Sustainability: The Next Wave of Growth in Business

(somber music) – When we think about
the future of business and the future of the corporation, there are some important global trends that are impossible to ignore. First there’s global population growth. We are at a population
of seven billion people on this planet, on our way to nine
billion by the year 2050. We also at the same time are experiencing rapid urbanization, so the growth of mega-cities, as well as the rise of the middle class in many emerging markets. All of that translates
into an incredible demand at an unprecedented scale for food, for consumer goods, for housing, transportation infrastructure, energy, water. – Feeding a population
of nine billion people by 2050 is going to be impossible if we don’t find new
technologies to do it. Providing energy and
housing to that population is gonna be impossible
if we don’t figure out more sustainable ways to
produce and use energy. – We are beginning to
experience very real constraints on the availability of
many natural resources and agricultural inputs
that go into making the goods that these nine
billion people will need. So companies are gonna
have to be very innovative when they think about
how they’re going to make and deliver goods in the future at the scale and the pace that’s needed. (upbeat music) Corporate sustainability is an approach to doing business that recognizes that responding to social and
environmental considerations can be good for business because it mitigates risk and it creates new opportunities. So when we talk about sustainability, we’re talking about this
intersection of three things, people, planet, profit. So sometimes we call that
the triple bottom line. – Sustainability is a corporate issue because companies are now
larger than many countries. Multinational corporations
do business around the world. They have revenues exceeding
the gross national product of some countries. And with that kind of reach, it’s imperative that
companies bring their values to where they do business. – When I was in business school, sustainability was still a
relatively new concept for me. – I thought I wanted to be a doctor because I was really interested in science and I really wanted to help people. And I realized after
taking a few environmental science classes as part
of the biology major that it seemed that the long-term demands for using science to help people was gonna come more from
natural resource management than from medical innovation, and that the next wave of critical care that’s going to come to the average human was going to come from
where they get their food, their water, and their energy rather than where they are getting their medicine and their medical care. So that’s why I shifted into really caring about sustainability. – I was instantly hooked on this idea that we could use the power and the scale of the private sector
to address large-scale global, social, and
environmental challenges. It’s a very compelling idea, right, that we can take the financial capital, the human resources, the skillsets, the discipline of business and apply it to innovating solutions to some of the world’s biggest problems. – One of my best experiences I’ve had since coming to business school was my internship at Walmart. I was working in global food sourcing and they’re really focused
on lowering their food waste. It’s a really big problem in all sectors of the food system right now that we throw away way
too much of our food. It’s a business challenge. It’s also an environmental challenge and it’s a challenge to the consumer. And so Walmart’s taking it very seriously. It was really exciting to
be a part of that project. It really opened my eyes to
different kinds of solutions that I never thought about, from packaging to logistics to how long a piece of produce stays on the truck. There are just so many opportunities to tackle that environmental
problem that also saves money, and that’s why companies like Walmart are taking food waste
so seriously right now. – We see sustainability as not
just a risk management tool, but a piece that should be
embedded in the business. If it’s not fundamentally
embedded in the way we run the business, then it really won’t be lasting. – The role of the corporation
and the expectations for corporate leaders are changing. Consumers are demanding more transparency. They care not just about what a product is and what it costs, but they also care about how it was made and where it was made. – Sustainability is all
about internalizing risks in your supply chain, in your workforce, all the way through to the
way your product is made to the way your product is distributed, and then thrown away. It’s all about recognizing that our natural resources are limited, that the way we treat our workers
is critical to operations, and that it’s not something that we can consider as charity anymore. It’s something that is really central to the way that we operate businesses. – When I began at DuPont in 2004, I think most corporate leaders thought about sustainability in terms of the imprint their company
had on the environment. So what were the emissions coming out of their manufacturing plants? What was coming out of the water effluent? How did that impact the environment? And most businesses were
focused on reducing that. – You know, back in the day, we used to have government on one side, environmental groups on the other side, and companies were sort of in the middle. Now companies are kind of
leading environmental issues. It’s no longer okay for companies to just leave environmental
and social issues up to government to solve. Companies that are forward-thinking really need to be aware
of the global context and how it’s shifting and be thinking about how
they’re gonna innovate sometimes very radically to do business in this changing context. – It’s gone more from
a footprint reduction to an opportunity. How do I grow my business
by bringing products that are gonna make
society more sustainable? And I think the corporate
mindset has changed again from looking internally
to looking externally. – As companies get into sustainability, they realize that there are
really strategic opportunities around sustainability as a way of driving innovation in their products, as a way of understanding
their supply chain better and finding both more efficient and effective ways to manage
their broader business system, as well as understanding where there are kind of red flags embedded in
their broader business system that they need to address now before those become
liabilities to the company. And then finally, I think companies that
really take this on, we’re beginning to see
a shift of companies away from a traditional
focus on footprint. In other words, all of
the impacts that they have and how do they manage
or minimize those impacts to realizing that business
is an incredible vehicle for delivering solutions for exactly these kinds of problems. – When we think about
innovation and sustainability, the possibilities are truly endless. I think that we can look at the challenges presented to us, climate change, and challenges related
to our changing world not only as challenges and problems but as business opportunities. I think that our opportunities are endless to create new types of energy, new types of ways to
run and fuel our world. I think that actually
we’re at one of the most incredibly opportune
times in our existence. (uplifting music) – [Katie] The opportunities
are really tremendous. Today’s students are going
to be the ones leading change and innovation in the future. – I’m very optimistic about the future because I firmly believe that people act in their best interests, and people’s best interests can align with the environment’s best interests. That we want healthy foods. We want a healthy world. We want healthy communities. And that we can achieve that through a mix of making smarter decisions and developing smarter technologies. I believe that those solutions
are well within our reach. It’s about identifying them
and then helping them grow and helping them become central
to our day-to-day lives. – I believe that there has
been a fundamental shift in the mindset of organizations toward a more sustainable practice and a more sustainable mindset and a more long-term view. And that leaves me optimistic
that we can tackle this and be rewarded for it. We’re seeing that markets are rewarding sustainable actions amongst businesses. We’re seeing that
consumers are valuing it. And I believe that we can
continue to make that impact, and more now than ever
need to focus on it. – No matter what industry
you decide to work in, for the rest of your career, you can be a sustainability champion. If you’re gonna work in marketing, you can work to make the product design or the packaging choices
better to minimize waste. If you’re going to work in
supply chain operations, you can advocate for better sustainability and labor standards with your suppliers. If you’re working in investment banking, you can be a champion
for impact investing, for green bonds or low-carbon portfolios. And anywhere you work, you can be the person in your office who changes the culture to more of a sustainability mindset. Don’t underestimate your potential and your power to make change. (uplifting percussive music)

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