With Earth Day around the corner, The Glass Hammer has decided to take a look into why sustainability makes sense from a business standpoint. We’ve long pointed out that companies must take a broader look at the gender composition of their workforce and senior leadership if they are to maintain a sustainable and profitable future. Today, we’re examining why a fresh look at investment in sustainability can spur innovation and growth.

Erika Karp, Head of Global Sector Research at UBS, said that she feels strongly that sustainability investing needs to be “completely integrated into the investment process – the decision-making matrix which drives stock recommendations.”

Karp said, “We’re talking about a paradigm shift here.”

She continued, “Good long-term investing starts with great questions. What we can do through great questions is make sure we are covering the material areas of inquiry that haven’t been pursued as they should be from the standpoint of risk adjusted return.”

What a mouthful! But, Karp explained, considering sustainability issues around environmental, social, and governance matters can only improve the investment process. She said, “If we are doing our best in investment bank research, we must do our best to pursue all areas of inquiry.” Considering so-called non-financial (or extra-financial) information when making decisions about investments is just a smart way to do business.

Sustainability as Innovation

Karp said, “Great investors are always pursuing different avenues of inquiry in the most aggressive way.” UBS, for example, has come out strongly in support of sustainability, as UBS Global Asset Management division is a signatory of the UN Principles for Responsible Investment and the UN Global Compact, as well as partnering with the Smith School of Enterprise and the Environment at Oxford University (led by Sir David King).

UBS is not alone. In their recent article in the Harvard Business Review, “Why Sustainability Is Now the Key Driver of Innovation,” Ram Nidumolu, C.K. Prahalad, and M.R. Rangaswami, write: “Our research shows that sustainability is a mother lode of organizational and technological innovations that yield both bottom-line and top-line returns.”

They explain:

“Becoming environment-friendly lowers costs because companies end up reducing the inputs they use. In addition, the process generates additional revenues from better products or enables companies to create new businesses. In fact, because those are the goals of corporate innovation, we find that smart companies now treat sustainability as innovation’s new frontier.”

The paper includes several real examples of how investment in sustainability led to innovation and bottom line results for big companies like HP, IBM, and Wal-Mart.

But, in fact, research has also shown that sustainability has the power not only to transform individual businesses and institutions but economies on a whole. For example, a new report entitled “A New Growth Path for Europe,” commissioned by the German Federal Ministry for the Environment, Nature Conservation, and Nuclear Safety, found that increasing sustainability targets could lead to significant growth in prosperity and jobs.

The report says, “In the coming decade, Europe will need to accept the challenge of increasing economic growth while reducing both unemployment and greenhouse gas emissions. New model results show that these three goals can actually reinforce one another.”

According to the report, raising the EU’s climate goals from a 20% cut in emissions to a 30% cut could:

• “increase the growth rate of the European economy by up to 0.6% per year
• create up to 6 million additional jobs Europe-wide
• boost European investments from 18% to up to 22% of GDP
• increase European GDP by up to $2004842 bn
• increase GDP by up to 6% both in the old (EU15) and new (EU12) member states.”

The report authors believe that taking a more aggressive tack in addressing sustainability issues would, in fact, drive innovation, create jobs, build wealth, and help drag Europe more rapidly from the global economic downturn. They write, “a new challenge can mobilise capabilities that could not be
tapped without it.”

Sustainability In Practice

Does sustainability always pay off for the investor? Yes and no. According to a recent study in the Journal of Operations Management certain green commitments make markets happy, while others don’t. And yet others don’t really have an effect at all.

According to GreenBiz.com, researchers Brian Jacobs, Michigan State University, Vinod Singhal, Georgia Institute of Technology, and Ravi Subramanian, Georgia Institute of Technology, found that the majority of corporate responsibility activities had no impact on a firm’s market value. These kinds of activities include “environmental business strategies (such as new standards), new eco-friendly products, renewable energy (supply or purchase), recycling programs, announcements of LEED certification.”

The researchers found that announcements of philanthropy efforts and ISO 14001 certifications can improve a company’s share price. At the same time, they found, the market reacted negatively to announcements of voluntary cuts in emissions.

But this is a short-term way to look at gaining from sustainability. Certain activities are likely to affect nearsighted investors differently than they would affect those with a long-term view of growth. After all, long-term growth is is just what the term “sustainability” entails.

As Karp said, “This is important to me personally because I have three young children and I want the world sustained for them. Just as I try to live my life based on principle, I try to drive my business responsibilities based on principle as well. Not only is this important for me personally, but it’s important to the future of the firm.”

Last week, the Women’s Network for a Sustainable Future organized an event around new trends in sustainability reporting. With shareholders, regulating agencies, and the public increasingly interested in results, the quality of metrics around corporate sustainability has improved dramatically, as has awareness of the importance of benchmarking and reporting progress.

Ann Goodman, Executive Director of WNSF said, “Everyone from the SEC down and up is clamoring for disclosure.”

