AmCham Belgium - AT Kearney Green Survey Results

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A short presentation of the AmCham Belgium - AT Kearney survey on Best Green Practices in US companies operating in Belgium. Presented at the Best Green Practices conference on September 29, 2010.

Transcript of AmCham Belgium - AT Kearney Green Survey Results

  • AmCham Belgium Green Survey

    How green are we?

    September 29th, 2010

  • AMCHAM BELGIUM

    Why eco-sustainability matters?

  • AMCHAM BELGIUM

    As billions of people improve their living standards, resources will inevitably become limited

    Today Future, 20xx

    7 bn.100

    (indexed)

    Developing countries strive to increase standard of living

    Fierce competition for resources leads to sharp price increase

    Current business models are becoming constrained

    The only way to survive this environment is to focus on smarter resource usage

    One planet Five planets

    20%

    Resources

    80%

    20%

    # People

    80%

    Developing countries

    Developed countries 7 bn. + X 500

    10%

    Resources

    98%

    2%

    # People

    90%

  • AMCHAM BELGIUM

    Sustainability is of strategic importance

    Economic Development

    Environ-mental

    Protection

    Social Wellbeing

    Regulation and activism

    Resource scarcity

    Consumption patterns

    The sustainability challenge is amplified by three main forces

  • AMCHAM BELGIUM

    Eco-sustainability represents formidable challenges and opportunities for companies

    Reven

    ue

    Co

    sts

    Risk Opportunity

    New Products

    Carbon Tax

    Revenue Threat Growth Platform

    Cost Peril Efficiency Booster

    Packaging weight

    reduction

    Declining relevance

    of current product portfolio

  • AMCHAM BELGIUM

    To address those challenges and opportunities, companies need to take a product lifecycle approach

    New end-to-end lifecycle approach to sustainability

    Traditional inward-looking approach to sustainability

    CO2Share of emission

    Supply Production DistributionUsage and disposal

    60-70%

    80-90%

    80-90%

  • AMCHAM BELGIUM

    To assess eco-sustainability of its members, AmChamBelgium has, with A.T. Kearney, conducted a green survey

    Support functions(sales, marketing, administration)

    Corporate strategy & business model

    R&DPurcha-sing

    1

    2

    3

    25 companies participated in the survey

    Product use

    Distri-bution

    Disposal

    Services

    Production

    To what extent is eco-sustainability a key element of

    company strategy and embedded in the organization?

    How does the company manage eco-sustainability in its day to day

    operations?

    To what extent are eco-

    sustainability principles applied

    in support functions?

  • AMCHAM BELGIUM

    Eco-sustainability in Corporate Strategy & Business Model

  • AMCHAM BELGIUM

    Sustainability is clearly recognized as a positive force for future performance

    Impact of eco-sustainability on profitability % of respondents

    10%

    20%

    10%

    Positive

    None

    Negative

    Next 3 yearsLast 3 years

    90%

    70%

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

    A similar trend in terms of

    revenue growth

    Eco-sustainability seen as a key enabler

    to outperform industry peers

  • AMCHAM BELGIUM

    Primary eco-sustainability objectives are brand and reputation improvement as well as regulation compliance

    Product differentation

    71%

    Risk management

    83%

    Increased efficiency

    88%

    Cost reduction

    92%

    Employee motivation

    92%

    Compliance

    92%

    Brand/reputation

    96%

    Objectives in your eco-sustainability strategyFrequency in %

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    Sustainability is clearly perceived as a key risk factor to be managed

    Competitor, substitutes

    Geopolitics

    Economics, globalization,

    tariffs

    Regulatory change

    Consumer and demographic

    Technology & innovation

    Environment and climate

    change

    84%

    72%

    64%

    60%

    60%

    52%

    48%

    Perceived and managed long term risksFrequency in %

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    84% of survey participants emphasize eco-sustainability in their strategy but much less translate it into targets

    % of respondents Frequency in %

    16%

    Keyelement

    Not akey element

    84%

    19%

    29%

    62%

    Water usage Paper Consumption

    CO2 emissions or energy usage

    Importance of eco-sustainability in the company global strategy

    Defined targets in key sustainability areas

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    (1) Management by ObjectivesSource: AmCham Belgium A.T. Kearney Green Survey 2010

