Framing the Business Approach to Sustainability: Some Studies By William R. Blackburn Lake County Green Conference College of Lake County Grayslake, IL May 17, 2012 ©2012 William Blackburn Consulting, Ltd.

Conference Board Study Participants Alcan, acquired by Rio Tinto Aveda part of Estee Lauder Source: W. Blackburn, Frameworks for Integrating Citizenship and Sustainability, Report 1446, (2009), available at www.Conference-Board.org ©2012 William Blackburn Consulting, Ltd.

Top Reasons For Increased Focus on Sustainability by Companies (Source: 2007 Conference Board study of 18 major corporations. ) WHY? Reputation, brand Stakeholder pressure (esp. customers) Reduce waste (and costs), increase productivity Employee morale, motivation and recruitment Peer pressure (competitors, high-visibility companies) 7% growth in natural food sales in Dec 09 No of sustainable product launches if 4 times faster in 2009 as last year---- (500) in Q1 is about same as for all of 2008. ©2012 William Blackburn Consulting, Ltd.

TCB Sustainability Framework Elements Organization Mission, Vision and Values Goal Setting & Strat Planning Deployment, Integration, Alignment & Accountability Management Systems Stakeholder Engagement Partnerships with NGOs and Government Supply Chain Programs ©2012 William Blackburn Consulting, Ltd

Source: W. Blackburn, Frameworks for Integrating Citizenship and Sustainability Report 1446, (2009), available at www.Conference-Board.org

Mission, Vision and Values Policy Bristol-Meyers Squibb Pledge UN Global Compact (Al, CC, P) Model Sustainability Policy (Conf. Bd. Report #EA 260—16 companies) Broad areas of focus Baxter’s 3 sustainability areas of focus Coke’s Manifesto for Growth (“5Ps”) JC Penney “CARES” “Alcan 8” priorities Hospira’s 5 sustainability areas of focus Coke: people, portfolio, partners, planet, profit JC Penney: community, associates, responsible sourcing, environment, sustainable products ©2012 William Blackburn Consulting, Ltd

Emerging Meaning of Sustainability from an Organizational View “The 2 Rs” Values-driven management based on--- Respect: for people and other living things Resources: the wise use of economic and natural resources —for the purpose of sustaining and promoting the long-term well-being of the organization and society (including the environment). ©2012 William Blackburn Consulting, Ltd.

Defining Sustainability Obligations and Issues for Action—Common Topics* Governance (oversight structures and systems for legal and ethical compliance and risk control on below topics for organization and its supply chain) Human Rights (civil rights, nondiscrimination, etc.) Labor Practices (wages, working conditions, etc.) Environmental Issues (pollution, energy and resource conservation, biodiversity, etc.) Fair Operating Practices (anti-corruption, fair competition, etc.) Consumer/customer Issues (fair marketing, consumer safety, product compliance, etc.) Community Involvement & Development Economic Viability of the Organization *Based on the GRI reporting guidelines and ISO 26000 SR standard ©2012 William Blackburn Consulting, Ltd.

No. of Companies with Goals on Subject Per Conf Bd. Study (total=11) Source: W. Blackburn, Frameworks for Integrating Citizenship and Sustainability…, Report 1446, (2009), available at www.Conference-Board.org

Management Systems EHS: ISO 14001 (Ab, H, FP) and OHSAS 18001 Mandatory certifications by Al, Bx EHS and quality (P, CC) EHS and security (DC) EHS and product responsibility (BMS) ©2012 William Blackburn Consulting, Ltd

Majority Use Global Reporting Initiative (GRI) Sustainability Reporting Guidelines ©2012 William Blackburn Consulting, Ltd

Partnerships with NGOs and Government Healthcare (Ab, BMS, P, Bx, H) Water (CC, FP), climate change (Al, Bx, BMS) Employee volunteerism (P, H, Av) Education on relevant skills (Al, Bx, DC, FP) EPA voluntary programs (Bx, BMS, P, JP) Customer-oriented partnerships (JP, FP, H, BMS, Bx, CC) Supplier-oriented partnerships (Av, CC) Healthcare: AIDs programs Volunteerism: P sponsors employees to assist NGOs in 30 countries FP: works with colleges to prepare disadvantages people for jobs with utilities EPA: Energy Star, Green Supplier Network, Climate Leaders, SmartWay Transport Partnership Customer partnerships: JP After School Roundup, to fund after school programs for needy children Supplier: Aveda gets natural ingredients from indigenous tribes; teams w/ NGOs and others to help make their communities sustainable ©2012 William Blackburn Consulting, Ltd

Supply Chain Programs Risk-based programs Approach Requirements or guidelines (supplier codes of conduct by 8 of 11) Evaluation process Questionnaires (Bx, BMS); self assessments (DC, JP) Expert site evaluations (BMS, Ab, CC, Av, JP, CC) Communications and networking forums (Bx, JP) and CSR awards (JP) Downstream collaboration (Av-spas, CC-bottlers) Downstream: Aveda spas during Earth Month; CC, bottlers council, standards, metrics, community programs , report ©2012 William Blackburn Consulting, Ltd

Putting It All Together Visible top management support Effective, operational or functional champion/leader Good teamwork Vision of what is to be achieved Desire to continuously improve Integration into plans, policies and procedures, practices and decision-making Staying current on emerging issues Connecting with internal and external stakeholders (employees, communities, customers, NGOs, governments) ©2012 William Blackburn Consulting, Ltd

The Sustainability Handbook— The Complete Management Guide to Achieving Social, Economic and Environmental Responsibility (See www.WBlackburnConsulting.com ) ©2012 William Blackburn Consulting, Ltd.

Business Models for Sustainability Lake County Green Conference Al Moody, Liberty Prairie Restorations (Libertyville) Ron Meissen, Baxter Healthcare (Deerfield) Bill Blackburn, William Blackburn Consulting (Long Grove) Lake County Green Conference College of Lake County Grayslake, IL May 17, 2012