Sustainability and the Bottom Line
Businesses are finding financial benefits in their sustainable choices.
by Kristen A. Graham
After the final plays are complete, the noise dies down and the last fans have left the stadium after each Philadelphia Eagles home game, employees circle Lincoln Financial Field, collecting hundreds of accumulated bags of trash. Then a funny thing happens: Each bag is ripped open to make sure no materials that could be recycled are improperly tossed.
It’s a fine point, but one that Leonard Bonacci ’01 (M.B.A.) believes is important to make. The Eagles are a recognized leader in sustainability efforts: The team diverts 99 percent of its waste from landfills. Its food waste is composted. It runs on 100 percent green energy, with solar panels and wind turbines a very visible presence at Lincoln Financial Field. Being environmentally conscious is important to Chairman and CEO Jeffrey Lurie and to Christina Weiss, says Bonacci, the Eagles vice president of event operations and event services.
“The brand recognition our team has comes with a level of responsibility,” Bonacci says. “The planet is in serious shape, and it’s incumbent upon businesses to take progressive and aggressive actions. We want to show people that you can have less impact on the earth.”
But equally as important is the organization’s bottom line. “Just like any business, it’s essential that we continue to evaluate ourselves and assess the positives and negatives of every decision we make,” says Bonacci, who leads the Eagles Go Green! initiative. “At the end of the day, it has to make business sense. You don’t sign a Jason Peters [NFL Pro Bowler] without running your business the right way. The same can be said for our sustainability efforts. I always tell people, ‘You can be green and still be profitable.’”
Sustainability and Business in the Classroom
Sustainability’s increasing importance in business is the subject of much discussion, research and action at SJU. The triple bottom line — people, planet and profit — is a model that guides how systems operate in both the University community and in the larger world, for which faculty are readying students to be ethical decision-makers and productive citizens. Broadly speaking, sustainability is meeting the needs of the current population without jeopardizing the future of generations to come. Being mindful of sustainability requires more than just recycling or planting trees — though paying attention to pollution, natural resource use and changes in climate is certainly relevant. The economic and social implications of sustainability are far-reaching, too, and SJU is paying close attention to them.
Take Diane Phillips, Ph.D., an associate professor of marketing, a member of the Faculty Task Force on Sustainability in the Haub School of Businesss (HSB) and chair of the SJU Sustainability Committee’s marketing subcommittee. Phillips has been interested in sustainability issues since she landed her first job out of college, working in Exxon’s marketing department. Few people gave much consideration to sustainability in 1989, but that changed two weeks into her job, when the Valdez, one of the company’s tankers, crashed off Prince William Sound in Alaska, spilling hundreds of thousands of tons of crude oil. Phillips was fascinated — so much so that when she wrote her master’s thesis two years later, she chose sustainability as the topic.
Her interest in the topic remains keen. Last year, she traveled to Chicago for training from Al Gore and others, learning the science behind climate change and how to present that information to a lay audience. Phillips is now a certified member of the Climate Reality Leadership Corps and gives talks on the subject.
Sustainability is also a theme in Phillips’ work in the Haub School of Business. She teaches People, Planet and Profit, an undergraduate course, and Marketing for Sustainability, a gateway course in the MBA program. Her students know that sustainability is a key to profitability. Five years ago, someone who knew about sustainability had an advantage in the business world. But being mindful of sustainability issues is no longer optional, according to Phillips. “You really need to know this stuff just to stay in the game,” she says.
It’s a vision that’s growing, says Claire Simmers, Ph.D., who is a professor and chair of the management department and a member of the HSB Faculty Task Force on Sustainability. “You’re seeing more top managers and other stakeholders recognize that it’s a viable business model,” Simmers says. For a long time, it was sometimes difficult to get investors and others on board with sustainability because it was seen as a liability only — an outlay with little benefit.
“There was no way to account for social and environmental initiatives except for making them costs,” says Simmers, who teaches Leading for Sustainability, an online graduate course. The recent creation of the Sustainability Accounting Standards Board, she says, helps regulate sustainability measures by developing and disseminating industry-specific accounting standards. Now, there’s a metric to value sustainability — organizations are being graded on it, accounting for it in public documents.