Moderated by Helle Jorgensen, US Sustainability Advisory Leader and member of the Global Sustainability Leadership Council, PwC, the panel included Margaret Lindeman, Sustainability Strategist, Lockheed Martin, Erica Matthews, Manager, Public Policy and Sustainability, Pepsico, and Mike Wallace, Director of Sustainability Reporting Framework, Global Reporting Initiative (GRI).

Corporate sustainability metrics matter to investors, consumers, and employees – and improving metrics around sustainability reporting will be critical to corporate success in the future.

Reporting for Investors

And as noted by the panel, investors on Wall Street are also growing ever more interested in seeing numbers around sustainability and corporate social responsibility. Even today’s Bloomberg terminals include self-reported, non-mandatory disclosure data on these topics.

Wallace underscored the importance of sustainability reporting when he recalled how one of his first meetings after getting off the plane from Copenhagen was with SEC Chief Mary Shapiro. “For many years, investors had been writing letters on disclosures for non-financial metrics,” he said. Investors are changing the way companies pay attention to and report on sustainability and social issues.

But, he said, the US has a long way to go compared to the rest of the world. While only about 12% of companies in the GRI database are based in the US, that percentage is growing, he said. Last month, the organization launched its “Focal Point USA” initiative at the New York Stock Exchange. Wallace said the symbolism wasn’t accidental.

“It just serves to show that the financial industry is recognizing the importance of non-financial performance metrics,” he said.

Ambitious Goals and Measuring Tradeoffs

Pepsico is taking a holistic approach to corporate social responsibility, said Matthews, echoing the company’s “Performance with Purpose” mantra. The company has set very ambitious goals for the next ten years, she said.

Originally Matthews balked at how big they were, but she thought, “If we are going to put these commitments out there, we must be sure we can meet them.” But that was actually not the case. They are indeed “stretch goals,” she said. She explained that goals aren’t goals at all if you’re sure you can meet them – you have to be ambitious.

Pepsico’s CSR reporting goals are focused around local and regional reporting (for example with water usage), social reporting (for example around human rights and grievance mechanisms), and measuring tradeoffs between health, nutrition, agriculture, and the environment. Without the use of metrics, she said, the company wouldn’t be as effective at understanding the tradeoffs behind each initiative or new product.

Moving from a Customer Demand to Point of Pride

Lockheed Martin, reminded Lindeman, is the US Government’s largest contractor. And sustainability just wasn’t on the table until the US started requiring reporting of sustainability metrics by its suppliers. Said Lindeman, “Originally there was a lot of push back by employees – that the customer wasn’t asking for us to do this, that the cost was higher. But now President Obama has signed Executive Order 13594, which covers sustainability requirements for government agencies.”

After the company’s largest client demanded further accountability, Lockheed Martin began to find other reasons to embrace sustainability, she said.

The connection between sustainability and profit helped employees and stakeholders see that sustainability is also about efficiency and tax incentives.

Now Lockheed Martin is ranked well when it comes to corporate sustainability. “It’s become a point of pride,” she said. “We’re seeing more headway within the organization… and we’re able to convince our internal stakeholders why it’s important.”

This article originally appeared on our corporate citizenship website Evolved Employer.

Talk of more green jobs has been everywhere lately, touted as a solution to our economic crisis soaring unemployment rate, and impending climate change situation. However, most green jobs to date have been male-dominated, labor-intensive roles in construction and manufacturing. With women comprising nearly 50% of the current workforce, the green solution will not be nearly as effective without involving more women and utilizing their strengths.

• Encourage women to pursue jobs in math, science and technology. This is the same idea we have discussed many times, but it is becoming increasingly important. In addition to becoming engineers or scientists, women could become architects designing LEED-certified buildings and interior designers selecting environmentally-friendly furnishings.

The EPA reported that U.S. buildings are responsible for nearly 40 percent of the nation’s total carbon emissions and almost 75 percent of total electricity consumption each year. Strides toward more environmentally-friendly new construction, as well as retro-fitting older buildings to improve their carbon footprint could make a huge impact. Men may dominate the manual labor market for this niche, but woman could help lead the way.

• Retraining and workplace education. Some claim that massive efforts need to be made toward retraining U.S. workers, while others say that with little effort, existing jobs could be greener. The answer most likely lies in the middle. At any rate, women are an excellent choice to retrain and educate workers on greening their jobs. Green consulting will be growing for some time to come.
• Create more CSR-related jobs. Studies show that women outnumber men in CSR positions already (except for upper management), but many companies either do not have environmental conservation initiatives or their CSR department is understaffed and ineffective. Give companies financial incentives to create and support environmental initiatives to analyze and determine where companies could conserve energy and cut costs. Women could easily take the role of environmental detective, proposing paperless offices, cutting unnecessary lighting, and other cost benefits. In light of several companies’ public statements about requiring supply chain carbon emission transparency (IBM, Morgan-Stanley, HP), companies already need this kind of help.
• Direct the next generation of women and girls down new educational paths. Traditional programs like business and law schools are already offering environmental lines of study. Green MBAs are becoming more and more popular. Technical trade schools and community colleges are also recognizing opportunities to offer classes in green careers. This is especially important since trade schools and community colleges focus on educating local residents, and many people in hard hit areas are in need of new education. Women have traditionally steered clear of labor-intensive jobs, but more effort should be made to open their eyes and engage their interest in previously male-dominated careers.
  
