Chemical Industry Ponders Sustainability Measures

Oct. 15, 2002

The Dow Chemical Co. put into place a 12-point sustainability plan aligned with its core values and key activities. Shell USA formed Shell Renewables in 1997 to develop alternative energy sources such as wind power and fuel cells.

These companies and several other chemical and petrochemical giants clearly recognize the importance of sustainable development, defined by the World Commission on Environment and Development (Brundtland Commission) in 1987 as "development that meets the needs of the present without compromising the ability of future generations to meet their own needs."

However, even large companies with sustainability projects currently underway continue to struggle with the development of clear-cut sustainability action plans. Moreover, many small- and medium-sized manufacturers are finding it difficult to take any action at all beyond what is required by environmental regulations and initiatives such as Responsible Care.

And as world governments, United Nations agencies and other stakeholders prepare for the World Summit on Sustainable Development, slated for Aug. 24 through Sept. 4, 2002 in Johannesburg, South Africa, sustainability issues weigh heavy on the minds of many industry leaders.

"Most companies doing business in the European Union are implementing sustainability [measures], while most purely domestic companies in the U.S. have yet to realize the benefits," contends John Payne, principal of The Payne Firm Inc. of Cincinnati. Payne's team of technical and business professionals helps clients develop plans for sustainability program implementation.

Yet sustainable development profits not only the world as a whole, stresses Payne, but also the company itself. "One common benefit is increased eco-efficiencies and real short- and long-term financial benefits," he says, "especially as the hidden costs of business as usual' are identified and often significantly reduced."

The call for action

With seemingly so much to gain, why do U.S. chemical companies continue to talk more about the need for sustainability than to act on that need? Perhaps because true sustainable development is such a daunting task. Exactly what actions are required? How do companies implement them? How do they measure the results of their actions?

A recent workshop sponsored by the Business Council for Sustainable Development (BCSD) attempted to at least partially answer these and other pertinent questions. The workshop, "Defining the North American Sustainable Development Agenda," brought together in Denver a mixed bag of stakeholders -- from the council's member companies, energy providers and consultants to associations, government agencies and academia.

According to BCSD, the event's mission was threefold: to identify key sustainable development issues in North America, to create a sustainable development action plan and to expose the BCSD organization to a broader audience.

Steve Miller, CEO of Shell USA and the event's keynote speaker, reminded workshop attendees that one-sixth of the world's 6 billion inhabitants enjoy 80 percent of the income. "This kind of situation simply is not sustainability," he said. "Whether it be political or environmental, what happens on one side of the world affects us all."

Miller challenged attendees to respond to the call for action. "It's one thing to be sensitive to challenges and quite another to take action to effect change," he stressed.

Sustainable development is not limited to reforestation efforts and the like, emphasized Miller. Sustainability efforts have the potential to bring about significant changes in manufacturing operations through the use of alternative feedstocks, technologies and more. In addition to environmental issues, sustainable development incorporates social and economic concerns and looks at issues globally.

Shell views sustainable development as a "mindset," Miller added, one that generates economic growth, achieves environmental improvements and transforms a company into a socially conscious neighbor. The company created a scorecard to measure its performance in the sustainability areas, he said, and is working with consultants to develop social indicators.

Moving forward

During a workshop panel session, several of the speakers likened their companies' sustainability efforts to a journey -- a journey in which the destination is not truly clear. "I don't know if you ever get there," said Jean (Pogo) Davis, manager of sustainable development for Conoco Inc. Companies must set targets, measure and make adjustments based on those measurements, she added.

"Metrics are important," agreed Terry Welch, director of technology for Dow. "By the time you get to your goals, the picture of the world is going to change on you."

During a hands-on ideation process, workshop participants were asked to identify key areas of concern related to implementation of sustainable development initiatives. They honed in on eight issues meriting further discussion: value chain integration, small- and medium-sized business engagement, transparency and credibility, the sharing of best practices, guidelines development, financial community education and communication, sustainability business-case development, and leadership alignment. The participants then worked in small groups to develop ideas for potential BCSD projects that address these issues.

The workshop was the first of its kind for BCSD, and clearly an attempt to move sustainable development from a discussion and policy-writing phase to an action stage. That task will be difficult, but the organization's efforts have the potential to generate real social, environmental and economic rewards for the most forward-thinking of chemical manufacturers.

By Kathie Canning, executive managing editor

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