We asked a number of notable individuals and organizations to share their thoughts on the question, “Can companies still afford to be green?”
CFO.com welcomes your thoughts, too. Send your letters to: The Editor, CFO.com, 111 W. 57th St., New York, NY 10019, or email us at DaveCook@cfo.com. Please include your full name, title, company name, address, and telephone number. Letters are subject to editing for clarity and length.
Your question suggests companies could afford being green so far — a question that’s difficult to answer, whether looking forward or back.
There is a lack of consistency of accounting in the industry for such expenditures. Drawing a precise line between what is or isn’t green appears to be an arbitrary task at best — due, if you will, to the many “shades of green” that are possible.
Companies must adopt responsible environmental policies and practices in the production and delivery of their products and services; our “shrinking” world requires it to ensure any reasonable degree of quality-of-life for all of its inhabitants. Ultimately, it will be all of its inhabitants who will pay and who therefore must find a way to afford environmentally responsible practices as individuals and members of institutions. It is essential to sustain what we all treasure about the environment.
E. B. Galligan
Senior Director and Chief Financial Officer
Port of Portland
Green issues are actually rising in importance for many corporations as they begin to realize their environmental liabilities go beyond health and safety. These rising environmental liabilities for greenhouse-gas emissions are now important financial issues.
One cost-effective mechanism to reduce a company’s “carbon footprint” is through emissions trading, which today is an emerging market but will shortly become a global market, especially for multinational companies. Other means to reduce environmental liabilities are through the purchase of renewable energy and its credits as well as the reduction of energy usage, which is beginning to have a financial value in the emerging “negawatt” markets.
Rather than looking at environment as a cost, sanguine companies consider the P&L as they would for any business unit. “Green trading” offers corporations the means to reduce their emissions, make money, and be responsible corporate citizens. Not only can companies afford to be green, but the impending costs make it more fiscally astute to be green sooner rather than later, when the costs will be higher.
Peter C. Fusaro
Global Change Associates
Your readers might be interested to know more about the EPA’s plans for the nation’s environmental protection programs. The agency’s strategic plan for 2003-2008 is posted at www.epa.gov/ocfo/plan/plan.htm. It elaborates on the EPA’s longer-term goals for air, water, and land; healthy communities and ecosystems; and compliance and environmental stewardship. This plan helps orient agency priorities and could prove useful to corporate executives seeking to plan their own organizations’ environmental strategies.