stakeholder analysis
TRANSCRIPT
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Customers
(current, future)
(Community)
Owners/Banks
Government
NGOs
IMPACTS COMPANY
Basic Stakeholder Framework
Workers
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Environmental Value Drivers
Process efficiency Buyer preferences Access to more “ecological” international markets Official business relationships Environmental performance and competition in the
domestic market Incentive for innovation Lower-risk profiles for funding and investment
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Driver # 1: Process Efficiency
Ecoefficiency material used/in product material new concept:
energy and material quantity per “service unit” ==> “dematerialization”
Thousands of well-known examples
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Driver # 2: Buyer preferences
Trend toward customers looking for better performance for customers and other stakeholders (both current
and future) due to requirements from markets by philosophy and conviction
Good and bad news Challenges for those not seeing them Exciting opportunities
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Driver # 3: Access to more “ecological” international markets
Fairly new trend “Market rules” set the guidelines Non-official
No GMOs, organic recycled content ISO 14001 more sustainable tourism
More official “product take-back” requirements
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Driver # 4: Official business relationships
The most complex Particularly important in relation to product
content traces of carcinogenic substances
Also process issues WTO role? UNFCC? Obviously, governments can protect the
population
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Driver # 5: Environmental competition in the domestic market
Local companies are already worried Multinational companies in industrial countries
have up to 30-year experience in creating and using environmental development as a market position.
They are not afraid to use it against local rivals.
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Driver # 6: Incentive for Innovation
Less evidence than other areas Companies under environmental pressure
innovate faster (“Porter Hypothesis”) cases: Bacardi, de-icing, paper and pulp
Rate of change is accelerating few companies have experience in this area
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Driver # 7: Lower-risk profiles for funding
International banks acknowledge risk Evidence for serious problems due to a lack of
in-depth evaluation Up to 50 basis points premium with ISO 14001
(10% of leading banks?) Relation with IFC and The World Bank,
multinationals
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Opportunities in “Products for the Future”
Good and bad news Favored versus un-favored sectors However, performance is important in all Alternative energy
willing to pay up to 15% extra for non-fossil energy Agriculture -- organic has 20% annual increase Tourism -- fastest growing segments?
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Are companies creating value from their environmental performance?
Solid supporting evidence Case studies Solid theory Evidence in research on historical performance
at market level Emergence of “Ecoefficient” or “Sustainable”
Funds
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Cash Flow
Costs
Earnings
Risks
Cost of Capital
Company Valuation
Source: Adapted from Rappaport1976
Strategic And
Policy Decisions
Change In
Value
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Cash Flow
Costs
Earnings
Risks
Cost of Capital
Strategic And
Policy Decisions
Change In
Value
• Energy Efficiency • Material Efficiency • “Dematerialization” • Reduction of Toxicity
Valuation: Environmental Elements
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Cash Flow
Costs
Earnings
Risks
Cost of Capital
Strategic And
Policy Decisions
Change In
Value
• New products • New markets • New clients • Price premium
Valuation: Environmental Elements
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Cash Flow
Costs
Earnings
Risks
Cost of Capital
Strategic And
Policy Decisions
Change In
Value
• Regulatory Risk • Risk of Direct action • ”Social license” • Site contamination
Valuation: Environmental Elements
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Cash Flow
Costs
Earnings
Riskis
Cost of Capital
Strategic And
Policy Decisions
Change In
Value
• Special credit lines • Company image • Lower risk profile • Venture Capital (high growth companies)
Valuation: Environmental Elements
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