The following post is written by Roberta B. Bowman, Senior Vice President and Chief Sustainability Officer at Duke Energy.

In 1999, fewer than 500 companies issued sustainability reports. That number is now over 3,500. Once only a concern for a few niche companies with sustainability as a core value and brand differentiator, corporate sustainability has moved categorically into the mainstream.

Today, there is a growing demand for companies to demonstrate a responsible, sustainable, long-term approach to business, to produce a statement of their sustainability activities, and to clearly show how this relates to their core business strategy. Corporate sustainability reports now contain detailed performance metrics and reflect the priority companies have given to measuring and managing the impact of their operations.

Several factors have driven the current momentum for sustainable corporate performance:

Stakeholder expectations: Companies understand the many benefits of sustainable operations, especially now that they engage with a wider range of stakeholders – shareholders, employees, business partners, investors, consumers, NGOs, the media – who demand accountability and transparency.

Global standards: The development and acceptance of global standards has played a critical role in sustainability reporting and performance management. Currently, over 1,500 companies across 60 countries have adopted the G3 standards – introduced by the Global Reporting Initiative, which provides a universal framework for disclosure. Additionally, groups such as the World Business Council for Sustainable Development, the World Resources Institute and the World Intellectual Capital Initiative have also developed useful resources for business reporting language.

Investor interest: Institutional investors and stock exchanges have also asked for better sustainability reporting from listed companies. Consequently, environmental, social and corporate governance indices have been established, such as the Dow Jones Sustainability Index and The Carbon Disclosure Project.

Natural resource constraints: Every company that depends on natural resources is facing increased costs and constraints. Sustainability helps companies improve their operations as natural resource constraints reshape markets.

In November, I had the honour of serving on the Selection Committee of the Zayed Future Energy Prize – a global initiative by the Abu Dhabi government that recognizes and rewards outstanding efforts in the renewable energy and sustainability sectors. I was impressed by the number of companies that had developed approaches, practices and processes to measure their performance as sustainable businesses.

From my experience on the Selection Committee, one thing is clear: corporate sustainability is becoming a boardroom strategy that is driving enormous creativity, efficiency and innovation.

The day may come when understanding the lifecycle of a product or service is so engrained in business that we won’t need to call that “sustainability”. Until then, initiatives such as the Zayed Future Energy Prize help showcase and promote the business value of sustainability, while facilitating sharing and learning between large corporations, NGOs and individuals.

Roberta B. Bowman is Senior Vice President and Chief Sustainability Officer at Duke Energy, and served as a member of the Selection Committee for the 2012 Zayed Future Energy Prize

Photo: Some rights reserved by gibffe at flickr

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Announced at the outset of the World Future Energy Summit in Abu Dhabi this week, Toyota said it will use the $1.5 million prize fund to establish a scholarship program for 10 students at the Masdar Institute of Science and Technology, located at the heart of the home-grown research and development community at Masdar City in Abu Dhabi.

Students chosen to receive the Masdar Institute-Toyota Scholarship will write their final Master’s degree thesis on a sustainable mobility topic.

"Masdar Institute is one of the leading research-oriented academic institutions that constantly engage with the youth to develop and implement clean energy technologies," said Nobuyuki Negishi of the Toyota Middle East & North Africa.

The Zayed Future Energy Prize, managed by the Abu Dhabi clean energy company, Masdar, seeks to identify, recognize and reward innovation, leadership, long-term vision and impact on renewable energy and sustainability.

The winners of the 2012 Zayed Future Energy prize will be announced tonight at an award ceremony in Abu Dhabi, at which point we will learn whether Vestas indeed set a new standard for corporate philanthropy at the event, now in its fifth year.

Photo credits: 1. Masdar Institute campus by Tim Hurst; 2. World Future Energy Summit
Note: Tim Hurst's travel expenses to the WFES were covered by Masdar

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In 2008, the Danish parliament passed a law requiring all large companies to publicly report on their corporate social responsibility, or, CSR. While the law does not require the 1,100 companies it impacts to actually be socially responsible, the hope is that by requiring companies to be more transparent about their CSR efforts, public pressure and desire for competitive advantage will motivate companies to enhance their "triple bottom line"  of people, planet and profit.

