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Sustainability transformation of a global business MAY 2019 www.csomagazine.com

Moving towards Sustainability 2025

VANTAGE DRILLING

A MATURE SUPPLY CHAIN

SUSTAINABILITY TRANSFORMATION AT A PROFIT Joe Gomez, Head of Energy & Sustainability, on creating value in the facilities management space

TOP 10

Electric vehicle manufacturers


FOREWORD

W

elcome to the May issue

that sustainability should be a

of CSO Magazine!

boardroom priority. The Global Head

In our cover feature this month, CBRE’s Head of Energy and

of Environmental Sustainability discusses how boards should

Sustainability discusses how the

respond to sustainability challenges.

company is responding to climate

Heiko Schilling, Head of Navigation

actions needs. Joe Gomez

and VP of Engineering at

talks about sustainability

TomTom, explains the

in the facilities

importance of high-

management space

definition mapping

and the ways the

within smart cities.

company creates value for its clients. Catriona Schmolke,

Joe Gomez, Head of Energy & Sustainability, CBRE

Senior Vice President and

Open Energy Market’s Simon Skillings, Head of Business Development, discusses procurement’s

Global Head of Safety, Security

role within the energy industry.

and Sustainability at Jacobs,

For May, CSO Magazine looks at the

explains the firm’s sustainability strategy.

top 10 electric vehicle manufacturers across the world. The list features

AB InBev and Vantage Drilling

Groupe PSA, Honda and Ford.

also sat down with us this month

Enjoy the issue!

to discuss their respective sustainability transformations.

Sophie Chapman. Sophie.chapman@bizclikmedia.com

Elsewhere, Capgemini’s Dr James Robey says in an exclusive comment w w w.c so ma ga z i n e. com

03


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SOPHIE CHAPMAN MANAGING EDITOR

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CONTENTS

A SUSTAINABLE AND PROFITABLE FUTURE

12 34

M AY 2 0 1 9

46

WHAT IS THE BOARDROOM RESPONSE TO SUSTAINABILITY CHALLENGES?


56

MAPPING OUT THE FUTURE OF SMART CITIES

Preparing your business for next generation energy procurement

66

78 92 TOP 10

Electric vehicle manufacturers

The biggest industry Events

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3 1

2

5 4

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118 Vantage Drilling

96 AB InBev

136 Danone

114 Plymouth Rock Assurance


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A SUSTAINABLE AND PROFITABLE FUTURE WRITTEN BY

HARRY MENEAR PRODUCED BY

CAITLYN COLE

M AY 2 0 1 9


13

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CBRE

Joe Gomez, Head of Energy & Sustainability at CBRE, discusses sustainability in the facilities management space and the ways the company creates value for its clients

O

ver 40% of the world’s energy is consumed by commercial and industrial buildings. At a time when the need for climate action

and sustainability reform is greater than ever before, global real estate services and investment firm CBRE’s Global Workplace Solutions (GWS) division 14

is working to leverage new technology, alongside the combined experience of over 80,000 employees, to ensure the world’s leading companies are also sustainability leaders in the private sector. “We work across a broad, diverse background of clients with different needs and specialisations around their energy and sustainability appetites. Our goal is to create value for them in that space,” says Joe Gomez, Head of Energy & Sustainability, EMEA. We sat down with Gomez to find out how CBRE is delivering sustainability at a profit to its impressive roster of tier one clients. Gomez and the GWS division work across four different major verticals. “We have industrial oil and gas businesses like Shell, BP, and Honeywell; then we have banking and insurance like Deutsche Bank, Bank of America or BBVA in Spain; the third vertical M AY 2 0 1 9


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Better air for the built environment There is a real drive for building occupants, managers and owners to utilise resources within the built environment more effectively now more than ever before. At VES, we know that understanding and influencing energy and sustainability will continue to be a critical facilitator in providing ever increasing control of good decision making. Our ability to respond to changes in building usage is strengthened by being aware of the choices made at business level, as we work to help stakeholders meet their environmental and commercial goals. We must also remain mindful of our long-term responsibilities to find ways to improve how we utilise precious resources as we develop over time. We believe that by embedding energy and sustainability goals and drivers within all our strategic decisions, we ensure constant progress and real tangible benefits along our transformation journey.

