Corporations Turn Environmental Activists Into Allies

March 23, 2008

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Environmental stakeholders have changed from pesky activists to big investors – pension funds, state controllers, institutional investors, and even their investment bankers – and can no longer be brushed aside, according to an article in HBR Green by Judith Samuelson, the executive director of the Aspen Institute’s Business and Society Program.

Companies today must be prepared to justify their environmental actions and those that don’t measure up or they will lose capital to more eco-friendly competitors. Earlier this month, it was reported that U.S. investors filed 54 global warming shareholder resolutions with U.S. companies, nearly doubling the number filed two years ago.

As a result, companies have begun turning to activists for help on drawing up sustainable strategies.

According to the article, the TXU buyout will be remembered as the tipping point in the stakeholder game, where investors consulted with the Environmental Defense Fund and the Natural Resources Defense Council. Other examples followed – Coca-Cola and the World Wildlife Fund have tackled global water quality and Clorox and the Sierra Club recently workied together on the rollout of a green product line, to name just two.

Expect more of the same. As an indication of the importance companies put in connecting with environmental stakeholders, Advertising giant Publicis Groupe recently bought sustainability consultancy Act Now, renaming it Saatchi & Saatchi S. The group is headed up by Adam Werbach, a past president of the Sierra Club.

In a recent EL column, Kevin Tuerff wrote that many companies are re-thinking their stand-off approach of dealing with environmental stakeholders as a segment of their green marketing.

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