Kimberly-Clark’s director of the Enterprise Sustainability Strategy Team, Peggy Ward, says that having strong support from the company’s Chairman & CEO as well as an external sustainability advisory board have been crucial to building and meeting its sustainability metrics.
David Kiron, executive editor at MIT Sloan Management Review, spoke recently with Ward. Here's an edited excerpt from that interview:
Tell us about Kimberly-Clark’s 2015 sustainability goals.
For 2015, we are focusing on people, the planet and products. That equates to the social, environmental and economic pillars of sustainability. That’s the triple bottom line for us.
Let’s go through that “triple bottom line” of looking at people, the planet and products.
Our goals around people are wide-ranging, and include our people, the people in the communities where we live and work and our suppliers. We have goals that correspond to those three areas. With our suppliers, we set a goal of 100 percent compliance to a set of social standards that we’ve developed. We’re targeting our contract manufacturing supply base first, in regions around the world where we think we need to ensure that we have those social standards in place.
On the planet side, we’re still following our traditional focus on energy, waste and water, but we’re pushing ourselves even further. In waste, our goal is to achieve zero manufacturing waste sent to landfill. About 48 percent of our mills [have achieved that].
Finally, on the product side, we’re pushing ourselves in product innovation. We’re still addressing packaging. We’ve added a net sales goal of 25 percent of our 2015 net sales coming from environmentally innovative products. By “environmentally innovative,” we mean based on an life cycle analysis of total environmental impact of our products.
Next page: Developing the plan
How long did it take to develop the plan?
This took us a while. It was a good 12- to 18-month process. For us, it was great: we got a good reception from our peers and from media, and we were noted by Triple Pundit, which said that this plan was an exceptional example of integrating all three pillars of sustainability.
For the development process, it sounds like you had strong CEO support. Who else was involved in the planning, and what kind of buy-in were you getting from other executives?
We do have strong support from our Chairman & CEO. He can have a very detailed, well-informed conversation on the topic of sustainability with anyone. It’s great.
We worked on this with Kimberly-Clark’s global sustainability team. That’s the VP of global sustainability, my boss Suhas Apte, who reports to our global strategic leadership team, who are the deputies of our CEO. That group consists of our chief financial officer, our chief legal officer, our chief marketing officer, chief HR officer and so on. The global strategic leadership team has ownership in this. We reviewed with them at certain touch points along our development process where we were heading.
But in addition to our Chairman & CEO and our global strategic leadership team, we also have something that’s quite unique and different: an external sustainability advisory board. That’s a board which is comprised of seven external members who are all experts in varying aspects of sustainability. The group involves someone from Walden Asset Management; someone who is the former head of sustainability at Procter & Gamble, one of our biggest competitors; and someone who used to be the VP of Dow Chemical in Europe, who now participates in a lot of United Nations climate programs; a woman who founded the Centre for Social Markets and who does a lot of her work in India on the social aspects of sustainability; the author of "Green to Gold and Green Recovery;" our former head of sustainability, who retired a few years back; and someone from Brazil who used to head the Ethos Institute there and then ran for the Green Party Senate in Sao Paolo.
Can you characterize their contributions to the development of the 2015 plan?
A lot of the counsel and advice they gave us was to say, “You can’t just say you’re going to obtain leadership, you really have to earn it. So, how are you going to earn it?” They gave us a lot of perspective up front to help us put boundaries and a framework around our strategy.
When we started to set the metrics, they had a wealth of expertise on what might be most meaningful, what should we be looking at and pursuing. Finally, when we were talking with our own management team, they helped us explain the business case and how material a lot of these goals and metrics are to our operations.
The other thing is, I’m Peggy Ward, one in 57,000 at Kimberly-Clark. When I tell our leadership what we need to be doing on a regular basis, it’s Peggy Ward telling them. But when our advisory board tells them, it adds that extra credibility. Having that external set of eyes and viewpoint is extremely valuable.
This article is adapted from “The Four Organizational Factors That Built Kimberly-Clark’s Remarkable Sustainability Goals,” by David Kiron, which was published by MIT Sloan Management Review in May 2012. This interview is part of MIT SMR’s research and content theme, Sustainability & Innovation. The complete interview is available at http://mitsmr.com/Ll9ArH.
Copyright © Massachusetts Institute of Technology, 2012. All rights reserved.