Our Collaborative Approach We work closely with business and technology partners to allow us to build upon the fundamentals of their expertise; key partners include Ziehl Abegg for fan & motor technology, Siemens Building Technology for controls and building integration, Hoval for energy recovery technology. Like us, their vision lies in creating energy efficient and sustainable environments to ensure technologies are used to the fullest potential; making every improvement easier to implement and longer lasting whilst ensuring future value can be unlocked through data built within the DNA of the solution. By bringing together these leading technologies within our own field of expertise in heating, ventilation and air conditioning, we can not only build ventilation systems to meet energy and sustainability standards for new buildings - we can facilitate energy improvement solutions for existing buildings which create lasting value and make a difference to occupants, building operation and environmental impact. No single technology applied in isolation can drive the energy and sustainability requirements of the future; just like our business partnerships, solutions are best achieved through a collaborative approach based upon tangible data and information which ensures consistent effective results with the ability to continuously drive

improvements through using the embedded data, which is captured and analysed as part of the solution. Replacing a belt driven centrifugal fan with an EC plug fan to perform the same duty can yield notable energy savings on its own. However, by understanding the purpose and usage of the area being served, we can ensure that even more energy is saved through optimised fan and motor selections and introducing modulating speed in response to intelligent demand control. We can use occupancy readings to ensure energy used on heating can be effectively reduced by introducing a controlled balance between fresh air intake, return and recirculated air, and usage of energy recovery devices such as thermal wheels. Along with associated reductions in maintenance requirements, and by working with our partners to bring together solutions in multiple air handling systems across buildings or whole estates, we can assist you and your partners in making a real and lasting impact on energy and sustainability in the buildings and estates you are responsible for.

Business case and investment By packaging our energy and sustainability business cases so they make sound business and financial investment sense, proposals can be delivered with equal priority alongside more conventional business investments. With the ever-growing pressures on the cost and utilisation of resources within the built environment, our energy and sustainability investments can provide far greater financial return and value than many other capital investments being considered. We have a wide spectrum of technical experts covering the UK, ready to meet and evaluate possible energy initiatives helping you progress along your own energy and sustainability journey. For more information: 023 8046 1150 | ves.co.uk | sales@ves.co.uk | LinkedIn Offices in Southampton, London, Manchester, Glasgow and Birmingham


CBRE

“We work across a broad, diverse background of clients with different needs and specialisations around their energy and sustainability 18 appetites” — Joe Gomez, Head of Energy & Sustainability, EMEA

M AY 2 0 1 9

consists of technology companies like IBM, Google and Cisco; and then the fourth is life sciences and pharmaceuticals – GlaxoSmithKline, Pfizer and Astra Zeneca – those sorts of customers,” explains Gomez. When taking on a new client, CBRE prides itself on being a full spectrum provider of a complete range of solutions. Through a number of years of experience of working with property portfolios of large global occupier clients, CBRE has developed an Energy Pathway product. This is now our standard proven


CLICK TO WATCH : ‘THE SEAMARK BUILDING, ELM PARK, DUBLIN, IRELAND’ 19 approach to implementing an energy

That’s the wheel of services that we

strategy for any of our accounts/clients.

offer. We bring them in at whatever level

The methodology takes the client on

our client is currently at and plug all the

a 10-step journey through energy mana-

gaps to make them a fully comprehen-

gement and allows for a tailored

sive energy and sustainability business

approach to be developed for each

that is creating value and mitigating risk

portfolio. The core elements of this

all the time. Once you’re on this wheel,

program define our three major offerings.

the idea is that you keep it going and the

The company calls its three major

process will become self funding,

offerings “Buy Smart, Use Smart and

because of the amount of value that

Be Responsible”. Gomez explains:

you’re creating and releasing. CBRE is

“The supply side energy management

in the business of being a full provider

is ‘Buy Smart’; demand side energy

of all of these services.”

management is ‘Use Smart’; and ‘Be Responsible’ is about sustainability.

