Survey Shows Shift to Business Value Strategy
released today by CSC (NYSE: CSC) and Chemical Week magazine
finds that leading companies are pursuing the financial and competitive
advantages derived from sustainability initiatives such as energy
management and environmental impact reduction programs. This year's
findings also highlight the broad growth initiatives underway to meet
increasing global opportunities in harnessing clean energy, expanding
food production and providing clean drinking water. Underlying these
initiatives is a rapid adoption in the use of automation to address
escalating product regulatory complexity and global expansion.
CSC identifies the following as the key components of sustainability:
energy management, governance, risk management, product stewardship,
carbon and environmental reporting, worker safety and other regulatory
mandates such as cybersecurity.
The annual survey, now in its third year, includes interviews of senior
executives at more than 200 leading global process industry companies to
identify key challenges, new opportunities and top initiatives. The 2011
survey results reinforce trends from last year's findings, noting that
while regulatory compliance is important, most companies are leveraging
sustainability as a top business initiative to drive growth and cost
For the complete results and to register for a live CSC/Chemical Week
webcast featuring insights into the survey findings (November 2 at 10:00
a.m. EDT), visit www.csc.com/2011sustainabilitysurvey.
"This year's survey results highlight that companies are taking in -- and
preparing for -- expanded and more complex product regulations and
deriving more value from their sustainability programs through an
emphasis on energy management, zero emissions products and resource
efficiency," said Chuck Deise, vice president, Process Industries, at
CSC. "Unsurprisingly, government-mandated regulations continue to
dominate sustainability expenditures, closely followed by energy
management. The majority of companies are also investing in technologies
to automate product regulatory compliance."
Global leaders such as Dow Chemical are using sustainability to
accelerate innovation in resource efficiency by making products with
fewer resources such as water to aid the bottom line. Dow aims to
develop at least three breakthrough technologies to meet world
challenges by 2015, and to improve energy intensity across the company
by 25 percent in 2015, up from 2 percent in 2010.
"In the past two years, in particular, we have seen dramatic
improvements in resource efficiency," says Neil Hawkins, a board member
for Dow responsible for sustainability.
This year's survey also provides evidence of a sharp increase in the
number of companies reporting customer imperatives on sustainability
performance in their buying decisions. Procter and Gamble (P&G), which
has sales of $83 billion annually from the sale of chemicals such as
detergents and shampoos direct to the consumer, views sustainability
less as a business opportunity and more as a business imperative. The
key message from P&G's customers is that eco-friendly products have to
provide equal performance and be available at equal cost to existing
"The mainstream consumer -- about 70 to 80 percent of the population --
will not pay more and will not tolerate trade-offs in performance or
cost, and this is the consumer we target in our strategy," says Len
Sauers, vice president, Global Sustainability, at P&G.
KEY 2011 SURVEY HIGHLIGHTS
Sustainability Resources and Budget
In terms of internal resources and budgeting, government-mandated
regulations continue to dominate sustainability expenditures today.
These are now followed closely by energy management.
There is a sharp increase in the number of companies reporting customer
imperatives on sustainability performance in their buying decisions.
Most sustainability issues gained importance in 2011, and energy and
regulatory compliance importance is consistent with the commitment of
resources and budget. The increase in renewable energy and water
conservation shows an additional interest in cost savings, and likely
capital investment to achieve additional benefits.
Green House Gas (GHG)/Carbon Management
Respondents indicated significant progress toward common enterprise-wide
carbon management since last year's survey. Those in the top level of
sophistication moved from 15 percent last year to 26 percent this year.
ISO 50001 certification was ranked "most important" by respondents,
meaning that companies are gearing up capabilities to more tightly
manage energy costs, measure efficiency and reduce their environmental
impact. Integration of energy and sustainability performance is also
becoming more common, and manufacturers are relying more on capital
investments to achieve energy efficiency.
Manufacturers are still in the early stages of managing production
energy costs, representing a large potential upside. Companies are
prepared with sufficient metering and measurement tools, but have not
connected them sufficiently for real-time capture and monitoring against
While chemical production consumes and discharges vast amounts of water,
few companies have an understanding of how future water availability and
water levels will affect their operations. Leading companies are
concerned about water consumption during production and throughout the
product life cycle, but most are not properly prepared to address
climate-related risks to their current and future operations.
Chemical companies are less confident in 2011 than in 2010 of their
ability to comply with product stewardship and regulatory requirements.
This is likely due to a comfort level they achieved last year in getting
through the first registration period for REACH, only to be met with new
requirements in other jurisdictions that changed their reality in 2011.
The highest correlation to product safety is the burden placed on the
Product Stewardship organization for global GHS expansion, and expanded
(M)SDS labeling requirements, followed closely by the complexity
expansion of (M)SDS authoring requirements. The survey indicates that
executive management recognizes the importance of Product Stewardship,
in light of increasing complexity and the explosion of EH&S Product
Life-Cycle Assessment (LCA)
The high cost of LCAs and historic lack of financial justification have
resulted in low adoption levels, with nearly one-third of respondents
indicating that less than five percent of their products are subject to
this analysis. Within three years, all respondents indicated their
products subject to LCAs would expand well beyond current levels,
indicating a significant investment and importance to their product
The most common LCA focus now, and over the next three years, is in
Manufacturing Operations. This is reflective of the relative ease of
internal measures, compared with the complexity of getting consistent
and compatible data from suppliers and customers. The least common focus
areas, raw material selection and end of life management, are indicative
of the significant challenges to gain both cooperation and overcome the
lack of current information standards. While leading companies stress
the importance of LCA to collaboration and innovation, most respondents
indicate they expect LCAs to bring about additional energy savings and
reduction to human health risks.
Most respondents fully expect cyberattacks on their manufacturing
facilities (a concern made more salient by the perceived vulnerability
of industrial control systems to threats such as Stuxnet), and most
believe they are sufficiently prepared to detect and stop them before
damage occurs. Interestingly, there is no change in perceived plant
risks (from 70 percent of companies in 2010 planning to expand
investment in new capabilities to fend off attacks). The primary
pressures for investment emanate from concern over increasing threats,
internal company risk management policies and new government
regulations, such as the Chemical Facilities Anti-Terrorism standards
The Third Annual Global Compliance and Sustainability Survey -- which
covered energy management, governance risk management, product
stewardship, carbon and environmental reporting, worker safety and plant
cybersecurity -- was conducted from August to October of 2011. For
complete results of the survey, visit www.csc.com/2011sustainabilitysurvey.
About IHS (www.ihs.com)
IHS (NYSE: IHS) is the leading source of information and insight in
critical areas that shape today's business landscape, including energy
and power; design and supply chain; defense, risk and security;
environmental, health and safety (EHS) and sustainability; country and
industry forecasting; and commodities, pricing and cost. Businesses and
governments in more than 165 countries around the globe rely on the
comprehensive content, expert independent analysis and flexible delivery
methods of IHS to make high-impact decisions and develop strategies with
speed and confidence. IHS has been in business since 1959 and became a
publicly traded company on the New York Stock Exchange in 2005.
Headquartered in Englewood, Colorado, USA, IHS employs more than 5,100
people in more than 30 countries around the world.
CSC is a global leader in providing technology-enabled business
solutions and services. Headquartered in Falls Church, Va., CSC has
approximately 96,000 employees and reported revenue of $16.2 billion for
the 12 months ended July 1, 2011. For more information, visit the
company's website at www.csc.com.
Media Relations Director
Vice President, Investor Relations