Environmental Governance - Leveraging existing corporate governance systems to respond to the growing market demand for sustainability information.

Whether you have an existing sustainability program or are just beginning to contemplate one, Wallace Partners can help you focus your efforts in a manner that meets your business objectives while addressing your most influential stakeholders’ interests.

Here are some questions we can help you answer:

• What are the most important sustainability criteria for your industry and your company?
• What do your stakeholders really want to know about your sustainability performance?
• How do you compare with your competitors on sustainability?
• Is your sustainability performance being accurately communicated by your company, within the market and among your stakeholders?
• Are your departments (EH&S, IR, HR, PR, etc.) aligned and working together to address the growing demand for sustainability information?

Does Sustainability Performance = Financial Performance?

A recent analysis conducted by PricewaterhouseCoopers examined companies that have:

1. Established certain sustainability and social responsibility practices,
2. Reported sustainability data along with financial results, and
3. Achieved recognition for having done so through one or more of six well-known sustainability indices.

According to the study, companies that improved their sustainability practices and communicated these practices to shareholders appear to offer investors greater financial returns.

Ratings, Ratings and more Ratings

A number of old and new ratings schemes continue to make their way into today’s sustainability headlines. While the topics, methodologies and lists vary widely, the common thread is the increasing interest in these types of ratings and the “sustainability story” conveyed to stakeholders. Here are a few of the latest:

Ethical Company Index
For the second year Ethisphere Magazine has published a list of companies that assesses business ethics and corporate responsibility. After examining 10,000 global companies, a panel of judges at the Ethisphere Institute selected 93 companies as the World's Most Ethical Companies.

Largest California Companies Scored on Sustainability
Cited in this month’s Environmental Leader was a report produced by the Roberts Environmental Center of Claremont McKenna College in 2007. The article highlights the difficulties companies and stakeholders confront as they attempt to measure and report sustainability performance. The report contains a compilation of scores evaluating the environmental and social reporting of California’s largest companies. The analysis finds that some companies, like Chevron, Hewlett-Packard and Walt Disney, publicized their sustainability on their Web sites, while others, like eBay, Google and Apple, rarely mentioned the subject, if at all.

Access to Medicine Index
The Access to Medicine Index measures and rates drug companies’ efforts to increase access to effective and affordable medicine. The Index ranks twenty of the world’s largest drug companies, offering investors and other stakeholders a new tool to rate the social responsibility record of these companies.

IT Companies Under the Radar
The Guide to Greener Electronics ranks the 18 top manufacturers of personal computers, mobile phones, TV's and games consoles according to their policies on toxic chemicals, recycling and climate change. First launched in August 2006 the Guide is now on its 8th edition and has been a key driving force in getting many of the companies to make significant improvements to their environmental policies.

UN Global Compact delists 630 companies
One path that many companies take on the sustainability journey is signing up to the UN Global Compact. It’s a voluntary initiative, but it does have some requirements around acting and reporting. Inaction recently resulted in a “delisting” of 630 companies from the UN Global Compact.

Shareholders – Assessing and Influencing Sustainability

Investors continue to push the SEC for formal rules to embed sustainability into financial results.

CalPERS/CalSTRS
California’s two largest pension funds, CalPERS and CalSTRS, which combined have $400 billion in assets, are lobbying securities regulators to make GHG disclosures mandatory, and supporting shareholder resolutions that urge companies to take more vigorous action. (Read more)

Shareholder Coalitions
A broad coalition of investors and major environmental groups repeated their call to the SEC to address the obligations of publicly-traded companies to assess and fully disclose the material economic opportunities and risks from climate change. The 20 signatories to the letter include leading U.S. and European institutional investors such as CalPERS, CalSTRS, F&C Asset Management and the Maryland, New York, New York City, New Jersey, North Carolina and Oregon public pension funds. (Read more)

Asian Market Interest in Corporate Sustainability Performance
The “Seoul Declaration” calls for collective action by business, investors, and civil society to promote greater integration of environmental, social and governance (ESG) issues into mainstream investment and business in Asia. Global financial institutions representing more than 14 trillion US dollars in assets and leading representatives of Asian business met in Seoul to promote this initiative.

Eastern European Market Interest in Corporate Sustainability Performance
English-speaking investors and stakeholders can investigate the environmental, social, and governance policies of an increasing pool of large cap-companies headquartered in 11 Central and Eastern European (CEE) Countries finds the tenth semi-annual Survey of Reporting on Corporate Social Responsibility (CSR) released by the Partners for Financial Stability (PFS) Program.

How we can help

Wallace Partners offers a unique approach to assessing current conditions and integrating sustainability into organizations. We apply a methodology that builds on existing management systems, identifies unforeseen assets, and enhances operational efficiency. Our strategic approach will help you identify the financial and reputational benefits of measuring and strategically disclosing sustainability performance data to priority stakeholders and the broader market. By identifying internal and external opportunities, we will help you lay the foundation for efficiently measuring and managing environmental, social, and economic performance, and disclosing sustainability information in a manner that:

• Increases business resiliency
• Reduces reputational risk
• Clarifies external perceptions
• Enhances access to investment capital, and
• Aligns with broader branding
  

Publications and Events

Mike Wallace is actively speaking and publishing on Environmental Governance topics. Articles and other resources are available on the site.