There are three principal areas in which CBRE creates value for its customers w w w.c so ma ga z i n e. com


Transform your energy challenges into business advantage Centrica Business Solutions and CBRE have joined forces in a preferred partnership arrangement to help businesses tackle the four major energy challenges of high costs; power supply disruption; operational efficiency, and sustainability.

Energy costs are volatile and rising. Power grid instability and extreme weather events are increasing energy supply risk. Employees, customers, shareholders and regulators expect you to be green and energy efficient. Ageing energy infrastructure may be pushing up your operational and maintenance costs, while compromising productivity

It’s time to rethink your long-term energy strategy and take a proactive approach to lower carbon, lower cost, lower risk energy management. Expert support from world-leading energy solutions providers Centrica Business Solutions’ partnership with CBRE brings together the vast expertise and resources of two world-leading energy services and solutions providers. Jointly, we provide complete end-to-end support to integrate advanced energy technologies into long-term sustainable energy strategies. In this way, your business can increase profitability, productivity, energy security and environmental credibility.

See how we can help


Time to power up your long-term energy strategy The radical shift from traditional centralised energy generation to decentralised and digitised energy opens exciting new opportunities to gain business advantage from higher energy performance.

Goodbye passive top-down energy consumption. Welcome to the next generation possibilities of optimsing, monetising and controlling your sustainable energy strategy. Benefits of distributed energy Advances in intelligent digital energy technology provide cost-efficient distributed energy solutions that reduce risk and secure a more competitive and environmentally sound future. Centrica Business Solutions, part of the global energy and services company Centrica Plc, is a strategic energy partner for business – delivering outstanding results and stretching the boundaries of what’s possible. We design, build, finance, operate and maintain intelligent, end-to-end distributed energy solutions – enabling you to analyse, generate, store and monetise your energy. We have expertise in cutting-edge energy insight and prediction; on-site generation from solar and cogeneration; battery storage; back-up power; energy asset management, and demand-response aggregation.

Learn More

These exciting opportunities to redesign energy strategies and embrace the opportunities of localised, distributed energy solutions are hugely underexploited. We can remove investment barriers Some businesses are slow to adapt to new opportunities because they believe that it’s too complex, too risky, or too costly. However, with two of the world’s most capable and technically advanced energy solutions providers in your corner, these barriers quickly disappear. Together, Centrica Business Solutions and CBRE have the proven capabilities to deliver a complete smart energy program that mitigates risk and delivers powerful results. We’re here to support your long-term energy vision and distributed energy projects every step of the way – from design and development – to installation – through to long-term monitoring and operation. The cost of implementing innovative distributed energy solutions is falling and the return on investment is impressive. However, if lack of finance or competing funding priorities are frustrating your energy ambitions, Centrica Business Solutions provides long term flexible finance options. We have a long and proven track record of funding both CAPEX and OPEX costs via the ongoing energy and operational savings, with built in performance guarantees to mitigate risk. In this way we can accelerate delivery of the end-to-end clean energy solutions.

Discover how Centrica Business Solutions and CBRE can help you transform your energy performance and future-proof your business growth.


CBRE

$21.3bn Approximate revenue (2018)

1906

Year founded

80,000

Approximate number of employees 22

M AY 2 0 1 9


through sustainability: profitability,

known as demand side response

brand and risk management. “Our goal

schemes, that will pay clients to turn

is to help a company generate its

load off,” says Gomez. Demand side

output in the most energy efficient way,”

response schemes involve financially

explains Gomez. “There needs to be

incentivising grid users to reduce or

a business case to make sustainability

shift energy consumption away from

attractive.” The first value opportunity

peak hours. “They can then bank that

that CBRE provides revolves around

obligation as a virtual power station

a “reduction in spend and therefore an

and do that multiple times around the

increase in profitability. Our customers

country,” explains Gomez. “Then they

reduce what they spend on their energy,

could have 20 megawatts of energy

getting back any revenue they’ve

that can be used to shave peak demand.

