elevating and integrating sustainability into strategic ......cdp: ghg questionnaire - eastman...

Elevating and Integrating Sustainability into Strategic Decision Making throughout your Organization

John Latham

elevating and integrating SUSTAINABILITY

into strategic decision making throughout your organization

john latham

John Latham (c) 2009

Understand the Systems and Stakeholders

Investors

Public

understand the pressures from multiple stakeholders...

Employees

Customers

John Latham (c) 2009

understand your value chain...

Suppliers Operations Customers

Inbound Logistics

Outbound Logistics

John Latham (c) 2009

understand the connection between energy and carbon...

understand the connection between energy and carbon...

Energy

Methane

Nitrous Oxide

HFC, PFC, SFs

Other

0 22.5 45 67.5 90

% CO2 Emissions

Source: EIA 2008

understanding fuel type consumption and carbon...

Source: EIA 2008

Petroleum

Coal

Natural Gas

Non-Fossil

0 12.5 25 37.5 50

% Consumption % CO2 Emissions

understanding electricity fuels and carbon...

Source: EIA 2008

Coal

Non-fossil

Natural Gas

Petroleum

0 22.5 45 67.5 90

% Consumption % CO2 Emissions

understand your electricity consumption and CO2...

Suppliers Operations Customers

Inbound Logistics

Outbound Logistics

Mining Transportation Power Production

$$ + CO2 $$ + CO2

John Latham (c) 2009

understand your hydro carbon usage and CO2...

Suppliers Operations Customers

Inbound Logistics

Outbound Logistics

DistributionExploration

Drilling

Production

Refining

$$ + CO2

John Latham (c) 2009

understand your materials usage and CO2...

Suppliers Operations Customers

Inbound Logistics

Outbound Logistics

Logging Transportation Processed Materials

$$ + CO2 $$ + CO2

John Latham (c) 2009

Carbon Disclosure Project

!

www.cdproject.net

carbon disclosure project...

1. Management’s views on the risks and opportunities that climate change presents to the business;

2. Greenhouse gas emissions accounting;

3. Management’s strategy to reduce emissions / minimise risk and capitalise on opportunity; and

4. Corporate governance with regard to climate change.

5. Greenhouse gas emissions split by business category;

6. Management’s engagement with its suppliers; and

7. Greenhouse gas emissions over the lifecycle of goods or services.

Source: http://www.cdproject.net/questionnaire.asp

CDP: GHG Questionnaire - Eastman Kodak...

1 Regulatory risks Yes“EK manufactures product using energy and operates a cogeneration power plant at largest site. Climate change could impact the cost of

energy.”

2 Physical risks Yes “Manufacturing, key office and distribution sites are not expected to be impacted by effects of climate change.”

3 General risks Yes “Potential increases in fuel and carbon costs will have an impact on manufacturing, suppliers and transportation.”

4 Risk management YesReduced energy and GHG emissions by 36% during the 2002-2007

timeframe vs. goals of 20%. Member of: US EPA Climate Leaders, CA Climate Action Registry, Climate Registry, Chicago Climate Exchange. “

5 Reduction plan Yes20% worldwide absolute GHG emissions reduction by 2008 using

2002 as the baseline year through energy efficiency and consolidation of operations.

6 Investment Yes $10 million from 2002 to 2007.

7 Savings achieved Yes Cumulative energy savings from 2002 to 2007 due to reduction efforts has been $68M.

8 Org Responsibilities YesCorporate Responsibility and Governance Committee of the Board of Directors. The Environmental Council, a group of senior execs, creates

long-term direction and oversight of environmental policy.

Source: CDP6 Greenhouse Gas Emissions Questionnaire - Eastman Kodak

Develop Strategies

swot matrix and analysis...

Strengths Weaknesses

Opportunities Just Do It! Invest???

Threats Maintain Danger!

value chain energy use and emissions

external pressures

John Latham (c) 2009

three strategic options...

Change the energy and materials sources and supply chain

Change the value chain’s energy and materials usage

Change the organization’s energy and materials waste

John Latham (c) 2009

Wal-Mart Goals - The Big 3...

Powered by 100% Renewable Energy

Sustainable Products - Resources and Environment

Create Zero Waste

“save people money so they can live better”John Latham (c) 2009

goals - value chain v. strategic options...

Suppliers Logistics Operations Customers Employees Investors

Sources

Change design of supplier facilities and processes and sources of

raw materials to use more renewable sources.

Change transportation modes to use

more renewable sources.

Change design of facilities and

processes to use more renewable

sources.

Change design of products and

services to use more renewable

sources.

Engaged in alternative energy and materials projects

Financial impact of alternative energy and materials sources.

Usage

Change design of supplier facilities and processes and sources of

raw materials to use less energy and materials.

Change design of packaging and transportation modes to use

less energy and materials.

Change design of facilities and

processes to use less energy and

materials.

Change design of products and

services to use less energy and

materials.

Increase the usage of low

energy practices (virtual meetings

and work). Engaged in

energy savings projects.

Financial impact of reduced energy and

materials usage.

Waste

Reduce the amount of energy and

materials waste. Increase the amount of recycling.

Reduce the amount of

energy used for transportation and storage of supplies and

materials

Reduce the amount of energy and

materials waste. Increase the amount of recycling.

Reduce the amount of energy and

materials waste. Increase the amount of recycling.

Engaged in waste reduction and

recycling projects.

Financial impact of reduced waste

and recycling.

John Latham (c) 2009

• Identify greatest opportunities based on:

• carbon emissions (example)

• expected reduction in energy usage

• expected reduction of GHG emitted

• financial impact

• estimated cost of initiative

• expected savings

• expected increase in revenue

• risks

determine priorities...

John Latham (c) 2009

Wal-Mart goals (selected)...

• Buildings - 20% increase efficiency by 2012

• Transportation - 25% reduction by 2008

• Waste - 25% reduction in solid waste by 2008

• Products/Sources - All Seafood from Marine Stewardship Council certified by 2010

John Latham (c) 2009

Translate and Take Action

WalMart Initiatives - Sources...

• Coffee - Fair Trade

• Cotton - Organic

• Seafood - Sustainable Sources

• Jewelry - Inherently Unsustainable

www.GreenBiz.com

Measure, Review and Learn

Change v. Improvement

Eastman Kodak results 1997 to 2005 (selected)...

• Emissions of 30 priority chemicals - down 64%

• Methylene chloride emissions - down 79%

• Total manufacturing waste - down 40%

• Water usage - down 47%

• Global energy usage - down 17%

• Global greenhouse gases - down 17%

http://www.kodak.com/US/plugins/acrobat/en/corp/environment/07CorpEnviroRpt/Sustainability_Report_2007.pdf

Source: Kodak Global Sustainability – Eastman Kodak Company 2007 Annual Report

Wal-Mart results (selected)...

• Buildings - 15% increase efficiency

• Transportation - 15% actual gain

• Packaging - 2,000 vendors

• Recycling - $28 million profit

• Products

• ALL farmed-shrimp factories are certified by ACC

• 20% increase in organic cotton sales

What are your sources of energy and materials?

How do you use energy and materials?

How do you dispose of waste?

focus on three questions...

John Latham (c) 2009

Why?