Part 3: Spotlight on Corporate Sustainability Best Practices

Kathryn L. Hersey, CFA
Aimee B. Forsythe, CFA

July 24, 2018

Investing & Economy

A quick look at select environmental, social, and governance (ESG) initiatives at Home Depot (NYSE: HD), Unilever (NYSE: UL), and Adobe Systems (NASDAQ: ADBE) offers helpful insights into how successful enterprises are implementing best practices in sustainability. 


Home Depot: Emphasizing the Environment and their Communities

Home Depot has long been recognized for its strength in sustainability initiatives, particularly for its focus on the environment. Rated a sector leader by the Carbon Disclosure Project, the company exceeded its goal of reducing energy usage by 20% in 2015, a reduction of 35% below 2008 levels.

Home Depot focuses on making its stores as environmentally-friendly as possible by improving lighting systems, reducing water usage, and focusing on recycling and waste management.

In addition, the company has:

  • Increased sustainability efforts for its customers with a responsible appliance recycling program, online rebate programs for energy efficient appliances, and in-store educational programs on green living.
  • Increased the organic products sold within their stores, giving consumers greater choice.
  • Helped customers save $900 million on their utility bills as a result of making Energy Star purchases in 2016, according to the firm’s 2017 Sustainability Report. ​

Home Depot has also done significant work with its suppliers, auditing their compliance with safety, human rights and environmental standards, as well as tracing the origin of products to ensure that they have been produced in a sustainable manner. For example, the company instituted a Wood Purchasing Policy in 1999 to trace the origin of every wood product sold in its stores, giving customers greater knowledge about the potential impact of their purchases.

Finally, Home Depot strives to make contributions to the communities in which it operates through disaster relief, children’s workshops, and the Home Depot Foundation, with its mission to provide every veteran with a home. The Foundation has contributed $198 million since 2011 to support housing for veterans and has pledged $250 million more through 2020. Home Depot employees also donate their time to projects that will improve the lives of veterans in their communities. 


Unilever: Reducing Energy and Water Use

Unilever has made significant progress on sustainability efforts over the years.  Their Sustainable Living Plan Steering Team, composed of senior leaders from various segments of the company, is charged with developing company-wide social and environmental goals and monitoring overall governance. 

Under the Sustainable Living Plan, the company has set goals to reduce energy usage overall, increase the use of renewable energy in its manufacturing operations, and manage energy use in offices and information technology (such as monitoring printer usage).

The company has also developed more sustainable products. They introduced a dry shampoo that does not require water and created laundry detergents that can be used with lower water temperatures to conserve energy and water consumption.

In addition, Unilever has:

  • A comprehensive program for water reduction that includes reducing water for cleaning, water recycling, and geothermal cooling. All three initiatives have contributed to a steady decrease in water consumption per consumer in recent years.
  • A notable carbon reduction program throughout its products’ life-cycles, with a target to halve GHG emissions by 2030 from a 2010 baseline. Unilever’s product carbon footprint and carbon emissions performance stand out against its industry peers and significantly reduce the company’s environmental impact. 

​Unilever is also focused on achieving diversity in the workforce with females comprising 39% of its Board of Directors. The company aims to empower women through their brands, value chain, and partnerships. It is committed to developing sustainable living brands that are increasing gender equality because they believe that a more inclusive workforce can boost reputation, innovation, and financial performance. 


Adobe Systems: Diversity and Carbon Neutrality

Adobe Systems stands out from its peers for a number of reasons:

  • Its workforce diversity is above average, with women comprising a quarter of senior management and nearly one-third of the total work force. The company invested $4 million in education and talent pipeline programs in 2017 to expand access in tech careers and increase the diversity of the future workforce
  • The company has been reducing water and energy consumption since the early 2000s.
  • It is an industry leader in water stress and carbon emissions performance.
  • Its North American facilities recently achieved carbon neutrality as all waste generated at the company’s headquarters is diverted from landfills.[1]

The workspaces at Adobe are all LEED certified for their design, construction, operation, and maintenance (under the Leadership in Energy and Environmental Design rating system for “green” buildings). In addition, the company built its own high energy efficiency data center which incorporates innovative technologies to reduce energy usage.
 


[1] Carbon Disclosure Project, www.cdp.net


This article is for informational purposes only and should not be construed as investment or legal advice.