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LS&CO and Corporate Social Responsibility “Any successful corporate social responsibility (CSR) campaign has to be embedded in the business throughout the organization. For CSR to be most effective, an organization should take its CSR objectives and fundamentally build them into strategic planning so that everyone considers business decisions through the lens of corporate social responsibility” - Hilary Krane, Senior Vice President and General Counsel for Levi Strauss & Co. (LS&CO.)* *Corporate Social Responsibility: A Fundamental Business Thought Process, Association of Corporate Counsel
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Ian HepworthJulia Sanders
LS&CO Materials Project
• The Project: Phases• Indicator Development and Matrix• Our Materials• Materials Analysis
– Paper and Toner– Hangers– Corrugated – Letterhead/business cards
• The Big Finale
Strategy
LS&CO
and Corporate Social Responsibility
“Any successful corporate social responsibility (CSR) campaign has to be embedded in the business throughout the organization. For CSR to be most effective, an organization should take its CSR objectives and fundamentally build them into strategic planning so that everyone considers business decisions through the lens of corporate social responsibility”
- Hilary Krane, Senior Vice President and General Counsel for Levi Strauss & Co. (LS&CO.)*
*Corporate Social Responsibility: A Fundamental Business Thought Process, Association of Corporate Counselhttp://www.acc.com/community/clo/perspectives/upload/HilaryKranePers-2.pdf
Phase 1: Investigate Identify potential target materials
Refinement of list with LS&CO team
Phase 2: Measure and Reduce
Identify Metrics for estimation of impacts
Investigate strategies to reduce impact
Phase 3: Recommend Present short and long term solutions
Develop implementation
program
Project Scope and Phases
• Material Environmental Impact:
• Research and investigation of current environmental impact based on generally accepted standards
• Research alternative substances/practices and reduction possibilities
• Cost Savings Potential:
• Interviews with key staff members and suppliers
• Industry benchmarking
• Predictability of Consumption:
• Interviews with key staff members across the firm
• Level of Visibility:
• Interviews with key staff members across the firm
• Industry knowledge and benchmarking
Indicator Development M
ethodology
Total Spend
20%
Environmental Impact
30%
Cost Saving Potential
30%
Predictable Consumption
10%
Visibility
10%
Paper $121,000 High High High High
Printer Accessories and Cartridges
$763,000 Medium High High Medium
Fixtures and Brand Elements
$8,500,000 Medium/Low Medium/Low Medium High
Size Dividers $175,000 Medium/Low Medium/Low High Medium
Hangers $1,000,000 Medium High High Medium
Servers $1,400,000 Low Low Low Low
Stationary/Business Cards
$49,840 High High High High
Wood Pallets $700,000 Medium Medium High Medium/Low
Corrugated $5,000,000 High High High Medium/Low
6
Jeans O-Meter
123,951.80 BTUs OR
36.33 kWh of energy
Anderson, Stephen. “Energy Consumption Associated with the Production and Distribution of Jeans in the U.K.” December 2004.http://cost355.inrets.fr/article.php3?id_article=63
Paper and Toner
The Size of the Problem
•17 Million Sheets
• $121,000
• 10%-17%
Wasted
• $15,000 Lost
LS&CO Currently spends $650,000/year on Toner
San Francisco Chronicle: http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2004/07/26/BUGL57SAL81.DTL
Toner: Costly Comm
odity
Green Print highlights and removes unwanted pages
PDF Writer
Tracks individual and aggregate pages and dollars saved
Green Print: An Integrated Software Solution
Average savings with Green Print are upwards of $100 per user per year*
*A GreenPrint Technologies White Paper http://www.scribd.com/doc/6061343/Green-Print-Technologies-White-Paper-September-2008
Green Print software eliminates unwanted pages saving paper, ink, and money
-$100,000
-$50,000
$0
$50,000
$100,000
$150,000
$200,000
0 1 2 3 4 5 6 7 8 9
Conservative NPV
Conservative Cumulative NPVStandard NPV
Standard Cumulative NPV
NPV
Conservative Payback Period: 2.5 yearsConservative NPV: $70,000
Standard Payback Period: 1.5 YearsStandard NPV: $180,000
Green Print: Financial Analysis
Green Print: Potential Savings
Year
Pres
ent V
alue
(tho
usan
ds)
Currently Used Potential Savings
Wood 260 Tons 34 Tons
CO2 490,000 Pounds 64,000 Pounds
Solid waste 200,000 Pounds 28,000 Pounds
Waste water 1.7 Million Gallons 215,000 Gallons
Energy 960,000 kWh 125,000 kWh
Environmental Savings
3,387 Pairs of Jeans!
