Green to Gold - GreenProf

1 Published by Soundview Executive Book Summaries, Box 1053, Concordville, PA 19331 USA 2007 Soundview Executive Book Summaries All rights reserved. Reproduction in whole or part is Smart Companies Use Environmental Strategyto Innovate, Create Value, and Build CompetitiveAdvantageGREEN TOGOLDTHE SUMMARY IN BRIEFF orward-thinking business leaders see the Green Wave coming andwant to profit from summary explores what every executive must know to manage theenvironmental challenges facing society and business. Based on theauthors years of experience and hundreds of interviews with corporateleaders around the world, this summary shows how companies generatelasting value cutting costs, reducing risk, increasing revenues and creat-ing strong brands by building environmental thinking into their Daniel C.

2 Esty and Andrew S. Winston provide clear, how-toadvice and concrete examples from companies such as Toyota and IKEA that are achieving both environmental and business success. The authorsshow how these cutting-edge companies are establishing an Eco-Advantage in the marketplace as traditional elements of competitive differ-entiation fade in importance. Esty and Winston not only highlight successfulstrategies but also describe why environmental initiatives sometimes faildespite the best summary is written for executives at every level and for businessesof all kinds and sizes. Esty and Winston guide leaders through a complexnew world of resource shortfalls, regulatory restrictions and growing pres-sure from customers and other stakeholders to strive for addition, you will learn: How to keep a sharp focus on execution while using an environmentalstrategy.

3 Ways to cope with environmental pressures and responsibilities. How to spark innovation that will drive long-term growth. How to anticipate and manage serious business risks. How to be good stewards of the Earth while simultaneously buildingthe bottom Knowledge for the Busy Executive 29, No. 1 (3 parts), Part 1, January 2007 Order # 29-01 CONTENTSThe Environmental LensPage 2 Eco-AdvantagePages 2, 3 Natural Drivers of the Green WavePages 3, 4 Who s Behind the GreenWave?Page 4 Managing the DownsidePage 4 Building the UpsidePage 5 The Eco-Advantage MindsetPage 5 Eco-TrackingPages 5, 6 Inspiring an Eco-AdvantageCulturePages 6, 7 Why Environmental Initiatives FailPages 7, 8 Eco-Advantage StrategyPage 8By Daniel C.

4 Esty and Andrew S. WinstonFILE: STRATEGIC MANAGEMENT The Environmental LensIn the weeks before Christmas 2001, Sony faced anightmare. The Dutch government was blocking Sony sentire European shipment of PlayStation game systems;more than million boxes were sitting in a warehouseinstead of flying off store was Sony at risk of missing the critical holidayrush? Because a small, but legally unacceptable, amountof the toxic element cadmium was found in the cablesof the game controls. Sony rushed in replacements toswap out the tainted wires. It also tried to track downthe source of the problem an 18-month search thatincluded inspecting more than 6,000 factories andresulted in a new supplier management system.

5 Thetotal cost of this little environmental problem wasmore than $130 million. Sony executives refer to theirPlayStation disaster as the Cadmium Crisis. Four Lessons From Sony s StumbleSony has been a business powerhouse for years andthe company is also generally perceived as an environ-mental leader. Nothing foreshadowed the PlayStationstumble, yet it happened. Why? Three lessons can bedrawn from Sony s difficult experience: Even the best companies can be surprised byenvironmental issues. The environment is not a fringe issue it cancost businesses real money. Real benefits can come from seeing things in anew at all the ways environmental issues affect abusiness can frame thinking and strategy in a new way.

6 Byexamining their business through an environmental lens, managers can avoid expensive problems and create sub-stantial value. Thus, a fourth lesson can be drawn fromSony s experience and this is the fundamental one: Smart companies seize competitive advantagethrough strategic management of environmental and Natural ResourcesThe business world and the natural world are inextri-cably linked. Our economy and society depend on nat-ural resources. The environment provides critical sup-port to our economic system not financial capital, butnatural capital. And evidence is growing that we re sys-tematically undermining our asset base and weakeningsome of our vital support environmental lens is not just a strategy tool or afeel-good digression from the real work of a s an essential element of business strategy.

7 It providesa way for businesses to contend with the problems ofpollution and natural resource these issues can drain value out of a com-pany quickly and damage brand reputations built upover decades of careful cultivation. Eco-AdvantageIn a speech to shareholders, Wal-Mart CEO Lee Scottlays out his definition of 21st Century Leadership. Atthe core of his new manifesto are commitments toimprove environmental performance. Wal-Mart will cutenergy use by 30 percent, aim to use 100 percent renew-able energy (from sources like wind farms and solarpanels), and double the fuel efficiency of its massiveshipping fleet.

8 The company will invest $500 millionannually in these energy are the world s biggest, toughest, most profit-seeking companies talking about the environment now?Because they have to. The forces coming to bear onGREEN TO GOLDby Daniel C. Esty and Andrew S. Winston THECOMPLETESUMMARYP ublished by Soundview Executive Book Summaries(ISSN 0747-2196), Box 1053, Concordville, PA19331 USA, a division of Concentrated Knowledge Corp. Published monthly. Subscriptions: $209 per year in theUnited States, Canada and Mexico, and $295 to all other countries. Periodicals postage paid at Concordville, Pa.

9 ,and additional :Send address changes to Soundview, Box 1053, Concordville, PA 19331. Copyright 2007by Soundview Executive Book ailable formats:Summaries are available in print, audio and electronic formats. To subscribe, call us at1-800-SUMMARY (610-558-9495 outside the United States and Canada), or order on the Internet at discounts and corporate site licenses are also Book Summaries CHRISLAUER Contributing EditorDEBRAA. DEPRINZIO Senior Graphic DesignerMELISSAWARD Managing Editor REBECCAS. CLEMENT PublisherSoundview Executive Book Summaries 2 The authors:Daniel C. Esty is Hillhouse Professor ofEnvironmental Law and Policy at Yale University withappointments in the Environment and Law S.

10 Winston works with leading companies todevelop dynamic environmental strategies and is Directorof the Corporate Environmental Strategy Project at to Goldby Daniel C. Esty and Andrew Copyright 2006 by Daniel C. Esty andAndrew S. Winston. Summarized by the permission ofthe publisher, Yale University Press, 366 pages. $ Copyright 2007 by Soundview ExecutiveBook Summaries, 1-800-SUMMARY,1-610-558-9495.(continued on page 3)For additional information on the authors, go to: are growing. Industry groups are facing anunavoidable new array of environmentally driven any revolution, this new Green Wave presents anunprecedented challenge to business as Evolving ChallengeEnvironmental worries used to center on limits togrowth and the prospect of running out of key naturalresources like oil and industrial metals.