Page 53 – Sustainability Academy

Aggressive capitalism without rules and ethics is a system that threatens society on a global scale. There is no doubt that empires and countries are collapsing like a pile of cards, such as Greece and Europe which will most probably be prime historical examples as the end of capitalism as we know it!

Positively aggressive capitalism, being an economy that benefits through the sole purpose of profit has reached its slow end! It has gradually reached a “balanced” form of the old one; it has essentially reforming into a “new moral capitalism”. This capitalism’s foundation is built upon the principles of sustainable development being economic efficiency, environmental protection and social cohesion.

In this form of capitalism, emphasis should be placed upon the “pragmatic economy” or what is called the economy of companies that produce real value, invest in innovative societies and the environment. Respectively, emphasis should also be placed upon rationalizing the public sector combined with the political system and corruption, as what we are currently living is a result of years of irrationality, and our children and future generations will be paying the price.

The fact is that liberalism predominantly through aggressive capitalism did not self-regulate, as many perhaps thought it would! Thus, this inevitably led to greed and accumulating wealth and large inequalities between those who gained major profits and those who resulted into substantial losses. In retrospect to the “pragmatic economy”, productivity, effective regulation of financial market and to the exemplary punishment of the few whose greed created a series of problems, it is clear to see that many are not to blame. In turn this shows that government intervention is in need of measurement and balance to deal with the issue of corruption! Governments should be able to set sufficient and effective rules in collaboration with relevant bodies, on an international level, to create normality and a sustainable development.

Besides governments, it is time for all companies to contribute to a sustainable development by pursuing their Social and Environmental Responsibility and earning the trust of their customers, employees and society in general. It is time for companies to invest in materiality and not in marketing moves, such as investing 90% of their CSR budget programs in communication companies. Moreover, today more than ever the accountability of any business, as well as our whole country, is judged by what is actually done, not on what is said!

In particular for the banking sector, I would suggest for them to go beyond sponsorship and donations which is thought to cure CSR and “common good” aims, but to start engaging and committing towards effective customer service and most importantly evaluating with new criteria indebted families and SMEs. This alteration would help prevent damaging both themselves and society as a whole from subsequent consequences, such as bankruptcy. Therefore, banks should implement consistently the principles of responsible lending and avoid those who contributed to the negative consequences we are currently facing. Moral Capitalism is already here even though most of us do not understand it yet.

Corporate Social Responsibility (CSR) is a business management tool for organizations, especially in times where the importance of branding and reputation play an important role in their operation, such as during periods of economic recession. In recent years, the economic crisis has created a volatile business environment, where the business risk is great and the image of every company is influenced by the perception of its stakeholders. Organizations while aiming to increase their profitability are expected to reduce or even eliminate their CSR activities; however many of them try to use these effects to their advantage and to reduce their business risks.

An important factor in the decision making of companies is their customers, the consumers as members of society. Companies which have used CSR merely as a promotional “trick” have lost their consumer’s trust, and have furthermore created a stream of frustrated and suspicious consumers, unable to trust companies and their offered products. The only reliable tool that has the potential to enhance or recover the lost consumer confidence is the effort of the company towards society through CSR activities and initiatives. The question rising is whether CSR should be treated as an additional cost for companies or as an investment with measurable results, an antidote to the economic downturn.
Why should businesses then invest on CSR activities? In a few words, through CSR businesses are given the opportunity to:

Reduce cost and risk
Gain competitive advantage
Creation of corporate reputation and legitimacy
Find profitable partnerships through value creating relationships
Promote innovation outside and inside the company
Increase accountability and transparency for stakeholder engagement

Moreover the economic crisis revealed the importance of effective long term decision making to manage risk. Therefore CSR as a long term strategy can play significant role in managing risk in this recession period. Also CSR actions can be delivered even with reduced budgets as their application can create opportunities in reduction for example energy and stationery costs rather than cost creation.

There are numerous examples of companies which have enhanced their environmental and economic performance though implementing CSR. From Nike to Boots and big retails such as Tesco and Sainsbury’s to small companies are investing in numerous CSR actions from merely environmental (renewable energy, carbon footprint) to societal (fundraising, employee volunteering) actions with positive effects in their economic performance.

A significant example of seeing CSR as investment is Sainsbury’s which has installed 69,500 new photovoltaic solar panels, or 16 MW of power, across 169 stores in the UK. The solar power will reduce Sainsbury’s total CO₂ emissions by an estimated 6,800 tonnes per year, and each store’s energy consumption as well as delivering energy cost savings.

Finally CSR seems to be a powerful tool in enhancing business strategy and create innovation in this period of economic crisis. For these reasons it can be seen as an opportunity for long term economic and business development.

The 2012 London Olympics received a great visibility boost when they announced back in 2009 that they would be zero waste. But what does zero waste mean? Simply, all the waste would be used anew as a resource, either as a fuel or as raw material for new products. Although easy to conceive, it has proven to be trickier a task than imagined. According to a new report by the World Wildlife Fund (WWF) and BioRegional, the waste and carbon generated was more than expected.

