Return on investment: Who's leading the way?
Pioneering companies are responding to the challenge of achieving and proving a return on investment in sustainability.
Unilever
Unilever’s Sustainable Living Plan aims to halve the carbon, water and waste impacts of its products across their lifecycle by 2020. Unilever CEO Paul Polman has said the plan aims to decouple economic growth from environmental impact. The outlay needed to achieve these targets cannot be underestimated; it can only be supported by a doubling in sales over the same period. Clearly, the company is banking on some of these extra sales coming from improved brand positioning associated with, for example, sourcing all agricultural raw materials from sustainable sources.
Vodafone
Two Tomorrows client Vodafone is working with pharmaceutical company Novartis in Africa to use text messaging to track stocks of anti-malarial drugs. It has also joined forces with other pharmas to pilot the use of mobiles to report outcomes in clinical trials. After initial success in Tanzania, trials will be extended to other sub-Saharan countries – potentially opening up market opportunities and bringing widespread health benefits.
GE
GE is a leading proponent of partnerships that advance both sustainability and its market position. In late 2010, it announced an investment of $55 million in power grid technology companies. This is the first of several rounds of innovation funding planned by GE and its venture capital partners as part of its Ecomagination Challenge, a global commitment to accelerate the development and deployment of power grid technology through open collaboration. New partnerships have been formed to develop and commercialise technologies vital to helping build the next-generation power grid. These technologies include energy storage, utility security, energy management software and electric vehicle charging services. GE expects these markets to grow rapidly into a $20 billion opportunity by 2015.
Coca-Cola
One of the world’s biggest brands, Coca-Cola continues to be affected by health concerns in developed markets that have hit brand earnings. But in developing economies such as India, it has been investing in initiatives to improve community access to safe drinking water and sanitation. While these actions are to some extent a response to protests against the company in the India, they are also a commercial necessity as water scarcity in parts of the country threatens the survival of the company’s assets. These and other initiatives have positively influenced the company’s brand value, according to a recent study by the brand consultancy Interbrand that looked at the effects of sustainability issues on brand value.
