1. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Measuring Sustainability’s Return on Investment Ted Freeman, Principal, Praxis Consulting Group New Hampshire BSR Annual Conference June 1, 2009

2. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. About Praxis What We Do Leadership CultureStrategy Who We Serve Employee- owned businesses Socially responsible businesses Non-profit organizations 2

3. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Types of ESG Initiatives 3 Community Engagement Workplace Operations ProductsServices

4. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Measurement  For Benchmarking  For Determining Impact  On Workplace  On Communities  On Environment  For Calculating Value 4

5. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Value of ESG  Tangible  Savings or revenue minus investment  Intangible  Brand equity  Customer loyalty  Employee commitment  “Doing the right thing” 5

6. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Tangible Returns  Bruss Construction  Satellite tracking of company vehicles –$36,000 in savings annually  Hypertherm  Intensive training program to build technical skills, give associates college credit –Initial investment: $2,000,000 –Savings in 2008: $2,450,000  Monadnock Paper  Hazardous waste reduction, energy conservation, etc. –$500,000 in savings annually 6

7. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Tangible Returns: ROI for Ownership Culture in the Workplace  Employee-owned companies with ownership cultures outperform their counterparts  Kramer, City University of New York  Freeman, University of Pennsylvania  Blasi & Kruse, Rutgers University  Keogh, Kardas, Scharf, Washington State  Hewitt Associates / Kellogg School  ESOP Association Annual Surveys  “Employee Ownership & Corporate Performance”, NCEO lit review 7

8. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Intangible Returns  McKinsey Global Survey  66% of CFOs and 75% of investment professionals agree that ESG initiatives create value for shareholders  Maintaining a good corporate reputation or brand equity is the most important way these programs create value  Significant uncertainty about putting a number on the value  Cone Cause Marketing Study  79% would switch brands if associated with a good cause 8

9. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Summary  Variety of types of ESG initiatives  Tangible and intangible value  Some of greatest value is hardest to measure  Employee ownership  Timberland market research 9

10. Copyright © 2007 Praxis Consulting Group, Inc. All rights reserved. Contact Edmund B. (Ted) Freeman Principal, Praxis Consulting Group ted@praxisCG.com 917.592.5827 (mobile) 347 463 9350 (office) 10