McKinsey Sustainability

8/3/2019 McKinsey Sustainability

1/16

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Exhibit 1

Moving beyond reputation

% of respondents,1 n = 2,956 Company is currentlytaking action

Company ismore effective thancompetitors

Reducing energy use in operations 63 47

Reducing waste from operations 61 44

Managing corporate reputation for sustainability 51 57

Responding to regulatory constraints or opportunities 46 50

Reducing emissions from operations 43 48

Leveraging sustainability of existing productsto reach new customers or markets

28 61

Managing impact of products throughout

the value chain 28 50

Improving employee retention and/or motivationrelated to sustainability activities

26 48

Mitigating operational risk related to climate change 22 41

Achieving higher prices or greater market sharefrom sustainable products

18 52

Reducing water use in operations 38 46

Committing R&D resources to sustainable products 31 59

Managing portfolio to capture trends in sustainability 38 56

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4/16

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5/16

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Leading the way with a strategic approach

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Exhibit 3

Little change across leadership criteria

% of respondents1

A few activities but no formalprogram to address issues

No sustainability activities

Sustainability is embeddedin business practices,with a formal program toaddress issues

Sustainability is embeddedin business practices,with no formal program toaddress issues

A formal sustainabilityprogram to address issues

3130

2422

1816

1820

88

How sustainability activities are organized Where sustainability falls on the CEOs global agenda

2011, n = 3,203

2010, n = 1,946

2

2010,n = 1,749

233 48 24

2011,

n = 2,956 26 45 22

A top-three agendapriority

Mostimportantagenda priority

A priority,but nottop three

Not asignificantagenda item

Companys overall effectiveness atmanaging its sustainability

2010,n = 1,705

284 40 21

2011,n = 2,956

243 46 21 4

8

Extremely Very Somewhat Slightly Not at all

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T

Exhibit 4

Leading with action

% of respondents1

Growth

Return oncapital

Riskmanagement

Committing R&D resources tosustainable products

6228

8053

Leveraging sustainability ofexisting products to reach newcustomers or markets

5825

7857

Managing portfolio to capturetrends in sustainability

7035

8550

Reducing emissions fromoperations

7340

7243

Reducing energy usein operations

7661

7443

Reducing waste from operations74

6068

41

Reducing water use in operations58

3673

41

Managing corporate reputationfor sustainability

7749

8053

Mitigating operational risk relatedto climate change

4419

6935

Responding to regulatoryconstraints or opportunities

6444

6848

Achieving higher pricesor market share because ofsustainable products

4215

7046

Improving employee retentionand/or motivation related tosustainability activities

4419

7044

Managing impact of products

throughout the value chain

66

24

67

46

Company is currentlytaking action

Value-creationlevers

Company is more effectivethan competitors

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Sustainability leaders, n = 293

All other respondents, n = 2,663

Amarelos indicam intens

que lderes mais utilizam

Verdes indicam itens quetm maior gap entre lderes

e amostra total


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Exhibit 5

Fewer barriers for leaders

% of respondents1

Lack of incentives tied toperformance on sustainabilityinitiatives

Pressure of short-term earningsperformance is at odds withlonger-term nature of sustainability

3321

3132

Lack of, or use of wrong, keyperformance indicators (KPIs) 28

13

Insufficient data or information toimplement initiatives

Sustainability isnt integrated into existingperformance management system

Company leadership sets sustainabilityas too low a priority

Business units are not engaged withimplementing sustainability initiatives

Sustainability department isdisconnected from the rest of theorganization, or is too low to

be influential

2113

2011

197

172

164

114

930

Insufficient resources forsustainability initiatives

Too few people are accountablefor sustainability

Company lacks the right capabilitiesand/or skills

We are capturing all the value we can

2515

2511

Current organizational structuredoesnt support accountability forsustainability activities

249

Barriers that prevent companies from capturing potentialvalue from sustainability initiatives

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All other respondents, n = 2,663

Sustainability leaders, n = 293

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9/16

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Value creation and industry

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10/16

Exhibit 6

Value varies by industry

% of respondents

Growth

Return oncapital

Riskmanagement

Committing R&D resources tosustainable products

Energy (2), high tech/telecom (3),manufacturing (1)

17

Health care/pharma (3)Leveraging sustainability ofexisting products to reach newcustomers or markets

15

Energy (1), extractive services2 (3), finance (2),high tech/telecom (1), manufacturing (2),retail (3), transportation (2)

Managing portfolio to capturetrends in sustainability

20

Reducing emissions fromoperations

10

Extractive services (3), retail (3),transportation (1)

Reducing energy usein operations

15

Retail (2), transportation (3)Reducing waste from operations 13

Reducing water use in operations 9

Energy (3), extractive services (1), finance (1),health care/pharma (1), high tech/telecom (1),manufacturing (2), retail (3), transportation (2)

Managing corporate reputationfor sustainability

20

Mitigating operational risk relatedto climate change

8

Energy (3), extractive services (2),health care/pharma (3)

Responding to regulatoryconstraints or opportunities

13

Achieving higher pricesor market share because ofsustainable products

13

Finance (3), health care/pharma (2)Improving employee retentionand/or motivation related tosustainability activities

11

Retail (1)Managing impact of productsthroughout the value chain 13

Total,n = 3,203

Industry, top three most cited activities1with potential to create significant value overthe next 5 years

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11/16

55

Looking ahead

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12/16

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13/16

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Creating value!

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14/16

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Potential value from sustainability activitiesover the next 5 years, by industry

Energy

Composition of business portfolio

Innovation and new products

New markets

Growth

Green sales and marketing

Sustainable value chains

Sustainable operations

Returns on capital

Operational-risk management

Reputation management

Regulatory management

Risk management

Extractiveindustries1

High tech,telecom

Retail

!"#$%&'()*"+)*,-$()$.*"/+-0".1)"%-2&3"0).2&3"2$("-.1)+"04$4$5"4$('*.+4)*6"-4&"2$("52*")7.+2%.4-$6",).+-&)'0"2$("

" 8-'+%)9":;!!""*'*.24$2?4&4.>"*'+@)>6""2$2&>*4*

Significant value Modest value Little to no value

Exhibit 2

Industry-specific opportunities

5P


15/16

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Risk management!

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16/16

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%(!-!("+A!$%!)'!9-#-0'/!

Sheila BoniniStephan Grner!"+!-!

5T

Related thinkingThe business

of sustainability:

McKinsey Global

Survey results

The business

opportunity in water

conservation

McKinsey Sustainability

Documents

Transcript of McKinsey Sustainability