overpaid on their energy bills, and they

When the whole country puts the kettle

actually can drive revenue into their

on during Bake Off adverts, they don’t

coffers if their national grid has programs,

have to turn another gas turbine on; we

E XE CU T I VE PRO FI LE

Joe Gomez Joe Gomez has served as Head of Energy & Sustainability at CBRE since 2016. He is a Warwick Business School MBA and a UK Chartered Energy Engineer, with a specialisation in Energy, Building Services, Refrigeration & HVAC sectors. In his role at CBRE, Gomez creates value for his customers through utility price reduction, productivity improvement, brand enhancement, supply and demand side energy management. He is responsible for the operation of CBRE’s energy and sustainability platform, as well as the company’s energy and utilities management services.

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23


CBRE

Watch the video

SmartServices click to find out how


can use this virtual power plant.” CBRE has a full matrix of over 150 initiatives that can be used to make savings on clients’ energy. “We work on a traffic light system,” explains Gomez. “Our goal is to take every red and amber box where there’s the potential for an energy saving and turn it green. By doing this we not only save the client money but also make that building itself greener. That will then give that business the best carbon credentials they could possibly have.” CBRE is the trusted advisor and partner to its clients.

“The goal is to turn every building green over a course of time. That will then give that business the best carbon credentials they could have” — Joe Gomez, Head of Energy & Sustainability, EMEA

“We’re there to run and manage their w w w.c so ma ga z i n e. com

25


CBRE

property,” says Gomez. “We don’t make anything or sell any products, but we sell our expertise and human horsepower.” Over the years, CBRE has built up its relationship with a trusted network of third party suppliers and contractors. One such company is VES. Founded in 1968, VES provides energy efficient ventilation and air handling solutions across multiple verticals in the industrial and commercial real estate space. “We believe VES is one of the best air handling units and air flow manage26

ment businesses in the country,” says Gomez. “What you get is a bespoke solution that fits your needs at a high quality standard. We believe that their attention to detail and their thoroughness is something we would stand behind.” Another avenue through which CBRE can drastically improve the sustainability of a property is its lighting system. “We work closely with global lighting provider Sylvania in delivering efficient and comprehensive lighting solutions to our client base,” explains Gomez. “Sylvania have a knowledgeable and committed team of professionals supporting us and they act as an extension of the GWS value M AY 2 0 1 9


chain in scoping, designing and delivering value.” Secondly, CBRE manages its clients’ sustainability branding, helping clients to position themselves on indices like the Dow Jones Sustainability index, the FTSE4Good, the Carbon Disclosure Project and the Global Real Estate Sustainability Benchmark,” says Gomez. “These rankings show the world our customers’ green credentials. If they occupy the top spots on those indices, not only is it good for their brand and good for how attractive they are to their market, but it also drives greater transparency between the company and its customers.” Thirdly, CBRE offers risk management through its sustainability expertise. “The energy and sustainability landscape has experienced a proliferation of financial and legislative requirements, driven by the United Nations Climate Change Program to deliver a world to our grandchildren that’s 1.5 degrees cooler than if we don’t take action,” notes Gomez. CBRE manages the risks of compliance for its customers so that “whether they’re lending money or making Nurofen, we take away their compliance headaches and minimise w w w.c so ma ga z i n e. com

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CBRE

28

“Because if you drive something more efficiently you drive it more reliably. And if you drive it more reliably, you’re driving better facilities management” — Joe Gomez, Head of Energy & Sustainability, EMEA

M AY 2 0 1 9


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CBRE

100

Clients served worldwide

450

Offices worldwide

18 years 30

Voted the industry’s top brand by the Lipsey Company

their exposure to the financial impact

technologies like battery storage and

of those regulations and penalties”.

photovoltaics to “make sure people will

The sustainability service CBRE

do something because it makes

provides is linked to three major trends

financial sense as well.’’ In January,

in the industry, which Gomez calls “the

Business Green reported: “As early

three Ds: de-carbonisation, decentrali-

as 2020, renewables are on course

sation, and digitisation”. De-carbonisa-

to overtake fossil fuels for the first

tion reflects the global movement away

time as the UK’s primary electricity

from fossil fuels in favour of renewables

source.” Over the summer of 2018,

like wind, solar and geothermal energy.

