FUTURE-FIT BUSINESS BENCHMARK: Who, Why, What, How, When

ISSP Conference

November 14, 2014

[email protected] sustainabilityadvantage.com

FUTURE-FIT BUSINESS

BENCHMARK:

Who, Why, What, How, When

WHO

http://futurefitbusiness.org/the-team/partners/

How would we recognize a truly sustainable,

future-fit business if we saw one?

How much is enough?

“Mirror, mirror …”

WHY

GLOBAL 100Companies with market cap > $2B

12 KPIs

1. Energy productivity

2. Carbon productivity

3. Water productivity

4. Waste productivity

5. % Taxes paid

6. % of Women senior execs

7. Clean capitalism pay link

8. CEO-to-Average-Worker Pay

9. Safety performance

10. Employee turnover

11. Innovation capacity

12. Pension fund status

Top 10 in World

1. Westpac Banking (Banking)

2. Biogen Idec (Pharmaceuticals.)

3. Outotec (Capital Goods)

4. Statoil (Energy)

5. Dassault Systems (Software)

6. Nestle Oil (Energy)

7. Novo Dordisk (Pharmaceuticals)

8. Adidas (Consumer Goods)

9. Unicore (Materials)

10. Schneider Electric (Cap. Gds.)

“The Global 100,” Corporate Knights magazine, Winter 2014.

WHAT

If it were to operate forever, it would not only do no harm,

it would do well by doing some net good.

The business contributes to the

possibility that the business, society, and

the environment will flourish

on our finite planet, forever

A sustainable future-fit business

creates net positive environmental,

social, and economic value

throughout its value chain

FOURTH BENCHMARK

X1

Baseline

year

Other companies

Performance

Today

2

Company

Goal

3

4

Fu

ture

-Fit B

usin

ess

Ben

ch

mark

Company X

HOW

Determine the Design Constraints

for a future-fit business model, based on

science-based System Conditions

that must be honored by any actor

in a sustainable human society

nested in a sustainable environment

Define future-fit Goals based on the Design Constraints

Agree on best future-fit KPIs by which to measure

company progress toward the Goals

8 SYSTEM CONDITIONS

Environment resilience must not be

systematically degraded by...• increasing concentrations of substances

extracted from the earth’s crust

• increasing concentrations of substances

produced by society

• over-harvesting or physical encroachment

into areas critical for natural processes

Society resilience must not be degraded through the erosion of

trust among people and institutions by undermining people’s…

• Health: physical, emotional, and emotional health; safety

• Influence: participation in decision making; having a voice; democratic rights

• Competence: learning; adaptability, personal growth; ability to knowledge

• Equity: impartial treatment; fairness; justice; respect; diversity

• Meaning: sense of purpose; caring; opportunity to make a difference

8 COMPANY DESIGN CONSTRAINTS

Company does not contribute to ...• a buildup in nature of

substances extracted from the earth’s crust

• a buildup in nature of

human-made, synthetic substances

• over-harvesting or physical encroachment

into areas critical for natural processes

Company does not contribute to conditions that undermine people’s …

• Health: physical, emotional, and emotional health; safety

• Influence: participation in decision making; having a voice; democratic rights

• Competence: learning; adaptability, personal growth; ability to knowledge

• Equity: impartial treatment; fairness; justice; respect; diversity

• Meaning: sense of purpose; caring; opportunity to make a difference

HOW

Determine the Design Constraints

for a future-fit business model, based on

science-based System Conditions

that must be honored by any actor

in a sustainable human society

nested in a sustainable environment

Define future-fit Goals based on the Design Constraints

Agree on best future-fit KPIs by which to measure

company progress toward the Goals

11 Environmental Goals• All clean, renewable energy

• All fair, sustainable water use

• All sustainable materials

• All products & packaging repurposed

• No emissions of naturally scarce substances (2)

• No emissions of human-made synthetics (2)

• No GHG emissions (2)

• No impact on biodiversity

17 Social Goals• Employee health and safety fostered

• All employees paid at least a living wage

• Equal pay for equal work

• No discrimination against employees

• Development for all employees

• No employee human rights violations

• Community health and safety fostered

• All statutory taxes paid in jurisdiction

where revenue is recognized

• No harm to others from product use

• No citizen human rights violations

• Customer health and safety fostered

• All systems align with future-fit goals

• Disclosure of all necessary info for KPIs

• No unethical practices

• Transparent on all lobbying

• Transparent on all investments

• All tier one suppliers are future-fit

28 GOALS

HOW

Determine the Design Constraints

for a future-fit business model, based on

science-based System Conditions

that must be honored by any actor

in a sustainable human society

nested in a sustainable environment

Define future-fit Goals based on the Design Constraints

Agree on best future-fit KPIs by which to measure

company progress toward the Goals

WHEN

How would we recognize a truly sustainable,

future-fit business if we saw one?

How much is enough?

“Mirror, mirror …”

WHY

4. What if it is mission impossible?

• New business models?

• New balance sheets?

5. Is it desirable to be

a future-fit business?

• Business case?

• Investor interest?

6. What about other sectors?

• More benchmarks by 2017?

• Critical mass by 2020?

THREE MORE QUESTIONS

4. What if it is mission impossible?

• New business models?

• New balance sheets?

5. Is it desirable to be

a future-fit business?

• Business case?

• Investor interest?

6. What about other sectors?

• More benchmarks by 2017?

• Critical mass by 2020?

THREE MORE QUESTIONS

www.sustainabilityadvantage.com

RESOURCES

ISSP Conference

November 14, 2014

[email protected] sustainabilityadvantage.com

FUTURE-FIT BUSINESS

BENCHMARK:

Who, Why, What, How, When