    % of respondents Frequency in %

    Most senior person accountable for

    sustainability strategy

    Eco-sustainability rewarding method

    Responsibility and accountability for sustainability is not yet firmly embedded in the organization

    Level of staff with sustainability goals

    included in their MBO1)

    Frequency in %

    Board ofDirectors

    or onelevel below

    Two levelsdown

    the boardor below

    100%

    70%

    30%

    Manager 33%

    Senior Manager/Associate

    Director24%

    Director 29%

    Vice President 24%

    24%Member of the

    executivecommittee

    Other 10%

    Reco-gnition

    rewards52%

    Monetaryrewards

    24%

    At leastone type

    of reward67%

  • AMCHAM BELGIUM

    Leaders in eco-sustainability have defined a clear strategy and structurally embedded it in their organization

    Eco-sustainability performance for Leaders and Followers% of total score

    (1) Top 25% performersSource: AmCham Belgium A.T. Kearney Green Survey 2010

    83%

    62%

    84%

    27%31%

    65%

    +56%

    +31%

    InvestmentsOrganization and KPIsStrategy

    Leaders

    Followers

  • AMCHAM BELGIUM

    Eco-sustainability along the Value Chain

  • AMCHAM BELGIUM

    Companies tend to focus their sustainability efforts within their boundaries

    Companies with eco-sustainability policies translated into concrete actions % of respondents

    37%

    63%

    45%

    60% 57%

    Supply Production DistributionUsage and disposal

    R&D

    Support functions

    Within 4-walls

    Outside 4-walls

    Not applicable (mainly R&D driven)

    The next challenge is to further engage suppliers

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    Leading companies have a stronger eco-sustainability focus across the entire value chain

    54%

    44%

    83%

    52%

    83%

    50%

    29%

    44%

    33%

    52%

    +19%

    +39%+31%

    Support FunctionsDistributionProduction/ServicesSupplyR&D

    Followers

    Leaders(1)

    (1) Top 25% performersSource: AmCham Belgium A.T. Kearney Green Survey 2010

    Eco-sustainability performance in core adding-value activities % of total score

  • AMCHAM BELGIUM

    60% of companies recognize that eco- sustainability performance starts at the design stage

    60% of companies

    take concrete actions in

    R&D

    Supply

    Production

    Usage and disposal

    Distribution

    New manufacturing line reducing energy usage by 30%

    Detergent enabling washing machine to operate at 15C

    Examples from participants

    More compact detergent enabling to decrease transport volume by 40-57%

    Minimize use of volatile organic compounds (VOC) in products

    Design (R&D)

    UsageManufac-turing

    High

    Low

    Environmental impact influenced

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    Companies tend to focus more eco-sustainability improvement on process improvement

    14%

    14%

    14%

    25%

    29%

    43%Raw material

    reduction57%

    Use of eco-friendly raw material

    71%

    Energy efficiency 75%

    Use of green energy 86%

    Waste reduction 86%

    Water reduction 86%

    Formal policy No Formal policy

    Raw material changes are seen as more difficult to implement

    Efforts in production towards eco-sustainability% of respondents

    Process related

    Product related

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    Companies have started to implement sustainable procurement

    56%

    38%

    36%

    23%Awards andrecognition

    69%46%

    Staff training 71%36%

    Sustainabilityevaluation criteria

    77%38%

    Writtenguidelines

    100%44%

    Currently do it

    Plan to do it within 12 months

    33%

    30%

    Policy & clear guidelines

    Policy but no guidelines

    No policy

    37%

    % of total spending value% of respondents

    Scope of sustainable procurementProcurement actions related

    to eco-sustainability

    however, guidelines cover less than 40% of their spending

    Source: AmCham Belgium A.T. Kearney Green Survey 2010

  • AMCHAM BELGIUM

    % of respondents % of respondents

    Excluding suppliers based on insufficient performance in

    sustainability

    Recognize or reward suppliers with good eco-sustainability practices

    Pressure on suppliers regarding their sustainability performance is expected to increase significantly

    23%

    8%

    10% of the time

    Never

    Within 5 years

    57%

    43%

    Today

    31%

    54%

    15%

    5 yrs ago

    69%

    50%

    33%

    Toda