Advancing Toward a Circular New York

By Kirstie Dabbs – Analyst-Intern, G&A Institute

New York City’s latest OneNYC 2050 strategy outlines an ambitious sustainability agenda that includes goals to achieve zero waste to landfill by 2030, and carbon neutrality by 2050.

New Yorkers who track city- and state-wide environmental goals and regulations are likely aware of the importance of renewable energy and energy efficiency in achieving this climate strategy, but those actions alone won’t fulfill New York’s ambitions.

A circular economy must also be adopted in order to further reduce greenhouse gas emissions and waste, while also conserving resources. Although the OneNYC strategy does make note of this shift, many New Yorkers remain unfamiliar with even the concept of the circular economy, let alone its principles, practices and potential impact.

What is the Circular Economy?

Also known as circularity, the circular economy calls for a reshaping of our systems of production and consumption, and an inherently different relationship with our resources.

Rather than following our current “linear” economic model that extracts resources to make products that are used and disposed of before the end of their useful life, a circular economy follows three core principles to extend the value of existing resources and reduce the need to extract new resources:

  • Design out waste.
  • Keep products and materials in use.
  • Regenerate natural systems.

These three principles — as put forth by the Ellen MacArthur Foundation — create opportunities to reduce and potentially eliminate waste,  from the design phase all the way to a product’s end of life.

Materials Matter

In the design phase, the choice of materials plays a critical role in either facilitating or preventing recirculation of materials down the line. By choosing to manufacture products with recycled materials, companies will drive demand for more post-consumer feedstock, further reducing waste to landfill which is aligned with the City’s waste-reduction goal.

Companies can also choose to manufacture products using responsibly sourced bio-based materials, which enable circularity because they biodegrade at the end of life with the appropriate infrastructure in place.

WinCup and Eco-Products are examples of companies leading the way toward biodegradable paper and plastic cup alternatives. The regenerative process of biodegradation is in line with the third principle of circularity and supports New York City’s waste goals in bypassing the landfill altogether and heading directly to the compost pile.

Durable Design Increases Product Lifespan and Reduces Consumer Demand

In addition to applying material design principles to divert material from landfill, companies can deploy design and marketing strategies to keep their products in use longer.

Designing durable products and those that can be easily repaired not only leads to longer product lives, but also reduces waste and demand for new products. Creating products that will be loved or liked longer – such as “slow” fashion that won’t go out of style – is another tactic to extend the emotional use of a product.

Finally, companies such as Loop that combine durability with reuse offer a solution to the packaging waste dilemma by keeping long-lasting packaging in circulation.

According to a 2019 report from the European Climate Foundation, by recirculating existing products and materials, the demand for new materials will decrease, reducing environmental degradation and product-related carbon emissions.

How Will the Circular Economy Help Reduce Greenhouse Gas Emissions?

The same report also notes that in order to meet the carbon reduction targets outlined by the Intergovernmental Panel on Climate Change, we “cannot focus only on…renewables and energy efficiency” but must also ”address how we manufacture and use products, which comprises the remaining half of GHG emissions.”

A recent press release from the World Economic Forum (WEF) summarized it succinctly: If we don’t link the circular economy to climate change, “we’re not just neglecting half of the problem, we’re also neglecting half of the solution.”

New York’s Steps to Advance the Circular Economy

Although the principles of circularity can be applied to an individual’s or organization’s behavior, to fully achieve a circular economy the economic system as a whole must fully adopt these principles.

According to a recent report by Closed Loop Partners — an investment company dedicated to financing innovations required for a circular economy — the four key drivers currently advancing circularity in North America are investment, innovation, policy and partnership. All are important and increasing; we are seeing the private and public sectors collaborating to take advantage of the economic opportunity offered by circularity while executing this environmental imperative.

The New New York Circular City Initiative

Closed Loop Partners, along with several other private and public organizations, have come together to found the New York Circular City Initiative, officially launching this month.

One of several partners participating in the initiative is the NYC Economic Development Corporation (NYCEDC), and Chief Strategy Officer Ana Arino spoke last year of how the NYCEDC is well-positioned to inspire and implement city-wide changes leading to a circular economy through levers such as real estate assets; programs to support circular innovation; its intersectional position between the private and public sectors; and public-facing awareness campaigns.

The vision of the New York Circular City Initiative is “to help create a city where no waste is sent to landfill, environmental pollution is minimized, and thousands of good jobs are created through the intelligent use of products and raw materials.” Through engagement in this collaborative effort, the City is taking an important step toward circularity, that, if scaled, has the potential to make significant and lasting changes in the local economy—and beyond.

# # #

Kirstie Dabbs is pursuing her M.B.A. in Sustainability with focus on Circular Value Chain Management at Bard College.  She is currently an analyst-intern at G&A Institute working on GRI Data Partner assignments and G&A research projects. In her role as an Associate Consultant for Red Queen Group in NYC she provides organization analyses and support for not-for-profits undergoing strategic or management transitions.

 

Profile:  https://www.ga-institute.com/about-the-institute/the-honor-roll/kirstie-dabbs.html

 

This article was originally published on the GreenHomeNYC blog on September 28, 2020.

 

Confluence: Coronavirus Crisis, Climate Change, Global Warming, Sustainable Investing, Corporate Sustainability & Citizenship…Shaping These Times

by Hank Boerner – Chair & Chief Strategist – G&A Institute

Over the past several weeks we have been witnessing an important confluence of events, a critical convergence of forces — something we might call reaching a critical inflection point for the sustainability and well-being of our planet, people, plants, and yes, profits going forward. Consider:

The COVID-19 infection has now touched just about every sovereign state on Earth, shutting down the largest economy, that of the United States of America, as well as the economies of many European nations…and of course important parts of the world’s second largest economy, China.

As this was happening, the public conversations about the impacts of climate change and global warming on people, flora and fauna, and planet continued, with the worldwide observance of the 50th Earth Day. Attention on climate change has doubled down even in the face of a frightening disease and resulting economic turmoil.

Numerous conversations among science and climate experts, in media channels, among public sector leaders, and other stakeholders, focused on the possible links between the coronavirus (and other serious infections) and climate change.

Questions are raised:  What new diseases might emerge…what new vectors might we see, moving from tropics to temperate climes and carrying unfamiliar diseases.  What fate awaits humanity as in some countries we see systematic destruction of rain forests (the “lungs of the Earth”) and as populated cities continue to push farther into wilderness areas?  Do we know the effects, short- and long-term, on human, as the arctic tundra warms and releases microbes and other organisms stored there in colder climes for millennia?

As the world’s capital markets were being impacted by the virus crisis and shutdowns of entire economies, the focus on sustainable and impact investing has intensified.

(On one conference call this week, a lecturer pointed to ESG investing trends and explained, look at the more resilient and sustainable companies for opportunity in the crisis and as we emerge. The ESG leaders will be more attractive for investors.)

Early results showed that sustainable investments (especially ESG mutual funds and ETFs) were performing with more resilience than more traditional instruments in the slowdown and in the ongoing adjustments of institutional investors’ portfolios in response to the crisis. (The outflow of ESG ETFs and mutual funds were small than for traditional peers.)

