As Published In August 2005

Being Green
By Leeann Myers

The new gold standard for corporate responsibility

When Simon Patten, sustainability program manager for BP's global property function, visited the BP offices in the capital city of Azerbaijan, he asked whether employees recycled office paper. The staff told him they didn't—there were no trucks to pick up materials or facilities to process them. With his encouragement and local creativity, they found a cardboard-box factory that had a similar problem. By marrying the cardboard waste with BP's used paper, the factory began to produce a high-strength paper suitable for making egg trays. "We now have several tons of office paper from the whole region regularly going to this factory," says Patten. "It was the first recycling contract ever signed there."

From Idealism to Realism

Businesses around the globe are beginning to reduce their environmental footprint by managing their use of energy, water, and waste. In some cases, particularly in Europe, government regulation has spurred these new environmental standards—and global corporations are enforcing those same standards with their suppliers.

But even in regions without regulations, the idea that companies should have a positive effect on society is becoming mainstream. And to shareholders and others analyzing a company's performance, how the corporation manages energy and resource usage is being seen as an indicator of how well run the company is in general.

Even government organizations are recognizing the importance of green: CalPERS (the California Public Employees' Retirement System), the largest public pension fund in the United States and one of the world's largest institutional investors, proposed last year that it would partially base its investment decisions on companies' environmental-governance measures.

"Good Business Sense"

Randy Smith, Oracle's vice president of global real estate and facilities, believes environmental and transportation issues are integral to his job. "We deal with commute alternatives, which have a positive impact on reducing greenhouse-gas emissions. We also get involved with recycling, energy conservation, waste reduction, and a lot of other environmental measures. It just makes good business sense." In 2004, Oracle, due to its efforts to fight traffic congestion around company headquarters and its provision of numerous commuter benefits to employees, was No. 5 on the U.S. Environmental Protection Agency's Top 20 Best Workplaces for Commuters list.

Mukesh Khattar, Oracle's director of energy, confirms that even small steps like turning monitors off at night, reducing lighting in halls and stairwells, and installing sensors that turn lights off if no one is in a room can add up to significant savings. "The first year we implemented our energy-reduction program, we saved 10.5 percent—a savings of more than US$800,000," he says. Oracle increased those savings over the next three years, cutting energy usage by as much as 12.4 percent.

How Green Is Green?

So, what makes a green office? "To me, an office is green when it has a formal energy- and water-management program," says Patten. To ensure the success of your company's green programs, experienced corporate energy managers offer these tips:

• Get buy-in for the program from all levels, including executives, facilities staff, and employees.
• Involve the individual. Patten trains what he calls "green-office gods and goddesses" at each location to provide positive reinforcement and make employees aware that their actions make a difference.
• Look at full-lifecycle costs and consider the long-term savings implications.
• Measure your success.

As commercial enterprises, corporations still must answer to shareholders and demonstrate proven performance. But environmental accountability is not at odds with the bottom line, says Patten. "We've saved a lot of money by using less paper, less water, and less energy and by creating less waste. This is all good business. And it's good for the environment as well."