A sustainability thought leader, practitioner, and professor of sustainability, operations and supply chain management in Duquesne’s globally ranked MBA Sustainable Business Practices program, Sroufe believes students thrive when challenged with real-world problems. His research into effective sustainability management performance is featured in numerous journals and books, and he consults with a range of corporations. He shared his Insider’s perspective in an interview with Sustainable Pittsburgh.
What are some big-picture trends in sustainability that businesses in our region should be paying attention to?
It’s interesting that blockchain pops up in so many ways right now. [The technology behind bitcoin, blockchain is a secure distributed database that contains a continually growing list of records, called blocks, with each block linked to the previous block and containing a timestamp.]
There are huge investments by banks in blockchain right now, because it’s going to basically take out all of their back-office operations. There are all kinds of supply chain implications, too, for payments of suppliers, for tracking both visibility and transparency. But where is the proof of concept? It’s still in process. It’s amazing that the financial sectors, supply chains and others have been investing in this — IBM has been a big investor for years. But it’s not really surfaced yet, what this [opportunity] is.
More recently and local to us, the International Living Future Institute Living Product Hub [launched here in April]. Years ago, people said there’s no way a building can produce more energy and water than it consumes — how can we ever have a living building? [Today] there’s hundreds of projects around the world; we have one of the first at the Phipps Conservatory. Now we’re doing the same things with products.
So, what if for every unit of product, [you produced] more water and energy for its manufacture than needed to produce the product? They’ve already got 37 products in the pipeline. It’s come to Pittsburgh because we’re centrally located, within 500 miles of half the population of the United States — why not do it here?
There’s the United Nations Sustainable Development Goals [UN SDGs], used as a strategy tied to Science Based Targets. In the past, [we saw] a lot of storytelling about what sustainability was and how companies were doing it, and now [there are] real goals and metrics that are science-based and can be broken out into 17 different platforms across all Sustainable Development Goals — and then underneath those goals, even more metrics and detail.
There’s a huge measurement movement taking place, and whether we realize it or not, it’s there within databases. Publicly traded firms have anywhere between 400 and 700 environmental, social and governance performance metrics per firm that are within Bloomberg Terminals [and other databases, indices and ratings systems]. The tougher thing will be how to keep up with them and understand which ones are the key performance indicators.
More research is coming out in social sustainability. My own research along with many others in the field are investigating how to measure social sustainability, and the valuation that is coming. In the future, we’ll see this in terms of employee engagement, employee development programs — that it will be embedded [into organizations], and it won’t be as much about the storytelling, but instead, the performance metrics that come out of it. [Editor’s note: Sustainable Pittsburgh is beginning to see Green Workplace Challenge participants evaluating their social equity impacts.]
One last thought: If you think no one is doing this anymore, all S&P 500s are reporting sustainability initiatives in some way. The Fortune 500, the S&P 500, all major multinationals are doing this.
Your MBA Sustainability student teams consult with organizations throughout our region on sustainability projects. What trends have you seen in local business sustainability over the years?
I can refer to [our student team that] just took second place [at the The Aspen Institute’s 2017 Business & Society International MBA Case Competition]. Their case was from IBM about how to engage IBM’ers in social sustainability. What our students proposed was [for IBM to use] Watson and big data analytics to engage their people in international projects that have social benefits that map back into the UN SDGs.
[Students] just completed a project in Harrisburg working with The Nature Conservancy in helping them to understand the business model and opportunity [in working with] state-headquartered companies to purchase Pennsylvania carbon credits from Pennsylvania woods. They had our team help develop this project to see if we can use Pennsylvania as a model for all 50 states.
The team came up with a methodology to identify partner companies and a multi-million-dollar opportunity every year to sell just state-level carbon credits and engage people around the discussion of what that means and how it impacts at a state level. You know,
you’re trading a ton of carbon; social cost of carbon can be rolled into that, too [quantifying the economic case]. There are environmental impacts. We know the owners of the woodlands and those people who put them into carbon sequestration, so there’s social impacts in this. And then there’s measured social cost of carbon impacts outside of that.
You spent time last year teaching and conducting sustainability research in Sweden. What are some European sustainability trends of interest to local leaders?
[Our] students are heading there [this month] because we want to benchmark their systems and what they do. I wholeheartedly believe that their systems are more resilient and more proactive in terms of healthcare — people are healthier, more content, happy. They appreciate what it means to get outside and interact with the natural environment. And they welcome and enjoy a work-life balance that we just tend not to have.
Ironically they have some similar political party differences in terms of conservatives vs. liberals, and a history of environmental degradation. Yet socially they really understand the importance of a healthy environment — and a healthy lifestyle. Their homes and their energy systems are more efficient. Mass transit enables mobility, and you remove the expense of having and maintaining a car. They think we are crazy, and the recent election confirmed it to them. [laughs]