The focus on the corporate sector intensified as the three important sectors of 21st Century economies struggled to adjust to the widespread effects of the virus crisis – that is, public sector (governments), private sector (corporate and business) and social sector (institutions, NGOs, foundations, charities, others, as first defined as the social sector by management guru Peter F. Drucker).

There is considerable public discussion now about what the “new normal” might look like as we emerge from the terrible effects of the coronavirus.  The confluence / convergence of recent events as outlined here will help to shape society in the near term — moving into the post-crisis period.

The G&A Institute team has been monitoring and sharing perspectives on the above and more in our usual communications channels. In these newsletters, in our Resource Guides, on our Sustainability Update blog.

You can check out our blog posts here.

We are offering perspectives in the ongoing series, “Excellence in Corporate Citizenship on Display in the Coronavirus Crisis”  — #WeRise2FightCOVID-19.

We offer here several features along the lines of the above themes of confluence / convergence of factors for you:

Featured Stories

Why we cannot lose sight of the Sustainable Development Goals during coronavirus
Source: World Economic Forum – Our world today is dealing with a crisis of monumental proportions. The novel coronavirus is wreaking havoc across the globe, upending lives and livelihoods.

An Earth Day CEO summit shows how dramatically corporate values have changed
Source: Fortune – This week marks the 50th anniversary of those nationwide environmental celebrations and “teach-ins” that came to be called Earth Day. From the largest 1970 gathering, in Fairmont Park in Philadelphia, to smaller marches and…

The Covid-19 crisis creates a chance to reset economies on a sustainable footing
Source: The Guardian – New Zealand climate minister says governments must not just return to the way things were, and instead plot a new course to ease climate change

50 years later, Earth Day’s unsolved problem: How to build a more sustainable world
Source: MSN/Washington Post – We haven’t quit the fossil fuels scientists say are warming the atmosphere and harming the Earth. Humans use more resources than the planet produces. Society has not changed course.

Marriott, Apple, Google, Facebook, Schein, CVS, Sentient Technologies, American Express, JPMorgan Chase — Finding Ways to Help – and Innovate!

G&A Institute Team Note: We continue to bring you news of private (corporate and business), public and social sector developments as organizations in the three societal sectors adjust to the emergency.

This is post #15 in the series, “Excellence in Corporate Citizenship on Display in the Coronavirus Crisis” – April 10, 2020

#WeRise2FightCOVID-19 “Corporate Purpose – Virus Crisis”

By Hank Boerner –Chair & Chief Strategist – G&A Institute

The team members at G&A Institute are in conversations throughout the day with corporate managers, with the discussions centering on sharing “what companies can do / what companies are doing” to meet the challenges of the cororanvirus pandemic.

That consideration for many companies today is both internally and external focused — the key tasks are keeping people safe, serving the community’s needs, keeping the corporate operations going to be best of their ability, and looking forward to the post-crisis era.

Here are a few selections of what executives and managers and their organizations are doing.  As we are thinking…

Life hands you the lemon / squeeze! / make the lemonade!
And get it around to others as fast as you can.

Setting An Example: Cut My Pay, Says Schein CEO

Stanley M. Bergman, CEO of Henry Schein Inc. (important suppliers to the medical community) is taking a temporary cut in salary during the virus crisis. As his company’s client base experiences hazards and cares for patients, the CEO (in SEC filing) will take 100% pay cut.

The company also stopped its share buyback program. The company markets equipment and supplies for clinics, dentist & doctor offices, and other segments of healthcare.

Schein is a co-founder of the Pandemic Supply Chain Network, using its own supply chain for distribution of testing supplies. The network was created at the 2015 Davos meeting as a public-private partnership. Now, the PSCN is part of the global COVID-19 response.

Information for you if would like to become a part of the effort: https://www.weforum.org/projects/pandemic-supply-chain-network-pscn

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Apple & Google Teaming For New “Contact-Tracing” Bluetooth App

It’s hard to get one’s head around the pandemic: millions, tens of millions, yes billions of people are stationary, immobile, not able to move around, sheltered at home, working remotely.

And tens of millions of us are not able to not move around, we must be at our posts, picking the crops, stocking the warehouse, driving the truck, stocking the shelves, manning the cash registers at retail.

Or more frightening, driving the ambulance, being on post in the emergency room or in the ICU, or in the wards with non-COVID patients.

Or driving the police car to respond to “the unknown”, or the fire truck to extinguish the blaze and save lives. Think about the EMT in the ambulance, hour after hour, running to danger.

Keeping on touch, virtually all of us, mobile and immobile rely on our cell phone…the lifeline to loved ones as well.

For those who must be on their designated post, moving around, interacting, the fear is that the virus could be too close, within reach to infect. To the rescue: Apple Inc. and Google – in a rare partnership, the rivals are adding technology to the phone to alert us if we’ve come into contact with a person with the virus.

This is to be an opt-in feature – “contact-tracing” – that immediately alerts us: quarantine and isolate and then treat or seek treatment because we have been in close contact with an infected person.

Over time we can expect to see this application added to the basic phone operating systems.

Watch for the news in May for iPhones and Android; the management of the system will be by public health agencies. The reports to the phone will be on anonymous basis. As the two companies announced the collaboration,  The phone owner must opt-in to be part of the network.

MIT says it is developing a similar system. Of course, there are numerous privacy protection issues – we’ll see how that goes on the rollout.

Facebook Joins the Tracing Effort

Facebook is one of the world’s leading social media platforms (claiming 2 billion-plus of the “connected”). Users are invited to share their own coronavirus symptoms and experiences to help researchers pinpoint “where” the disease is occurring.

Carnegie Mellon, the great tech school, is using the data in pilot effort to try to see where data is telling us help is needed. Such as the all-important ventilators that are in such short supply. Or where “go home/stay home” guidance or orders are needed. The output is going to be shared with public sector health managers.

* * * * * * * *

Headed to the Drug Store? How Do You Know What You Need is There?

The CEO of the nationwide CVS drug store network, Larry Merlo, was interviewed by Barron’s Jack Hough. The CVS stores are in the midst of becoming “HealthHUBS” (to provide medical services) and strengthening is “Caremark” program for pharmacy benefits management. And now, the CVS workforce is pressed to help customers in the midst of the virus crisis.

Explains CEO Merlo: Home deliveries are up by three times the usual volume. Tele-medicine connections are up two times. CVS waived copays for tele-medicine and for deliveries. COVID-19 testing was starting in Shrewsbury, Massachusetts (in a store parking lot) to do 100-plus test a day. Stores are being kept stocked. Limits are applied to prevent hoarding.

The company maintains close contact with suppliers to keep the pipeline stocked and moving to stores. CDC guidelines are followed in the stores. Cash bonuses are being doled out to hourly store staff, pharmacists, managers. There is day care service where possible; sick leave is granted to part-timers.

Lessons Learned: Keeping mind the Chinese sign for crisis (“danger” and “opportunity”), we learn that the CVS CEO thinks the crisis has helped to strengthen the firm’s confidence in what CVS can do to help to change the trajectory of healthcare delivery.