  Austin Community College (ACC) hosted a Women in Green Jobs – Solar Training Information Session in March 2010 in an effort to educate women on why green jobs are the future and the large role that women will play. The session also touched on other green course offerings that ACC offers specifically from a women’s perspective. In K-12, younger girls also need more encouragement to develop an interest in all types of blue and white collar green jobs, even if they are currently considered nontraditional.
• Encourage green businesses and nonprofits. There are opportunities in both the for-profit and nonprofit sectors to create new green businesses, and even industries. Never underestimate the female factor for recognizing unusual green opportunities. Recently, Hillary Clinton and the Clinton Global Initiative announced a worldwide push toward supplying families in developing countries $25 energy-efficient cookstoves, which would improve their health and reduce carbon emissions. In addition, supplying these cookstoves will spawn an industry that creates jobs both in the U.S. and around the world.

Women and men are both needed to be green collar workers, defined as, “one who translates new environmental technologies for consumers, designing and manufacturing goods that use fewer materials and less energy that those of just a few years ago.” The aim should be to widen the scope of green jobs for everyone, and that means women, too. Without everyone’s participation, the green job revolution will not succeed as the economic and environmental solution our nation needs.

Frances Hesselbein

On Tuesday, the Women’s Network for a Sustainable Future held its 7th annual summit, entitled “Sustainability, We Get it… Now What?”

Ann Goodman, Ph.D., Executive Director of WNSF, said, “By now the term sustainability has entered the vernacular. Now that everybody gets sustainability, how can we use it to drive [business].

Kathy Robb, Head of Environmental Practice at Hunton & Williams and a WNSF board member, explained explained that WNSF was founded around the belief that “women in business want to bolster sustainability efforts in their companies.”

She continued, “Caring about the environment allows companies to attract and retain women employees, customers, stockholders, and stakeholders – and create a better world for everyone.”

Dr. Goodman introduced the program’s keynote speaker, Frances Hesselbein as a personal “she-ro.” Hesselbein, Chair, Leader to Leader Institute; Chair, Study of Leadership, West Point Military Academy; former CEO, Girl Scouts of the USA is someone who has accomplished much, including being awarded the Presidential Medal of Freedom, the US’s highest civilian honor. Yet, in spite of her achievements, Goodman said, Hesselbein continues to be “generous, friendly, down to earth, straight forward, direct, [and] empathetic.”

Hesselbein opened her discussion on creating a sustainable society with a poem:

Be careful of your thoughts, for your thoughts become your words.
Be careful of your words, for your words become your actions.
Be careful of your actions, for your actions become your habits.
Be careful of your habits, for your habits become your character.
Be careful of your character, for your character becomes your destiny.
- Anonymous

“Today is all about destiny,” she began.

Creating a Sustainable Society

Hesselbein spoke at length to the importance of education in creating a sustainable democracy. She said, “There are two institutions that have sustained democracy,” in the United States. The first of which, the US Army, she said, was going strong. But, she continued, the second, public education, is faltering. “The kindest thing you can say is that the house is on fire.”

She continued, “How can we sustain a democracy if we do not educate our children?” According to Hesselbein, only one in two children graduate in New York City. And in Los Angeles, only one in five. “For those of us committed to sustainability, those are not invisible children. Education of all our children is [critical] to democracy.”

But Hesselbein is not cynical or pessimistic about the future. She joked, “Even my blood type is B positive.”

“I get my hope, my positive future, from them. I have a feeling that this generation of young men and women is different from earlier generations. When I say ‘to serve is to live,’ this generation says, ‘of course.’”

Developing Girls into Leaders

Having served as the CEO of the Girl Scouts of the USA from 1996 to 1990, it is natural that Hesselbein would place a lot of faith in the next generation of leaders. Hesselbein, in fact, is charged with transforming the organization. She recalled, “When I came to New York, I never wanted to be CEO of the Girl Scouts I never wanted to leave Pennsylvania – ever!” In 1976, she said, the program hadn’t changed in 12 years. “It had lived through the trauma of the 1960s and early ’70s,” without an update, she said.

“In 67 years, they had never had anyone from the field” lead the organization, she explained. So, when she went in to interview, “I didn’t think they were serious.”

Asked what she would do to change the organization, she said, “I suggested a huge transformation. We would focus on math, science, technology. We would throw out the hierarchy and institute flexible, circular management. I had a great time describing all we would do for them,” she said with a smile.

Two days later, she got a call asking her to come back. She accepted the job, and promised new handbooks within a year.

Hesselbein’s efforts changed the GSUSA dramatically, in both its management structure and its work developing girls. In fact, when she asked how many women in the room had been (or continued to be) girl scouts, at least half of the room’s hands went up. She said, “Only the best is good enough for those who serve girls.”

