1. University of Calgary Distinguished Speaker Series March 3, 2016 COMMUNICATING THE BU$INESS CA$E(S) FOR SUSTAINABILITY bobwillard@sustainabilityadvantage.com

2. “Over the last 10 years, the ‘Sustainability Imperative’ has emerged, magnified by escalating public and governmental concern about climate change, industrial pollution, food safety, and natural resource depletion, among other issues.” David Lubin and Daniel Esty, HBR, May 2010.

3. NESTED INTERDEPENDENCIES

4. Society and Business are wholly owned subsidiaries of the Environment

5. BUSINESS IMPACTS THE NESTS

6. BOOMERANG IMPACTS

7. GREAT ACCELERATION DASHBOARD Will Steffan et al, “The Trajectory of the Anthropocene: The Great Acceleration,” Anthropocene Review, Jan. 2015. Safe operating space

8. GLOBAL RISKS World Economic Forum (WEF), “Global Risks 2016,” January 2016. Impact Likelihood High

9. “Expect the Unexpected: Building business value in a changing world,” KPMG, 2012

10. Access to capital Talent wars Productivity Innovation Risk management Security of supply Profit Share price Brand value Revenue growth Market share Expenses (SUSTAINABILITY) STRATEGIES “Sustainability” ENABLERS vs. ONE MORE GOAL

11. Revenue PROFIT Expenses +51% to +81% Sustainability Capital Reserve sustainabilityadvantage.com “BEST PRACTICES” CASE -16% to -36% 7 Risks to Revenue 7 Risks to Expenses Materials & water costs Revenue growth Company reputation; Innovative products; Innovative services & financing Energy costs Employee attrition costs Employee productivity & innovation Waste costs -10% +9% -75% -25% +2% -20% OpportunitiesRisksP&L Statement

12. 60-employee manufacturing company 58% reduction in electricity usage 90% reduction in natural gas usage Reduced annual CO 2 emissions by 115 tonnes Invested $46,186 to yield energy savings of $89,152 Average pay-back period of 6.3 months “Manufacturer finds lighting energy efficiency convenient,” Green Manufacturer, March 1, 2010 42 projects between 2006-2008 Increased profits by 76%

13. Bottom-Line Business Case “Expect the Unexpected: Building business value in a changing world,” KPMG, 2012 Opportunities could increase Profit by 51-81% Risks could decrease Profit by 16-36%

14. Piper Alfa oil and gas platform exploded in the North Sea, July 6, 1988. Worst catastrophe in 25 years of exploration. The accident killed 165 of 220 crew members. Andy Mochan plunged 15 stories into a burning sea of oil and debris, knowing he would survive only 20 minutes in the freezing water. Based on Daryl Conner, Managing at the Speed of Change, 1992. Why did Andy jump? He chose uncertain death over certain death. The pain of his “current reality” was too great. He jumped because he had to, not because he wanted to. “BURNING PLATFORM” FOR CHANGE

15. INCOME STATEMENT / PROFIT & LOSS STATEMENT Grow revenue Good company reputation / brand; Innovative products; Innovative services & financing Risk of eroding revenue growth Poor company reputation / brand; Outdated products; Missed services opportunities Save operating expenses Energy; Water; Materials; Waste; Maintenance; Travel; Insurance; Borrowing Risk of higher operating expenses Energy; Water; Materials; Waste; Maintenance; Travel; Insurance; Borrowing Engage employees Productivity & innovation; Attrition; Hiring Risk of disengaged employees Productivity & innovation; Attrition; Hiring Other risks Physical disruptions; Societal disruptions; Insecure supply; Compliance expenses; Litigation Expenses wiki.futurefitbusiness.org/overview CASE FOR FUTURE-FITNESS Higher market valueMARKET VALUERisk of lower market value AlignmentPURPOSE & VALUES ALIGNMENTRisk of misalignment

16. FUTURE-FIT BUSINESS If it were to operate forever, it would not only do no harm, it could do well by doing some net good. A Future-Fit Business creates value while in no way undermining – and ideally increasing – the possibility that humans and other life will flourish on Earth forever.

17. 3-STEP METHODOLOGY 8 Science-Based System Conditions 8 Business Principles 20 Goals 3 Environmental System Conditions 3 Environmental Business Principles 10 Environmental Goals 5 Social System Conditions 5 Social Business Principles 10 Social Goals wiki.futurefitbusiness.org/overview

18. FUTURE-FIT BUSINESS GOALS All renewable energy. All environmentally responsible and socially equitable water use. All materials from responsibly managed or recycled sources. Operational byproducts are repurposed. Operations emit no substances which cause harm. Operations emit no GHGS. Products emit no substances which cause harm. Products emit no GHGs. All products and packaging can be repurposed. Safeguard employee health. Pay at least a living wage. No discrimination. Fair employment terms. All concerns addressed. Informed about all impacts. All concerns addressed. (Suppliers are included within the company’s extended operations.) Fair /right taxes paid. All lobbying for FF outcomes. wiki.futurefitbusiness.org/overview Operations do not negatively impact areas of high conservation value.

19. INCOME STATEMENT / PROFIT & LOSS STATEMENT Grow revenue Good company reputation / brand; Innovative products; Innovative services & financing Risk of eroding revenue growth Poor company reputation / brand; Outdated products; Missed services opportunities Save operating expenses Energy; Water; Materials; Waste; Maintenance; Travel; Insurance; Borrowing Risk of higher operating expenses Energy; Water; Materials; Waste; Maintenance; Travel; Insurance; Borrowing Engage employees Productivity & innovation; Attrition; Hiring Risk of disengaged employees Productivity & innovation; Attrition; Hiring Other risks Physical disruptions; Societal disruptions; Insecure supply; Compliance expenses; Litigation Expenses wiki.futurefitbusiness.org/overview CASE FOR FUTURE-FITNESS Higher market valueMARKET VALUERisk of lower market value AlignmentPURPOSE & VALUES ALIGNMENTRisk of misalignment

20. www.sustainabilityadvantage.com RESOURCES futurefitbusiness.org

21. University of Calgary Distinguished Speaker Series March 3, 2016 COMMUNICATING THE BU$INESS CA$E(S) FOR SUSTAINABILITY bobwillard@sustainabilityadvantage.com