"As nearly every study shows, companies with better environmental performance consistently achieve superior financial and stock market performance,"
One of the best kept secrets today is that sustainable products are more profitable than conventional products ö sometimes as much as ten times or more. The Economist reports that an index of the "worldās top 200 sustainable firms," set up by Dow Jones, has outperformed the rest of the stock market.
One company made changes to a silicone window sealant and qualified its product as sustainable. The cost -- $10 million. The result ö an increase of $200 million in sales during the first three years. The extra cost included an LCA (life cycle assessment), studies on health effects, and the paperwork for obtaining an EPA exemption, which was granted due to no adverse environmental effects. Distributors soon sought out the bio-safe sealant because it eliminated the liability they normally incur when dealing in a hazardous substance. Within three years profits from the new sealant had increased tenfold.
In Vermont a company designed a factory process for making wrought iron without the usual reliance on toxic and flammable chemicals. After two years, toxic emissions were eliminated, use of toxic materials was reduced by 98%, labor and materials costs were lowered, production speeds were increased, and product quality was improved. Almost immediately the companyās fireplace accessories and other wrought-iron items became best sellers. There was a 24% internal rate of return to investors, and all capital costs from the transition were quickly paid off.
In recognition of this overall trend the Future 500 Conference in April 1999, led by Fortune 500 companies, was titled "The Profit is Sustainability ö the Sustainability of Profit."
"By designing a product with environmental parameters in mind, companies can increase profits by reducing material input costs, extending product life cycles by giving them second and third life-spans or by appealing to a specific consumer base."
Changing the selling and buying habits of the world begins with an understanding and harnessing of market mechanisms. MTS is accelerating the market by employing "market drivers."
Green Building Mortgage Backed Securities (MBS).
Why are these securities attractive to investors? The buildings whose mortgages are in Green Building MBS pools have higher value from lower building operating costs, greater occupant satisfaction, increased value and tenant retention, and greater access to capital. For example, for its green building headquarters, National Geographic increased its appraised value, received a higher Moody's credit rating, increased tenants' rents,lowered interest rates on loans secured by the realty, and enjoyed reduced worker absenteeism creating a projected added value of $50M.Download Capipial Markets Partnership Brochure on Sustainable Mortgage Backed Securities
See Article to 100,000 Building Owners on Benefits of Green Building MBS
Sustainable Products Development:
"Few problems are less recognized, but more important than, the accelerating disappearance of the earth's biological resources. In pushing other species to extinction, humanity is busy sawing off the limb on which it is perched."
The "ecological footprint" that is, the amount of land necessary to support one personās cost of living -- is 2.5 acres in the developing world and ten times that much in the United States. The developing nations, trying to improve the quality of their lifestyles, are fast becoming partners with the industrial world consuming the natural environment and driving to extinction a large part of the world's fauna and flora. If present trends continue unabated, Earth could easily lose a quarter of its plant and animal species within the next 30 years and half by the end of the century.
What we lose are not just plants and animals. We may lose the keys to our own survival as a species. If we cut down pristine forests for wood pulp, where will we go to discover plants that may hold the answer to curing diseases? More than 40% of prescription drugs used today in the U. S. today are from natural organisms. Forests contain more than half of all species on our planet (many yet to be named). Nonetheless every minute of every day an area of the size of a big sports field is leveled of its trees, saplings, seedlings and all other growth.
Moreover, who can judge the ultimate value of any particular species to humanity? This destruction of the diversity of life has immense adverse effects to our aesthetic and spiritual value. It also causes secondary and tertiary effects. After clear-cutting, the burnt underbrush releases atmospheric carbon dioxide which contributes to climate change and disruption, formerly called global warming. It is estimated that deforestation contributes one-third of all CO2 releases caused by people. The UN now concludes that climate change as caused by pollution, will cause increased deaths, disease and economic damage beyond the $600 billion from natural disasters in the 1990ās (more than the four previous decades combined). Even conservative bipartisan leaders like David Gergen support an aggressive response: " [We] must move swiftly. · With only 5 percent of the planetās population, we account for one quarter of all greenhouse gas emissions. ·. The United States is not living up to its responsibilities as a steward of the Earth."
Indeed, based on existing technologies, for every person in the world to reach present U. S. levels of consumption would require four more planets the size of Earth. With the world population set to double by the end of this century, it would then require eight more planets.
If we are to survive and thrive on this small planet with its limited resources of water, land, and clean air, we must be wise. We must think about what we produce and how we produce it, and whether these products will come back to haunt us. The only reasonable solution is to create an economy that rewards efficiency, pollution prevention, reuse, recycling, and forward thinking.
"Our only limitation is our belief that it is so."-- Moshe Feldenakias
For some years we have been engaged in a debate of economy-versus-environment. Think a moment, and its falsity is obvious. Clearly, to survive and prosper, we must have both a good economy and environment. Even so, it is difficult to shake off the old assumption that we must agree to tradeoffs, that we must sacrifice something positive in one to gain something positive in the other.
Today there is heartening news. This old assumption also has been proven false. "Sustainability" is not the enemy of profitability. Just the opposite is true. Sustainable products are competitive and more profitable in the marketplace for a variety of reasons:
In the economy of the 21st century the definition of "sustainable" products is taking on a clearer and fuller meaning. In their entire life cycle, from the extraction of raw materials through to final use, these products win out over conventional products on their environmental and social merits and are more profitable. This "triple bottom line" provides a profound value. Public health and the environment benefit. Consumers benefit. Workers and entrepreneurs benefit. Society benefits ö on a global scale.