renewable energy already exceeded

In addition to the moral imperative,

other sources during periods of intense

CBRE uses the rapid advance of green

sunshine, and in 2018 UK energy

M AY 2 0 1 9


ad infinitum, and by digging up the roads and laying more and more copper wire to bring us more and more energy. That’s just patently unsustainable,” Gomez explains. “We should be looking to generate energy in a decentralised way, which reduces reliance on the grid and creates more resilient local operations.” CBRE maintains strong ties with energy companies that emphasise sustainability in their offerings and are making strides towards a decentralised energy future. Centrica is a multinational energy and services company with its headquarters in Windsor, Berkshire, that is moving into decentralised power generation options. “What they’re doing is moving into distributed energy solutions, which take the energy they production from coal fell by 25%.

are providing to their clients, but design

“That’s a consequence of that agenda

those solutions to be so efficient that

being driven and price points begin-

the customer uses less energy,” Gomez

ning to compete with and become

says. “Centrica have their own Com-

better than traditional methods,”

bined Heat and Power (CHP) business

says Gomez.

in Manchester. They’re the only CHP

The second trend, decentralisation,

manufacturer in the UK. They have their

involves the restructuring of energy

own metering business, their own battery

distribution infrastructure on a global

storage business and their own solar

scale. “We as a nation and as a planet

business. They provide the full technical,

cannot continue to feed our need for

project management and funding agre-

energy by building more power stations

ement solutions we believe a customer w w w.c so ma ga z i n e. com

31


CBRE

“VES, we believe, is one of the best air handling unit and air flow management businesses in the country” — Joe Gomez, Head of Energy & Sustainability, EMEA 32

could utilise. So, we have a preferred arrangement with them,” he explains. Digitisation, Gomez believes, will allow CBRE to increase both efficiency and sustainability for its clients. “If you put a sensor on every moving part of everything, you’d have ultimate and infinite knowledge of the machinations of our needs in life, right?” Gomez asks. “Now, if you put a sensor on every part M AY 2 0 1 9


of a building – its windows, boilers, chillers, air handlers, low voltage power points and its computers – you could identify a problem and fix it before the building’s occupants were even aware something was wrong. Not just if something was broken, but if it was about to break.” Gomez believes that the power of predictive analytics and automation will dramatically change the real estate management industry. “That continual progression towards complete data transparency on everything that moves is the goal,” he says. Looking to the future, Gomez believes that digitisation will continue to have an exponentially magnified effect upon the sustainability space. “Digitisation is the way forward, not only with respect to facilities management, but in respect to the ability for facilities management to be driven by smart decisions around energy,” Gomez emphasises. “Because if you drive something more efficiently you drive it more reliably. And if you drive it more reliably, you’re driving better facilities management.”

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S U S TA I N A B I L I T Y

34

A MORE SUSTAINABLE FUTURE Catriona Schmolke, Jacobs Senior Vice President and Global Head of Safety, Security and Sustainability at global professional services firm Jacobs talks about the company’s commitment to a more sustainable future… WRITTEN BY

M AY 2 0 1 9

CATRIONA SCHMOLKE


35

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S U S TA I N A B I L I T Y

A

t Jacobs, our global sustainability strategy is known as PlanBeyond – planning beyond today for a more sustain-

able future for everyone. By focusing on our people, our places and our partnerships we aim to integrate sustainability into every aspect of how we do business. As we face some of

the toughest environmental challenges of our time, our people are working to find better ways to create an enduring legacy for the world – whether working together on our projects, in partnership with our clients and suppliers, or taking steps as individuals to make a dif36

ference across our offices and facilities. Our PlanBeyond Global Sustainability strategy is a roadmap for progressing sustainability fully into our global business. For us, this means social and economic progress while protecting our environment and improving resilience. It is also about being the employer of choice for our people and being the go-to solutions provider for a more connected, sustainable world. As a business, we have a tremendous opportunity to continue to influence positive change and drive progress through the solutions that we create and deliver for our clients. With $15 billion in fiscal 2018 revenue and a talent force of more than 50,000, Jacobs provides a full spectrum of services M AY 2 0 1 9


