The Evolution of Environmentally Aware Business
Saturday, March 6th, 2010When Henry Kravis and his business partner George Roberts established Kohlberg, Kravis, Roberts & Co (KKR) in the mid-seventies with the help of the First Chicago Corporation, their main business was in highly leveraged transactions. Recently they have put together an innovative green enterprise which centers not only on profitability, but also on the environmental impact of the companies they control. When Henry Kravis from KKR and the Environmental Defense Fund (EDF) merged just a year ago green matters went mainstream. Their objectives include encouraging companies in fighting against environmental threats like toxic chemicals as well as intemperate water consumption. Eco-efficiency (a term originally advocated by the World Business Council for Sustainable Development WBCSD) is the methodology leveraged to achieve these goals, employing techniques such as improving fuel economy through vehicle fleet maintenance, increasing the durability of products and waste reduction. Although the project was an enormous success, no-one understood how extensive the consequences were until Ken Mehlman, the man in charge of the project, carried out the review of the first year. Topping everybody’s expectations, Ken found that practicing eco-efficiency not only raised environmental awareness, but was increasing the profits from all their business organizations as well. To date, KKR and Ken Mehlman have succeeded in getting virtually all of their firms taking part in eco-efficiency principles. And, when you consider that the group has a 2009 portfolio with a worth of $86 billion, you can be sure this was no easy see what an enormous feat this is. The Green Portfolio project now includes new opportunities. The Climate Corps Program established by the Environmental Defense Fund is one of these, it advances eco-efficient business principles to students taking an MBA.
KKR and Ken Mehlman have taken the time to create metrics that quantify and manipulate resources. This type of info is invaluable as companies may easily measure each of their day-to-day operations and find out precisely how they can resolve any issues while simultaneously tracking their progress. The business community has been transformed forever by the pioneering efforts of these groups. So, to summarize, the work of these organizations has made environmentally friendly business practice not only viable, but commercially desirable, and their novel ideas are setting a new standard in today’s business world.