By Marc Stoiber
Morten Schroder of Van Houtte Coffee knows something about being a
sustainability leader.
In fact, Van Houtte has a long, proud history of adopting
sustainability measures, even before a clear ROI matrix has been
established. (The latest example is Van Houtte's implementation of
Renewable Natural Gas, a product I helped
position and market).
"We believe in making decisions based on the bottom line, of
course. But we also have a very clear agenda to reduce greenhouse
gas emissions" said Schroder. "What surprised us is that our
sustainability decisions - without fail - have all paid off
financially. Even when they were based on investing in new
ideas."
Schroder is not the only trailblazer reaping the rewards of
acting on ideals.
As reported recently in Sustainable Brands, new
research on the world's 50 fastest growing brands found a
cause-and-effect relationship between a brand's ability to serve a
higher purpose and its financial performance.
The research, from Millward Brown and Jim Stengel, cited
companies like Method, Seventh Generation and Stonyfield Farm. All
companies that have elevated ethics and sustainability to leading
operating principles.
The study GROW: How Ideals Power Growth and Profit at the
World's Greatest Companies forms the backbone of
Stengel's book.
So are ideals the next brand differentiator? Is acting ethically
the best way to engage jaded consumers? Or does it all come down to
common sense?
A Practical, Successful Shift: B Corp
B
Corp gained prominence a few years ago as a business
sustainability certification program.
One of the things that made B Corp different was, in hindsight,
incredible common sense. The program provided a template for
companies to incorporate longer term payback - often key to
sustainability initiatives - right into their corporate
charter.
This simple, yet profound shift away from short term ROI made it
possible for companies to invest in ethical, sustainable
improvements without the fear of having their programs axed for
lack of short term payback.
On Friday, February 3rd, B Corp announced it had over 500 US
companies on board, and had just signed up its first 39 Canadian companies. A success
that Houston Peschl of DIRTT, one of the largest Canadian
corporations to sign on, attributes to finding a common sense way
to validate ethical behavior.
As Peschl says, "DIRTT understands that it requires a different
approach to be successful, the old business practices of
manufacturing are archaic. Through innovative product design,
amazing work force culture, and revolutionizing how to manufacture
environmentally friendly products within a local economy, B Corp
allows us to capture many of the intangibles of our unique approach
and show the world what we are doing to change manufacturing in
North America."
Futureproof Brand Lesson: Reconsider The Business
Model
If there's one thing to be learned from Van Houtte Coffee and B
Corp, it's that the old business model for measuring performance
needs to be tweaked.
Quarterly returns are fine. But the consistent long term gains
seen from sustainability measures - gains like customer loyalty,
staff motivation and improved efficiency as energy use is reduced -
take time to manifest.
It can be likened to the returns on brand investment. Brand
building is a slow process, but accepted as invaluable to
companies.
While we're looking at the business model, attention needs to be
paid to the ROI measures used. New, exciting sustainability
initiatives often have hidden benefits, or hard to measure
benefits. For example, the Renewable Natural Gas program that I
worked on offered incredible marketing benefits that easily
outweighed the operational costs - but those marketing benefits
needed to be brought into the ROI measurement before the business
case made sense.
Finally, if you want to build a futureproof brand, you need to
lead. That said, your leadership needs to be based on strong insights into market trends
and consumer demands. As Henry Ford and Steve Jobs understood,
leaders can create products that people need - even before people
know they need them.
Just ask Morten Schroder or B Corp.
Marc Stoiber is
a creative director, writer, innovator and green brand specialist
and a frequent contributor to GLOBE-Net. He consults with clients
across North America. He also speaks and blogs extensively on
trends that will influence the destiny of today's
brands. This story first appeared in Huffington Post February 16th, 2012 and is
reprinted here with the kind permission of the author.