Getting Girls into Math and Science

When asked how best to engage today’s girls in math and science in order to fill the STEM career pipeline with women, Hesselbein replied, “We’re not telling the story.”

Girls need to see real-life role models in those fields. “It can’t just be a brochure,” she said. “We need to give [women in STEM fields] a platform where young women can hear, ‘I’m the chief engineer of –.’ They need real life examples.”

She continued, “All over the country we have many remarkable role models. We need to bring them together.”

Hesselbein talked about the importance of mentoring, saying she mentors three women herself. She also reiterated the importance of education.

She said, “In terms of volunteerism, this generation is often compared to the generation of the 1930s and 1940s, which we now call the Greatest Generation. One of the things that made that [title] possible was college scholarship. For this generation, that opportunity is shrinking. How do we give them that opportunity for education and internships?”

She continued, “This generation has a passion for making a difference.”

In June, Accenture released “the largest CEO-based study on sustainability of its kind to date,” based on more than 100 in-depth interviews with world business leaders and an online survey of 766 UN Global Compact member CEOs.

The study, entitled “A New Era of Sustainability,” [PDF] reveals the attitudes toward sustainability held by top leadership in a variety of sectors, including “automotive, communications, consumer goods and services, energy, financial services, metals & mining and utilities.”

Said Peter Lacy, UNGC-Accenture CEO Study Project Lead 2010 and Managing Director, Accenture Sustainability Services, Europe, Africa, Middle East and Latin America:

“We hope that this study provides a rich, authentic and evidence-based platform to understand CEO views on the progress, challenges and implications of the journey toward a new era of sustainability.”

Sustainability Embedded Within Corporate Culture and Strategic Planning

One of the most surprising findings revealed by the study was the speed with which sustainability has become viewed as a major business imperative. According to the report, in 2007, the last time the study was performed, “sustainability was just emerging on the periphery of business issues, an increasing concern that was beginning to reshape the rules of competition.”

Today, the report continues, sustainability is “top of mind.”

Sustainability, the CEOs said, will play a major role in shaping in their businesses moving forward. According to the report:

“Eighty-one percent of CEOs—compared to just 50 percent in 2007—stated that sustainability issues are now fully embedded into the strategy and operations of their company. For example, we saw cases of companies beginning to integrate sustainability issues into their executive compensation packages, as well as design and innovation functions, more than in 2007.”

Accountability Key

But the CEOs face challenges in leading their companies toward a more sustainable future – from customers, shareholders, and investors. And the challenges all boil down to accountability.

First of all, coming out of the global economic slump, consumers have continued to be mistrustful of corporations. As Kaspar Villiger, Chairman of UBS AG, said: “We have lost trust, and we need to regain it with a culture of responsible behavior.”

Companies need to figure out how to regain the trust of the customer and clients they serve.

Second, shareholders, say the CEOs, have been slow to get in board. One Goldman Sachs leader said:

“We need to realize that analysts bring with them an education rooted within the green borders of Excel. But we are talking about externalities that very often are not linked directly to line items. CEOs need to be able to link these to cash flow and the balance sheet.”

The CEOs also felt that investors were not interested in less quantifiable social benefits of sustainability – only the bottom line.

Edemir Pinto, CEO of São Paulo stock exchange BM&FBOVESPA, suggested that CEOs must work harder to communicate the value of sustainability initiatives to investors. He said:

“CEOs may complain that investors do not value their sustainability activities properly, but they need to tell investors what they are doing: If they don’t communicate regularly, investors cannot incorporate these issues into their models.”

How can companies effectively embed sustainability into their strategic plans, building trust with consumers while garnering the support of shareholders and investors? The report suggests that accountability reporting can help corporations build a case for themselves regarding sustainability.

Producing metrics-based justifications for sustainability efforts can prove to mistrustful consumers that the company is actually doing the good work it claims to, while the numbers can also help sway the results-focused style of shareholders and investors. In fact, some of the CEOs who took part in the survey presented innovative solutions to the problem of quantifying sustainability efforts.

“There should be a focus on integrated reporting of CSR and financial results, which could bring about an alignment of sustainability with economic performance,” said Fulvio Conti, Enel S.p.A.

The report notes PepsiCo CEO Indra Nooyi’s suggested business model for corporate responsibility:

“Full Business Value = (Profit + loss) – (Positive + negative impact on society).”

Additionally, besides noting sustainability success as part of company-wide performance reports, Accenture’s study suggests that sustainability success be tied to pay packages for individuals within firms.

The report says:

“Embedding sustainability into the performance and remuneration packages of top executives and management was seen by many CEOs as perhaps one of the most effective means of ensuring more active management and monitoring of sustainability impacts. ‘People have a habit of doing what you pay them to do,’ one business leader told us.”

This will provide another layer of accountability to sustainability initiatives moving forward, and hopefully overcome some of the wariness regarding the implementation of these CEOs’ visions of sustainability for their companies.

