Sustainability has long been on the agenda at many companies, but for decades their environmental, social and governance activities have been disconnected from core strategy. Most still take a fragmented, reactive approach – launching ad hoc initiatives to enhance their ‘green’ credentials, to comply with regulations, or to deal with emergencies – rather than treating sustainability as an issue with a direct impact on business results.
Evidence shows that CEOs see value in sustainability. A 2010 Accenture study conducted for the UN Global Compact on the importance of sustainability found that 96 percent of CEOs surveyed thought that sustainability issues should be fully integrated into the strategy and operations of a company. Despite this metric, many companies are still taking a reactive approach instead of integrating it into their core business elements, such as their capabilities, processes and systems.
Still not convinced sustainability is important? Here are eight key reasons why CEOs should pay attention to sustainability and start taking action to ingrain it into their core business strategy.
Cost savings and controls that lead to an improved bottom line. Companies who adopt sustainable practices will benefit from resource efficiency, lower energy consumption and emissions and waste minimization. Combined, these benefits will improve your bottom line.
Customer demand. You will attract customers who care about the environment.
Risk mitigation. With energy costs rising and uncertainty in supply, companies need to start re-thinking about how they obtain and use inputs. As a senior leader you need to assess this long-term risk to the business and find ways to reduce those risks.
Market leader. Don’t adopt sustainability strategies to comply with government regulations, become a leading-edge organization and market leader.
Employee retention. Employees want to work for a company they feel good about. According to a recent survey 92% of young professionals would be more inclined to work for an environmentally-friendly company.
Brand reputation and publicity. A company that can maintain a strong brand and reputation based on trust is a key source of competitive advantage. This means no green-washing.
Ranking and ratings. Many investors are paying close attention to Dow Jones Sustainability Index and Carbon Disclosure Project when evaluating companies. Positive sustainability credentials shows investors your business model is strategically aligned to sustainability and you’ve assessed the risks and opportunities related to it.
New revenue opportunities. Sustainability can open a new range of product and services that you didn’t know existed before.
As the visionary and leader of organizations, CEOs need to adverse themselves in the importance of sustainability and how it impacts the strategy and operations of their company. If done systematically, the benefits are significant.
Tiffany Richmond has over five years of experience as a marketing professional and is responsible for marketing strategies at Energy Advantage Inc.
I stumbled across this article on the Sustainability Learning Center website that I thought was great summary of items companies should focus on when building the business case for sustainability. Here’s a summary of the article’s key points.
Tips on building a business case for sustainability:
Meet your team “where they are”. If they are focused on financial results, talk cost savings and market growth. If they are worried about reputational risk – talk about risk management and stakeholder engagement. Sustainability and Corporate Social Responsibility are holistic. Present it in a way that “talks” to your audience. Piggyback on existing initiatives. The other pieces can come later.
Get the right team engaged. If you can’t get senior management engaged, this isn’t going to work. Influence the influencers. Find a champion that is connected to the right people. Sometimes the key influencers might be competitors or senior management in another company.
Understand stakeholder expectations. Where are your customers, staff and suppliers on sustainability and corporate social responsibility? This will help you make your case.
Align the business case for sustainability with your overall strategy. Show how it fits with your new product, innovation, quality and customer service strategy.
Consider customizing the business case for different business units. Manufacturing may be interested in the savings from eco-efficiencies but sales and marketing may be interested in how it meets customer needs.
Tackle the “low hanging fruit” and demonstrate early wins. Companies have typically found millions of dollars in savings in the first few years. Some with a simple return on investment of only a few months.
Choose meaningful measures and targets. What gets measured gets done so choose metrics that are aligned with your company’s KPIs and let you track the business benefits of your plan.
Don’t forget the ‘how’ when you talk about the ‘why’. A business case and a plan are beautiful things but without implementation they are just squiggles on bits of paper. Make sure you know how you are going to implement the plan and line up support and resources to do so. This includes: people, their time, incentives, training and resources as well as the appropriate tools, IT and infrastructure.
Include a communications strategy in your business plan. Include elements that connect to the “thinking, feeling, willing, social self”. Make sure the program is authentically meaningful and aligns with the values of your employees.
Earth Day is Monday April 22nd, 2013. What are you doing to celebrate the largest international environmental event? The first Earth Day was forty-three years ago on April 22, 1970 as a nationwide demonstration, petitioning the government to put environmental issues on the political agenda. 20 million participants demonstrated that day which is now an annual celebration across the globe.
In light of this event, here are 8 suggested Earth Day activities you can do to get involved in the movement and help sustain our environment.
Articles about energy and environmental matters happening around the world.
Calls for an Audit into Labels Claiming Food Sustainability
Companies might claim they have fair trade practices, pay fair prices to local farmers, that their treatment of workers is above board or they have safe environmental practices. But consumer groups are questioning the legitimacy of some sustainability certification schemes following reports that some companies are ”certifying” their own products.