John Neiva, Ph.D., also an HSB Faculty Task Force on Sustainability member, is quite focused on the issue. The associate professor of management researches economic and social sustainability and is co-editor of two books on the topic: one about green products; the other, green power. His own background is in consulting, investment banking and private equity, but Neiva notes there’s been a real evolution in the business world. Corporate leadership used to worry only about what happened to its products until consumers purchased them, and that evolved into the current cradle-to-grave thinking (reduce, reuse, recycle). Now, business leaders are beginning to understand the need to plan for cradle-to-cradle (waste-free production).
“Our waste cannot be called waste anymore,” Neiva says. “It’s got to be input for something.”
There’s a sustainability continuum, he says. Some businesses are proactive, ahead of the curve, and some are accommodative, not innovating, but going with the flow, being good corporate citizens. Others are defensive, following the law but not moving an inch beyond it.
And some, Neiva says, “fall into the worst category — those that occasionally break the law and try to get away with it.”
Many businesses, however, sit in the first two categories. Even big, traditional companies are thinking seriously about sustainability, though sometimes for somewhat self-serving reasons. Coca-Cola, for instance, has taken up the issue of water conservation, acknowledging that weather extremes have become a disruptive economic force, threatening its bottom line. “Businesses in this way can become leaders in sustainable practices,” Neiva says. “Whereas governments are slow to change, businesses can react more quickly, and they do. More and more, big businesses understand that you’ve got to look beyond the short term. You’ve got to think 20 years from now, and you’ve got to take into account potential consequences of any action on all stakeholders.”
The students in Neiva’s Organizational Sustainability course examine other countries’ sustainability paths, too. In Denmark, for instance, the Gross Domestic Product is growing per capita, but the country’s per capita energy consumption is going down. Iran is on the other end of the spectrum — “turning into a wasteland,” Neiva says. Sustainable societies consider not just their own importance, he adds, but their neighbors’ importance, too.
Aligning Sustainability with Business Priorities
Closer to home, Judy Ward ’07 (M.B.A.) is immersed in sustainability. Ward is CEO of Advanced Enviro Systems, a Chester, Pa., based business that works with institutions and nonprofits on waste reduction, recycling and environmental sustainability.
Advanced Enviro works both locally and nationally with clients such as Wawa, for whom it negotiates hauling contracts and sets up recycling services at stores.
When the company worked with Saint Joseph’s, for example, Ward helped the University create a request for proposals for a new trash hauler and vet the potential vendors. “We were able to reduce the cost of collection significantly and enhance the services,” Ward says.
The company has also helped the University recycle all the food waste from the Campion Student Center. Ward’s work has helped Saint Joseph’s move from a recycling rate of under 20 percent to nearly 40 percent. “We don’t just go in and say, ‘Buy this equipment and start recycling,’” she explains. “We try to set up programs that pay for themselves.” It’s a whole mindset — and not just about trash. “Waste is any time or resource not put to its optimal use,” she says. “We help businesses look at all of that.”
For a time, Ward says, many organizations were gung ho about sustainability — they felt they had to be green at all costs. “But recently, people have said, ‘I’d like to be more green, but it has to make financial sense,’ and honestly, that’s a more sustainable outlook,” she says. “Sustainability is not just about doing things that are good for the environment. It has to be good for business, and it has to help the business extend its life and value for the community.”
In her work as an analyst at BNP Paribas, a French bank and financial services company with offices in King of Prussia, Pa., Georgia Hatzipapafotiou ’07, ’13 (M.B.A.) often incorporates the lessons learned in Simmers’ Leading for Sustainability graduate course.
“BNP Paribas prides itself as a strong bank, but we also want to act responsibly,” she says. “As a major player in the global economy, the bank is aware of the importance of protecting the environment and upholding corporate social responsibility and sustainability efforts.”
That translates to even the smallest details — employees get reusable, biodegradable corn plastic coffee and water mugs as well as canvas lunch totes.