This article originally appeared on our new corporate citizenship website, Evolved Employer. Evolved Employer provides news and analysis for business leaders on corporate sustainability, corporate social responsibility (CSR), diversity, corporate philanthropy, and employee wellbeing. The site aims to provide best practices and ideas that will help senior executives lead their companies in the 21st century in a way that is profitable, yet sustainable, in all aspects of the word.

Currently women make up about half the U.S. workforce, so more than ever before, retaining women in the workplace is an important issue. Many businesses offer work/life balance, flex time, and other family-friendly incentives to attract, inspire and keep female employees, but a recent survey shows another surprising way to make women happy: do good, and tell the world about it.

A survey conducted by the Simmons School of Management and Hewlett-Packard during the 2009 Simmons School of Leadership Conference reported that female employees who thought their employers were ethical and supported socially responsible initiatives were happier with their jobs, thought less about quitting, and were more likely to champion their company in social settings. However, the findings also showed that since many women were unaware of their company’s corporate social responsibility (CSR) activities, employers were missing out on this unexpected benefit.

The results showed:

• More than 75% of respondents indicated that “making a positive impact on society” and “expressing and acting in line with my values” are important to them
• Respondents also said that “when CSR is an important part of an organization’s business strategy, it contributes to the fulfillment of ‘individualistic’ career needs, such as ‘opportunities to develop one’s professional skills/expertise’”
• 45% reported awareness of their companies’ CSR efforts
• 35% reported that they have participated in their companies’ CSR activities

As more and more businesses are realizing the importance of socially responsible initiatives as a sound business strategy, reaching and influencing women is critical in more ways than just retaining female employees. Social responsibility also makes a big difference to consumers, and women make 85% of consumer purchasing decisions. In March 2010, Penn Schoen Berland, Landor & Associates, and Burson-Marsteller released the results of their second annual Corporate Social Responsibility Perceptions Survey that gauged consumer opinions of companies in 14 industries, from apparel to telecommunications.

Although the respondents were both men and women, knowing that women make the vast majority of purchasing decisions casts these results in a new light.

• Despite the recession, more than 75% of consumers responded that social responsibility is important no matter the industry
• When choosing between similar products, 55% are more likely to choose a product that supports a certain cause
• 38% plan to spend the same or more on products or services from socially responsible companies compared to 2009
• Only 45% of respondents say they know the meaning of the term “corporate social responsibility”
• Only 11% say they have heard communications about CSR from any company in the past year
• 59% plan to spend the same or more (45% and 14% respectively) on products from socially responsible companies in the coming year
• 70% are willing to pay a premium on products from a socially responsible company
• 22% are aware that their companies have CSR practices, 25% say no and 53% say they don’t know if their companies have CSR initiatives
• 34% of respondents would take a pay cut to work at a socially responsible organization (majority being younger workers 18-24)
• Only 13% of respondents have read about a company’s CSR agenda on the corporate website
• Of those who have read about a company’s CSR efforts on their website, 26% are much more likely and 49% are somewhat more likely to purchase a product from that company

These surveys show that (female) employees and both male and female consumers are paying attention to social responsibility. The key? Communication. The authors of both reports advocate better communication of social initiatives both internally and externally. Spreading the word inside your company is a great way to build goodwill, loyalty, and job satisfaction. Additionally, female employees have indicated that they would be proud to spread the word of their company’s social efforts, and this type of communication can be worth ten times any media campaign.

Who best to get your message out? Yep. Women again. In June 2010, the Boston College Center for Corporate Citizenship released a report detailing the profile of today’s corporate citizenship leaders. In its key findings, it shows that (among respondents) women outnumber men 3-to-1, although the percentage of men who hold a senior or executive level position (49.7 percent) is far above the number of women (26.9 percent). Although respondents indicated that creating partnerships inside the company (86.3 percent) and relationships outside the company (84.2 percent) were a part of their responsibilities, evidently even more attention needs to be paid to these activities. Employee involvement can be crucial to the success of a CSR program. In 2010, The National Environmental Education Foundation released a study showing that “environmental and sustainability (E&S) employee education and engagement initiatives help companies achieve a range of business objectives from attracting and retaining employees to boosting the bottom line.”

So shout your CSR efforts to the rooftops – or at least to all the corners of your company. Employees and consumers alike are watching, and women in the role of employee, consumer, CSR representative, and community member can be powerful allies.

Last Monday, the Women’s Network for a Sustainable Future held a discussion panel entitled Human Capital for a Sustainable Economy. WNSF Executive Director Anne Goodman said that a focus on sustainable careers can improve the economy and create jobs. She said, “WNSF envisions a future for sustainable jobs.” She explained that these kinds of careers can create financial, environmental, and social progress.

Moderated by Michelle Kahane, Professor of Professional Practice at Milano the New School for Management and Urban Policy, the panel featured Melinda Wolfe, Head of Human Resources at Bloomberg, Susan Heaney, Global Director of Corporate Responsibility, Avon, Natalie Thompson, Vice President, Global Leadership and Diversity, Goldman Sachs.

“Bloomberg has some very dramatic goals to reduce our carbon footprint by 50% in a couple of years,” said Wolf. She continued, “Our commitment is a defining hallmark for the company.”

