1.
Training Students for
a Sustainable Future
in Business
Tensie Whelan

2.
NYU Stern Center for Sustainable Business
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3.
Business at Risk: Key Trends
Climate change: supply and transport disruptions and
resource scarcity
Resources: supply and manufacturing disruptions, license
to operate threatened
Economic and social inequity: conflict, high turnover, low
morale, license to operate threatened
Radical transparency: one tweet can effect brand and
share price
Changing expectations: consumers, clients, government,
NGOs4/24/2017 3

4.
The Value at Stake from Sustainability Issues can be as high as 25-70% of
Earnings before Interest, Taxes, Depreciation, Amortization (EBITDA)
Regulation/reputation Restricted license to operate, 70%
reputational damage due to
perceived misuse
Rising Operating Costs Raw material costs up, 60%
true cost of water/carbon
Supply Chain Disruption Production delay or cancellation 25%
McKinsey Study: Profits with Purpose 2014
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5.
Commodification of Brands
• Brands competing on functional attributes and
price.
• Most brands have collapsed into each other as
consumers price shop.
• Havas Study: Most people would not
care if 73% of brands disappeared.
Only 20% of brands notably improve
our quality of life.
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6.
Edelman Trust In Business 2017
Trust in Business (US)
• Informed population: 68%
• Mass public: 47%
57% belief the system is failing them (eroding social values,
globalization, immigration, pace of change
37% (49%) rate CEO as credible spokesman, employee 48%, person
like you, 60%
72% government should protect our jobs and industries, even if the rate
of growth slows.
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7.
Edelman Trust In Business 2017
How business can rebuild trust: (system works vs failing)
• Protects and improves the environment: 52%/60%
• Creates many new jobs: 47%/55%
• Address society’s everyday needs in its business: 46%/53%
• Programs with positive impact on local community: 46%/53%
• Profits stay here in the country: 46%/56%
• Treats employees well: 62%/72%
• Offers high quality services/products: 59%/68%
• Listens to customers: 58%/67%
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8.
BBMG Global Consumer Segmentation
c
Aspirationals
Practicals
Advocates
Indifferents
39%
10%
25%
26%
SOCIAL & ENVIRONMENTAL VALUES
MATERIALISM
BBMG & GlobeScan 2015

9.
Rise of the Aspirationals: BBMG
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10.
Rise of the Aspirationals: BBMG/Globescan
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Trust in Brands: “trust global companies to act in the best interest of
society” (58%)
Seek Style and Status: “I want to stand out by the way I look, my style”
(78%)
Positive Influencers: “I encourage others to buy from socially and
environmentally responsible companies” (87%)
Responsible Consumers: “I believe we need to consume less to
preserve the environment for future generations” (88%), and are
“willing to pay more for products produced in a socially and
environmentally responsible way” (90%)
Young: Millennial (47%) and GenX (34%) generations

11.
Expectations of Business: Changing Investor Climate
• Global environmental, social and governance
(ESG) investing: $21.4 trillion in 2014 (30% of
professionally managed assets in Europe, the
United States, Canada, Asia, Japan, Australasia
and Africa).
• ESG investing almost doubled 2012-2014,
33% 2014-2016 (22% in US)
• Governments requiring disclosure of climate
related risks to investors.
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12.
In the face of these trends, what kind of managers do we need?
• Systems and design thinkers
• Stakeholder managers
• Interactive/transparent communications
• Grounded in ESG risks and opportunities
• Understand the business case for sustainability
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13.
Sustainable Companies Outperform Peers
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Data by Eccles,
Ioannou & Serafeim /
Harvard Business
School . 180 companies
over 28 years (1993-
2011)

14.
Arabesque and University of Oxford Meta Study
(200+ academic studies):
• 90% of studies: good ESG standards lower cost of capital
• 88%: good ESG results in better operational performance
• 80%: stock price performance positively correlated with good
sustainability practices.
Arabesque/Oxford Study (2016)
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15.
Overview of Business Case Drivers from Embedded Sustainability
Sustainable Business
Benefits at the Firm Level
Description
Cost Savings Through
Improved Operational
Efficiencies
Reduced waste, energy, water use. Reduced raw material use. Increased
recycling and reuse. Increased efficiency and productivity through streamlined
processes.
Better Positioned to
Manage and Mitigate Risk
Mapping and mitigating physical, reputational and regulatory risks in supply
chain and direct operations reduced exposure to climate change, water scarcity,
community unrest.
Increased Innovation
Through Design and
Systems Thinking
Design and systems thinking that embeds sustainability results in improved and
new systems and products.
More Loyal and Unique
Corporate Ecosystem
Sustainable companies engage with stakeholders along their supply chain and
aim to create, rather than extract, value from them.

