you’re inside the jar. The world looks normal, but you can’t see the most obvious things. Like the writing on the label.

The result?

You end up going along the same old path, with the same old results

That won’t work if you’re trying to find your way in the post-green world.
Because we need new ideas. So I would challenge you to find someone, or a team of people, who can help you think outside the jar about where your company is going.  Get these people to study your company, or brand. And get their candid opinions on where it’s is going.  95% of what they say may not be relevant or useful. But I can guarantee you it will be surprising. And a few of their points may start your brand down the right path to future success.

Marc Stoiber is a creative director, entrepreneur, green brand specialist and writer. He works with clients to build resilient, futureproof brands.

 

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7
October

New Resource Bank’s Sustainability Scorecard Quantifies Customers’ Commitment and Progress

October 3, 2011

New Resource Bank has a radical (for a bank) proposition: attract values-aligned deposits and use those funds to
make loans exclusively to improve sustainability. The challenge: How do we measure borrower sustainability? And where do we draw the line between who qualifies and who doesn’t? A related concern for us is maximizing our impact—we don’t want to be merely “preaching to the choir.”

We’ve addressed the challenge by developing a client sustainability assessment (try out the bank’s free sustainability scorecard – https://www.newresourcebank.com/ ) and using the score on that assessment to place our customers on a sustainability continuum.
We decided that the minimum standard we require is a genuine commitment to managing and operating more sustainably. That meant we needed to measure not just initial sustainability, but also progress over time.

The bank started testing the assessment tool in July 2010. After working with a trial group of existing customers for several months, the assessment team revised the tool based on that group’s responses and suggestions. All new commercial lending customers began taking the assessment in November 2010; existing customers participate when their loans are renewed.

Here’s how the process works: Every prospective client completes the New Resource Bank ClientSustainability Assessment, which asks a total of 42 questions about their practices related to :

  • General Sustainability,
  • Waste Management and Pollution Prevention,
  • Energy and Water Conservation,
  • Community Involvement, and
  • Employee Practices

Points are awarded based on how advanced the company’s practices are.

We then use the summary scores to sort our clients into four levels of sustainability:

  1. Learner
  2. Achiever
  3. Leader and
  4. Champion

Within those levels, clients fall into Silver and Gold rankings. Clients receive a toolkit based on their assessment that provides resources,
suggestions, and initiatives that can help them improve their sustainability. The bank’s goal is to have customers advance to the next level—or higher—with each successive assessment. We will re-assess existing customers annually to track the impact we are having and evaluate the trends across our market segments. The initial round of reassessments will happen at the end of 2011.

To date, 50 New Resource clients have completed the assessment. NRB has:

  • 1 Silver Learner (2% of total)
  • 20 Gold Learners (40%)
  • 15 Silver Achievers (30%)
  • 8 Gold Achievers (16%)
  • 6 Silver Leaders (12%)
  • No Gold Leaders – yet
  • No Champions – yet

Once the bank has a large enough pool of participants, they plan to use the collected information to compare markets, sector by sector, to determine whether certain types of businesses are scoring higher than others on the sustainability scale and what their challenges are.
We could then use that information to devise industry-specific solutions –possibly in clean-technology, water management or health care.

As a bank, their goal is to ensure that depositors’ money is invested in companies, projects and organizations committed to
sustainability.

As a trusted advisor, NRB’s mission is to help businesses unlock the economic value of sustainability.
By aggregating the individual data we collect, the assessment provides a means to evaluate both of these objectives.

TRY NRB’S SUSTAINABILITY ASSESSMENT

New Resource clients take the assessment by using an interactive online tool that quantifiesthe results automatically and sends the score directly to the clients’ loan officers. The assessment is available for anyone to view on our website, sothat our stakeholders can see for themselves how we are evaluating our loan portfolio. http://newresourcebank.com

Article written by Bill Peterson, NRB for Sustainable Life Media

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7
October

Increasing Well-Being To Build Your Brand and Competitive Advantage

A new vision of what it means to be prosperous and to flourish as individuals and societies is taking hold in parts of the business world. It’s inspired by the coming together of disparate disciplines including:

  • Positive psychology
  • Welfare economics
  • Hedonomics
  • Neuroscience
  • Marketing

For a long time there have been counter-intuitive signs leading Nobel prize winners like Amartya Sen, Jospeh Stigliz and Dan Kahneman, to question the meaning of prosperity.