Despite the fact the unprecedented law is nearly three years old, however, it remains relatively unknown outside of the tight-knit CSR community. But not for long. Denmark wants to be become a global powerhouse of good corporate citizenship. And after visiting the country last week for a CSR conference and awards event that featured a rousing keynote presentation of his latest slideshow by Al Gore, I'd argue the Danes are well on their way.*

CSR experts and business leaders from around the world including CEOs from some of Denmark's largest, most powerful companies gathered last Thursday in the quiet port city of Sonderborg for the 2011 CSR Awards and Conference, the first event of its kind in the northern European country. “We do things that we’re not supposed to do, but do anyway,” said Sonderborg Mayor Aase Nyegaard of the efforts taken by her city and country to lead by example.

Despite Denmark's leadership in the space, attention to CSR is largely dominated by a practitioner and media community that focuses almost entirely on American corporations. As a result, CSR is often recognized as a new phenomenon in Europe, a notion echoed by many of the speakers at Thursday's conference.

Sponsored by a handful of large Danish companies including Danfoss, KPMG, VFSA and SE (formerly Southern Energy Denmark), the day-long conference showed just how seriously many Danish companies are taking the new reporting requirements, with implementation updates presented by Novozymes CEO Steen Riisgaard, SE CEO Niels Duelund, and Danfoss CEO Bjorn Christiansen.

The idea that companies be good global citizens is hardly new to Europe. In fact, many would argue that European companies have longer traditions of being good global citizens in terms of their social and environmental policies and practices. Partly because they have been required by governments to be so.

But can the Danish model of government-led CSR catch on outside of Denmark? And perhaps more importantly, should it?

When Denmark assumes the the European Union's rotating presidency in 2012, some believe they will use the opportunity to focus on CSR and perhaps even propose a mandatory reporting requirement similar to their own for all EU member states. With a brand new coalition government just forming the day I left Copenhagen, one can't be exactly certain of the policies Denmark's government will be pushing — foreign or domestic. But even if they don't propose a Danish-style CSR reporting law to the EU parliament in 2012, organizers of last week's event in Sonderborg, the CSR Foundation, have indicated they plan to hold a Europe-wide CSR conference and awards to promote Europe's the best and brightest in European CSR.

Is Good CSR Just Good PR?

Critics of the Danish CSR law to require CSR reporting say the law is too vague and flexible, produces little in terms of actual positive outcomes and requires too little of companies. Relying heavily on the voluntary approach to CSR standards proffered by the the United Nations Global Compact, critics argue the Danish CSR law has no real teeth and is merely a tool for public relations and marketing aimed at bolstering the position of Danish companies and positioning the country as a CSR leader.

"[T]he real kicker," writes one critic of the law, "is the government's estimation that overall 1,100 companies will use up 3,000 hours between them in order to comply with the Act."

It is no secret that communications is at the core of corporate social responsibility and the Danish CSR law. And in fact, the reporting requirement only applies to businesses which have CSR policies. "If a business neither has, nor wishes to establish, social or environmental policies beyond what the legislation requires," the Danish government's CSR website explains, "they must simply state in their management review that they have no CSR policies."

But the Danish government makes their intention of the law clear and accepts at face value that it is, at least in part, an effort to improve the image and promote awareness of Danish companies' corporate citizenship.

"Many Danish companies are good at working with CSR," said former Danish Deputy Prime Minister Lene Espersen in late 2008, just after parliament passed the CSR reporting amendment. "However, often they don't tell the outside world about their efforts," he said.

While the Danish approach to legally encouraging voluntary corporate reporting may not hold companies directly accountable for their social and environmental performance, what the critics seem to be missing is that reporting is only half of the equation. After companies release their reports (and especially if they choose not to), many will argue it is then up to NGOs, shareholder groups, the media and other members of civil society to take that information and run with it. As long as these critical parts of the equation remain underdeveloped, however, innovative approaches like the one promoted by Denmark may only be half as good as they could be — and half as effective as they are designed to be.

The Danish CSR law at a Glance

In late 2008, acts by the Danish Parliament (Folketing) required all large and state-owned companies, to include a section in their annual reports about the company's CSR efforts, if they have any. The Danish Financial Supervisory Authority also requires reporting by all institutional investors, mutual funds and other listed financial business.