Pharmacies (local) and tele-medicine (distant) are key elements. The critical role that healthcare professionals play in local communities (where CVS outlets are located) is really being demonstrated today.

Marriott and Hilton have been working with CVS to create a transition for those folks who are furloughed. Speaking of Marriott…

* * * * * * * *

Holding on to Customers / Serving the Local Community & Responders

Marriott CEO Arne Sorenson in communications to patrons explains that cancellations for scheduled trips are being adjusted out to June 30th (usually 24 hours notice is required). Expiration of points accrued for use at the properties is being extended. “Experience flexibility” is the theme.

And about helping the communities in which the resorts and hotels are based:

  • Marriott properties are donating food, pre-cooked and cooked meals to crisis responders, as well as a supply of cleaning products, masks, gloves, sanitizers, wipes, shower caps, anti-microbial wipes, and other supplies to local communities. Hotel windows sport signs and symbols of love and support to those passing by.
  • Working with American Express and JPMorgan Chase (two credit card partnering organizations), Marriott committed to provide $10 million worth of hotel stays to professionals on the front lines of the crisis. “Rooms for Responders” are being made available in New York City, New Orleans, Chicago, Detroit, Los Angeles, Las Vegas, Washington DC, and Newark, New Jersey.
  • To reach the responders, Marriott is working with the American College of Emergency Physicians and Emergency Nurses Association to help match doctors and nurses with available rooms.

And the “Community Caregiver Program” initiative (coordinated by franchisees and property owners) provides deep discount accommodations near to hospitals to first responders and healthcare professionals stepping up to serve local communities. This is available in North America, the Caribbean and Latin America (at 2,500 hotels to date).

* * * * * * * *

The Food Supply in the Crisis – Changes in Post-Crisis Behaviors

What is happening in the food sector? Mike Geraghty writing on the Sensient Technologies Corporation platform shares the results of a mid-March 2020 study by Nielsen that forecasts six key consumer behavior shifts happening during the crisis.

The findings will have a major impact on the food industry and will/could lead to permanent changes in the way consumers shop for food.

These are (by their headlines):

  • Proactive Health-Minded Buying
  • Reactive Health Management
  • Pantry Preparation
  • Quarantined Living Preparation
  • Restricted Living
  • Living a New Normal

Under each category headlines there are explanations of the shifts seen in consumer behavior and COVID-19 event markers. There’s valuable findings and shared perspectives here for you from the Sentient folks (providers of color technologies and services for the food and beverage industries).

The commentary: https://sensientfoodcolors.com/en-us/global-markets/covid-19-changing-food-industry/?utm_source=FoodNavigator&utm_medium=Email%20Top%20Text%20US&utm_campaign=COVID&utm_content=Apr%202020

* * * * * * * *

G&A Institute Team Note:
We continue to bring you news of private (corporate and business), public and social sector developments as organizations in the three societal sectors adjust to the emergency and organize their response.

New items are posted at the top of the blog post and the items posted today will move down the queue.

We created the tag “Corporate Purpose – Virus Crisis” for this continuing series – and the hashtag #WeRise2FightCOVID-19 for our Twitter posts. Do join the conversation and contribute your views and news.

Do send us news about your organization – info@ga-institute.com so we can share. Stay safe – be well — keep in touch!

Principles to Guide Company Managements in the COVID-19 Era from the World Economic Forum (WEF) – The “Davos” Leaders

G&A Institute Team Note
We continue to bring you news of private (corporate and business), public and social sector developments as organizations in the three societal sectors adjust to the coronavirus emergency.

This is post #13 in the series, “Excellence in Corporate Citizenship on Display in the Coronavirus Crisis.”  #WeRise2FightCOVID-19   “Corporate Purpose – Virus Crisis”  –  April 7 2020 

By Hank Boerner — Chair & Chief Strategist – G&A Institute

The World Economic Forum – “Davos” – issued principles on April 1st on Corporations and the Upholding of Stakeholder Principles in the Virus Crisis

Leading CEO’s around the globe got a communication from the World Economic Forum (“Davos” in shorthand) urging the following of Stakeholder Principles in the COVID Era.

The business community’s contribution in the global pandemic, say the leaders of the WEF “Covid Action Platform”, is to be leaders of responsiveness and stewards of resilience.

And — to cooperate and collaborate in managing the corporate community’s response to help society deal with the global emergency and work towards economic recovery.

To those ends, the platform Stakeholder Principles set out for business leaders are:

  • To employees, our principle is to keep you safe.
  • To our ecosystem of suppliers and customers, our principle is to secure our shared business continuity…to keep the supply chains open and integrate supply partners in the firm’s business.
  • To our end consumers, our principle is to maintain fair prices and commercial terms for essential supplies.
  • To governments and society, our principles is to offer our full support…standing ready with resources, capabilities and know-how.
  • To our shareholders, our principle remains the long-term viability of the company and its potential to create sustained value.

And…we must also maintain the principles and we must continue our sustainability efforts unabated, to bring our world closer to achieving shared goals, including the Paris climate agreement and the UN SDGs agenda.

By doing all we can, say the WEF leadership, and coordinate our work, we can ensure that our society and economy get through this crisis – and we can mitigate the impact on all of our stakeholders.

The signatories of the letter to CEOs:

  • WEF Founder Klaus Schwab (he’s executive chair);
  • Brian Moynihan (CEO of Bank of America and Chair of the WEF International Business Committee);
  • Feike Sijbesma (Royal DSM, Special Envoy on Coronavirus, Dutch Government) , and Jim Snabe (Chairman, Siemens and Maersk), the Co-Chairs of the WEF Impact Committee.

The WEF leaders stress that CEOs should continue to embody “stakeholder capitalism” to help secure a common prosperity.

CEOs receiving the letter were asked to support the WEF global effort to manage the economic impact in the COVID-19 era.

Link to the Covid Action Platform document: http://www3.weforum.org/docs/WEF_Stakeholder_Principles_COVID_Era.pdf?mod=article_inline

The WEF also circulated a 6-page “Workforce Principles for the COVID-19 Pandemic – Stakeholder Capitalism in a Time of Crisis” white paper. This is especially timely as corporate HR managers and others focus on Human Capital Management (HCM) in a time of crisis.

Link: http://www3.weforum.org/docs/WEF_NES_COVID_19_Pandemic_Workforce_Principles_2020.pdf

Our December 3, 2020 profile of the World Economic Forum (WEF) / Davos conveners with focus on Corporate Citizenship topics is in the blog at: http://ga-institute.com/Sustainability-Update/the-world-economic-forum-on-corporate-citizenship-topics-with-focus-on-the-fourth-industrial-revolution/

G&A Institute Team Note
We continue to bring you news of private (corporate and business), public and social sector developments as organizations in the three societal sectors adjust to the emergency.

New items will be posted at the top of the blog post and the items today will move down the queue.

We created the tag Corporate Purpose – Virus Crisis” for this continuing series – and the hashtag #WeRise2FightCOVID-19 for our Twitter posts.  Do join the conversation and contribute your views and news. 