“P LANBEYOND IS OUR HOLISTIC SUSTAINABILITY PROGRAM, WHICH INCORPORATES SOCIAL RESPONSIBILITY” — Catriona Schmolke, Senior Vice President and Global Head of Safety, Security and Sustainability, Jacobs 37

including scientific, technical, professional and construction- and program-management for business, industrial, commercial, government and infrastructure sectors. So, we have significant scope to make a positive difference. We carefully considered the United Nations Sustainable Development Goals (UN SDGs) to provide global context for shaping our PlanBeyond Strategy. We believe this allows us to better address our clients’ global challenges, including clean water, affordable energy, inequality, climate change, w w w.c so ma ga z i n e. com


S U S TA I N A B I L I T Y

38

“W E ARE PROVIDING COMPREHENSIVE INFRASTRUCTURE, TECHNOLOGY AND INTELLIGENCE SOLUTIONS TO HELP OUR CLIENTS, CITIES AND COMMUNITIES TO CREATE SMART AND CONNECTED PLACES THAT FUNCTION MORE EFFECTIVELY” — Catriona Schmolke, Senior Vice President and Global Head of Safety, Security and Sustainability, Jacobs

environmental pollution, economic growth and peace.

A SUSTAINABLE ROAD MAP With the acquisition of CH2M in December 2017 and our recently announced agreement to divest Jacobs’ Energy, Chemicals and Resources (ECR) segment to WorleyParsons, we have turned the course of Jacobs’ future, and now focus on broadening our leadership in high growth sustainable solutions to tackle challenges across urbanisation, water scarcity, climate change, digital proliferation, clean energy and security. In the past year, we reduced carbon emissions by more than 37 million tons, equivalent to a full year’s energy use by four million homes on our client projects. In addition, on our own operations, the former CH2M business exceeded its five-year commitment to reduce greenhouse gas emissions by 25%, ultimately achieving a 29% reduction since 2012. We have just received the 2019 Climate Leadership Award, a prestigious US award by The Center of Climate and Energy Solutions and The Climate Registry. Environmental Business International (EBI) also just recognised our work with 11 Business

M AY 2 0 1 9


CLICK TO WATCH : ‘JACOBS: WHAT IF...’ 39 Achievement Awards for Environmental

systems and operations; and predictive

and Climate Change Innovations.

data analytics with application to

Jacobs supported many charitable organisations including making contributions to the Global STEM Alliance and

artificial/augmented intelligence and machine learning. PlanBeyond inspires us to make

Engineers without Borders and fundrais-

a positive environmental, societal and

ing with employees for Water for People

economic difference for businesses,

in 2018. We are close to finalising our

governments and communities around

global approach to giving and volunteer-

the world — from the way we operate

ing in 2019.

our business, to the work we perform

In 2019, we will launch innovation

with clients and other organisations.

centres to extract greater value from technologies of focus for our clients, including: automated design solutions for agile adaptation and scalability of

EXAMPLES: • We are in year two of implementing our global mental health maters (MHM) w w w.c so ma ga z i n e. com


S U S TA I N A B I L I T Y

plan and have trained over 1000 Positive Mental Health Champions across our global business. MHM aims to promote positive mental health, raise awareness and provide resources to support all our people and ultimately destigmatise the conversations around mental health. • We implemented eight Employee Network groups in 2018 as part of our transformation. Our Employee Networks are employee-led and employee-organised groups centred around offering employees an opportunity to collaborate with others around the world 40

who share similar interests and explore opportunities that relate to their specific goals. • During 2018 we performed extensive stakeholder outreach as part of a materiality assessment to identify our priority sustainability issues as a business. This included the launch of our first Global Employee Sustainability Survey with 10,500+ people inputting how they would like Jacobs to transform. • We launched the quarterly Sustainability Award program, sponsored by our Chief Financial Officer, which recognises and rewards individuals and teams that contribute to a sustainable future through innovative thinking and smart actions. M AY 2 0 1 9


