In an era of cutthroat competition, say some leading-edge companies, the race is not just to the swift or strong, but to those who embrace environmental health and safety as an essential part of their business.
WHEN SUN CO. CEO ROBERT CAMPBELL let a gathering of safety and environmental professionals in on how he planned to gain a competitive advantage for his company in the future, he didn't discuss top-secret research or efforts at cost control. Instead, he told them about the oil firm's efforts to become an "activist" on environmental safety and health issues.
In 1992, the Coalition for Environmentally Responsible Economies (CERES) presented a resolution to Sun's shareholders asking them to adopt the 12 CERES Principles (formerly known as the Valdez Principles). At first, Campbell told attendees at "Corporate Environmental Health & Safety Excellence: A Vision for Management," sponsored by the Conference Board and Arthur D. Little in New York, he urged shareholders to reject the resolution. He thought the environmental principles were too strict and would interfere with business decisions.
"[A] funny thing happened on the way to the ballot box," he said. "Somewhere during the cautious discussions between CERES and us prior to that annual meeting, a slight hint of mutual understanding began to emerge. To our surprise, they didn't really want to put us out of business. To their surprise, we had already made a strong financial and operational commitment to environmental improvement and were willing to do more."
Sun decided to endorse the CERES principles. Campbell said the results have been reassuring. Employees have a renewed sense of determination to improve the company's environmental performance. In turn, Campbell said, Sun's economic performance will be enhanced. Moreover, he insisted, employees support the idea that the two issues are linked.
In addition, the company has decided to "play offense instead of defense" on environmental issues. For example, Sun has volunteered to work with the Pennsylvania Dept. of Environmental Resources to undertake a groundwater remediation project at its Philadelphia refinery.
By becoming an EHS activist, Sun will be at a competitive advantage in the future, Campbell said. The company has worked to establish sufficient environmental credentials so it will get a "warm ear" where there was formerly a cold shoulder.
Further, he sees the CERES principles as a way of improving Sun's overall performance. By bringing EHS issues under the corporate umbrella and marrying them to other business functions, Sun not only avoids future liabilities, but also makes its operations more efficient. The less waste Sun generates, the less it has to spend on treatment and disposal.
PAYING FOR OLD ATTITUDES
To succeed in today's competitive world, Campbell and other speakers told the gathering of 200 EHS professionals, companies must stop treating EHS as an afterthought and integrate it into their everyday business operations. The conference was designed to provide insight into how leading-edge companies are applying total quality management principles to the EHS arena.
Speaking from personal experience, Sun's CEO said companies need to operate with the belief that "we're doing what makes sense for the environment, makes sense for the economy, and makes sense for our business."
Certainly, the stakes have been raised for companies with poor safety or environmental performance. Workplace accidents cost the nation more than $115 billion annually. By 2000, the private sector will spend $88.7 billion annually to comply with environmental regulations. In response to a well-informed and highly active public that demands corporate responsibility, regulatory agencies have stepped up their enforcement programs. Moreover, new criminal codes could put corporate executives behind bars for violating health, safety, and environmental laws. …