The Dow Jones Sustainability Index: Why winning isn’t everything

01 Sep 2014

Andre Veneman of AkzoNobel

There is not long to go before the rankings are announced for the 2014 Dow Jones Sustainability Index (DJSI). That may mean little or nothing to some people, but for AkzoNobel, it's a big deal.

The DJSI ranking is based on research by RobecoSAM, a renowned investment group based in Switzerland. They annually assess the sustainability performance of around 90 publicly listed global companies in the chemicals and coatings industries.

This involves carrying out detailed analysis of various criteria that relate to standard management practices and performance measures. We are measured against 86 chemicals companies, of which the top nine are included in the DJSI World Index. I'm proud to say we've been ranked number one in our sector for the last two years. But it's not necessarily about finishing first.

Let me explain. The DJSI is the most respected independent sustainability ranking system. It benchmarks our performance across the industry and enables us to assess what progress we are making in terms of achieving our strategic sustainability goals. And this is crucial, because achieving a high ranking is not an end in itself. The fundamental value of the DJSI is as a management tool, which helps to continuously improve the sustainability performance of our business.

Being ranked first means you are doing a lot of things right of course, but more importantly, the assessment also highlights areas for improvement. And you need to take action, because if you don't make progress and adopt a continuous improvement mindset, you'll drop down the list or fall off it altogether. For example, in 2013, operational eco-efficiency and talent attraction and retention were identified as areas where we could do better. So since last September, we've been working hard to improve in these areas.

In fact, we attach so much importance to a strong performance on the DJSI that our ranking is tied to remuneration packages for our top 600 executives. That's a clear indication of how sustainability is driving our business, and how our business is driving sustainability.

We have a clear vision for what we want to achieve and our DJSI performance is a barometer for measuring the level of our success. We are committed to delivering more value from fewer resources and have adopted a Planet Possible strategy built on three key pillars:

  • Improve resource efficiency across the full value chain
  • Reduce our carbon emissions across the value chain by 25 to 30 per cent per ton by 2020 (2012 base)
  • Increase revenue from downstream eco-premium solutions to 20 per cent of our revenues by 2020

When this year's DJSI rankings are announced in early September, we will know if our ongoing efforts to intensify our sustainability initiatives are continuing to move us in the right direction. It's a process which actually began several years ago, because we've featured in the top three for each of the last eight years.

What this demonstrates is that sustainability has become an integral part of our business activities and our company culture. But it also shows that we haven't stood still. We've made improvements each year and used the assessment to critically identify areas that need attention.

Everyone likes to win, but the thing about the DJSI is that even if you aren't ranked first, what you learn is invaluable. So you congratulate whoever finished number one and set about making the necessary improvements to put you in contention next time. In some ways, everyone's a winner.

André Veneman is corporate director sustainability and HSE at AkzoNobel

How to reverse negative effects on your credit report

26 Aug 2014

Credit report

A bad mark on your credit report can be damaging in many different ways. It can cause problems for you in many areas of your life, such as your ability to take out personal loans, including car loans and mortgages, and even applications for instalment plans, including mobile phone contracts and pay-monthly insurance policies. Whether you know you have negative items on your credit report or aren't sure, there are steps you can take to reverse them.

Checking your credit report as a business

Just like you would check your personal credit report, you can check your business' credit report. Click here to get your credit report. This allows you to see how other lenders see your financial history. It also gives you the chance to correct any errors that might be on your credit report. Often people will find that a simple error is making a big impact on their overall credit score.

A routine check of your credit report can also be an important part of your annual accounting. It will allow you to be secure in the knowledge that no unexpected lines of credit are on there, and that your personal finances are reflected properly.

Fixing problems

If you do find that there are problems on your credit report, or that your credit score is not as high as you would like it to be, there are steps you can take. First off, contact credit agencies to correct any errors. This can help ensure that your report is accurate.

Second, make sure you are on the electoral roll. This will help support any identity checks that may be required. If you have changed address, make sure these are noted on your report. Something as simple as a name change, such as through marriage or divorce, can leave you with a less than ideal score unless you make the connection to your old name and your past credit history. If you have a financial association listed on your credit report that is no longer valid, contact credit agencies to have this removed.

