Why Sustainability Should be on the Corporate Radar

In A Personal Reflection on Corporate Sustainability (October 11, 2012), we introduced the purpose of the ProEdgeWire: Sustainability & Education section as a platform to ask questions and discuss corporate sustainability; to highlight mainstream developments in the global natural resource sector, encompassing the whole supply chain to highlight what miners and developers are doing as part of their corporate sustainability programs, with upstream and downstream examples. It is our ultimate aim to educate our readers with timely projects encompassing the essence of sustainability, while inviting our partners and readers alike to take part in an important dialogue to help direct the future of corporate sustainability in the resource sector.

You might now be asking why corporate sustainability should be on a company’s radar — The simple rationale for addressing sustainability issues in the realm of environmental, social and governance factors is that being proactive in these areas affords a company the agility to respond effectively to events that affect the bottom line but which are often not captured in financial statements. Additionally, being proactive in these areas can also result in a favorable corporate image, increase social license to operate and better bottom line numbers.

Consider this example: A few years ago, while living in Vancouver I saw a sign posted on an entrance door at a Wal-Mart stating that during the summer month, the store would be turning off some lights to keep the store cooler. This may seem like an ordinary measure and in fact, one that you’ve likely implemented at home on a hot day to maximize the effect of your fans or air conditioning system; or perhaps you’d turn the fan and air conditioning off altogether because turning off the lights did the trick.

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Doing this also has broader implications that you may or may not have taken into account. It reduces the use of electricity which in turn avoids the greenhouse gas (GHG) emissions that would have been created when generating the electricity to keep the lights running and it also saves the cost of paying for the electricity needed to keep the lights on. This cost avoidance affects the bottom line, especially when you consider how large stores can be and when you multiply these savings by hundreds or thousands of stores worldwide. This is just one of myriad examples that highlight how environmental factors can and do impact business operations and why these factors should be addressed proactively.

I checked Wal-Mart’s website to learn more about their sustainability efforts and found that as part of their energy conservation efforts, every new store built will have an automatic dimming system so that as daylight hours increase during the year, lights will be dimmed or even turned off to reduce electricity demand during peak hours. This system is already in place in 600 Wal-Mart Supercentres, SAM’S CLUBS and Neighborhood Markets and has resulted in an annual savings of about 250 million kwh per year, enough to power approximately 23,000 homes. Other initiatives include an interior lighting retrofit program and the installation of white roofs. You may or may not know that Wal-Mart has an extensive sustainability program across its global operations and this is just the tip of the iceberg.

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  1. The Wal Mart example you cite example is but one of many practical ways that energy consumption can be reduced. In many ways sustainability is synonymous with innovation and practicality – in business terms. Some airlines reduce weight by keeping minimalistic paint schemes so as to reduce the amount of paint on the fuselage. Given the sizes involved, the savings are not trivial. Similar ideas are used in maritime transport. Solar panels are used to generate power for auxiliary systems on ships, reducing load on the diesel engines, which reduces emissions in turn. Sustainability is therefore about improvement and technological progress, hardly the monopoly of the sandal wearing crowd.

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