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A Smarter Planet for a Sustainable Future
IBM Chairman Sam Palmisano urges participants of the IBM Summit at Start to explore new directions, ideas and inspirations for the benefit of their business, their clients and society.

No matter what your business, sustainability is your business


The Chinese shipping company COSCO looked at its carbon footprint and saw not an obstacle, but an opportunity. It reduced the number of its distribution points from 100 to 40, lowering costs by 23 percent and reducing carbon dioxide emissions by 15 percent, which equates to 100,000 tons per year.

In 2000, IBM looked at our own water usage at plants (US) and labs and set a goal for savings. Eight years later, water initiatives in our microelectronics manufacturing operations achieved a 2.4 percent savings rate, translating to a savings of 1,214 thousand cubic meters (TCM) of water.

From government agencies to retailers to financial institutions, organizations worldwide are assessing the current and future impact of their activities. And that includes their impact on the planet. For example, by 2025, buildings will use more energy (US) than any other category of "consumer." (Already today, in the United States, they represent 72% of energy use.) And 40% of the world's current output of raw materials goes into buildings. That's about 3 billion tons… annually.

Given increasingly finite resources, businesses depend on balanced natural ecosystems for raw materials, water, energy and the physical health of their employees and customers. They depend on thriving community systems for labor, new sources of innovation and customers. And given the links among its systems, an enterprise committed to practicing sustainability considers both the immediate and far-reaching consequences of any action it takes. However, there are some challenges associated with developing a sustainable business approach. Following are three such challenges.

Benefits of eco-efficiency to organizations

 

To be sustainable, organizations must embrace a new objective: optimize operations to minimize environmental impact and improve social outcomes in a manner that also maximizes performance

 

Collecting operational information in timely manner

In the 2009 Corporate Social Responsibility (CSR) Report (US), IBM found that four in ten of the business leaders surveyed reported that over the last three years they have increased the amount of information they collect about their operations in each of eight sustainability areas we tracked: energy management, carbon management, waste management, water management, sustainable procurement, product composition, ethical labor standards and product lifecycle.

Change in information collection over the past three years (Percent responses). 
Energy management: 64% Increased, 24% stayed the same, 11% Not applicable (includes don't collect)
Waste management: 56% Increased, 31% stayed the same, 11% Not applicable (includes don't collect)
Carbon management: 53% Increased, 24% stayed the same, 22% Not applicable (includes don't collect)
Water management: 49% Increased, 35% stayed the same, 14% Not applicable (includes don't collect)
Sustainable procurement(ethical of enviromental): 49% Increased, 37% stayed the same, 12% Not applicable (includes don't collect)
Ethical labor standards: 49% Increased, 42% stayed the same, 7% Not applicable (includes don't collect)
Product composition: 46% Increased, 37% stayed the same, 15% Not applicable (includes don't collect)
Product lifecycle: 39% Increased, 39% stayed the same, 20% Not applicable (includes don't collect) Source: IBM Institute for Business Value 2009 CSR Study.

 

Seeing into the supply chain

Three out of ten organizations surveyed aren’t asking their suppliers for any information in any of the eight categories. Surprisingly, in the carbon and water categories, where cross-ecosystem “footprinting” is becoming more common, approximately eight out of ten aren’t collecting information from their suppliers. And, despite a long history of brand-damaging scandals in the area of labor, six out of ten aren’t collecting information on ethical labor from their suppliers.

Outperforming organizations, on the other hand, are collecting more information from their suppliers in each of the eight categories we tracked as compared to their peers.

Including customers as part of sustainability efforts

Most organizations understand expectations for transparency with regard to CSR initiatives. Over one-half of the business leaders we surveyed consider the open sharing of information a high priority. However, until recently, organizations have tended to share information reactively – in response to stakeholder demands. Those that expect to gain business advantage from CSR are developing new ways to inform and educate their stakeholders, whether they are customers, employees or partners.


 

Emergence of eco-efficiency economy: the 2010 Jam

Earlier in 2010, the IBM Institute for Business Value brought together business executives, government officials, non-governmental organization (NGO) leaders, journalists, analysts and environmental experts from more than 60 countries for the first ever IBM Eco-efficiency Jam (US).

The consensus of the more than 1,600 participants: Eco-efficiency is poised to become the biggest economic "game-changer" for organizations in the next 20 years. And those companies and institutions that understand and embrace eco-efficiency will find they have deepened their engagement and advocacy with their stakeholders, employees, and customers.