Carrie brainstorming with work colleagues on how technology can help communities lessen their carbon footprint and improve social factors
“Some things we do don’t make sense from a standard ROI analysis, but reflect our values.”
In an upcoming interview in EBBF’s Inspire e-magazine, Carrie Freeman talks about her current position as head of the Sustainability Strategist office at a large semiconductor manufacturing company, including developing a new investment model that takes into account environmental and social factors for making business decisions. In the following excerpt, Carrie explains how this new investment model is being developed and used.
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EBBF: In the first piece you wrote for our blog you mentioned one of the major challenges you face in your position is convincing some people that sustainability makes business sense in a number of ways. And in this context you mentioned that you are creating “a social return on investment framework to be applied in situations where a standard economic model would not deem the project worthy”. Could you say more about this framework?
Carrie: We’re in the second phase in the development of this framework. The first phase is an analysis of sustainability practices based on traditional Return on Investment formulae, looking at potential revenue growth versus production cost. In other words, how much will it cost us to implement these ‘greener’ practices and how much can we expect to profit from them. But this phase alone isn’t really adequate in a new era. The second phase, which is where we’re at right now, is starting to look at situations and apply calculations to help determine what is the broader business value that such sustainability actions bring in regards to employee engagement and retention, license to operate, risk management, impacts to supply chain, benefits to customers, and benefits to your brand. Although these things are less quantifiable, we’re trying to include these metrics in our decision making. We recognize that this itself is a stepping stone, after which we can move on to the third phase of the framework: social return on investment, to the societal value that accrues from such action. Then we would look at how this is contributing to the community, to an impact on society, to improving ecosystems. We’re not there yet (hardly anybody is), but that’s where I’m hoping to see the company evolve. That’s our long-term vision.
One encouraging aspect about our work is that it is primarily being promoted by financial staff from across the organization—not by sustainability people—and so I think it will be better received by the company overall. I think it’s brilliant that they are the ones who are doing it. They’ve found that this is one area where there isn’t a lot of info out there for them to use; it isn’t something we can just purchase on the shelf somewhere and plug in. So they’ve taken it on as a challenge, and are working with academia, investment analysts, and other companies in order to find relevant studies and data to build this new framework.
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If you liked this, click on for more insightful and inspiring interviews in past issues of Inspire.