Do send us news about your organization – info@ga-institute.com so we can share.   Stay safe – be well — keep in touch!

Advanced Manufacturing in the Era of Greater Corporate Sustainability – Here’s “Industry 4.0” From the World Economic Forum

by Hank Boerner – Chair & Chief Strategist – G&A Institute

The 18th Century British song title goes, The World Turned Upside Down. American legend has it that at the end of the War of Independence with the American colonists winning the conflict, the British military played the song with the apt title at Yorktown, Virginia as they surrendered.

We can apply that song title to important developments in the global world of manufacturing in the 21st Century. Important news from Davos is the basis of our commentary here.

The mantra Take, Make, Dispose has been the traditional approach of many manufacturing firms over the many decades of the modern industrial revolution.

It’s 110 years and counting since entrepreneur Henry Ford set up his modern factory in Detroit with the assembly line bringing the car to the factory hand — rather than the worker walking around to find the car and install his component.

Are we in now in Phase One of dramatic change? Phase Two? Three?  The World Economic Forum discussions center on Phase Four – as in, the Fourth Industrial Revolution. And part of that is the focus on achieving greater sustainability in industry.

Discussions and presentations at the WEF annual meeting in Davos, Switzerland always brings forth new ideas, new concepts, new approaches to topic areas such as manufacturing and production. 

The WEF Advanced Manufacturing and Production Initiative has been addressing many issues, including using data and 3-D printing and new materials to foster innovation, and supporting the widespread adoption of “inclusive” technologies.  What does that mean in practical terms?

Furthering the discussion that got underway in 2019, this year the Davos gathering’s participants were treated to a presentation focused on “Industry 4.0” for manufacturing a more sustainable world by a corporate CEO, whose ideas for “four simple solutions” that can help make the global manufacturing industry more sustainable. 

We bring you today CEO Ric Fulop’s “four” simple solutions:

First, the Desktop Metal CEO advises, companies can move to “tooling-free” manufacturing, eliminating scrap. Eliminating tooling can mean use of less parts and fewer products whizzing around the globe; only raw materials would be shipped, creating a more efficient supply chain. (And a more sustainable / less polluting global transport network for manufacturers.)

Second, the spreading out assembly of today can be consolidated, to achieve fewer, more multi-functional assemblies (meaning less parts to transport, saving energy, reducing emissions, saving money). Three-D printing can make contributions here, many experts say. More customization is also more possible with 3-D methods.

Third, “generative design” can open new ways to use artificial intelligence (AI) and mimic nature in some ways; 3-D printing is key here, because new design tools can help industry use fewer natural resources and manufacture lighter weight components for cars and airplanes – lowering carbon emissions in manufacture and long-term product use. And then…

Fourth, circular manufacturing and the use of new polymers moves us closer still to a process where parts are designed to fit into sustainable loops for re-use over and over. 

The Potential Impact on Vehicle Design & Manufacturing

Imagine a time (soon?) when automobile / vehicle parts and components live a very long life, to be used over and over in a line of future new vehicles, as well as live longer “first” lives upon manufacture and use.

Longer use is a fit with current practice — people are now keeping their autos much longer these days and this approach could stretch out vehicle use for years after purchase.

Think of “re-purchase” of your car, with parts and components being re-used in assembly along with the new toys and gadgets that impel us to purchase “the new”.

The post-WWII industrial approach of “planned obsolescence” would be going away. That does not have to mean that auto makers would suffer loss of market; there will always be the new new thing on wheels, but the parts etc may be in their second or third of fourth life!

Henry Ford, the Ford Motor Company founder, not only perfected the process of automobile manufacturing, he took advantage of, and helped to further advance, important materials and components of the car.

Henry Ford-Master Tinkerer

Think of the company’s use of metals / metallurgy; glass; paints; engine blocks; driveshaft components and innovations; fabrics & leather; electrical parts and systems; rubber (tires, fan belts); lighting systems — all present in the Tin Lizzy, the famed Model T, with millions of these cars and T-trucks putting Americans on the road to the future.

Materials in manufacturing are still key; various metals, ordinary and exotic, most long used in modern manufacturing, may over time give way to the use of advanced polymers that are more environmentally-friendly and perfectly suitable for the evolving circular economy. (They don’t rust or get tossed out too soon in the useful life.) Goodbye, auto graveyards at some point.

That old ’56 Chevy or ’69 Pontiac or ’40 Ford that you always yearned to have? Those cars’ future descendants may some day be assembled from parts that date 50 or 60 years back or so.

WEF Lighthouse Companies

The WEF’s concept of developing a network of “lighthouse” companies that would develop the way forward was unveiled in 2019.

Companies in such industries as chemicals, automotive, textiles, healthcare, and electronics would collaborate to develop more efficient processes along the lines outlined here.

The “Platform” developed by WEF today includes 130 organizations from 22 industry sectors, governments, academia and civil society working together. 

One of the participating companies is Desktop Metal; Founder/CEO Ric Fulop described for you the “four simple solutions” above — and in this week’s Top Story.

Top Story

4 ways the way we make things can change for a sustainable world    
Source: World Economic Forum – The way we make things is changing. But the Fourth Industrial Revolution isn’t solely about how new manufacturing technologies, like 3D printing, will benefit companies and consumers. It’s also about how industry can usher in a…

More on the World Economic Forum’s “Shaping the Future of Advanced Manufacturing and Production” is available at: https://www.weforum.org/platforms/shaping-the-future-of-production

Find this blog post interesting? I explored Henry Ford’s tinkering and the impact on America in a post: https://www.hankboerner.com/staytuned/the-21st-century-company-and-you-iteration-innovation-progress-and-the-now-very-familiar-disruption/

Which Are the “Best Of” Sustainable Companies in the Important Annual Rankings? Mirror, Mirror on the Wall – What Reflection for Our Company?

February 7 2020

By Hank Boerner – Chair & Chief Strategist – G&A Institute

Mirror, mirror on the wall – who is the most sustainable company of them all?  (Paraphrasing that most memorable line from the Queen in the Walt Disney Studios’ 1930s big screen classic, Snow White and the Seven Dwarfs,)

“Best Of” is being regularly applied now by a ever-widening range of third party players in examining the performance and achievements of U.S., North American and global companies’ sustainability efforts (and applying their methodologies to focus on an ever-widening list of ESG criteria for users of the lists, rankings and so on). 

The results are published for many or all to see – such as this week’s Corporate Knights’ “2020 Global 100” unveiling at the World Economic Forum in Davos — which we are sharing in our Top Stories of the week.

Looking at (or for) the “fairest” of them all, or the best-in-class, or most sustainable, or leading in corporate citizenship rankings, et al — there are now many more ESG ratings organizations, publishers, NGOs, investor coalitions, trade / professional associations, and others in the “ratings, rankings, scores and other recognitions” arena.

And these ratings, rankings, scores, best-of lists are published in many more forms and value-added variations.  Keeping current and in the ESG ratings & rankings game is a full-time job at many companies today.