Finally, give your finances an overhaul to begin the credit repair process. Your credit score is constantly changing as your credit behaviour changes. The longer you go with on-time payments and good credit activity, the better your score will be. If you have any defaults listed on your credit report, consider contacting those lenders to discuss payment plans or other ways to clear any bad debts.

Moving forward with good credit

Good credit takes work, both in earning it and in maintaining it. The important things to remember are to keep credit activity going and to never make a late payment. Simply staying away from any loan situation won't be beneficial to your overall score. This is because lenders will use your credit report to predict how you will handle future debts. If you don't have a history for them to use for this prediction, they'll assume the worst.

Of course, if your credit report shows the worst - taking out credit agreements and not paying them in line with your obligations - you will also end up with a low credit score. Making regular on time payments is key to maintaining a great credit score.

How to reduce energy use in the home

22 Jul 2014

boilingkettle

Click here to enlarge the infographic


Energy Saving Kitchen InfographicNearly half of a household's energy bill comes from the cost of running kitchen appliances, such as washing machines, dishwashers, refrigerators and ovens, according to research by the Energy Saving Trust.

Even if people adopt the most energy efficient behaviours, they will struggle to reduce energy consumption on older and inefficient appliances - particularly those that guzzle power when they are switched on 24/7, such as fridges and freezers pushing up costs and carbon emissions.

Consumers are increasingly being urged to trade in old appliances for more efficient products that can save them money in the long run. For example, an average dishwasher costs around £40 per year to run, but a new one typically costs £12 per year less than and older one and will use less water, EST found.

Research by Global Action Plan (GAP) earlier this year found that consumers are currently paying about £300 per year to power domestic appliances throughout their homes, totalling £8bn across the UK. But by switching to more energy-efficient appliances, an average home could cut its bills by £99.

Meanwhile, using EST figures, appliance manufacturer Beko found that a household could save nearly £118 per year if it was to replace all of their appliances with its EcoSmart range.

George Mead, marketing manager for Beko, said it was now working with retailers to try and teach shoppers about the value of buying more efficiency goods.

Even the EU's Ecolabel scheme has been accused of confusing customers rather than helping them. As the scale starts at A+++ many shoppers may believe their A-rated appliance is the best on the market when in fact it is ranked as the fourth most efficient.

"Consumers are often confused by the energy efficiency ratings of products," explains Mead. "They were introduced a number of years ago but now most new white goods will have an A rating at the minimum so A+++ isn't necessarily the clearest way to explain how green a product is.

"By talking to our consumers we've found that equating money savings with eco efficiency makes green products much simpler to understand."

Understandably, many consumers are reluctant to pay seemingly high upfront costs for new appliances, when they feel their old ones work perfectly well.

But GAP's report found a lack of national initiatives to boost the sale of energy efficient goods. It highlights a range of ways that countries have encouraged consumers to buy greener appliances over the years.

French consumers, for example, are rewarded with tax credits for buying efficient appliances, while in the US from 2009 to 2012, consumers received cash rebates from the government. Brazil, meanwhile, offered a free energy efficient appliance to poorer households from 2008 to 2010.

With the EU now looking set to agree an energy efficiency target for 2030, helping consumers cut their demand is likely to move further up the agenda over the coming years.

But until new policies are brought into play, UK customers are being encouraged to study the potential benefits.

"Large appliances such as fridge freezers are switched on, kept on, and in use every day throughout the year," adds Mead. "Similarly, over a third of UK households are fitted with water meters, meaning consumers are becoming more aware of their own water usage, particularly through washing machines and dishwashers.

"Therefore, by investing in an eco-friendly appliance, consumers can be sure that they'll be making savings in the long run."

Discover how the Mercedes-Benz Vito E-Cell can benefit your business

01 Jul 2014

Mercedes-Benz Vito E-CELL

Way back in 1972 Mercedes-Benz developed the first electricity powered van and now, with the Vito E-Cell, they once again lead the way in a technological field that makes increasing economic sense for business across multiple sectors.