Who is required to report?

Large companies Companies covered by Amendment to Danish Financial Statements Act are those that meet two of the following:

• Total assets/liabilities of DKK 143 million (US$25.6 million)
• Net revenue of DKK 286 million ($51 million)
• An average of 250 full-time employees

What do they have to report?

The amendments and executive orders do not explicitly define CSR but rather give businesses the flexibility to turn to an array of recognized principles and standards when reporting. Broadly speaking, companies should include:

• The business's social responsibility policies, including any standards, guidelines or principles for social responsibility.
• Evaluation of achievements made via CSR initiatives during the financial year, and any expectations regarding future initiatives.
• How the business translates its social responsibility policies into action, including any systems or procedures used.

*Disclosure: Travel support was generously provided by the Danish government and the CSR Foundation, an organization working to promote Danish companies’ CSR efforts.

Photos: Timothy Hurst

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Some of the world's largest and best-known companies accustomed to their annual inclusion in the Dow Jones Sustainability Index received a bit of a jolt this week when they were bumped from the most important sustainability-focused investment ratings in the world.

Based on a corporate sustainability assessment conducted by the Swiss sustainability-focused investment boutique SAM, the updated Dow Jones Sustainability World Index (DJSI World) reflects improved CSR performance in banking, insurance and the healthcare "supersectors," while those that took the biggest hit include oil and gas, utilities, industrial manufacturing and, yes, even technology firms.

Among the largest and best-known companies not included on the 2011 DJSI World (pdf) include beverage powerhouse Coca-Cola Co., California-based technology giant Hewlett-Packard Co. and California utility PG&E.

Other notable deletions among the regional indices include Microsoft, Waste Management, FedEx (North America), Volkswagen AG, Statoil ASA (Europe) and Suncorp Group Ltd. (Asia).

Despite the notable deletions, the World Index grew by a net of 18 companies with Minneapolis-based medical technology company Medtronic Inc.; French energy management and energy efficiency powerhouse Schneider Electric S.A., and French bank and financial services company Societe Generale S.A leading the way as the the largest additions.

New additions to regional indices include Sprint Nextel, U.S., CSX (North America), Mitsubishi Corp. Hang Seng Bank Ltd (Asia Pacific) and Alcatel-Lucent (Europe)

First calculated in 1999, the Dow Jones Sustainability World Index is made up of more than 300 companies in the top 10 percent of their business sector based on a basket of long-term economic, environmental and social criteria including with a special focus on industry-specific risks and opportunities.

Changes to the DJSI World and all 18 other world and regional indices will become effective with the open of the stock markets on September 19, 2011.

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The other day I was stopped behind a taxi operated by one of the Denver-Boulder area's big taxi companies and saw the words "Sustainable Development" plastered across the back of the car, a Toyota Highlander Hybrid. Along with the curious nod to the environmental paradigm, the word "Hybrid" and the taxi company's phone number were both printed in the same font and size on the back of the taxi.

Now, I get putting the phone number up there, that's just common sense. It's also apparent why the word "Hybrid" was put on the back of the taxi; to bring attention to this and other hybrid vehicles now operated by the company. But what's up with the shout to "Sustainable Development"?

In hopes of learning more about this curious use of the phrase, I went to the company website, perhaps thinking I'd find that "sustainable development" is actually the name of some project or initiative the company was running to green their operations or operate more sustainably. No such luck. All I learned was that the company had purchased some number of hybrid vehicles (exactly how many was not made clear) to use in their fleet.

Hats off to this taxi company for partially upgrading its fleet to hybrid vehicles. And while I definitely don't give the company low marks for using the hybrid vehicles as billboards showcase their sustainability efforts, they could make a lot more sense doing so. It just doesn't fit. In fact, without some clarification or explanation, it's straight up incoherent. Sustainable development is a paradigm, it's an academic discipline, it's a broadly-defined and sometimes vague eco-socio-economic ethic that has lost much of its original meaning. But whatever it is, it doesn't belong on the back of a taxi.

