In The Downturn, Green Companies Outperform
management consulting firm A.T. Kearney indicates that firms with
“true commitment to sustainability” outperform industry peers in
the financial markets. The study, called
target=”_blank”>Green Winners: The Performance of
Sustainability-Focused Companies During the Financial
Crisis, found that in 16 of 18 industries,
sustainability-focused companies outperformed their peers by 15% in
a six-month period.
The performance differential translated to an average of $650
million in market cap per company.
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The big takeaway for me is seeing that the companies prospering
now were the companies who embarked on this journey ten years ago,
well before it became a media-worthy item. Now these companies have
pulled ahead of the pack in terms of competitive advantage and are
building momentum.
The report cited as an example a global consumer packaged goods
company that “views sustainability as not just a philanthropic
endeavor but a fundamental part of its business strategy.” It began
its sustainability efforts more than 10 years ago and has
incorporated sustainability practices in every link of the value
chain.
volume by 76 percent since 1998, and over the same period reduced
greenhouse gas emissions by 16 percent, water consumption by 28
percent and energy use by 3 percent, according to the report. In
2007, improvements in energy efficiency led to a $30 million
savings. Over a 16-year period, the company saved more than $500
million by optimizing packaging volume.
And it’s not just about savings.
target=”_blank”>IBM has generated $500 million in
new contract signings in 2 quarters from their Big Green
initiative.
target=”_blank”>Clorox is projecting $40 million
in first-year sales from its GreenWorks line.General Electric vowed
to improve the energy efficiency of its operations by 4% a year and
double its revenues from relatively clean products to
target=”_blank”>$20 billion by 2010.
This is a trend that is not going away. If your business hasn’t
committed to baking in sustainability (and/or a social-good outcome
that’s more directly related to your business) into your business
strategy, the mounting data on both consumer expectations and
competitive advantage suggest that you will be left behind
Source: greeneconomypost.com