Thompson said, “At Goldman Sachs, we’ve had an environmental policy in place since 2005. It is fully integrated at every aspect of the business.” Thompson also cited Goldman’s new LEED certified facilities.

Heaney explained that at Avon, CSR “functions very much like HR. It intersects with every single department in the company, and sets policy and procedural standards” across the organization. “When Goldman Sachs started tracking social investing, [we realized] this must really count!” she joked. “It was really a turning point.”

Creating Staff Buy-In

Heaney emphasized the importance of taking a long-term view with corporate responsibility. She said, “It’s not a quarter by quarter analysis.” Companies have to be in it for the “long haul” and see these initiatives as an investment.

The challenge, she said, was not in creating CSR policies, but in gaining a groundswell of support for them. She said, “You can make someone do something. But you have to make them want to do something.”

Wolf agreed. She said, “I think it’s really important that you are attracting the right people.” She said the company’s values have to resonate with its staff. For example, she said, Bloomberg recently removed wastebaskets from its employees’ desks. “It takes a certain kind of employee to commit to collect their trash and then throw it away themselves,” making sure to also sort out recyclables and compostables. She continued, “If you’re not going to buy into it, you’re not going to like it at Bloomberg.”

Thompson discussed the need for employees to see top-down leadership on sustainability directives, as well. “You yourself become part of the solution rather than just a talking head.” Heaney added, “If the C-Suite isn’t behind this, it doesn’t matter what you do.”

Attracting the Green Workforce

Dr. Kahane asked the panel if sustainability is one of the factors they hire around. Wolfe responded that she believes it works in the other direction. “We’re looking for the best talent. Sustainability is not one of the core characteristics,” but she said, individuals who care about green issues were more likely to seek out Bloomberg. “It works best from the other side. When you go out there and you see our employee value proposition, by nature we’re going to attract certain types of people.”

Thompson agreed, “We’re evolving in sustainability. I’m not sure if there if there is a direct connection” between new hires and their green characteristics.

Heaney took the perspective of hiring individuals specifically to fill CSR or sustainability-focused roles. She said, “It’s about finding a person who can actually do something and not just talk about it.” She explained that working in a sustainability-focused role can seem like a moving target. “We’re looking for someone who understands what sustainability is, but who also knows that nobody really knows what sustainability is.” She continued, “It’s like learning to drive in the Indy 500. You live in constant gray. There is no black and white.”

Thompson brought up the importance of the next generation of the workforce – the millennials. “It depends on the cohort. On the analyst level, there is a different sensibility on the environment and sustainability.” The sustainability factor, she said, is important “to create a pipeline that will have throughput to take you to the next phase of leadership.”

Wolfe added, “you’re recruiting people you hope can lead the company to the next phase.”

By Melissa J. Anderson (New York City)

In 1972, we got our first real glimpse of what the Earth looked like from outer space with the iconic “Blue Marble” photograph taken by astronauts aboard the Apollo 17 spacecraft. But as Kathy Robb, Partner at Hunton and Williams and Chair of the Women’s Network for a Sustainable Future (WNSF) explained, it wasn’t just a pretty picture— it represented much more.

“This perspective, never before possible, dramatically affected our appreciation of the natural environment,” she said. Today’s view of sustainability “may well be another bright line,” she continued.

On Tuesday, October 6th, WNSF held its 6th annual Businesswomen’s Sustainability Leadership Summit. Entitled “New Dynamics of Sustainability Leadership: Changing Roles, Fresh Opportunities,” the summit took place at the Institute for International Education at the U.N. and brought together 200 women to discuss the new dynamics of sustainability in the business world.

Featuring women from the nation’s top companies, speakers and guests at the summit came together to discuss new ways of doing business in light of the ever-growing importance of sustainability.

Business Sustainability: More Than a Passing Fad

As keynote speaker Linda Fisher, Chief Sustainability Officer and VP, Safety, Health & Environment for DuPont and Deputy Administrator of the United States Environmental Protection Agency explained, sustainability is becoming an important issue, rather than the fad predicted by naysayers just a few years ago. She remarked, “I can’t think of a more dynamic time to be involved in working with the environment.”

Fisher was presented with the Busineswomen’s Sustainability Leadership Award for her work in putting DuPont at the forefront of sustainable business strategy. Upon receiving the award, Fisher joked about when she told her older brother she was going to be focusing on environmental law upon receiving her law degree 25 years ago. “He said, ‘The environment – well, that will be a very nice boutique practice.’ No way is it a boutique or narrow practice now.”

Her talk focused on three things: why the emphasis on sustainability is here to stay; the importance of cooperation between industry leaders, non-governmental organizations and activists, and consumers; and the role government regulation should play in the mix.

First, responding to criticism of “greenwashing” in the industry, Fisher said that it exists, but there is also “real meaningful change” going on in many companies. She went on to say that the reason for the meaningful change is that sustainability initiatives aren’t simply an afterthought, they are “part of the conversation about growth.” Fisher explained that as consumers become more conscious of environmental concerns, industry must respond to stay competitive and innovative.