The third party evaluation approach can be better understood in how they apply their research to arrive at rankings and ratings, and assigning scores, with shared (privately or publicly) rationale to explain the selections of the individual company for benchmark, or the rankings assigned. 

Therein, important stories are being told about companies on the list or assigned a high ranking or in an index. Investors can better understand the why and how of the selection.

(And, we should say, stories are told in the ratings & rankings et al processes about those companies that are omitted or not selected or having a lower rating compared to peers).

For example, look at investable products. S&P Global recently launched an index based on the widely-used benchmark, the S&P 500(R), focused on ESG performance. The bottom 25% — 100 companies! — were not included in the first go-round. Story subtly told – company is in or out.

Besides the welcomed opportunity for corporate leaders to bask in the sunshine of the valued third party recognitions (“look, we got in this year’s best companies list focused on…”), and to admire the reflection in the “best of mirror mirror” on the board room or C-Suite wall, there are very practical aspects to these things.

Such as: As explained, the inclusion of a corporation in a key ESG equity index / investing benchmark or investable product offering and more recently, reflections of the company in the mirror mirror of credit risk ratings and ratings opinions on fixed-income instruments.  

The decision to issue a “green” bond to the market may or will be affected by third party views of the planned issue – green enough or not! That’s beginning to happen in the EU markets.

The Positives

With the many in-depth third party examinations of companies’ ESG strategies and resulting outcomes (considering company’s actions, performance, achievements) now taking place, and with the results becoming more transparent, some of the scoring / ranking / etc results have the effect of enabling a more complete, accurate and comparable corporate ESG profile to be developed by the company.

With better understanding of the ranking & rating etc the issuer’s leadership can assign more resources to improve their public ESG profile, especially those developed by the key ESG rating agencies for their investor clients.

Important to understand in 2020: These close examinations of companies’ ESG performance are becoming more and more decision-useful for portfolio management for asset owners and managers.

And lenders, And bankers. And the company’s insurers. And business partners. And customers. And present and future employees wanting to work for a more sustainable, doing-the-right-thing company.

As board room top leaders better understand the importance of these ratings, rankings etc. exercises (and the importance of engaging with raters & rankers & list makers), with more internal resources allocated to the task of improving the profile — the company will tend to make more information publicly-available for the third party examinations.

The virtuous cycle continues — more information disclosed and explained, better ratings could result, year-after-year. As we always say, it is a sustainability journey.

More ESG information is now being made public by companies for delivery on critical ESG delivery platforms (such as on “the Bloomberg” and the Refinitiv Eikon platforms, in S&P Global platforms).

This in turn leads to better packaging of ESG data and narrative to inform and influence investors; and, leads to improved investment opportunity for being recognized as a leader in a particular space by key investor coalitions (ICCR, INCR, Investor Alliance on Human Rights, Climate Action 100+, and other).

The latter means a multiplier effect — quickly bringing the company’s sustainability news to more investors gathered in a community-of-interest on a topic.

(Think of the volumes of information now being made available by companies focused on GHG emissions, climate change risk, diversity & inclusion, labor rights, human rights, reducing ESG impacts on communities, greater supply chain accountability, use of renewable energy, water conservation, and more,)

Mirror, Mirror 2020: At the recent World Economic Forum meeting Davos, Switzerland, the “100 most sustainable companies of 2020” report was announced. 

Publisher Corporate Knights’ much-anticipated annual ranking of “most sustainable companies in the world” was the basis of the announcement. 

That annual survey looks at 7,400 companies having more than US$1 Billion in revenues, examining 21 KPIs. The stories of the companies from Fast Company and The Hill provide the details for you.  (This is the 17th year of the survey.)

At the Davos gathering this year, participants learned that almost half of the most sustainable companies were based in Europe (49); 17 were HQ in the U.S.A; 12 in Canada; 3 in Latin America, 18 in Asia, and one company in Africa.

For the U.S.A., Cisco Systems is highest ranked (at #4, thanks to $25 billion generated for “clean revenues” from products with “environmental core attributes”). The #1 company is worldwide is Orsted of Denmark (renewable energy).

Our G&A Institute team closely monitors these and many other third party rankings, ratings, scores, corporate ESG profiles, and other critical evaluations of companies. 

This is an example of the knowledge we gain in this [ratings/rankings] arena, which becomes a vital part of the various tools and resources we’ve created to help our corporate clients qualify for, get selected for, and lead in the various “best of lists”.

In sum, achieving better rankings, ratings, scores — so their mirror mirror on the wall question reflects back a very welcoming image! 

In these newsletters, we work to regularly share with you the relevant news items and other content that helps to tell the story of the dramatic changes taking place in both the corporate community and in the capital markets as as the focus on corporate ESG sharpens. Like this week’s Top Stories.

Top Stories for This Week

The 100 most sustainable companies of 2020   
Source: The Hill – A ranking of the most sustainable organizations was unveiled at the World Economic Forum in Davos, Switzerland, Tuesday. 

These are the most sustainable corporations in the world   
Source: Fast Company – Canadian research firm Corporate Knights releases its annual list of most sustainable corporations in the world, with some new entries in the top 10. 

For a the complete list and important background, go to:
Corporate Kings’ 2020 Global Ranking 

And also from Davos:
World Economic Forum calls on business chiefs to set net-zero targets   
Source: Edie.com – In a letter from the Forum’s Founder and executive chairman Klaus Schwab and the heads of Bank of America and Royal DSM Brian Moynihan and Feike Sijbesma, businesses have been urged to respond to climate science through the… 

Davos 2019: The Conversation in Switzerland Ripples Out to The Rest of the World – News, Commentaries, Reports, Initiatives, For Your Consideration

by Hank Boerner – Chair &  Chief Strategist, G&A Institute

Davos, Switzerland –  January 2019: The Conversation in Switzerland Ripples Out to The Rest of the World – News, Commentaries, Reports, Initiatives, For Your Consideration

by Hank Boerner – Chair and Chief Strategist, G&A Institute

The world leadership gathering in Switzerland in winter every year – we see this in the “Davos meetings” in the news report datelines – are part of the World Economic Forum’s (WEF) broad thought leadership activities.  This gathering is the WEF’s annual meeting (there are regional meetings as well).

Heads of state, CEOs, invited societal thought leaders, leading academics and journalists, politicians of all persuasions, NGOs, heads of multilateral heads (Christina Lagarde, International Monetary Fund)…they were all gathered there again this year.

WEF bills itself as “the international organization for public-private cooperation”; it was created in 1971 as a not-for-profit, to operate in a non-partisan, independent forum for leaders of society.  The annual meeting provides the opportunity for sharing ideas on a wide range of issues and topics. And then the broadcast of these out to the world.
This year, the broad themes of discussion included “4th Industrial Revolution”, “Geostrategy”, “Environment”, and “Economics”.

“Shaping” (taking actions as private-public partnerships) was the theme of numerous initiatives such as “Shaping The Future of Environment and Natural Resource Security”.

A slew of reports are typically issued each year; in 2019 one was “Seeking a Return on ESG: Advancing the Reporting Ecosystem to Unlock Impact for Business and Society”.