How Target Aims to Hit the Mark on Sustainability
Target believes that to have a lasting positive impact on society, sustainability must be integrated into the fabric of the organization while encouraging growth at the same time. Target focuses on four commitments; sustainability living, sustainability products, smart development and efficient operations.
Assessing Businesses’ $7.3 Trillion Annual Cost to Natural Capital
Primary production and processing industries are costing the global economy around $7.3 trillion a year in terms of the economic costs of greenhouse gas emissions, loss of natural resources, and other factors, according to a new study.
Folks at Energy Advantage are very pleased to announce that its internal controls and systems are compliant with the new Canadian standard for third party assurance reporting, CSAE 3416. Every year the company undergoes a strict audit from independent third party auditors to assess the internal control objectives of its utility bill payment and reporting services.
This compliance proves Energy Advantage’s controls are fairly designed and provide reasonable assurance that control objectives are met and operating effectively.
“This certification demonstrates to our customers that our services are maintaining effective and efficient internal controls,” says Rob Kirkby, Chairman & CEO, Energy Advantage Inc. “Our continued compliance to Canadian third party assurance reporting proves the quality and safety of our operating procedures and controls.”
The new service organization reporting standard was updated to align with international control standards, specifically the United States SSAE 16. CSAE 3416, compared to its predecessor CICA 5970 is more complex and includes intricate new requirements and important updates to previous ones.
CSAE 3416 is a professional standard used by independent third party auditors to rigorously assess the internal control objectives of service organizations.
Tiffany Richmond has over five years of experience as a marketing professional and is responsible for online marketing strategies at Energy Advantage Inc.
Over the past several months you have been working hard to collect and input your portfolio’s historical energy data into one centralized database (ideally it’s in an online database) and setting up a process to track the data on a continuous basis. You’ve spent hours on the phone with utilities requesting utility invoices, contacted numerous property managers to send you facility specific data (age, square footage, etc.) and went blind reading line by line charge types on the invoices. But you did it. The task that has taken you forever to finish is finally done. What do you do next?
I see this situation all too often. Companies invest time and resources into collecting their utility data then don’t know what to do with it. This typically leads to nothing being done other than collecting the data on regular basis (which might I add is a step in the right direction, just not a big enough step).
Now before I go on I shouldn’t disregard the initiative of collecting your data regularly. This is important. You can catch billing errors made by utilities, troubleshoot problems with your invoice and avoid late payment charges. All positive results.
But now you need to look past the charge types and really understand what your data is telling you. The best way to get started is to choose one year of data and look at your performance (in the industry we like to call this a baseline). By doing this you can gain an understanding of:
Your energy consumption and costs (let’s keep it simple and begin with electricity and natural gas data) relative to internal and industry benchmarks;
Performance trends at different properties; and
Target candidates for potential performance improvement initiatives.
To start unravelling the story of your performance you can manipulate your data in a number of ways, here are a few to get started:
Look at total energy consumption by property, banner or region. Energy consumption is a variable that can be controlled and managed by operational processes, behaviours and capital improvements (versus energy cost which is reflective of the market price). By looking at your properties total energy consumption (electricity and natural gas data monthly or annually), you will be able to identify those properties out of trend energy intensities. Further investigation into the highest properties should be conducted. How are they operating their properties differently than the less consuming ones? Keep in mind that the size of a building, business activity and occupancy may affect consumption. Try to compare properties that are similar in nature.
Look at total energy cost by property, banner or region. By doing this, you will identify what property, banner or region has the highest energy cost. There are many factors that could contribute to high costs including, size of the building, business activity, market price, geographic location, tax percentage, weather and occupancy. So don’t jump to any conclusions right away.
Understand total energy cost by commodity type. This will identify the performance of each commodity type (electricity and natural gas) in your properties. When visually displayed by month it should align with the type of business activity you do. For example if you are a commercial real estate company there is typically a distinct increase in electricity consumption during the summer from the cooling load and a increase in natural gas consumption in the winter from the heating load. Compare properties side by side to see how similar or different they are. If they are different but located in the same region further investigation is needed to understand why.
Use internal benchmarks to rank properties based on current energy performance. Look at your properties’ energy use intensity or energy cost intensity (typically calculated by taking the total energy consumed/cost in one year and dividing it by the total floorspace of the property). This will allow you to compare properties that are similar in size more accurately, as well as to compare properties to industry averages. Properties that are using less energy will have a lower intensity. Also compare the cost per square foot to your annual cost across all properties. Look for properties that have the highest annual cost and highest total cost per square foot. These properties are likely to yield valuable energy savings and should be further investigated as candidates for specific energy savings initiatives.
