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February 17, 2009
Book Review: The Sustainable Enterprise Report Volume 2
    by Robert Kropp

Second edition of report offers evidence that the economic downturn provides an opportunity to establish economic, social, and environmental considerations for competitive advantage.


Deloitte, a worldwide provider of audit, consulting, financial advisory, risk management, and tax services, has published the second edition of its study entitled The Sustainable Enterprise Report: Turning Awareness into Action. A download of the complete report is available on the website.

Directed at C-level executives, The Sustainable Enterprise Report dispenses with theory and instead offers practical advice, replete with examples of successful corporate sustainability efforts, to guide senior management of corporations on a path that it contends is necessary to maintain competitive advantage in the years to come.

The report contains peer-reviewed white papers, whose authors offer insights into the latest issues involving corporate responsibility and sustainability, as well as several case studies. The four primary chapters of the report argue that companies must build on their investments in corporate responsibility and sustainability in order to manage risks and opportunities in a global environment increasingly threatened by climate change.

The report asserts that "companies that drive fundamental changes in business strategy, operations, and supply chain, will have the opportunity to transform themselves in a way to benefit from important emerging opportunities in the areas of alternative energy, climate change, local sourcing, and many others."

In the introductory white paper, entitled "Green Business is Good Business," Andrew Winston, co-author of Green to Gold: How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage, identifies the rapidly rising prices of commodities and a growing expectation of transparency by corporate stakeholders as two forces that are driving the need for corporations to create sustainability plans.

Additionally, the anticipated increase of regulatory action on climate change is expected to include aggressive greenhouse gas emissions laws and green design principles in building codes.

Winston recommends a number of steps for corporations to take in order to adapt to requirements brought about by climate change. Resource efficiency throughout the organization and in its supply chains is a necessity in an era of dwindling resources and impending environmental crises. Transparency in dealing with all stakeholders will help ensure that a company's efforts are measurable and contribute to sustainability.

In their white paper entitled "Risk Intelligence," Mark Layton and Eric Hespenheide set out a number of steps to help corporate responsibility and sustainability programs proactively address the opportunities associated with risk management. Drawing on a 2006 Deloitte white paper entitled The Risk Intelligent Enterprise, the authors recommend corporate action plans that integrate corporate responsibility and sustainability into long-range business strategies.

With such a transparent long-range plan in place, the authors contend, corporations will evolve from an ad hoc response to potential crises to a state of capability in which risk considerations are included in the decision-making process.

In "Always Leading Green," Richard M. Gittleman traces the development of cap-and-trade programs for the reduction of carbon emissions, starting with the European Union's Emissions Trading Scheme and focusing on the Western Climate Initiative (WCI), which involves four Canadian provinces and seven U.S. states, including California.

The cap-and-trade program as designed by the WCI is intended to lower the cost of achieving emission reductions and mitigate the economic impact on consumers and businesses. The initiative targets not only carbon dioxide emissions, but five other greenhouse gases as well.

"Market forces, reinforced by complementary public policies, will promote energy efficiency and clean, renewable energy sources to supplant carbon-intensive, fossil-fuel-based electricity," Gittleman writes. "Making renewable energy sources more attractive will provide a significant benefit to California on both an economic and carbon basis and will go a long way towards fulfilling its emissions reduction goal" of returning to the state’s 1990 emission levels by 2020.

Marsha Willard and Darcy Hitchcock, the authors of The Step-by-Step Guide to Sustainability Planning, adapt the findings of their book in a white paper entitled "6 Steps to Sustainability." Noting that 75% of the largest corporations now utilize a business sustainability plan, the authors set out a series of steps to ensure that the plan accomplishes the goals of measurable progress and transparency.

Other white papers included in The Sustainable Enterprise Report address green building, which according to author Paul von Paumgartten must be expanded beyond new construction to include the retrofitting of existing buildings to meet green building standards. Bill Birchard recommends that companies adopt a reporting framework based on the sustainability reporting guidelines employed by the Global Reporting Initiative (GRI).

Lloyd Timberlake of the World Business Council for Sustainable Development (WBCSD) addresses the challenge of doing business in a water-constrained world, and Stephen Stokes examines how Europe's integration of green agendas in response to regulatory and market forces provides lessons for a similar adoption in the US.

Case studies included in The Sustainable Enterprise Report address such topics as telecommuting, the sharing of knowledge with strategic business partners to achieve the goal of sustainability, and the introduction of alternative-fuel vehicles into corporate fleets.

 

 
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