These reports and other information are available for you on-line at: https://www.weforum.org/agenda

Naturally, with the wise men and women of our global society gathered in the snowy reaches of Davos and presenting their views over several days, there was the usual flow of headlines and news stories out to the rest of the world.

Our team, led by Editor-in-Chief Ken Cynar closely monitors the Davos and other WEF meetings (the annual and regionals) to bring you relevant highlights. This week after the conference wrapped up, Ken Cynar selected this week’s Top Story pick.

That selection presents the comments of Hans Vestburg, CEO, Verizon Communications, on the theme of The Fourth Industrial Revolution and a Sustainable Earth.  CEO Vestburg (he’s originally from “high latitudes” Sweden and became CEO in August 2018) is strategically positioning his giant telecomm enterprise to balance market leadership, promising advances in technology (such as 5G networks) and challenges presented by climate change, population growth — and helping society achieve a sustainable and equitable future.

Hans Vestburg said at Davos: “Perhaps it because of my roots in a land so beautiful (Sweden) and yet so vulnerable…I’ve long had an interest in the potential link between technological advancement and environmental sustainability.”  CEO Vestberg helped to lead the U.N. Sustainable Development Solutions Network, as example.

He sees the coming generation of high speed, highly-interactive technologies as a possible resource to help society buy time against catastrophic worldwide climate change (think of 3D printing, 5G networks, the Internet of Things, 4IR networks, autonomous devices).

Consider this, said the CEO of Verizon to the Davos leadership gathering:  “If we and our partners throughout industry, government and academia can collaborate imaginatively on way to maximize the sustainability benefits of these emergent technologies from the very start, the next few crucial decades could see cascading gains in momentum against both materials wastage and emissions.”

We think you’ll find his comments intriguing – and most welcome from the CEO of a prominent U.S. corporation with commitment to address critical issues related to climate change, and willing to speak up!

This Week’s Top Story

Want a Sustainable Earth? Bring on the Fourth Industrial Revolution
(Wednesday – January 23, 2019) Source: World Economic Forum – When I became CEO of Verizon back in August, one of my commitments was to accelerate our company’s progress in Fourth Industrial Revolution (4IR) technologies, drawing upon our longstanding role as a world leading…

Focus On The Corporate Sustainability Journey This Week – News & Opinion All Around the Topic in Various Communications Channels…

by Hank Boerner – Chair and Chief Strategist – G&A Institute

Remember the great Beatles’ song…Here, There and Everywhere?  That’s what seems to be happening with “Corporate Sustainability” these days.

The news and commentary seem to be everywhere now, with an examination of how the corporate sector is embracing the concept and developing strategies, action plans, assigning teams and moving forward to address ESG issues.

When we began our sustainability news, commentary and research sharing at Governance & Accountability Institute more than a decade ago, the items were few and far between, skimpy and more periodic than regularly appearing.

Today, a widening range of media and communications channels bring us the news of what the players in the corporate sector are doing — and how institutional investors and other key stakeholders are responding to same.

We see numerous news stories and commentary about what companies are doing in their sustainability journey…and how this matters in so many ways for the issuer (such as improved risk management, more effective investor relations, greater access to capital, enhanced reputation for recruiting and retaining human capital, preferred supplier status, and more).

G&A Institute is the data partner for the USA, UK and Republic of Ireland for the Global Reporting Initiative (GRI) and in this role, we gather and analyze (and then database) the corporate sustainability and CR reports of literally hundreds upon hundreds of companies.

The progress we’ve seen companies making in their journeys is encouraging and pretty astounding if you think back just 10 years or so (to the dark days of 2008).

And so as companies move ahead in the journey and greatly expand their disclosure and reporting, the communication channels light up with the “sustainability” news, commentary and research focused on a company, a group of peers, investors, an industry or a sector.

We selected a few examples for you this week.  First, from the food processing industry, an examination by Kevin Piccione (he describes his company’s effort – Sealed Air, an early sustainability adopter).

He cites the World Economic Forum finding that most “sustainable companies” outperform their peers by a third – but only 2% actually achieve or exceed their sustainability goals. So why do they succeed?  A brief review for you.

The second article for you is Harry Menear’s more in-depth piece from Energy Digital, examining which companies stand out for “green credentials”.

His focus is on the Corporate Knight’s “Top 10 Sustainable Companies” roster, which is drawn from comprehensive research on 6,000 companies worldwide across all industries (for companies with US$1 billion revenues).

The companies were scored on energy use, carbon, waste and clean air production, innovation expenditures, taxes paid, diversity of leadership, supply chain management, and other elements of the sustainability journey.  Which companies made the Top 10?  The link is below for your reading.

The third item is a note of caution from Bloomberg by Emily Chasan and Chris Martin — who point out that in the midst of the growing enthusiasm about corporate sustainability, there are some companies that investors call out for their “corporate greenwashing” (and they name names).  The authors cite the recent Ceres report on this (500 companies were analyzed).

They write:  Companies are still making questionable claims but accountability is rising.

Emily and Chris tell us companies (and their executives) are being forced now to admit to greenwashing (that is, “gushing” sustainability claims with a tenuous grip on reality).

Examined:  Mid-American; VW; Wal-Mart; Amazon; AB InBev SA.  There are perspectives shared on this by Calvert,  CalSTRS, BlackRock, Neuberger Berman, DWS Group, UBS.

And there are as always many items that our editors share this week in the Highlights, as we say, drawn for you from the many communications channels that our team monitors every day.  Let us know your thoughts as to how we are doing and what you would like to see!

This Week’s Top Stories

Achieving your sustainability goals does not mean sacrificing profits
(Thursday – August 16, 2018) Source: Food Processing – Nearly 90% of business leaders believe that sustainability is essential to remaining competitive and despite the clear link between sustainability and profit, only 2% of companies either achieve or exceed their sustainability…

Top 10 Sustainable Companies
(Monday – August 13, 2018) Source: Energy Digital – Which companies stand out for their green credentials? Energy Digital finds out.

Investors Are Increasingly Calling Out Corporate Greenwashing
(August 20, 2018) Source: Bloomberg – Corporate sustainability reporting has risen dramatically over the last few years, with 85 percent of the S&P 500 index producing annual corporate responsibility documents in 2018, up from just 20 percent in 2011, according to the Governance & Accountability Institute. That’s partially due to investor demand. Assets in sustainable investment funds grew 37 percent last year, according to data tracked by Bloomberg.

The Words From Davos In 2018: Sustainability, Responsibility…And More In This, The Fourth Industrial Revolution

by Hank Boerner – Chair and Chief Strategist, G&A Institute

The World Economic Forum (WEF) annually convenes business leaders, government officials, celebrities and other luminaries in the Swiss village of Davos-Klosters to explore societal issues and develop or work to advance solutions to same.

This year’s convocation was staged over four days n late-January. Some of the highlights for you:

UN Sustainable Development Goals in Focus
The Government of Denmark and the WEF signed a memorandum of understanding to move ahead with a partnership to improve the state of the world through a public-private cooperation. The agreement provides a model framework that could lead to improvement over the long-term.

