Jon Chorley is Oracle’s chief sustainability officer and group vice president of product strategy for supply chain management applications.
As CSO, Chorley drives and coordinates all initiatives, both internally and externally, related to environmental sustainability. This responsibility covers all areas, from IT infrastructure and business operation to corporate reporting and risk management.
In this Q&A, Chorley talks about his career background, fostering a sustainable culture, emerging technologies in sustainability, and how the construction industry can boost its environmental sustainability.
Chorley also reveals the companies he thinks excel in sustainability.
“Most businesses I engage with are active or want to be active in driving sustainability initiatives,” he says. “The perspective that business is in opposition to the environment or opposed to sustainability is misguided.”
Rick Bell, Oracle Construction and Engineering senior content marketing manager, led the discussion.
JON CHORLEY: One of my team, who's since retired, came to me well over 15 years ago saying, "I think there's something in this sustainability thing that is important to Oracle, important to business. Do you mind if I take a few months to research it?" We came back with some proposals about what was happening in the market, the importance of really up-leveling our sustainability programs at Oracle. The combination of looking at the impacts to Oracle and how that could be leveraged in the broader marketplace together with my own personal interests got me engaged. That was about the same time that Oracle acquired Sun Microsystems, and so we moved from being a pure software development company to one with a major physical supply chain. Sun had been proactive in this and had a more mature sustainability program. The combination of us getting that going for a year or two, then Sun coming onboard really got the ball rolling.
JON CHORLEY: I have two main responsibilities at Oracle. I have the sustainability hat as chief sustainability officer, and I also run our supply chain applications product strategy group. So many things that impact environmental sustainability intersect the supply chain issues as well—procurement policy, products you build, logistics, manufacturing processes, energy management, all those things intersect with sustainability, so there's a good deal of synergy there. It's getting harder to balance those things, because the interest and demands on the sustainability side are increasing exponentially. That remains a challenge, but it's still an interesting combination.
Whenever I have a conversation about my sustainability role, there's always two aspects to that, which is Oracle as an operating entity. We have 140,000 people; we have a lot of real estate; we have a physical supply chain that's quite complicated. And we have major data centers. So there's that operating entity aspect, how you track and manage it, and improving that process. But also, how do we build capabilities into our solutions and leverage that with our customer base? Clearly the multiplier effect you can have when you have hundreds of thousands of customers is enormous. There's walking the talk in terms of operating the business, but also translating that into things we can use for our customers.
JON CHORLEY: There's been an evolution about people's thoughts on sustainability. The role that I took on as CSO was focused on environmental sustainability, and it was related to the materials we use, the energy we consume, the CO2 we produce, and looking at ways to drive those impacts down: reduce, renew, and recycle. That was a traditional view of sustainability. What's happened over the last few years is a broadening of those ideas to embrace ESG—environmental, social, and governance—a broader set of statements about how businesses engage in the world, in communities, and their ecosystems, which includes the need to be sustainable. By that I mean not extracting more from resources than you put back in, but also embracing social aspects, like diversity and inclusion, and elimination of modern slavery aspects. On the governance side, how you manage your business in a responsible way. Where does sustainability fit with that? I like to draw a diagram with three circles: environmental, social, and governance, and put sustainability in the middle, because you want to create policies and practices with an element of continuity and the ongoing ability to operate sustainabiy in each of those domains.
JON CHORLEY: Number one is getting quality information. The challenges are both internal and external. Internally, knowing how to capture and monitor the internal operations of the business. The external challenges are, how do you get the same quality information from your supply base and pass that on to your customers? In the last 200 years, we’ve refined the way we exchange information on the financial sector. It's generally trustworthy and you can rely on that information. We need to move into that same mode for exchanging sustainability-related information. Carbon intensity, for example. It's improving but it's still ad hoc to a large degree, and the trust factors are not as strong as they could be.
Number two is businesses understanding what's important. It's easy to focus on window dressing—what some people call greenwashing, which is having the appearance of being relevant but may not be that impactful. Getting clear about where your business is going and its economic drivers. How do those economic drivers intersect with sustainability-related questions? For Oracle, that's straightforward. We're a cloud company. We're growing our cloud. We're building data centers. How we think and manage that is both material to our business success and to the environment. Companies thinking, managing, and engaging what's important to their business in those two dimensions helps them focus on things that make a difference.
Finally, leadership. You need that leadership to make it clear where sustainability sits in the overall goals and direction of the business, and it's ideally on a par with the other things that drive the growth of the business. Getting those messages out, supporting initiatives, supporting people, doing the right thing.