Fisher recalled that in the 1980s, business leaders complained that they wished people in the environmental community understood business. “Well, now they do,” she added. And they exercise this knowledge in two ways: first, by utilizing the market as a venue for change—whether through the boycott of products they deem environmentally unsound or putting their purchasing power to work buying products they feel support their values; and, second, by embracing a new view of technology and innovation as things that will allow the world to become more sustainable.

Industry must “invent solutions” and make technological breakthroughs, Fisher said, rather than dourly abide by regulations. “Successful companies have always known where their customers were going before the customers did,” she explained. “Economic success will really come first to those companies that have integrated sustainability into their business models.”

Finally, Fisher discussed the role of government regulation in sustainability. Regulation is necessary, she said, because the marketplace is imperfect. “We do need the hot breath of the EPA.”

But regulation needs to be fair, she said. It should also be cost effective, drive innovation, protect the public, and level the playing field. And, because we operate in a global economy, the government needs to consider the global impact of its regulations. It needs “to get the rules of the road clear.”

Sustainability Leadership and Market-Based Initiatives

Following Fisher’s speech, the audience broke out until small groups to discuss what their companies are doing to approach sustainability.

Suzette Rhodes, LEED AP Industry IIDA, A&D Sales Representative for HermanMiller explained that her company views sustainability not as a differentiator but as an opportunity for leadership. By focusing on transparency, the company invites others in its industry to learn about sustainability initiatives and practices. “We need to take other companies with us. Sustainability is more than a competitive advantage,” Rhodes explained.

Following the small group session, Marlys Appleton, VP AIG Investments and WNSF Board Member introduced the panel dialogue. The panel featured Hye-Won Choi, Senior VP, Head of Corporate Governance, TIAA-CREF and Co-Chair, SEC Investor Advisory Committee, Beth Keck, Senior Director, International Sustainability & Strategy, Walmart, Dr. Sharon Nunes, VP, Strategic Growth Initiatives, IBM, and Dr. Ponni Subbiah, VP of Global Access Strategy, Pfizer, Inc.

These company leaders also emphasized the importance of market-based sustainability initiatives, and called for companies to incorporate sustainability into their growth strategies.

Finally, Michelle Moore, the Obama Administration’s Federal Environmental Executive gave her remarks. She called for reductions in water and energy use by the federal government, saying that it’s time for the government to “practice what it preaches.”

Above all, the summit’s leaders and participants agreed: cooperation between the industry, environmental community, consumers, and government is key in tackling global environmental challenges. If this level of dialogue continues, we may indeed be seeing a new bright line in our approach sustainability and environmental issues in business.

Green mutual funds might seem like the hottest new trends on Wall Street but women in this industry are adamant that green investing is not a passing fad. According to the Social Investment Forum, an association of socially responsible investing firms and professionals, socially responsible investing represents an estimated $2.71 trillion. From 2005 to 2007, this segment of the market grew at a rate of 18 percent.

“Green business is not a trend,” says Vicki Radden, Managing Director of the Capital Markets Partnership. “It’s a new way of approaching business that is not an option. It is a requirement.” The Capital Markets Partnership (“CMP”) is a nonpartisan, nonprofit coalition of investors, investment banks, insurers, city, state and federal government, countries, and NGOs creating a market shift toward sustainable investment. Says Radden, “The Capital Market Partnership provides advocacy for various financial products and pushes forward the agenda within the capital markets to drive financial entities to develop, support, invest and promote.”

Radden likens the so-called trend in sustainable investing to the dot com era in the early nineties. Back then, companies viewed adding a dot com to their names and creating an Internet presence as a “hot” idea and key differentiator. However, a few years later, it was standard operating procedure; a requirement for doing business.

Why Women are Making Waves in the Sustainability Market

And regarding this new segment of the fund market, Radden thinks women are particularly well-suited. “The folks I’m bringing to the table now are women,” she says. “All of them are willing to step to the table because they believe in the vision and they are willing to take that risk.”

Radden says a financial career in sustainability is still viewed as a less traditional, more risky career move. And women, she says, are risk takers. “If I wasn’t willing to take on the projects that others wouldn’t – the low probability orphans or the high visibility for failure projects,” she says. “Well, you can’t stay comfortable in the shadows and be able to move up.”

“This segment requires you bring a lot of skills to the table,” adds Radden. “You need to understand the financial aspect, technology, politics, legislation and you’ve got to understand the global impact. You need to be multifaceted and, in my experience, women do that really well. Women are phenomenal managers.”

Sentinel Investments, a Vermont-based mutual fund company that is committed to practicing business with integrity, and doing what is best for both its clients and its employees, tapped one of its top women at the firm, Executive Vice President, Clara Sierra, to head its sustainable investing practice.

Erin Gray of Green Century Capital Management, Inc. is another good example of the opportunities available to women in the green fund market. Green Century Capital Management was founded in 1991 and administers the Green Century Funds, a family of environmentally responsible mutual funds. It was founded by non-profit environmental advocacy organizations and is wholly owned by non-profit advocacy groups.