16.
Automotive Monetization
Methodology
Sustainable Business Benefits
at the Firm Level
Description
Increased Competitive
Advantage
Secure supply chain; loyal customers; market share; non-replicable model;
not competing solely on price; managing complexity and rapid change
More Positive Earned Media Builds reservoir of trust, positive coverage
Improved Sales and Marketing Communicating sustainability proposition increases customer loyalty and
improves sales.
Better Recruitment, Retention,
and Morale of Employees
Improved retention, recruitment, morale, and health; reduced accidents and
lawsuits.
Stronger Financial Valuation
Through Transparent
Reporting of ESG Factors
Transparent reporting on ESG results in better financial performance.
Create Value to Society
Through Net Positive Impact
Net positive approaches aim to create stakeholder value and deliver
regenerative services to society.

17.
Corporate Sustainable Management Trends
• Embrace a higher purpose
• Embed sustainability in core business strategy
• Embrace design and systems thinking
• Integrated reporting and new financial metrics
• Manage to the corporate ecosystem
• Develop radical transparency skills
• Pre-competitive collaboration
• Business in creating value for society
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18.
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19.
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20.
Best in Class: Unilever
• Sustainable Living Plan is the business strategy.
• Goals: Double growth, halve env footprint,
100% sustainable sourcing, jobs for 1 million smallholders.
• New products positive contribution to UNSDGs
• CEO bonus tied to Sustainable Living Plan
• Results: Brands with purpose outperforming.
• Popular employer: #2-3 on LinkedIn
• Revenue to rise 5% in fiscal 2017. vs P&G (flat sales growth).
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21.
Undergrad, Grad and Executive courses
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22.
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Events and Outreach

23.
• Monetization Working Group
• Business case pilots:
deforestation-free supply chains
• Embedding ESG/long term plans into quarterly reporting
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Research on the Business Case

24.
Project partners:
Key findings:
1. Sustainability investments can deliver significant net benefits to ranches
($52-89Mn, 21-36% of revenues)
2. For slaughterhouses and retailers benefits are overall positive ($65 -
307Mn, 0.03-0.15% of revenues) and ($30-132MN, 0.02-0.1% of revenues)
3. Majority of benefits revenue increase and cost and risk avoidance. Other
benefits include talent retention, lower cost of capital and GhG emission
reduction.
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Deforestation-free Supply Chains: Beef in Brazil

25.
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CSB Methodology: Drivers of Financial performance
CSB research has
found that when
players in a value
chain embed
sustainability in their
core strategy and
practices, they
consistently drive
value through:
• Innovation
• Risk reduction
• Operational efficiency
• Customer and supplier loyalty
• Employee recruitment, engagement and retention
• Improved sales and marketing
• Better and more earned media coverage
• Lower cost of capital
• Higher valuation
We used these drivers to assess the financial value created in the value chain
by adoption of sustainable and deforestation-free practices
© New York University

26.
Sustainable, Deforestation-Free Beef in Brazil: Business Case
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27.
MBA Signature projects: GAR, Pfizer, NYSERTA
MBA challenges: Nespresso, Aspen
In-class challenges
Internships: Inherent Group, McDonalds
Fellowships: West Elm
Panels, classroom lectures and C-Suite speakers
Club and event sponsorship
Business Cases
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Opportunities to work with students

28.
Recruitment: ALIGN recruitment with purpose and
sustainability
"A knowledge of corporate valuation may be necessary (for
some jobs) but is definitely not sufficient to get a job with
us; the candidates who we really work to recruit and then
groom for promotion are those who can also
demonstrate passion."
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David Chubak, Chief Productivity Officer, Citibank

29.
Thank you!
twhelan@stern.nyu.edu
CSB website: www.stern.nyu.edu/sustainability
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