JON CHORLEY: My experience is that businesses really do get it. Most businesses I engage with are active or want to be active in driving sustainability initiatives. The perspective that somehow business is in opposition to the environment or opposed to sustainability is misguided. Businesses see it as a critical risk factor that might impact their business as a brand risk, a market risk, even an environmental risk. Rising sea levels, storms, all those things can have an impact on businesses. And most businesses have a disciplined process of looking at risk and are including sustainability or climate change in those analyses. There are outliers at both ends, businesses that define their brand as all about sustainability and businesses that are still struggling to get their arms around it.
But in my experience, it's good. Cisco recently won an award related to their sustainability initiatives. I think that's very positive. Amazon is an interesting company, growing enormously and so their total absolute footprint is increasing, but their intensity levels are decreasing. They're doing the right things but it's hard when your business is exploding exponentially. Still, they are doing a lot of positive things. Unilever has an active set of brand-related programs. I recently presented with Melissa & Doug, a toy manufacturer focused on educational-related toys. They use a lot of wood, and they're focused on the renewable aspects of that. Suzano is a wood company, paper pulp, in Brazil that is carbon negative. They sequester more carbon than they consume. They understand that their long-term future needs to be based on essentially planting more trees than they cut down.
JON CHORLEY: One of the things I often talk about in terms of sustainability is LEED certified buildings. Nowadays, nobody would build a building that is not LEED certified. It has become the standard. The construction industry has looked at that, understand that for their brand, their products need to be broadly acceptable. The standard has been elevated. I applaud that, and I think that's a trend that you'll see in other areas regarding sustainability where the bar rises and there's a well-defined standard that people expect products and services to conform to. The industry has set a model that can be duplicated in other areas.
JON CHORLEY: There are internal and external discussions regarding that. The external facing one is often about engagement with the supply base, particularly if they're a product company. But if you're a construction company, you may look at carbon sequestration within the concrete. That's an interesting angle. Could that help build a market around a concrete product by selecting suppliers that do that? More broadly, just understanding what the suppliers are doing in terms of their own programs. Do they have a sustainability program? What is their target? Have they set a goal for carbon reduction? What about other policies? Being in active engagement with them is key. On the internal side it's all about communication. When I came into this role, Oracle was doing far better than anybody knew we were doing, and that applied to people internally as well as people externally. So how do you create that climate of communication and transparency? Getting that climate of transparency applies to external communication as well, but also fostering good ideas. We have green teams throughout Oracle. They are self-organizing. They drive initiatives. They raise ideas and suggestions for improving things within the business and their local community.
JON CHORLEY: If you're talking about large-scale construction, you've got steel, concrete, and glass. Those three things are highly energy intensive. Manufacturing concrete is a chemical process that generates CO2. It’s not an easy problem to solve, and indeed it may be one of the hardest problems. You have to think about sequestration techniques that inject some of that CO2 into the concrete. Clean steel—green steel—produced by a renewable energy source is a possibility, but the cost factors of that are significant. And then glass obviously is a high-energy process. You must think about your energy source for that. There's been a lot of pioneering work on a fairly large scale in wood construction. The modern pre-laminated and cross-laminated timbers can have strength factors equivalent to that of steel with a high degree of fire resistance. Being open to looking at these options and including them in your knowledge set is obviously important. Cost is a factor. What they call the green premium—how much does it cost for a green product as opposed to a non-green product? The gap is shrinking between a green product and a non-green product as things scale up. The more the demand scales up, the more the cost, or the green premium, goes down. Building those markets is enormously helpful.
JON CHORLEY: If you look at Oracle, in terms of the solutions that we bring to the market, the fundamental thing that we can do is to build sustainability, build ESG, into our core business applications. So when you're making a decision about a product or service that you're going to offer, sustainability and ESG factors are part of that decision-making process. Exposing that in a very natural way within those business applications is critical. It has to be built in and cognizant of the goals of the company.
You're trying to be carbon negative by 2030? OK, how are you tracking? Those things need to be built into the operating system of the business. That's an important piece of technology that we at Oracle can bring to the marketplace.
Obviously, there's other technologies out there. The increased efficiency of solar and its cost effectiveness, large-scale wind farms, these are very important technologies. Hydrogen is interesting as an energy storage mechanism. I met with a person who's using salt domes, these very large underground structures, to store hydrogen. Salt domes are used to store oil; perhaps we can use them to store hydrogen. You can generate that hydrogen with electrolysis using solar but store the energy in a more transportable way. It's an interesting technology.
Volvo Truck did an analysis that showed the vast majority of truck trips in Europe could be done with electric vehicles. Because the trips are local, you can get the truck back at night and recharge it.
Green steel, concrete, they're hard problems, and as I mentioned, helping stimulate innovation in those spaces is key. Thinking about those things in a constructive, positive way can help drive transitions.
JON CHORLEY: Absolutely. You need them to build. Reduce where you can, reuse where you can, those things obviously remain important. But again, seed money to get those ideas moving forward is key, and a willingness to help scale those things up helps drive the cost down.
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