And, adoption of the approach by other nations. Consider what this European nation and the WEF have in mind:

  • They will pursue public-private partnership to promote green growth.
  • Develop a technology and innovation partnership.
  • Work together to encourage greater adoption of the SDGs.
  • Support the mobilization of private capital for infrastructure through the WEF-led initiative, the Sustainable Development Investment Partnership.
  • Support trade and investment through the Global Alliance for Trade Facilitation (a multi-stakeholder initiative).
  • Work to implement the WEF’s System Initiative on Education, Gender and Work.
  • Denmark will assign a Ministry of Foreign Affairs senior advisor to the WEF New York City office (a second such WEF appointment for Denmark).

Prime Minister Lars Lokke Rasmussen said: “Denmark has an ambitious agenda to promote public-private partnerships…in terms of sustainable growth, social cohesion and technological skills. We are delighted to team with WEF to create concrete progress on these agendas…to create better lives for more people and sole the urgent climate crisis. We must build bridges across sectors, borders and old divisions…”

Addressing Modern Slavery
Influentials addressed the need for coordinated global action to end modern slavery – that was championed by US Senator Bob Corker (R-Tennessee); Monique Villa, CEO of Thomson Reuters Foundation; and, Gary Haugen, CEO of the International Justice Mission.

Senator Corker drew attention to the new Global Fund to End Modern Slavery (“GFEMS”), a public-private partnership to fund programs in countries where such practices are prevalent.

The initial funding is from the United States and United Kingdom; the goal is to raise US$1.5 billion-plus and develop a global strategy to address modern slavery. (It’s estimated that as many as 40 million people now live in modern slavery conditions. This is said to be a $150 billion global business.)

There are three pillars adopted by GFEMS: (1) leverage the rule of law; (2) “energized” engagement with business sector (3) work to sustain freedom.

Jean Baderschneider is CEO of the new Global Fund. The fund’s work will be modeled on the global effort to fight AIDS, TB and malarial infections, bringing together governments, the private sector and NGOs.

Tech-Reskilling Drive Announced
The Information Technology industry is going to work to target 1 million people to offer resources (such as on-line tools) and training opportunities to “re-skill” adults to help them meet the requirements of the tech industry for employment, as well as continue their education and learn more about today’s technology.

Big names in tech are signed on: Accenture, CA Technologies, Cisco, Cognizant, Hewlett Packard Enterprise, Infosys, Pegasystems, PwC, Salesforce, SAP, and Tata Consultancy Services. The coalition is seeking more members to help develop tools and processes to address the “barriers preventing adults from re-skilling or successfully completing training, initially in the United States. There are plans to scale to other geographies.

The coalition’s “SkillSET” is hosted on the EdCas AI-powered Knowledge Cloud Platform, accessible to all.

ISO 20121:2012 Certification for Davos
The conference was awarded the ISO certification for “sustainable event planning and operation” by DNVGL (a certifying body). ISO 20121 is a framework for identifying and managing key social, economic and environmental impacts of an event.

Sustainability measures implement by the Forum included carbon compensation for all air travel by the staff, media and participants; promotion of “sustainable transport” in Davos (walk don’t ride); energy efficiency; water management; sourcing of renewable energy; reduction of waste and recycling.

Ending With A Call to Action
The 2018 Forum closed with a call to action to “globalize compassion” and “leave no one behind.” This, the 48th WEF Annual Meeting, closed on a creative note with four artists sharing visions of how painting, photography, film and dance can inspire empathy with other people’s stories.

Across all of the 400 sessions, the Davos organizers said, “…one key theme kept emerging, the need to embrace our common humanity in the face of rapid technological changes ushered in by the Fourth Industrial Revolution.”

And so the call for a spirit of inclusion, diversity and respect for human rights…this characterized the 2018 gathering, said Sharon Burrow, one of the seven female co-chairs of the meeting (she is General Secretary of the International Trade Union Confederation).

Important outcomes of the meeting included these developments, on the theme of “mending our fractured world”:

  • Preparing workers for the future.
  • Safeguarding our oceans.
  • Closing the gender gap.
  • Tackling waste and pollution.
  • Unlocking nature’s value.
  • Making meat sustainable.
  • Bridging the digital divide.
  • Fighting financial crime and modern slavery.
  • Taking on fake news.
  • Securing air travel.

And…advancing the Fourth Industrial Revolution, which includes Forum centers at work with social, public and private sector partners in numerous countries.

As Oliver Baitch writing in Ethical Corp observed, having spent four days at the conference:

“First, and foremost, sustainability is here to stay. Long gone are the denials or debates as to whether “non-financial” or “soft” issues are the preserve of global business. Themes such as citizenship-centred science, a post-oil energy matrix and tax transparency have shifted from side-room workshops to the main stage.

“Second, companies are beginning to put their money where their mouths are. Davos 2018 saw a litany of firm, measureable corporate commitments – professional services firm PwC promising to cut its carbon emissions by 40% by 2022 (having cut them by 29% since 2007) through to Coca-Cola pledging to collect and recycle the equivalent of every bottle or can it sells globally by 2030.”

You can read his summary of the 2018 confab at: http://www.ethicalcorp.com/will-sustainability-be-ceos-trays-after-davos

And, of course, there is a significant amount of related information at the WEF web site:  https://www.weforum.org/

Cradle-to-Cradle Case History: Shaw Industries

Guest Commentary by Jennifer Moore – at the Conference Board

Content originally prepared for Certification in Corporate Responsibility & Sustainability Strategies – on-line courseware by G&A Institute **

The early 21st century ushered in a new wave of heightened concern about resource scarcity and climate change. Consequently, consumers have been more concerned about the sustainability of the products they purchase and the effects they are having on the environment.

Businesses have also taken on the challenge of incorporating sustainability strategies into their business models. Many more companies are now integrating sustainability practices through product stewardship and their R&D activities.

These companies are focusing on life cycle assessments of their products and are aiming to achieve Cradle-to-Cradle status. As defined by the Ellen MacArthur Foundation, the Cradle-to- Cradle school of thought is an important branch within the circular economy concept.

Cradle-to-Cradle focuses on products that have a positive impact and reduce the negative impacts on commerce through production efficiency (see footnote 1).

Cradle-to-Cradle and circular economy goes beyond the “reduce, reuse, recycle” campaign of the late Twentieth Century to focus more on the design and production of products, rather than on consumption by the consumer.

The authoritative work, “Cradle to Cradle: Remaking the Way We Make Things”,  authored by Michael Braungart and William McDonough called for a new era of production, wherein, companies should be focusing more on “doing more good,” rather than “doing less bad.”

The goal and focus should be on the end of the product’s lifecycle, and whether it will either be safely re-entered into the environment — or be recycled back into production.

