PT_Plastics Today

Plastics Today, September 2015

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32 Global Plastics RePoRt 2015 sustainability outlook I f there ever was a concept that has come out of the closet during the past decade, it's sustainability. It's an issue that has been embraced by businesses and industries across the board. Yet, even as the awareness has grown that sustainability should be an integral part of corporate culture, many businesses still find themselves wrestling with the actual implementa- tion of sustainable measures and prac- tices, and are having trouble finding a concept of sustainability that works for them. According to a survey by McKinsey Global Survey, most companies still take a "fragmented, reactive approach— launching ad hoc initiatives to enhance their "green" credentials, to comply with regulations, or to deal with emergen- cies—rather than treating sustainability as an issue with a direct impact on busi- ness results." In short: many companies are talking the talk, but have no idea of how to walk the walk. Obstacles Talking to a number of CEOs and managing directors about their efforts in this area, several difficulties emerged. As one European manager said: "Frankly, we have other priorities. Right now the economic situation is such that sustain- ability has moved somewhat to the back burner." A sizable number said that they thought that adopting sustainability measures and practices would cost too much, and that they did not have the necessary budget. Some said there was no demand for sustainable products from their customers, or that their customers were not really interested in whether or not they operated in a sustainable way. The biggest problem, however, was that of quantifiable value. How does going the sustainable route lead to value cre- ation, in terms of dollars and cents? Corporate sustainability How to generate value creation from sustainable practices is a good question. After all, everyone knows and under- stands the traditional model, with its emphasis on growth and profit maxi- mization. The goal of a business is to earn money. However, and this is where the confusion starts, this cannot be the only goal. As Peter Drucker, often called the founder of modern management, famously said: "Profit for a company is like oxygen for a person. If you don't have enough of it, you're out of the game. But if you think your life is about breathing, you're really missing some- thing." The fact is, a well-run company is more than likely to make a profit, simply because profit is an obvious consequence of good management. As a banker from ABN AMRO recently pointed out to me: "When we see a company with a working sustainability policy in place, we know that is indicative of a company with a good strategic policy. And these are the companies that are operating at a profit, not despite the fact but because of the fact that they have successfully incor- Making sustainability pay Sustainable business practices can be a driver of success, but they require companies to change the way they do things, which is never easy. Karen Laird

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