Now Green Means Business

Other factors are also hastening the trend. Recent studies by analytical groups such as Innovest Strategic Value Advisors of New York have indicated that companies that score well on various environmental metrics also demonstrate above-average return on investment and stock performance. Other research done by groups such as KLD Research has drawn a connection between how capable and innovative a management team is and how ecofriendly its business is. That makes sense. Innovative management teams are one step ahead of the competition and think strategically about the next wave. Those such as Staples and Dupont that saw resource and regulatory issues on the horizon a few years ago are now reaping the rewards. Others, such as Google, have long understood that if they used less energy, they could satisfy both their need to do good and their desire to do well. Google has sought more efficient ways to manage the energy drain of their massive server network, and that has been one more secret of their success.

In short, environmental concerns have suddenly emerged as a dominant driver of global corporations, marrying an old impulse to be good stewards of the planet with an equally ancient desire to make money. That marriage may well eradicate the quaint distinction between profit motive and public good, opening up a brand-new world of business practices and investment opportunities.

Karabell is president of River Twice Research and senior adviser to Business for Social Responsibility.

Karabell is president of River Twice Research and senior adviser to Business for Social Responsibility.

© 2008