Secrets Behind Alcoa's Sustainability Program

If you're worried about meeting sustainability goals at your company, you may want to pick Kevin Anton's brain a bit.

He's Alcoa's chief sustainability officer, and just one year after Alcoa set long-term targets, he's largely on track or ahead of schedule. Alcoa has already reached its 2020 targets for greenhouse gas emissions and freshwater use. It is also making headway on several others and identified actions plans for the most challenging areas.

First, the good news: Alcoa reduced its carbon intensity (metric tons of emissions per ton of production) by 22 percent below 2005 levels, exceeding its 20 percent target, the company said in its 2010 Sustainability Report released last week. Did the company set its target too low? Maybe.

"If you set a 10-year stretch goal and you achieve it in year one, you can celebrate it but -- keep in mind we have a 30 percent GHG (greenhouse gas) reduction goal in 2030 -- I think what we're going to have to do now is spend some time in 2011 and figure out what our new GHG goal should be," Anton said. "The organization is still focused on hitting the 2030 goal since we already hit the 2020 goal, but I want to put a new goal out in front of the organization to make sure that we don't lose any focus."

The company reduced its freshwater-use intensity (consumption per unit of production) by 19 percent below 2005 levels, well beyond its 10 percent goal. Other goals where the company is making progress include:

• Reduced the energy intensity of global primary products by 3 percent (2020 goal: 10 percent reduction)
• Reduced the energy intensity of remaining businesses by 6 percent (2020 goal: 20 percent reduction)
• Reused or recycled 29 percent of landfilled waste (75 percent recycle or reuse rate by 2020, 100 percent by 2030)

Alcoa has made less progress in the following areas:

• Mercury emissions intensity increased 16 percent (2020 goal: 80 percent reduction)
• Reuse of bauxite residue, a byproduct of aluminum refining, remained flat (2020 goal: 15 percent reuse rate)

Although using green power and improving efficiencies played major roles in Alcoa meeting its carbon footprint and freshwater use goals, Anton also points to four critical elements underpinning Alcoa's sustainability program: leadership, scorecards and roadmaps, compensation, and transparency and data. He explained how each of these components is crucial to maintaining momentum for the program.