Says Gray, “This type of investing values women in its underlying principals. It values a different, diverse work force. It values differences of opinions. It is opening up to new markets and fund managers are looking for diverse boards and management teams. So, the type of investing we’re doing makes it open to women.”

Gray recounts a recent industry meeting where “there was some talk of Mother Earth and the idea that the earth nurtures our whole system – that all of our economic principles have to be subsumed to what our planet can sustain. Just the whole idea of femininity and nurturing doesn’t always find a voice in financial services.”

Gray, who started out working in public accounting and then pursued an MBA in environmental management, sees opportunities for other women. “Growth has flattened out recently,” she says. “Some firms are downsizing and others are growing faster.” Still, she says sustainable investing is becoming more mainstream.

“Find a place where your values match up with what the companies are doing,” she advises women looking to enter this segment of the market.

Fund managers are faced with a rack of new decisions, shaped by the climate change agenda: should we invest in ‘clean’ energies like wind power? If you know an organisation consumes a lot of carbon, does that make its market value less? On top of that, it’s a political hot potato, with the impending discussions at COP 15 (December’s climate change conference), and the Obama administration pushing ahead for a cap-and-trade scheme.

With the US carbon emission trading market set to be worth $1 trillion by 2020 investors can’t help but take notice. Companies are going to need to know exactly how much they are emitting. A whole industry has sprung up around green house gas emission calculations, with the aim of permitting allowances to be accurately traded with software like GreenCert, which has been produced as a joint effort by IBM, C-Lock Technology, Inc. and Enterprise Information Management.

It’s important to be able to measure accurately, to ensure that carbon trading schemes can be audited effectively. “This lesson was rather painfully illustrated in late 2007,” says Jennifer Smokelin, an attorney at Reed Smith LLP, and Professor of Law (adjunct) at the University of Pittsburgh School of Law. “Verified emission data released spring 2006 showed that there was over-allocation of between 75 million and 150 million tons by member states. Lithuania, for example, over allocated its allowances by nearly 200%, which not only served to effect no net reductions on carbon dioxide but also caused the price of a ton of carbon to plummet from about €30 per ton CO2 [in] April 2006 declining to €0.10 in September 2007, a market collapse.”

It’s a delicate balance: the cap needs to be set low enough to make the whole thing worthwhile. “From an environmental standpoint, a cap-and-trade system is only effective at reducing emissions if the cap is stringent enough to do so,” Smokelin says. “From a market standpoint, the market will only function if there is demand for credits and offsets; demand is created by a cap that is hard to meet so sources need to purchase credits; the more demand, the higher the prices for credits and the more robust – presumably – the market.”

The big consultancy companies are also getting in on the act, and wising up to the fact that their clients need advice in this emerging area. Helle Bank Jorgensen is US sustainability and climate change leader at PricewaterhouseCoopers, advising clients on their sustainability strategies, in areas like alternative energy, clean technology, carbon finance and climate policy. Jan Babiak has a similar role – global head of climate change and sustainability services – at Ernst & Young. In fact, if your CEO doesn’t have a climate change expert on speed dial, then they need to update their phonebook.

“Now that climate change is at the forefront of the political agenda, investment opportunities to support the growth of the new energy economy have become the hottest ticket in town,” says Susan Preston, general manager of the CalCEF Clean Energy Angel Fund. “Climate change has become a very real public concern; consumers are demanding green products and corporate sustainability. With volatile carbon markets and increased pressure from both the public and private sectors, smart companies are taking preventative steps now to ensure their longevity.”

Alternative energy sources and sustainability may well be hot topics, but for the most part venture capitalists are steering clear. “Clean technology is one of the fastest growing investment sectors worldwide,” says Preston. “Unfortunately, the venture capital model focuses on the large, multi-million-dollar deals, leaving a large gap at the early stage or seed level where companies need much less cash, but are too young to attract the attention of the VCs.”

Preston’s company is one of the few to bridge that gap. “Clean energy technologies cannot flourish on venture capital alone, so we’re implementing a new model of financial innovation in the public interest, where we bring together interests from industry, policy and finance to fill the funding gaps throughout the technology development lifecycle–from invention to commercialisation to deployment to scale-up,” she explains. “In light of today’s global financial market conditions and the beating that the private equity investment industry has endured, I see and hear from investors a rising need for transparency in private equity investing.” Preston is trying to listen to those voices, and in keeping with the Fund’s mission of “financial innovation that evolves with and addresses current market conditions,” she says that the CalCEF Clean Energy Angel Fund has made transparency to its individual and institutional investors the cornerstone of its investment model.

This facet of our economy didn’t exist in recent memory: managing the markets based on consumer and investor demand for cleaner energies, and the complex legislation and guidance around carbon trading schemes, are all relatively new. It’s an emerging slice of the fund management industry; a new niche, if you like. “Combating global warming and setting the technology, policy and finance foundation for a new energy economy is the only viable path forward,” says Preston.