Sustainability Nears a Tipping Point
This year, more survey respondents say sustainability is on their company’s management agenda. Not all companies have found ways to profit from their sustainability efforts — but those that have share some interesting characteristics.
Topics
Leading Sustainable Organizations
At companies such as Campbell Soup, sustainability is now a standard component of managers’ performance evaluations.
In the summer of 2010, Jos de Wit, a senior research associate for Eastman Chemical Co., was thinking about $50,000, Kenya, and HydroPack, a paper-thin, five-by-seven-inch bag that could transform contaminated water from virtually any source — sewage, floodwater, swimming pools — into a nutritious drink.
De Wit was trying to convince senior managers at his company to finance a $50,000 demonstration project that would field test HydroPack in a village in Kenya. While HydroPack was not an Eastman product — it is produced by a small company called Hydration Technology Innovations — the product does incorporate Eastman materials. De Wit believed Eastman should extend its support for a technology that had already demonstrated its ability to save lives: Some 24,000 HydroPacks were used in Haiti in the aftermath of the country’s 2010 earthquake.
At first, de Wit tried to persuade Gaylon White, who as director of the Eastman Innovation Lab seemed a natural champion. White, however, was overloaded with work and knew that obtaining funding for the project would be a challenge. The amount of Eastman material used in the HydroPack membrane was so small that it was insignificant from a business standpoint.
Two months passed and de Wit again approached White, who agreed to meet with HTI officials. They quickly convinced him to back the Kenya project. White then began to cultivate support within the organization. According to White:
We had early resistance because the HydroPack did not have big volumes and was not from a big brand. But you know what? Starting small is how many interesting innovations start. Plus, there are huge applications for this technology that could open up markets for us. Some people got this. When I framed the decision in terms of having a responsibility to educate and improve the world, everyone was persuaded.
The Leading Question
What are companies who are profiting from sustainable business practices doing differently?
Findings
- “Harvester” companies are more likely to have strong CEO commitment to sustainability.
- They are three times more likely to have a business case for sustainability.
- They are more likely to collaborate with external groups.
References
1. G.C. Unruh, “Earth, Inc.” (Boston: Harvard Business Press, 2011), xi.
2. Ward points out that in the United States, interest in sustainable consumer goods has increased in recent years, but that consumer demand for such goods remains strongly influenced by pricing.
3. R. Bowman, interviewed by M.S. Hopkins, “What’s Your Company’s Sustainability Filter?” Jan. 18, 2011.
4. M. Gladwell, “The Tipping Point” (New York: Little Brown, 2000).
5. M. Gladwell, “What Is the Tipping Point?,” www.gladwell.com/tippingpoint/.
6. MIT Sloan Management Review and the Boston Consulting Group, “Sustainability: The ‘Embracers’ Seize Advantage,” research report, winter 2011.
7. World Economic Forum and the Boston Consulting Group, “Redefining the Future of Growth: The New Sustainability Champions, Research Report, 2011” (Geneva, Switzerland: World Economic Forum, 2011), www3.weforum.org/docs/WEF_GGC_SustainabilityChampions_Report_2011.pdf.
8. M. Lubber, ”Percolating a Sustainable Coffee Cup,” Forbes, Sept. 19, 2011, www.forbes.com/sites/mindylubber/2011/09/19/percolating-a-sustainable-coffee-cup.
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