These are just a few ways to analyze your data. If you still have unanswered questions at the end of your analysis, such as; “why am I spending more at property A versus property B?” Visit this property. Even complete an energy audit. The more data you can gather and collect the better you will understand the story, which, let’s face it, will help you make better business decisions when it comes to energy.
Please note the utility data displayed in the graphs is fictional data.
Tiffany Richmond has over five years of experience as a marketing professional and is responsible for online marketing strategies at Energy Advantage Inc.
Articles about energy and environmental matters happening around the world.
Achieving Scalability in Energy Management
AT&T teams up with Rocky Mountain Institute (RMI) in its Portfolio Energy RetroFit Challenge to prove that deep energy retrofits are both technically feasible and financially prudent when applied at scale.
Measuring the Real Cost of Water
Big savings are available to companies that look beyond their utility bills and understand the broader economic costs of their water consumption.
HR and Sustainability: An Odd Couple?
Andrew Savitz argues that employees are the key to creating sustainable companies, but that they — and their colleagues in human resources — are often overlooked when companies embark on environmental programs.
China’s Solar Boom Shows Signs of Setting
A bond default by one of China’s biggest solar panel makers is a sign the Chinese solar industry is heading for the same kind of consolidation that has hit the rest of the world, where overcapacity and low prices have driven many players out of business.
Hayes Says UK Energy Strategy Must Remain Flexible
The UK Minister of State for Energy, John Hayes, speaking at the Marketforce conference in London on Tuesday, emphasised the need for flexibility to be built into the country’s energy policy in order to meet the unpredictable energy landscape demands of the future.
Earth Hour is a unique opportunity for you to become more sustainable and do something positive for the environment. It’s been the source of inspiration for millions of people taking steps towards a cleaner, safer future. It’s not just about saving energy for one hour, it’s about going Beyond the Hour with lasting, behaviour-changing actions for a sustainable planet.
Employees of Energy Advantage will be turning off their lights for one hour on Saturday March 23, 2013 at 8:30 PM to support Earth Hour 2013. Are you?
In order to respond to their energy and environmental challenges, organizations need to clearly understand their energy costs, identify areas for improvement in operational practices, reduce energy costs and environmental impact, develop a baseline to compare against industry benchmarks or future performance, and finally, to track and report their performance. These key initiatives require expertise in various areas, but have one crucial element in common. If you guessed energy data then you are correct. The gathering of energy data is the first step in effective and environmentally-forward energy management. To begin, your organization will need a complete and up-to-date set of utility billing information. But what happens if you don’t have this information or if it is difficult to obtain? Where do you start?
The purpose of this article is to help identify ways that companies can collect their utility bill data and establish a comprehensive and accurate energy data set. The first step is to create a data foundation. In order for any company to make informed decisions about energy management, it must establish a data foundation. The age old saying you can’t manage what you don’t measure is as relevant today as it was a hundred years ago. Why is this important? Well, once the raw data is collected, data manipulation, analysis, trending and comparison can be completed.
Seems easy, right? Now all you have to do is find the data.
The Challenges
Every organization is different. Some companies track data but not all in one place, others rely on utilities or third parties, and some don’t track it at all. In every case, establishing a data foundation that is accurate, transparent and complete can prove quite difficult. Finding and collecting the right data can be an arduous task.
Where do you look for this data? It can be very time consuming poking around your organization or even contacting utilities for this information. The challenge is compounded when you have multiple locations, across provinces and/or states, and are searching for multiple data types, like natural gas, electricity and water data, that include data points like demand, consumption, and total costs.
Once you’ve obtained the data, the next challenge is to determine how to compile it. This is most pertinent if you are gathering the data from different places. It’s important to have one location, whether a file or a database, that will contain all the data, making it easier to manipulate for analysis.
Where to Find Your Data
So where do you start? There are four sources that can help you find and collect your energy data, outlined below:
Directly Contact Utilities. All utilities keep a historical record of data. You can call the utility and ask them to send you historical information for your account. Each utility has its own policy, but some will send a soft copy of your utility bill, known as a historical print out, which is a screen shot from their system of some data points, including amount of bill, consumption, and demand. If you request a hard copy of the utility bill, you may be charged a fee per bill.
Utility Online Databases. Some utility companies have online databases that allow users to log in and view account details and utility bill information. You can download the utility information online and compile this data in one document. Some utilities offer e-billing services, advising you by email when your bill is ready to be downloaded from their site. Examples of utilities that have online databases include Union Gas, Enmax, BC Hydro, Hydro One, Hydro Quebec. Other utilities partner with Canada Post; they post your bill on their site, and E-post sends you notification by email that your invoice is available.
Company Accounts Payable Department. A good place to start is your company’s accounts payable department. They should have utility data for the current year.