If your business runs small deliveries or a fleet operation and you're looking to reduce costs (who isn't?) then then the progressive, sustainable technology pioneered by Mercedes with the Vito E-Cell is increasingly hard to ignore.

Electricity-powered vehicles are no longer the marginal concern they once were, with Low Emission Zone (LEZ) areas spreading throughout Europe, not to mention the favourable operating costs offered by such vehicles, the business case for electric-drive vans is increasingly compelling, especially for city operators. And if it's an upgrade your business is exploring then the Vito E-Cell undoubtedly represents the vanguard of the electronic-drive van market right now.

The Vito E-Cell marks a real transition point for the electricity powered van market in that it significantly broadens the scope and adaptability of sustainable vehicles, so the advantages of progressive sustainable technology no longer come at the cost of practical application. This is a van that can match the needs of an increasingly broad range of businesses without the compromises that have been associated with such technology in the past.

The first thing drivers of the Vito E-Cell will notice is just how familiar it looks. This is a van that will feel like a seamless transition for anyone more used to standard petrol-powered models, until you start the engine that is ... The Vito E-Cell offers a completely noiseless drive but delivers power and agility that might come as a surprise. With 60 kW of output and 280 Nm of torque available from standstill the E-Cell offers a drive that is pacier and more dynamic than ever before. This van has been designed to navigate urban traffic with ease and delivers a nimble, responsive drive courtesy of ESP - a dynamic handling control system that is unique to Vito E-Cell.

Mercedes have also targeted quick, practical recharging with the Vito E-Cell, making it easier than ever before to charge your vehicle. The Vito E-Cell can be fully charged in just six hours, giving you an impressive 80 mile range. This range is enhanced by the clever integration of technology that converts energy from deceleration into electricity, meaning that every time you step on the brake you're effectively filling the tank!

The Mercedes Vito E-Cell is available through S & B Commercials with flexible finance options and a broad array of customisable elements, meaning there's considerable scope to design a bespoke package that suits you and your business needs perfectly.

Addressing fresh water deficiency

16 Jun 2014

A frozen faucet

For many countries, fresh water availability is an acute concern. In some cases it is the sheer number of people in one location that is triggering the deficiency, in others it is rising sea levels due to climate change and in some situations it is a particular industry, such as cotton that is causing the problem. Because of this, over one billion people have no access to clean drinking water and two million people die annually from water-related diseases.

Most of these grave concerns are occurring in the developing world and therefore not of immediate interest to industrialised nations and international media. Ironically, it is actually the developed world that has caused many of today's problems through the purchasing of products that require enormous amounts of fresh water, such as cotton, leather or beef, and by contributing to climate change through the burning of fossil fuels. On top of this, the demand for fresh water is expected to increase by over 50 per cent by 2050. Clearly, something needs to change.

But how do we change? And do we have the necessary tools to help us value water properly across the globe? Would it be possible for example to put a differentiated price on water or should it be governed by laws and regulations?

Many questions are up for discussion and how we view the commodity of fresh water may ultimately have to change. Naturally these issues are vitally important to the business world - just as access to water is essential to life, it is also essential to the sustainability of any business.

Companies need to start by making sure they manage their own fresh water sustainably, not depleting scarce resources, reusing it and making sure the discharge does not affect the local availability of clean freshwater.

At AkzoNobel we treat water as the limited resource it is by optimizing our water-use through greater efficiency, innovative processes and new technologies. Our ambition is to achieve sustainable fresh water management at all our 300 manufacturing sites by 2015 - to date 86% of manufacturing sites have such systems.

But we also know that on its own, efficiency within our operations is not enough to safeguard the resources we need for our business. We recognize that we must mobilize partnerships with government bodies, NGOs and local communities to improve our understanding of the shared fresh water challenges we face, enabling us to make better management decisions.

Certainly a collaborative approach involving many different parties will be essential if we all are to overcome the many technical, financial, legal and humanitarian issues often associated with access to fresh water.

Johan Widheden is a sustainability specialist at AkzoNobel

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