The Olympic Delivery Authority’s goals included “recycling and reusing 90% of waste, delivering more than half the materials needed by sustainable transport, using natural remediation methods to clean soil, barges to take away segregated waste through newly dredged waterways and using only legal and sustainable timber sourced through a supplier panel”, as Sir John Armitt, ODA chair states. Some targets were exceeded forming success stories, while others were not met. Some claim that a great effort was made, others that the case was no gold metal. But what do the facts say?

80% of all contaminated soils were cleaned on-site and reused, saving £68 million
98.5% of demolition material was either reused or recycled, diverting at least 412.000 tons of waste from landfill
100% of the timber used on-site was certified as legal and sustainable
530m³ of rainwater harvested from the velodrome roof will be used each year to flush toilets and irrigation
2.000 tons of waste were removed from the Olympic park by barge
3.200 tons of carbon will be saved each year by using a 3.3 MW gas-fired combined cooling, heating and power engine and a 3MW biomass boiler to generate heat and power
60.000 of silt, gravel and rubble, as well as tyres, shopping trolleys, timber and an entire car were removed from the waterways on the site.
178 bird habitats and 66 bat habitats have been created on the park’s bridges with 635 nest and bat boxes installed throughout the site.
170.000 tons of recycled and secondary aggregate were used in concrete mixes, saving 30.000 tons of embodied carbon and eliminating more than 70.000 lorry movements

Gold metal or not, certainly the London Olympics attempted something that has no Games has attempted before. One can only hope that this pioneering initiative will be followed to the Olympics to come, and who knows. Maybe on the Rio 2016 Olympics we will be discussing about a low-carbon Olympic torch after all.

Have you ever wondered what the link is between sustainability and investors? Your answer can be found in the findings of the resent report Sustainable Extraction?, analyzing the SEC disclosure by major oil & gas companies on climate risk and deepwater drilling risk. Findings showed that even the 10 top oil and gas companies are not providing high quality reporting of the risks it faces from deepwater drilling or climate change, and how they’re managing these risks.

Why is this Worrying?

Investors deserve more disclosure in order to invest in such risky sectors! Why? The social and environmental risks associated with extracting and transporting these fuels are numerous and significant and investors also need to protect their own reputation.

How Does This Affect Your Company?

This report is a wakeup for all investors as quoted from New York State Comptroller Thomas P. DiNapoli, this means CSR is growing in investors’ minds and agendas. If your company is not acting responsibly you might find yourself being an unattractive target to investors as they will protect their own reputation over yours.

If you want to learn more about what you can do regarding your attractiveness towards future investors as the business case for sustainability, take a look at CSE’s “Certified training”

So, you have a sustainability strategy. Great first step. But you do not know how to communicate it. You want something innovative, fresh and interactive? Scan it! QR Codes can be an important tool to promote your sustainability strategy.

The real key behind QR codes is to think creatively when you review your printed communications and then decide how you can transform this to an interactive and attractive web page. Through a QR Code you can provide immediate access to concise information in a user friendly way. What better way to promote your sustainability strategy?

Imagine your product on the shelf, and every consumer having the opportunity to see what you do in terms of your sustainability strategy, simply by pressing a button on their smartphone. Not sure this will reach many people? Numbers might convince you otherwise. IDC say 144.9 million smartphones were sold worldwide in Q1 2012, while total 2011 sales were 491.4 million units.

Imagine the countless possibilities. You can use it to engage your stakeholders and inform them for your sustainability report; engage with consumers, while communicating your product’s sustainability features, such as its water/carbon footprint; use it to promote your sustainability related campaigns.

If you need more information on how to use a QR code for sustainability, check out our new service

Every company understands differently the meaning of Corporate Social Responsibility. However, CSR encompasses four basic elements: The company behavior towards its employees, the market, the society and the environment. In a sense, companies through CSE do nothing more but to return a part of their revenue to society and the environment they operate into. As companies are a part of society, they derive from it all the capital necessary for their operation, either human or environmental. Some companies decide to develop a code of conduct, in which they analyze a set of actions towards the society and the environment. Others take voluntary action in aid of the environment, society or sensitive social groups.

But there are various fields in which a company can encompass Corporate Social Responsibility. Below are some tips for what could companies do to move towards that path.