On a larger scale, the bank has affirmed its commitment to reducing carbon dioxide emissions and supporting research aimed at combatting climate change. BNP Paribas recently announced its support of a Green Bonds initiative that aims to encourage sustainability and the development of brownfields, which are former industrial sites that may be environmentally contaminated. For some companies, sustainability is more of an image issue than a real concern.
But, Hatzipapafotiou says, “I believe the greater the alignment of sustainability efforts and business priorities, the greater the attraction of customers, the greater the operational cost savings, and thus, the greater the potential success for a firm across the entire value chain, reflected all the way down to the triple bottom line.”
When Tomiko Wolf ’09, ’11 (M.S.) was an SJU student, she traveled with Phillips and others on a sustainability and green marketing study tour to France and Switzerland. “We visited some of the top businesses in the world and met with people who are incorporating sustainability into their business model,” Wolf says.
The time to start her job search began when she arrived home, and Wolf knew what she wanted: “a company that not only talks about sustainability, but incorporates it into its mission and strategy.” That led her to SAP, the German software company with a reputation for sustainability and corporate social responsibility. She’s now a program specialist with The Graduate Academy, co-managing the rotational training program established for recent college graduates.
It’s not just that products in SAP’s portfolio help companies do things like manage natural resources or analyze how they’re faring with sustainability. It’s not just that the company’s annual report also contains a sustainability report. SAP also focuses on corporate social responsibility, investing in education and entrepreneurship.
Every October, SAP teams complete hundreds of projects around the world, getting paid time off to volunteer. The company’s top performers may also take advantage of six-month, paid social sabbaticals, to execute a project in an underdeveloped country, incorporating SAP technology in some way.
Even the building where Wolf works in Newtown Square, Pa., is sustainable, a LEED (Leadership in Energy & Environmental Design) Platinum Certified facility. SAP freezes its rainwater and uses it to cool off the building later. “It’s another testament to what we’re trying to do,” Wolf says.
Prioritizing the Triple Bottom Line
Michael Bucher ’14, who majored in food marketing with a concentration in leadership, ethics and organizational sustainability, was the founding president of Enactus, a campus organization that uses entrepreneurial action to shape a more sustainable world.
He also got a firsthand taste of the triple bottom line as a co-op student working in the social responsibility office at the Campbell Soup Company in Camden, N.J. “We wanted to have an impact on the lives of others, but we also wanted to add sustainable growth,” says Bucher, the recipient of a Genuardi Family Foundation
Scholarship. Campbell’s social responsibility plan centers on four pillars — nourishing the planet, consumers, neighbors (community service) and employees. Working at a company that cares about these things drove home lessons learned at Saint Joseph’s, Bucher says.
“I’m realizing that you have a responsibility as a person, and as a corporation, to do more than make money,” he says. “One of your key stakeholders is your environment. That’s attractive to me, because you’re adding value to everything you do. The opportunity to be a part of that was really incredible.”
Sustainability was high on Bucher’s list of things a potential employer ought to be good at. “I asked about it in every interview,” says Bucher, now starting a job as a sales associate with Mondelez International in the Philadelphia area.
People, Planet and Profit
Once a distant goal, sustainability and a focus on the triple bottom line are now first-line priorities for most businesses. Bonacci, the Saint Joseph’s alumnus steering the Eagles’ sustainability efforts, points to myriad advantages in the organization’s sustainability push. Take the club’s energy bills. When Lincoln Financial Field opened in 2003, the first month’s power bill was nearly $400,000. At first, the organization tasked an intern with the sole job of making sure things were powered down after an event. That saw electricity rates drop substantially. Things leveled off. They tried making adjustments to the lighting control system. Then, NRG Energy reached out and proposed putting solar panels and wind turbines on the stadium, and the Eagles jumped.
Now, solar and wind power generate about 30 percent of the stadium’s energy, and Bonacci estimates that the team could save as much as $30 million over 20 years with its alternative sources of energy. “You can package this any way you want,” he says. “We’re lessening the impact on the environment, and that speaks to people.
And it just makes business sense to do this.”
Graham is a freelance writer and occasional contributor to SJU Magazine.