DC Velocity - June 2018

26 DC VELOCITY JUNE 2018 www.dcvelocity.com t h ou g ht l e ad er s

al, it’s really quite small. Because doing something major requires a big investment.

QWhat are some of the best tools or methodologies for balancing sustainability against providing jobs and being profitable?

ABasically, you have to do a benefit-cost analysis. Are the benefits of the sustainability program greater than the costs? When they conduct that analysis, some companies give a discount to programs that are environmentally sustainable. For instance, normally they would ask for a 12-percent return, but if it’s environmentally sustainable, it needs to [produce] only a 10-percent return.

The benefit-cost analysis itself should be a comprehensive exercise that considers the impact on reputation, job dislocation, and whether not doing something somewhere will create more problems somewhere else.

QWhat are some examples of big companies that have been able to take a balanced approach to sustainability?

AThere are big companies that care about sustain- ability to an extent, such as Unilever and Starbucks.

Both are working very closely with their suppliers on
sustainability. Starbucks works with its coffee suppliers
and educates them on how to be both more sustainable
and more productive. It teaches them how to cultivate
their crops and how to prevent erosion when the crops
are grown on mountainsides, and how to rotate their
crops regularly. Unilever, which is the world’s biggest
supplier of tea, has a similar program with its tea grow-
ers. Because the programs focus on teaching growers
how to be more productive, the cost savings from those
efforts help them invest in sustainability efforts. This is
one way that companies are able to have their cake and
eat it too.

QWhat are some of the most difficult parts of setting up a sustainability program? AThe classic one is recognizing that sustainability is a supply chain issue. Many companies are dedicated to sustainability within their own company. So, for example, all of Apple’s own facilities are carbon-neutral. But that’s nothing because Apple doesn’t make anything. It’s the factories that are the big energy consumers. So the question really is, “How do we make [Apple’s contract manufacturer] Foxconn’s facilities more sustainable?” And Apple is aware of this.