I've pored through much of what's been served up this summer. Herewith are summaries of what I learned from five of them:
The report provides insight into the learnings of two water footprint pioneers, WWF and SABMiller, who collaborated with consultancy URS Corp. to undertake water footprints of the beer value chain in South Africa and the Czech Republic. The report discusses what the water footprint results in South Africa and the Czech Republic mean for SABMiller's businesses and their action plans in response to the findings.
Why would a company open itself up to such scrutiny? Perhaps because of the findings:
In comparison with other beverages, beer's water footprint is relatively small; for example an independent report has estimated that coffee, wine, and apple juice all have water footprints more than three times that of beer.
However, the water footprint figure itself does not give the whole picture, as WWF and SABMiller point out. More important is the context — where water is used, what proportion of the area's total water resource it represents, and whether water scarcity creates risks to the environment, communities and businesses now or in the future.
Fully a third of the companies studied have unmitigated climate change risk, about the same as a year earlier. Just over half (55%) have short-term targets on climate change (compared to 48% in 2008), while 91% of "high" and "very high" impact companies (such as those in industrial metals, food producing, and oil and gas production) disclose absolute CO2 or greenhouse gas emissions data (73% in 2008).
Even where there's good news, it's still rather sobering. EIRIS found that about one in five (19%) companies deemed to have a "high" and "very high" risk still have "no or a limited response to climate change." This is an improvement from 34% of companies in 2008, but hardly anything to cheer about.
If a market price of $28.241 were applied to each ton of CO2-e emitted by companies in the S&P 500 and their first-tier suppliers, carbon costs would total over $92.8 billion. This equates to over 1% of revenue from the companies in 2007, and over 5.5% of combined EBITDA.
At the company level, carbon costs would vary, from less than 1% of EBITDA for 203 companies, "while 71 companies could see earnings fall by 10% or more."
Trucost and IRRC point out that some large investors are beginning to view their portfolios through the lens of carbon risk and mitigation, a hopeful sign that could push companies to become more proactive even in advance of legislation.
One recent development within the institutional investing arena is that some asset owners and managers have begun to invest in companies that are on a clear path to reducing their emissions, or that provide "solutions" such as energy efficiency and clean technologies and renewable energy supplies. For instance, the Norwegian Government Pension Fund – Global announced plans in April 2009 to allocate approximately $2.8 billion to an environmental program, including investments in "climate-friendly energy" and improving energy efficiency.
The report identifies four major obstacles "blocking environmentally sustainable neighborhoods," including aging utilities and scarce transit lines, the high cost of building multi-level structures, regulatory barriers from planning and zoning laws, and tax incentives that favor suburban sprawl. The report recommends long- and short-term action steps that policy makers and industry professionals can take to remove these obstacles.
Among the recommendations for "industry leaders":
Invest in sustainable development and utilize the experience and expertise of sustainable developers. Create a group of industry leaders to lobby government decision-makers to end the barriers to better land use policies. Conduct a public education and outreach campaign "to inform voters about the benefits to them of sustainable development and the need for infrastructure support like transit and utility upgrades."
The quest for sustainability "is already starting to transform the competitive landscape," say the authors.
By treating sustainability as a goal today, early movers will develop competencies that rivals will be hard-pressed to match. That competitive advantage will stand them in good stead, because sustainability will always be an integral part of development.
But it's not easy, they point out. Companies that have started the journey go through five distinct stages of change, with innovation opportunities at each stage:
- Stage 1: Viewing compliance as opportunity
Stage 2: Making value chains sustainable
Stage 3: Designing sustainable products and services
Stage 4: Developing new business models
Stage 5: Creating next-practice platforms
That model may not be quite as catchy as Elizabeth Kübler-Ross's five stages. On the other hand, the HBR issue is one of the few uplifting reads for summer's end.