Last week, I spoke at the annual Greenbiz Forum. They’ve moved to a new (much warmer) location and brought on the Sustainability Consortium and ASU as co-hosts in the event, and I have to say, the event was better than ever in terms of quality of speakers, networking and even the venue itself.
Joel Makower kicked us off as usual by recapping findings from the firm’s annual State of Green Business report. His top-line report was that sustainability progress is slowing … that we’re not seeing significant carbon reduction – we’re not seeing companies launch lots of new initiatives or claim big successes in footprint reduction. Joel remarked that maybe this is because companies have already “done all the easy stuff, like energy efficiency.”
Au contraire, mon frère!
According to Lawrence Berkeley National Laboratory (LBNL) the market potential for Energy Services Companies (ESCOs) is still between $71–$133 billion. ESCOs, if you don’t know, are defined by the Department of Energy as companies that “develop, install, and fund projects designed to improve energy efficiency and reduce operation and maintenance costs in their customers’ facilities.” In short, they’re companies that make energy efficiency happen in commercial and industrial buildings. Given the expected market potential, that’s a lot of energy efficiency left to be handled. (By the way, LBNL forecasts 2014 ESCO revenues to hit $7.5 billion – so it seems companies are still working to pick this “low-hanging fruit.”)
Further, according to our recently released B2B Pulse report, 62% of companies still have goals related to energy efficiency – in short, they’re not done. They’re still striving to use less energy and will keep striving because, as 66% of corporate decision makers told us, cost savings is the number one reason why they’re committed to sustainability.
I would offer another hypothesis for the plateau in sustainability: Companies can only do so much by themselves. To really move the needle on sustainability, they’ll have to engage employees and consumers and move them to change their behaviors. That takes money and, sadly, in our experience, the Fortune 500 talk a great sustainability game but rarely put their money where their mouths are when it comes to marketing/engagement/behavior change on the topic.
Another interesting and related finding from B2B Pulse is this: Of the CEOs who reported being deeply committed to sustainability, most did not believe it gave them a competitive marketing advantage, being primarily committed for personal/philosophical, cost reduction or risk aversion reasons. But you have to figure if they don’t see sustainability as a competitive advantage, they’re not going to authorize big marketing expenditures against it.
So if we want to get off the sustainability plateau and see real traction, we have to convince those committed CEOs that there is, in fact, a competitive advantage. And we have to start engaging Americans to change their behaviors. When we companies begin doing that en masse … that’s when the low-hanging fruit will have been picked.