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> The only comprehensive database of the environmental impacts of public companies (and a growing number of private companies)

> Over 4000 global public companies with 8+ years of history

> Global thought leaders on comprehensive environmental impacts & data

Newsweek 2010 Green Rankings: US ResultsNewsweek 2010 Green Rankings: US Results

Newsweek Top 100 Equally Weighted

Newsweek 2010 Green Rankings: PerformanceNewsweek 2010 Green Rankings: Performance

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UN Report on Ecosystems Valuation & the world’s largest investors

The initial analysis of the top 3000 public companies shows:

– US$2.2 trillion in environmental costs were caused by the largest 3,000 listed companies in 2008 – out of over US$6T in total damage costs from all human activity. Public companies account for over 1/3 of the total annual global environmental costs. Other elements of the economy, such as other public and private companies, governments, universities and consumers contribute the remaining externalities. For many of these organizations, externalities largely come from their supply chains.

– Our report estimates the value of external environmental costs at 10% of global GDP (issues include GHGs, Water, Forestry, Fisheries, Air Pollution) short term, heading up to 15-20% of GDP in the medium term

– The cost of pollution and other damage to the natural environment caused by the world's biggest companies reflect over one-third of their profits

Environmental Impact Categories

KPIs (Key Performance Indicators)

GHGs (of which Trucost tracks 9 separately as well as in CO2-e)

Water Abstraction & Use

Volatile Organic Compounds

Acid Rain & Smog Precursors

Natural Resource Use

Heavy Metals

Waste

Greenhouse Gas Data• Standardized data so companies can be accurately compared

• Broken down into Scope 1, 2 & 3

• Represented as absolute figures (tons) and intensity (%)

Environmental Footprint Management

• Public & Private Companies – Sprint

• Public sector entities globally including NHS Trusts in the UK – Google ‘Trucost Mid Essex’ for a sample comprehensive Scope 1, 2 & 3 report

• Cities & Municipalities - London and its 32 boroughs

• Universities – Michigan State

• Countries & Regions

London Councils : BackgroundLondon Councils : Background

For Local Authorities carbon emissions embedded in the supply chain far exceed the emissions for which or they are directly responsible.

London is the world’s first region to undertake a full carbon analysis and engagement programme with its supply chain. The broad objectives are as follows:

• Identify Efficiency & Cost Savings• Risk Management

• Compliance• Leading Practice

‘If you want to work with the world’s best companies you must account for your embedded (supply chain) carbon. If we contract with people who have no interest in this, why are we contracting with them when they have no regard for the single most important issue facing mankind’.

Neil Hart – Head of Environment, Rolls Royce

Summary figuresSummary figures

Initial Analysis :

Total spend is £7.8 Billion equates to 45,084 aggregated transactions.

90% of the total spend is 18,200 aggregated transactions with 10,500 unique suppliers (All transactions which are greater than £87,900.00 on average)

Total Carbon Footprint of London’s Public Procurement: 2.7mn tCO2-e (larger than many entire countries!)

Average Carbon Intensity: 361 tCO2-e per £mn

Significant intensity variances between Boroughs: ‘Best’ performer at 174 tCO2-e per £mn; ‘Worst’ performer at 713 tCO2-e per £mn

Waltham Forest PCTSupply Chain FootprintFinal Results

Next StepsNext Steps

Sample Data: Body Level EmissionsSample Data: Body Level Emissions

Allows the comparison of individual council with each other within a region, these are carbon

intensities

Supplier Level Analysis : Top PollutersSupplier Level Analysis : Top Polluters

Top 20 polluters based on physical tonnes of GHGs per 1 £mn of

expenditure with that supplier

Scenario Analysis : Reporting on Reduction TargetsScenario Analysis : Reporting on Reduction Targets

Set a reduction target for carbon intensive categories

Scenario ResultsScenario Results

Forecast total supply chain carbon reduction

based on these category level reduction targets

Columbia University &

University of Maryland Smith School of Business

Students actively participate in the building of a most sustainable portfolio, while reviewing methodologies & metrics, with guest speakers and presentations.

Sustainability Risks are many

• Business as Usual in a Changing World of dwindling resources

• Geopolitical & other Supply Chain Risk • Reputational Risk • Employee Quality Risk • Customer Risk • Measurement Risk • Global Regulatory Risk• Innovation Opportunities not taken

Sustainable Investing

• Sustainable investing is an investment philosophy that explicitly considers future

environmental and social trends in financial decision making, in order to provide the best risk-adjusted and opportunity-directed results for investors.

• Sustainable investing seeks to identify ‘predictable surprises’ that can help protect & enhance shareholder value over the long-term. We reject the notion that the recent financial crisis was a ‘black swan’ – it was instead a predictable or even a preventable surprise (The Big Short, etc.)

Sustainable Investing

• Sustainable investors seek the key innovations and drivers of the opportunities of tomorrow that are being generated by today’s rapidly changing world

• Different from socially responsible investing (SRI) – which remains 90% negatively focused (see SIF Trends, 2010).

• Classic SRI investors lead us to believe that they look at sustainability with a positive lens, but they largely do not – hence, the misunderstandings & confusion

Sustainable Investing

Companies seeking the opportunities of tomorrow has become a proxy for good governance, and is also useful for finding maximum leverage in negotiations & positioning

The Sustainability Imperative (HBR, Esty/Lubin, May 2010)

How the Top Innovators Keep Winning (s+b, November 2010) Sustainability: The Embracers Seize Advantage (MIT Sloan, Feb 2011)

Sustainable Portfolio – Columbia Ticker Company 2009 Returns US Equity AMZN Amazon.com +166% AXP American Express +121% AAPL Apple +149% AMAT Applied Materials +39% KO Coca Cola +29% FSLR First Solar –3% GPS Gap Inc. +58% GE General Electric –7% IBM IBM +59% ITRI Itron Inc +7% JCI Johnson Controls +53% PLL Pall Corp +29% TTEK Tetra Tech +15% WMT Walmart –4% Non-US Equity 0494 Li & Fung (HK) +129% RHAYY Rhodia ADR +181%

In 2010, our Sustainable Portfolio gained 18.85% vs. S&P 500 12.8% vs MSCI World 5.6%

Sustainability Imperative – outperformance

(+ NWGR + Hawken/Kiernan/Abby Joseph Cohen)

Source: Krosinsky, 2008

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Sustainable Investing MSCI World S&P 500 FTSE 100

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One-year average percentage return (2007)

Three-year average percentage return (31 December 2004 - 31 December 2007)

Five-year average percentage return (31 December 2002 - 31 December 2007)