Cradle-to-Cradle aims to achieve three things: (1) eliminate the concept of waste, (2) power with renewable energy, and (3) respect human and natural systems. (2)

This concept argues that resource consumption and economic growth should not be isolated from each other. In fact, they often go hand-in-hand. (3)

The private sector is not siloed; it has been highly influenced by the public sector and discussion forums. Many non-governmental organizations (NGOs), driven by public demand, have advocated for the advancement of a circular economy. The World Economic Forum, Oxfam International and the United Nations in particular have been vocal about transitioning to a circular economy.

Also, the emphasis of the Sustainable Development Goals (SDGs) released in 2016 by the United Nations is on developing a more circular economy and seeking to implement sustainable development across the UN member states. (4)

While the SDGs are driven by politics and protecting human rights, the goals cannot be achieved without businesses and were developed with input from the private sector. There is business value for companies to align their strategy with the SDGs. (5)

Many companies have recognized the benefits of aligning their goals with the SGDs and the relationship between resource consumption and economic growth.

Consumers are now expecting companies to provide products that are eco-friendly and reduce resource waste. According to a survey conducted by Nielsen in 2014, “55 percent of on-line consumers indicated they were willing to pay more for products and services provided by companies that are committed to positive social and environmental impact, an increase from 50% in 2010 and 45% in 2011.” (6)

The Business Community’s Embrace of Cradle-to-Cradle

Businesses across all industries are now developing their product stewardship products to meet these consumer demands. Companies cite “customer demand for solutions that address global sustainability challenges, such as climate change and resource scarcity” as primary drivers of sustainable product initiatives. (7)

For example, 3M is striving for 40 per cent of their new products to be sustainable and Kimberly-Clark is developing solutions for used diapers. One exemplary model of sustainable product stewardship is Shaw Industries’ dedication to Cradle-to-Cradle.

The Shaw Industry Model

Shaw Industries is the largest producer of carpet tile in North America. While carpet tiles can have a lifespan of 10-to-25 years, commercial owners and tenants often update their facilities more frequently than that to reflect contemporary trends, resulting in a high-waste industry.

Historically, when the time came for flooring to be removed from businesses, schools, retailers, hospitals and other properties – whether for wear-and-tear or aesthetics, it was sent to landfills.

Recognizing the opportunity to create a better solution for customers and to create a product that would help advance toward a more circular economy, Shaw developed EcoWorx-backed carpet tile, which it introduced in 2008 and continues to optimize for sustainability performance.

The world’s first Cradle-to-Cradle Certified carpet tile — EcoWorx — was designed for reuse. To create a carpet tile that could be infinitely recycled with no loss of quality meant removing PVC, phthalates and other chemicals. As a result of its meticulous design process, Shaw understands what’s in its EcoWorx products and, therefore, what’s going into the next generation of its products.

Today, with 16 years and more than 3 billion square feet of EcoWorx installed, Shaw continues to optimize the product’s performance in alignment with Cradle-to-Cradle criteria – material health, material reutilization, energy, water and social responsibility.

Most recently, Shaw worked with one of its suppliers to remove an ingredient from its latex that was added to the list of banned chemicals within version 3 of the Cradle-to-Cradle Certified Products Program Standard.

Further, the company employs sustainable manufacturing practices – making efficient use of materials and natural resources, using alternative and renewable energy sources when possible, and designing and operating its facilities and manufacturing processes in accordance with widely recognized sustainability and safety standards.

It completes the sustainable manufacturing process by delivering its products using the most efficient mode of transportation feasible while meeting customer deadlines.

Shaw has committed itself to embracing Cradle-to-Cradle practices and has lead the way in carpet reclamation in the flooring industry. Today, 65 percent of its products – commercial and residential – are Cradle-to-Cradle Certified, with a goal of designing 100% to Cradle-to-Cradle principles by 2030.

Not only is Shaw committed to upcycling within its own operations, it also looks for opportunities in other industries.

For example, the company converts plastic drink bottles into residential carpet through a joint venture with DAK Americas: The Clear Path Recycling Center in Fayetteville, NC produces 100 million pounds of clear flake each year, recycling approximately three billion plastic drink bottles annually.

Furthermore, in 2016 alone, Shaw supplied more than 200 million pounds of post-industrial waste to other businesses for a variety of recycled content needs. For instance, the wood flour – waste fiber from hardwood flooring operations – is used by a major producer of composite decking and the minimal waste from its resilient manufacturing facility is used to make garden hoses.

The Future for Cradle-to-Cradle in Industry

Today, sustainable leadership companies, like Shaw, can strive to achieve cradle-to-cradle production through the certified program by the Cradle-to-Cradle Products Innovation Institute.

The Institute examines certifiable products in five (5) quality categories – (1) material health, (2) material reutilization, (3) renewable energy and carbon management, (4) water stewardship, and (5) social fairness. (Footnote 8)

Sustainability managers must partner with their design and strategy teams to develop sustainable solutions to the products and services their company offers. Not only are these products essential ecologically and socially, they are also drivers of revenue growth.

If managers are concerned about getting [internal] corporate buy-in to fund ESG R&D, they are able to present the business case of how other companies — especially like Shaw Industries with the illustrations here in this case study — have seen Cradle-to-Cradle’s positive impact on their revenue. (9)

According to The Conference Board, “revenues from sustainable products and services grew at six times the rate of overall company revenues.”

In order to address Earth’s ecological crisis, companies must lead the way by ensuring they are designing eco-friendly products and services that respects the finite resources available on the planet. Sustainability managers can look to Shaw as one company that is leading by example.

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Jennifer Moore is Manager, Executive Programs, Sustainability & EHS at the Conference Board. She engages with senior executives from Fortune 250 companies to understand their needs and help solve their business issues. She oversees and executes all aspects of 15 roundtables per year.

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**  Information about the G&A Institute on-line course:

http://learning.ga-institute.com/courses/course-v1:GovernanceandAccountabilityInstitute+CCRSS+2016/about

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Footnotes:

(1) Ellen MacArthur Foundation. Cradle to Cradle in a Circular Economy – Products and Systems. Retrieved March 5, 2017. https://www.ellenmacarthurfoundation.org/circular-economy/schools-of-thought/cradle2cradle

(2)  Ellen MacArthur Foundation. Cradle to Cradle in a Circular Economy – Products and Systems. Retrieved March 5, 2017. https://www.ellenmacarthurfoundation.org/circular-economy/schools-of-thought/cradle2cradle

(3) Strahel, W. (2015). The Performance Economy. Palgrave MacMillan: 2006

(4) United Nations. United Nations Economic and Social Council. Millennium Development Goals and post-2015. Development Agenda. Retrieved March 5, 2017. http://www.un.org/en/ecosoc/about/mdg.shtml.

(5)  Yosie, T. Is There Business Value in the UN Sustainable Development Goals? Retrieved March 5, 2017. http://tcbblogs.org/givingthoughts/2017/02/07/is-there-business-value-in-the-un-sustainable-development-goals/#sthash.L0MLUAN7.xHIHNvHZ.dpbs

(6) Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 17.

(7) Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 8.

(8)  C2C Product Certification Overview – Get Certified – Cradle to Cradle Products Innovation Institute. Retrieved March 5, 2017. http://www.c2ccertified.org/get-certified/product-certification

(9)  Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 6.

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