Third Party. You can hire a third party to help with the ‘heavy lifting.’ If you use a third party to help collect, track, and manage your utility data, then you are a step ahead of the game. Third parties have the expertise and knowledge to work with utilities and to ensure the right information is being collected. Most third parties will have online portals that give you access to your utility data 24/7.
The Types of Data to Collect
Now that you know where to collect your energy data, what type of data should you ask for? I’ve outlined some considerations below:
Size of the Data. Are you looking for a full data set, spanning all of your company’s locations, or a sample set that includes only a few? If you are looking for a data sample, you need to consider some factors that may affect the overall completeness, including the location, the weather (winter vs. summer) and the type of business you are in. For example, if you operate a restaurant in Alberta, you would use more natural gas in January due to cold weather than a similar operation in California.
Number of Years. Are you looking for 12 months or 24 months’ worth of data?
Data Types. These can include electricity, natural gas, water, steam, propane, and furnace oil.
Data Points. Having all the data points on a utility bill would be ideal, but in the event that this isn’t possible, the most important ones are consumption, demand, and total amount of bill. You should also inquire if the total amount of bill includes taxes.
Collecting energy data will always be challenging for organizations. I hope this article identified steps that may ease this process for your company.
Tiffany Richmond has over five years of experience as a marketing professional and is responsible for online marketing strategies at Energy Advantage Inc.
What’s at the heart of your office? Is it the bricks and mortar? The plumbing and wiring? If you stop to consider this question, an image of your clients or staff will likely come to mind – those friendly faces in the hall who often complain about how hot or cold it is. The people you’re in business for, and the people who make your business successful, are really what drives the decisions you make about how to operate your building. Whose comfort is better to consider when you’re developing an energy or sustainability plan?
This may seem both obvious and impossible at first blush. It’s true that within the workplace there are differing opinions about the ideal ambient temperature, lighting, or workspace functionality. Yes, it is difficult to make everyone happy all the time. As we learned recently, effectively building and maintaining positive relationships with tenants has direct benefits for everyone – and those benefits are not always mainly financial. Whether you begin with the intention of saving money through energy conservation, or in an effort to align your corporate values (that mission statement framed on the wall) with your daily operations, the outcomes will be the same: 5 – 10% energy savings, improved employee engagement ratings, and enhanced public reputation.
The most recent Energy Advantage blog outlined a three-step process for engaging tenants. Building on those insights, here is another list – this one highlights the commitment necessary if you’re serious about implementing a lasting tenant engagement program.
Build Relationships:
Unfortunately, a major challenge faced by most landlords relates to the typically adversarial relationship they have with their tenants. It’s impossible to find common ground and work cooperatively in a hostile environment. Make an effort to improve communications with tenants; make it the most important area of responsibility for your building managers.
Build Consensus:
In developing communications, appeal to the emotion of your target audience. People care more about how they feel in their workplace than they do about energy or economic figures. Involve tenants as partners and watch their enthusiasm grow. Ensure broad support through:
Co-creation: establish a committee of energy champions, which may or may not include senior leadership, with representation from individuals who have high social status (perhaps senior management) and who are unexpected eco-champions. This group will help to define a collective brand for the location, and will offer critical insights into how the program is being received. Here is where the potential for a “social building” identity will be realized.
Simplicity: use defaults that support conservation, concrete and easy-to-understand information, and compelling imagery to inspire interest. The goal is to shift the behaviours from being conscious “reflective thinking” options to habitual “automatic” thinking choices.
Timeliness: launching an energy conservation campaign to align with traditional calendar holidays, as well as seasonal high and low temperatures will help to motivate participation and combat typical barriers.
Feedback: provide frequent “at-a-glance” results of how people are doing in their efforts to conserve energy. These are best displayed at the site of the target behavior, such as workstation common areas or elevator landings, to help them become visual “prompts” that further reinforce sustainable choices. Individuals respond to personalized cues.
Normative: integrate peer influence tactics, such as competitions between tenants and participation in campaigns from champions across the organization – particularly individuals who are in influential roles (again, this may not be limited to senior leadership).
Commitment: public declarations of energy conservation goals will reinforce action because people will hold each other accountable, and because people don’t like to behave in ways that appear incongruent with their stated values.
Build Systems:
If you build it and they come, you should have a plan to help them stay. Many have tried – without success – to create change through flashy campaigns that fizzle out just as they plateau.
Organizations are complex, and the people who are part of them need assurances that the changes they make will be supported in the long term.
If not, really, what’s the point?
Randi is a social marketing and corporate sustainability planner with ten years of communications management experience.
to compare against industry benchmarks or future performance, and finally, to track and report their performance. These key initiatives require expertise in various areas, but have one crucial element in common. If you guessed energy data then you are correct. The gathering of energy data is the first step in effective and environmentally-forward energy management. To begin, your organization will need a complete and up-to-date set of utility billing information. But what happens if you don’t have this information or if it is difficult to obtain? Where do you start?