Working conditions:

Manage effectively its human resources, through equal opportunities and trainings
Manage effectively its human resources, through equal opportunities and trainings
Offer social insurance programs
Renovate sanitary facilities and always keep them clean

Market:

Protect the consumer
Rational pricing of the offered products and services
Ensure product quality and safety

Society:

Support cultural and sports events
Support NGO’s
Support socially sensitive groups
Support education

Corporate Ethics:

Anti-corruption measures
Active participation of all board member in the decision making process

Environment:

Reduce waste
Recycle
Reduce energy consumption
Environmental friendly investments

If you want to learn more about what you can do to build a CSR strategy for your organization, please visit our website

There is a great need for dialogue between businesses and civil society, in order to restore the destroying effects of the economic and social crisis, and the wounded consumer trust towards businesses. This was the most important finding of the CSR 2012 survey on “Corporate Social Responsibility and responsible consumption”. It was indicated that the percentage of consumers choosing to reward socially and environmentally responsible business this year has declined to 27.1%, a decrease of 11.9% compared with last years’ results, and returning to 2008 levels. On the other hand, the percentage of consumers choosing to punish socially and environmentally irresponsible business remains to the high levels of 37.6%, with only a slight tendency to decline compared to the last measurement (-5.6%).

But how can businesses restore this lost trust? Can Corporate Social Responsibility offer the tools needed towards this end?

CSE can help you answers these questions and offer you the tools needed to form a solid business case for your organization and regain consumer trust. Join our next Certified Sustainability (CSR)Practitioner training in Brussels 11&12 October to find out how!

Although up until now people have been forced into a behavioral change, time has proven this method inefficient. And though progress has been made in the field of sustainability, there is still a long path to walk upon. How innovative can one be in order to accelerate sustainability?

To answer this question, a second one is posed: Would you rather pay a carbon tax or play a carbon game that incentivizes you to reduce your emissions? Yes, sustainability is moving towards its “gamification”, a game-motive which calls upon people to promote sustainability in their everyday life. In the world of games, people tend to create a “perfect world”, one they feel proud of. By bringing the game into life, people are asked to change their lifestyle, socialize and promote the idea of sustainability; lead the world to a change.

Sustainability Brands mentions: “Developed in conjunction with Guerillapps, the game features Farmville-esque slick graphics and addictive gameplay. Most importantly, it bridges the gap between the digital and physical world by connecting with TerraCycle’s real-life recycling and charitable programs. The results are impressive.”

The trend has also entered the world of enterprises, with enterprise gamification which is focused on organizations and employees. Susan Hunt Stevens, CEO and Founder of Practically Green, has already developed “a gamification platform for helping companies optimize their sustainability programs. Practically Green’s engaging web and mobile interface employs game mechanics such as leaderboards and badges to challenge people to form groups, take green actions and measure their environmental impact at work.”

The concept of sustainable development in terms of the lean and prudent use of energy resources of the Earth is initially embedded in daily business practice as a cost reduction strategy. The likelihood of an unexpected climate destabilization, has mobilized citizens who step up their efforts to direct formation of ecological consciousness and compliance. Companies on the other hand, as associations of economic power tend to endorse political power and to adopt environmental criteria to bring the idea of sustainable development into practice.

The idea of corporate policy of sustainable development through sound energy management can be incorporated at corporate-level, product-level and store-level infrastructure of the organization itself. In terms of main infrastructure, green stores aim to continuously reduce the environmental impacts of operation of these interventions by saving energy and natural resources as well as by adopting efficient waste and energy management systems.

Specifically, at a first level an energy-responsible store identifies its carbon footprint, ie the rate of carbon dioxide emitted during its operation, and lists in detail its intensive sources of energy. On a second level, based on this mapping, the organization in interest has the opportunity to develop a plan to reduce emissions by replacing them with efficient energy sources to create a more energy-responsible infrastructure. Optionally the organization may proceed to a more advanced plan, by offsetting through an internationally accredited organization. The compensation covers a deposit corresponding to the carbon originating from the operation of the infrastructure and is invested in projects and research on renewable energy.

Daily “eco-friendly practice” is not only a social service but a potentially innovative business strategy as an energy efficient store does not increase operating costs but rather limits them. A good strategic communication for the company’s profile is also recommended because of the increasing market demand for green development. Consumers today recognize green entrepreneurship as a basic condition for sustainable development, before the threat of ecological collapse of the planet from polluting human activities and global warming.

In recent years the power of corporate reputation has become a major issue both at a scientific level and in professional practice. The positive image of a company in any industry supports sales of existing products and services, respectively, while contributing to the successful introduction of new products and services. It is notable that most corporate reputation is part of the corporate balance sheet as a capitalized size and valued as such in the case of acquisitions, strategic alliances or joint ventures.

A large number of companies recognize the business benefits of CSR as a policy and practice. Simultaneously, a new practice that is constantly gaining ground in global investment is what is called “Socially Responsible Investing“. These investments are particularly popular, not only to large investors but also to small businesses, insurance companies and even to individual investors, while rated them as one of the most effective tools to serve the social and environmental objectives of corporate social responsibility. Furthermore, as a typical win-win opportunity they combine economic return by minimizing risks in economic, social and environmental terms.

However a question arises: Do socially responsible investments imply costs for investors in the form of lower performance, such as organic food is more expensive than conventional? Although this is theoretically possible, as the Citigroup Smith Barney observes, since it reduces investors’ options, the empirical data give contradictory answers which ultimately did not exclude the possibility of even higher yields.

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