New Zealand orgs think about more than bottom line

15 June 2005

Why New Zealand organisations are thinking about more than their single bottom line

Peter Neilson, Chief Executive of the New Zealand Business Council for Sustainable Development (the Business Council) told delegates at the Stevedoring and Ports New Zealand conference in Christchurch today that sustainability is the right path for business to take because it improves both profits and relationships with staff and the wider community.

Neilson acknowledged that the wake up call for early adopters of sustainability was often a crisis which brought huge media interest to the organisation following a breakdown in their ethical, environmental or social obligations. However whilst managing risk and reputation may have started some companies on their journey, many others have realised that sustainability just means good management practice reducing costs and improving efficiencies.

“More and more companies however are focusing on their social and environmental impacts alongside their financial commitments as a way to differentiate themselves from their competitors and to attract new talented young people who are pushing for more sustainable business practice. In the current very competitive labour market, job applicants are demanding more than just a financial package.”

Neilson told the conference that with global shipping representing 85% of the world’s transport needs, sustainability matters for the ports and freight handling industry, which is focusing on safer lives, safer ships and cleaner seas.

“We may be a small country on the other side of the world from many of our markets, however global trends, particularly in the supply chain, now mean that even companies that have previously been able to ignore sustainability are being pushed into doing something about it. There are an increasing number of companies that having first looked inside their organisation to address environmental and social impacts, are now extending the scope to include their suppliers.”

He welcomed the role of Ports of Auckland and Port of Tauranga as active members of the Business Council sharing the organisation’s commitment to managing business in a way which promotes quality of life. Business Council members commit to reporting on their triple bottom line within three years of becoming a member.

The Business Council has produced a guide to a sustainable supply chain which has been accredited by fellow World Business Council for Sustainable Development partners as being one of the leading pieces of work in this area. Business Council members including The Warehouse, IAG NZ and Vodafone NZ have incorporated the code of practice for suppliers into their procurement practices.

Neilson believes that ultimately all businesses will need to address their sustainability because it will become a pre-requisite for doing business:-

“In Europe leading retailers and brand owners require their suppliers of goods and services to comply with terms of trade which extend beyond service and price. In the USA we are seeing the corporate sector –- hotels, office complexes etc - include sustainability criteria particularly relating to environmental impacts in their tenders. New Zealand companies trade around the world and many are recognising that sustainability ultimately provides business with its license to operate, innovate, grow and compete in the global market.”

Neilson told the conference that with 83% of New Zealand’s exports by value being shipped via their ports, they have a major role to play for our export brands that rely on their clean green shipping practices.

More about the NZ Business Council for Sustainable Development

The Business Council’s starting position is that a business needs to be profitable in order to be sustainable. Sustainable business also needs to be sensitive to the needs of their employees and to the communities in which they operate and to minimizse their impact on natural resources.

Business Council members employ over 50,000 New Zealanders across the North and South Islands. Based on the average family size of 3, this means it is directly responsible for the livelihoods of almost 150,000 people or 4% of the population. However its real impact is much bigger as many businesses are reliant on member companies as trading partners in local communities.

ENDS

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