GreenPrint: Environmental Im
pact
*Environmental Defense Paper Calculator http://www2.edf.org/papercalculator/index.cfm
Recycled Paper Content: 30% to 100%
Volume data from Staples invoice: Quantity Price Total Spend
50% Recycled Price
100% Recycled Price
SPLS 8.5X11 30% REC COPY CS 3130 $42.99 $104,260.30 $63.99 $51.99
SPLS 8.5X14 30% REC COPY CS 153 $55.99 $8,277.30 $94.99
STAPLES 8.5X11 3-HOLE CS 117 $45.99 $5,146.83 $79.99
STAPLES 8.5X11 30% REC COPY RM 358 $5.99 $1,399.78 $8.79 $6.79
SPLS 8.5X14 30% REC COPY RM 94 $8.79 $824.24 $10.49
SPLS 8.5X14 COPY RM 133 $7.79 $683.62 $10.49
SPLS 11X17 30% REC COPY RM 21 $18.89 $326.34 $15.79
PAPER COPY GTWHT 20# 8.5X11 WE 24 $6.29 $177.12 $8.79
Paper Total $121,095.53
NPV100%
Recycled Paper Payoff
0 1 2 3 4 5 6 7 8 9
-$60,000
-$40,000
-$20,000
$0
$20,000
$40,000
$60,000
$80,000
$100,000
NPV In Concert With Green Print100% Recycled CostCumulative NPV
Pres
ent V
alue
(tho
usan
ds)
If the switch to 100% recycled paper is adopted in conjunction with Green Print, the net NPV is positive
Year
Cost Offset: Combine Paper Change with Green Print
Currently Used Potential Savings
Wood 162 Tons 162 Tons
CO2 490,000 Pounds 98,400 Pounds
Solid waste 200,000 Pounds 52,300 Pounds
Waste water 1.7 Million Gallons 406,300 Gallons
Energy 960,000 kwh 228,400 kWh
100% Recycled Paper Environmental Savings
6,201 Pairs of Jeans!
GreenPrint: Environmental Im
pact
*Environmental Defense Paper Calculator http://www2.edf.org/papercalculator/index.cfm
Option 1:– Adopt Green Print Now
• Moderate environmental impact• NPV positive: $70,000 - $180,000
Option 2:– Adopt Green Print Now– Adopt 100% recycled paper w/ in 2-5 years
• High environmental impact• FSC Certified – Internal and External Communication• NPV positive or cost neutral: $0 - $80,000
Paper and Toner Recomm
endations
Julia P. SandersIan A. Hepworth
Environmental Consultants
Letterhead and Business
Cards
PHONE: 415.501.1234FAX: 415.501.6789EMAIL: [email protected]
Letterhead and Business Card
AnalysisAlternative 1: Keep current design• +
$2,000/year in paper cost
Alternative 2: Remove script Levi Strauss• Cost neutral
Alternative 3: Major design change• +$2,000/year
in paper cost• +$7,500
design fee• +$34,700
additional purchase to replace stock of outdated design
• 700 lbs. of discarded letterhead
LS&CO. has committed to adopting New Leaf paper, that is 100% PCW and FSC-Certified
LetterheadKeep current design
Minimal cost No waste due to discard Can consider design change in future
Letterhead and Business Card
Recommendation Indicator Potential SavingsWood 3 Tons
CO2 1,680 Pounds
Waste water 6,930 Gallons
Energy 3808 kwh
103 Pairs of Jeans!
Reputational Opportunities
FSC Logo Internal and External Priorities Communicated
*Environmental Defense Paper Calculator http://www2.edf.org/papercalculator/index.cfm
Hangers
Hangers: The Lifecycle
LS&CO Annual Hanger Spend: $1,000,000
Drivers of cost:
Average Hanger Inventory: 8,400,000
Purchase 880,000 new hangers every year
Assumption: ship each hanger approximately 500 miles
Recently moved to reused hangers
Hangers: Eco-Friendly Substitution
Standard 6012 – Average resin content: 36.2 grams– Hook (West Coast): 8.7 grams– Price per 1000: Average $164
Eco 6012 – Resin content: 27.2 grams (25% reduction)– Hook (Nail head): 8.3 grams (4.6% reduction)– Price per 1000: Average $133
NPVEco-Friendly Hanger Payoff
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
Conservative NPVObserved NPV
Conservative NPV: $146,000Observed NPV: $317,000
Savings from Shift to Eco Hanger
Material Potential Savings
Plastic 7.7 Tons
CO2 47,000 Pounds
Energy 168,000 kWh
Hanger Replacement Environmental Savings
4,570 Pairs of Jeans!
GreenPrint: Environmental Im
pact
External Benefits Trendsetting , Externally facing
CorrugatedTBD
Annual Potential Impact
199 Tons of Wood
*
211,080 lbs of CO2
80,300 lbs of SOLID WASTE
*Environmental Defense Paper Calculator http://www2.edf.org/papercalculator/index.cfm
628,000 gallons of waste water
*Environmental Defense Paper Calculator http://www2.edf.org/papercalculator/index.cfm
*525,000 kWh
Jeans-o-meter
14,261 Pairs of Jeans!!!