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This summer, The National Gallery in London is engaging public audiences with an 8,000 plant rendering of Van Gogh's A Wheatfield with Cypresses (1889).

Over 25 varieties of flora are offering museum-goers sweeter, cleaner air and a setting ripe for ecological discussion as the National Gallery forwards their plan to reduce the museum's carbon footprint 43 percent by 2015.

The living wall will insulate the museum, lower outside air temperatures and cast entertaining shadows on Trafalgar square, but the integral component of the carbon-neutralizing plan is GE's Jenbacher engine.

The combined heat and power (CHP) system minimizes energy loss from transportation and distribution while providing electricity and heat.  Jenbacher engines have the added function of utilizing waste heat, an innovation that increases overall plant efficiencies by more than 90 percent.  The engine will account for 40 percent in energy savings.

The Gallery is also in the process of switching to LED lights in conjunction with a system that automatically adjusts roof blinds and accounts for sunlight.  The bulbs are expected to last 25 times longer at 15% of the cost.

A Living Masterpiece

Grasses for the living wall were grown off-site until a desired length and texture was reached.   Then the 640 hanging modules were installed, plant-by-numbers style by designers and horticulturists ANS Group.  The company is contracted to prune the piece through October, at which point the living wall will be taken down. After that... free flora with admission day?

Images Courtesy of GE Reports

Follow Allison Leahy on twitter or reach her by email.

Support for this article provided by

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It seems just about every company is making environmental claims about their products these days.  "Going green" offers an increasingly powerful advertising angle and a million ways to capitalize (and make a positive difference).  But with more eco-labels than you can shake a stick at, how can you be sure product claims are spurring a sea change that runs deeper than sophisticated, eco-design biodegradable packaging?

Greenwashing is a nagging concern for consumers, and the environmental policy landscape isn't all that friendly for emerging green product manufacturers, either.  That's why Green Products Roundtable (GPR), a "consensus-seeking entity" with members including The Dow Chemical Company, Five Winds International, Staples, Rainforest Alliance, the DOE and EPA (the latter two are non-voting participants) has published "Accelerating Green Commerce", a 43-page report asking the FTC to tighten-up their current Guide for Environmental Marketing Claims.

Under the GPR's proposed guidelines, it would no longer be acceptable for a table to be labeled as a 'sustainable wood table'.  The advert and label would have to clarify that they  have sourced the wood from a forest that was certified to a sustainable forest management standard, and further identify that standard.

The barrage of misleading and deceptive environmental marketing claims and product (brand) names bombarding consumers today is desensitizing consumers to valid and credible messaging  -Consensus Guidance sent to the FTC [PDF]

Asking companies to elaborate upon problematic marketing terms such as biodegradable, sustainable and recyclable will give deeper meaning to the terms, while quantifying broad claims like 'made with natural ingredients' and 'this product saves trees' are other ways the Green Products Roundtable hopes to encourage better business practices.

The document is intended to help inform anyone who is attempting to evaluate “what is a credible eco-label”.  The document should be helpful for entities involved in making, interpreting, using, or substantiating environmental claims on products.  These entities include, for example,  product manufacturers, retailers, consumers, institutional and commercial buyers, developers of environmental product standards, eco-label issuers, certifiers, dispute resolution entity, federal government, accreditation bodies, other interested stakeholders, and an authoritative or coordinating entitity.  We expect that the information below would also be used in conjunction with the FTC’s Guidelines for Environmental Marketing Claims   -Accelerating Green Commerce

For a modest annual fee of $175 companies are welcome to sign their Green Marketing Pledge which acts as a promise of compliance to GPR standards.  If a company breaks the pledge (or the FTC guidelines) there is no liability, but their document could make it easier to enforce rulings in false-claims cases.

Over the next year, the GPR will work with stakeholders and eco-labeling programs to pilot test the information and continue advocating for transparency and honesty in environmental marketing materials.  The proposed standards are US-centric for now, but there's plenty of room at the roundtable and an explicit desire to globalize the conversation.  A final version of the report will be available by December and by 2012.

Follow Allison Leahy on twitter or reach her by email.

Image Credits:  Stop the Greenwashing, WStryder via Flickr;  Mighty Mac, Dave_s via Greenwashing Index

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