The BSR Conference 2011—“Redefining Leadership”—held from Nov 2nd to Nov 4th in San Francisco, with Oracle as one of the main sponsors, saw senior business executives, civil society representatives, and other experts from around the world gathering to share strategies and insights on the future of sustainability. The general conference sessions kicked off on November 2nd with a plenary address by former U.S. Vice President Al Gore. Other sessions were presented by CEOs of the caliber of Carl Bass (Autodesk), Brian Dunn (Best Buy), Carlos Brito (Anheuser-Busch InBev) and Ofra Strauss (Strauss Group). Here are five key highlights from the conference:
1. The main leadership challenge is integrating sustainability into core business functions and overcoming short-termism. The “BSR GlobeScan State of Sustainable Business Poll 2011” - a survey of nearly 500 business leaders from 300 member companies - shows that 84% of respondents are optimistic that global businesses will embrace CSR/sustainability as part of their core strategies and operations in the next five years but consider integrating sustainability into their core business functions the key challenge. It is still difficult for many companies that are committed to the sustainability agenda to find investors that understand the long-term implications and as Al Gore said “Many companies are given the signal by the investors that it is the short term results that matter and that is a terribly debilitating force in the market.”
2. Companies are required to address increasing compliance requirements and transparency in their supply chain, especially in relation with conflict minerals legislation and water management. The Dodd-Frank legislation, OECD guidelines, and the upcoming Securities and Exchange Commission (SEC) rules require companies to monitor upstream the sourcing of tin, tantalum, tungsten, and gold, but given the complexity of this issue companies need to collaborate and partner with peer companies in their industry as well as in other industries to understand how to address conflict minerals in their supply chains. The Institute of Public and Environmental Affairs’ (IPE) China Water Pollution Map enables the public to access thousands of environmental quality, discharge, and infraction records released by various government agencies. Empowered with this information, the public has the opportunity to place greater pressure on polluting companies to comply with environmental standards and create solutions to improve their performance.
3. A new standard for reporting on supply chain greenhouse gas emissions is available. The New “Scope 3” Supply Chain Greenhouse Gas Inventory Standard, released on October 4th 2011, is the only international greenhouse gas emissions standard that accounts for the full lifecycle of a company’s products. It provides a framework for companies to account for indirect emissions outside of energy use, such as transportation, manufacturing, and distribution, and it incorporates both upstream and downstream impacts of a product. With key investors now listing supplier vulnerability to rising energy prices and disruptions of service as a key concern, greenhouse gas (GHG) management isn’t just for leading companies but a necessity for any business.
4. Environmental, social, and corporate governance (ESG) reporting is becoming increasingly important to investors and other stakeholders. While European investors have traditionally driven the ESG agenda, U.S. investors are increasingly including ESG data in their analyses. This trend will likely increase as stakeholders continue to demand that an ESG lens be applied to their investments. Investors are increasingly looking to partner on sustainability, as they see the benefits of ESG providing significant returns on investment.
5. Software companies are offering an increasing variety of solutions to help drive changes and measure performance internally, in supply chains and across peer companies. The significant challenge is how to integrate different software systems to facilitate decision-making based on a holistic understanding of trade-offs. Jon Chorley, Chief Sustainability Officer and Vice President, Supply Chain Management Product Strategy at Oracle was a panelist in the “Trends in Sustainability Software” session and commented that “How we think about our business decisions really comes down to how we think about cost. And as long as we don’t assign a cost to things that have an environmental impact or social impact, then we make decisions based on incomplete information. If we could include that in the process that determines ‘Is this product profitable? we would then have a much better decision.”
For more information on BSR visit www.brs.org. You can also view highlights of the plenary session at http://www.bsr.org/en/bsr-conference/session-summaries/2011. Oracle is proud to be a sponsor of this BSR conference.
By Elena Avesani, Principal Product Strategy Manager, Oracle