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July 15, 2003

First Steps for the U.S. Business Council for Sustainable Development
    by William Baue

Carlos Guimaraes, chair of the U.S. Business Council for Sustainable Development, speaks about the new organization's strong membership, partnerships, and projects.

SocialFunds.com -- Although U.S. corporations long have been members of the World Business Council for Sustainable Development (WBCSD), the U.S. lacked a national affiliate until after the September 2002 World Summit on Sustainable Development in Johannesburg, South Africa. In October 2002, the U.S. Business Council for Sustainable Development (USBCSD) was established. Recently, SocialFunds.com spoke with Carlos Guimaraes, chair of the USBCSD, to discuss the progress of the organization since then, its present status, and its future potential.

"The USBCSD wants to prove that sustainable development is a good way of approaching business by developing and implementing projects that have value for businesses, for society, and for the environment," said Mr. Guimaraes.

Mr. Guimaraes also serves as vice president of the environmental operations business at Dow Chemical Company (ticker: DOW). The organizational design that created this position at Dow is unique in that Mr. Guimaraes bears responsibility for the operations of environmental assets and environmental infrastructure for the company worldwide.

"The characteristics of my job and the relative importance of Dow Chemical's commitment to sustainable development motivated the USBCSD to offer me its chair," Mr. Guimaraes told SocialFunds.com.

Mr. Guimaraes' installation represents the first step of launching the USBCSD, which evolved from the Gulf Coast Business Council for Sustainable Development (GCBCSD), a joint venture between Mexican and American companies founded in 1993. In 2001, the Mexicans shifted their sustainable development agenda to focus more on Mexico and more on social issues, according to Mr. Guimaraes. This change inspired the GCBCSD to expand its representation to cover all of the U.S.

"The second step is to install a strong membership base of about 40 high-quality corporations--not necessarily big corporations, but those committed to sustainable development from a broad spectrum of industries," said Mr. Guimaraes.

The USBCSD currently numbers about 15 members, including Alcan (AL), American Forest and Paper Association, Armstrong Wood Products, ConocoPhillips (COP), Shell Chemical, Temple-Inland Forest Products (TIN), and TXU (TXU), among others.

"The third step is to install strong partnerships with about five to six industry associations, five to six universities geographically distributed throughout the U.S., and five to six nongovernmental organizations (NGOs), to create a network of multistakeholders representing a broad spectrum of North American society," said Mr. Guimaraes.

"In addition, we want to have about five to six projects per year in each of the following platforms: byproduct synergy, water, supply chain integration across industries, sustainable development education, and stakeholder management," he added.

For example, byproduct synergy capitalizes on industrial byproducts by using this waste as raw materials in another industrial process.

"You normally see such byproduct synergy within the confinements of one single industry or company--what we have been able to do is link different companies from different industries," said Mr. Guimaraes.

In one particularly successful example, Chaparral Steel provides steel slag for Texas Industries to reuse in the production of Portland cement.

"The steel slag replaces a portion of the limestone required in the production of high-quality Portland cement, resulting in increased productivity from the cement plant and higher value for the steel slag," said Mr. Guimaraes. "The estimated value of this synergy for one cement plant and one steel mill is $10 million per year, and the benefits include reduced disposal costs for steel slag, reduced raw material costs for the cement plant, and reduced global warming emissions of carbon dioxide (CO2) and nitrous oxide (NOX)."

While such integration between industry players may be more commonplace elsewhere in the world, it is rare in the U.S.

"In the U.S., companies and even industries work in relative isolation: they integrate themselves into the marketplace through a supply chain, but they don't integrate themselves in terms of productivity," said Mr. Guimaraes. "The field of opportunity for optimization of North American industry is just enormous--if we cross-fertilize across industries through byproduct synergy, for example, we can increase our productivity and our competitive position."

"And the USBCSD is an outstanding forum to promote such initiatives because it is very, very focused," he concluded.

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