Sustainability and the Bottom LineNovember 1, 2019
In my September 2019 editorial, I explained the importance of developing environmentally sound operational practices, through the eyes of Martinrea International. You would think that the notion of being a good corporate citizen would be enough to convince plant managers up and down the supply chain to practice environmental responsibility.
Well, evidently not. I received this response from a reader:
“Does sustainability and social responsibility really save money for a business? Where is the payback for the stock holder?”
This type of short-term thinking, with actions driven only by next-quarter’s balance sheet, nearly always leads to poor decision-making with little to no forethought given to long-term ramifications. Consider these two facts presented in my editorial:
- Contracts from Martinrea require that suppliers adhere to the company’s environmental responsibility and customer requirements. “Failure to comply could result in termination of the contractual relationship,” the company says.
- Seventy percent of employees say they’d prefer to work for companies with a strong green footprint, and nearly half would accept a smaller salary to do so.
Other returns on sustainability related investments are easy to grasp. Environmental stewardship can reduce energy bills and help companies mitigate operational risks from new regulations. Showing employees you care about sustainability can boost job recruitment and satisfaction, and raise productivity. Finally, research from Deutsche Bank reveals that companies with high rankings for sustainability enjoy lower cost of debt and equity.
Stefan Ranstrand, president and CEO of sensor-technology provider Tomra Systems, sums it all up:
“It is a tricky balancing act,” he writes, “to weigh productivity against sustainability; the two are not mutually exclusive. In the 21st century, there are ways to increase both, which can not only bring about tangible business benefits, but also maintain the long-term well-being of the planet.”
Finally, we proudly present in this issue our 2019 Women of Excellence (WOE) in the metal forming and fabricating industry. As you read about our honorees (our website provides more detailed information about each), keep these thoughts in mind:
- The number of female engineers has more than doubled since the 1980s.
- A recent LinkedIn study of leadership data shows that manufacturing has experienced a 26-percent rise in female leadership hires over the past decade, more than any industry segment surveyed except for software/IT services.
- As noted in a recent Boss Magazine article, studies show that gender balance in manufacturing management improves company performance.
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