Profits: sustainability must be relevant to our daily lives

How going green can save you money
By MARGARET CASE LITTLE, COMMUNICATIONS MANAGER | Published: SEPTEMBER 27, 2010


From leading the EPA’s Climate Leaders program to consulting for a company at the forefront of sustainable business practices, SAP’s Jim Sullivan knows a thing or two about corporate sustainability. 



For a retailer just thinking about a sustainability program, what are the most important things to keep in mind when getting started?


The key factor in any corporate sustainability program is to create a solid business case on how the program will increase overall profitability and then get the appropriate buy-in at the senior management level to make sure it can be well-executed. In retail, the two main drivers for profitability are the opportunity to improve margins (primarily through operational efficiency) and the opportunity to increase revenue growth. Over time as the program matures, there is also the opportunity to improve the company’s valuation multiple (primarily by improving risk premiums such as predictable access to insurance/capital).


After creating a solid business case, the second most important thing to take into account is the scope of the program. “Sustainability” is an intentionally broad concept and a key factor for success is to narrow the scope of a corporate program to a manageable number of material indicators that are extremely relevant to an individual company, their customers, and their broader stakeholder community. For example, SAP reports out on eleven core metrics around the environmental, social and economic dimensions.


The final ingredient necessary for a successful program is an early commitment to transparency in tracking progress. Senior management and stakeholders must realize sustainability is a journey on which most companies are on their initial steps. For the long-term credibility of the program, companies should commit to not only reporting on their success but also on lessons learned and challenges in achieving their goals.


measure & verify... define business 'core-metrics' & track your progress. marco is here to help you mange the margins, so you can grow!