Since Robert Kennedy’s 1968 speech questioning GNP as a measure, evidence such as the Happy Planet Index and Genuine Progress Indicator (now being used by the State of Maryland), are helping challenge assumptions about the link between wealth, growth and well-being and prosperity. These indicators show for instance, that despite continuing exponential economic growth since the 1970s, in the rich world, life-satisfaction has flat-lined.

Work by academics and think tanks shows that, above a level of income we have all in the rich world long since achieved, only 7% of our well-being comes from income. The key things which increase well-being are:

  • connection to friends, family and community
  • giving back and volunteering
  • being physically active
  • having life goals and continuing to learn
  • taking notice and being engaged

These are what the New Economics Foundation think tank calls the “five ways to well-being,” and they are now becoming central to UK Government policy.
Combined with this is the increasing realization for many that we are living off the capital and the interest of planet earth and are at or near the limits of safety in terms of the pressure of the macro-economy on the planet. A consensus is building that continued growth of the macro-economy risks pushing us into unstoppable climate change and the peaking of many of the finite resources our way of life depend on. Other evidence is emerging from economics work by Professors Tim Jackson and Peter Victor suggesting we do not actually need growth to deliver the kinds of things we expect from a successful economy. Others are showing that in fact we may indeed be at the end of growth, whether we like it or not.

As a result of these forces, a new economics is emerging that questions the meaning of prosperity and posits that instead of focusing on growing wealth we ought instead to focus on growing well-being. Such thinking comes at a time when a significant segment of society (those sometimes described as “Cultural Creatives”, an estimated 33% of the U.S. population), are once again tuning in to Thoreau’s thinking in Walden that a person “is rich in proportion to the number of things they can do without.”

Politicians, interestingly many from the new right, are tuning in to these new cultural norms and framing their new politics in terms of well-being and community rather than wealth and individualism. President Sarkozy of France asked Joseph Stiglitz to lead a policy review on these issues and, U.K. Prime Minister David Cameron after his own review has set his Office of National Statistics upon the task of measuring and developing policy around well-being.

As well as numerous speeches on the subject of well-being, Cameron recently called on business “to work on improving quality of life and well-being.” These signals from governments, as well as pressures from NGOs and think tanks and these shifting societal norms are putting pressure on companies to develop more authentic, post-consumerist businesses which place well-being at their hearts.

Brands like Coca-Cola have long flirted with the language of happiness. Others like IKEA, Nesquik, Dunkin Donuts and BMW have also more recently started tuning their brands into “happiness.” There has been little indication until now that companies are really trying to understand the complexity and richness of the research on well-being, flourishing, positive psychology and welfare economics. But things seem to be changing.

Recently a client of mine and one of the UK’s leading CEOs, Ian Cheshire of Kingfisher B&Q (seeking to be the world’s largest home improvement retailer), spoke about the need for a new capitalism which prioritizes well-being over growth. Cheshire is just one of a number of CEOs in the UK and elsewhere who are working hard behind the scenes to understand how they can evolve their business models so that their products, services and brands support maximum flourishing for their customers, workers and society at large.

Companies from SSE (formerly Scottish and Southern Energy) to Virgin (too many businesses to list) are experimenting in mapping aspects of well-being against their products, services, and brand attributes, and considering how research into happiness — for example, studies that spending money on experiences makes people happier than buying material objects — could (and should) alter their strategies.

The holy grail for these companies has become the “well-being dividend” where sustainability efforts can be shown to increase rather than damage customer and societal quality of life and well-being. In its Sustainable Living Plan, for example, consumer-products conglomerate Unilever committed to “improve the well-being of one million people.” Having made that promise, the company must now work out what it must do to deliver on it.

The movement seems poised for the next step: turning theory into practice through experimentation and innovation.

* This article was adapted from Jules Peck’s Harvard Business Review’s blog published on Sept. 19, 2011

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