“T HE GLOBAL DEMAND FOR ENERGY SECURITY AND SUPPLY CONTINUES TO GROW AT A RAPID RATE. WE ARE HELPING OUR CLIENTS MEET THE CHALLENGES” — Catriona Schmolke, Senior Vice President and Global Head of Safety, Security and Sustainability, Jacobs

• Every year we acknowledge our best project teams from around the globe with our highest form of project recognition – the Joseph J. Jacobs Master Builder Award. This honour is given to project teams who achieve flawless project delivery while demonstrating our commitment to safety, integrity, continuous improvement, innovation, JacobsValue+ and JacobsSustainability+. • With infrastructure clients for whom we provide operations and facilities management services, we saved 5,074,759 kWh of electricity, and 23 billion gallons of wastewater. • For a large-scale air terminal client, we delivered improvements that generated more than $700,000 in savings, while eliminating 15,863 tons of CO2 emissions. • We piloted a mobile app to reduce paper consumption and boost productivity, sparking broader implementation converting 35,830 forms from paper to electronic documents. • We launched an effort to reduce single-use plastic consumption that eliminated 400,000 disposable plastic gloves from the waste stream across multiple client sites. Our 2020 goal w w w.c so ma ga z i n e. com

41


S U S TA I N A B I L I T Y

42

includes targeting the elimination of

social responsibility. Our approach is in

SUPs in all our offices.

line with the UN Sustainable Develop-

• We balanced the gender diversity

ment Goals and the triple bottom line,

of the Executive Leadership Team,

in that we see sustainability covering all

including the appointment of our first-

aspects including environmental, social

ever female Executive Vice President,

and economic development. Jacobs

Joanne Caruso.

defines sustainability as “Ensuring long-

• We donated over $255k to Water

term business resilience and success

for People through our annual employ-

while positively contributing towards the

ee giving campaign.

economy, society and the environment”. Our framework is organised around

A 360-DEGREE VISION

three core pillars: People, Places and

PlanBeyond is our holistic sustainabil-

Partnerships. Within these pillars are

ity programme, which incorporates

six focus areas with twelve PlanBeyond

M AY 2 0 1 9


2020 goals. Through the implementa-

• Coordinate local community and

tion of these goals we will transform the

charitable initiatives via Community

business and our contributions to our

Connect and Jacobs Employee

people, our communities, the environ-

Networks in all regions

ment and our industry.

PLANBEYOND 2020 PARTNERSHIP GOALS PLANBEYOND 2020 PEOPLE GOALS • Train 1,500 Positive Mental Health Champions (including 50% Senior Management Team) • Approve plans for establishing a global wellbeing baseline • Enrol 100% employees in Conscious Inclusion training • Jacobs Employee Networks to

• Upgrade Jacobs Value+ (including capture of project contributions towards the UN (SDGs) • Undertake sustainable innovation planning sessions with 10 top-tier clients • Launch new global Sustainability and Resilience Project Framework procedure

43

deliver PlanBeyond-related communication campaigns

PLANBEYOND 2020 PLACE GOALS • Reduce air travel by 20% - this will build off our success in cutting driving miles by 10% in 2018. • All offices to adopt Sustainable Workplace Plans (including removal of single-use plastics) • Launch Global Giving and Volunteering program

Jacobs intends to integrate sustainability throughout their business by making it part of their culture w w w.c so ma ga z i n e. com


LEADERSHIP

• Initiate sustainability partnership dialogue with 15 global suppliers Our new PlanBeyond governance structure will ensure accountability, reporting up through the PlanBeyond Executive Steering Committee to the CEO and Chair of the Board at regular intervals. For each focus area, a working group produces and is responsible for a delivery action plan. A senior sponsor has been assigned to lead each working group and that role will take responsibility for reporting progress to the PlanBeyond Executive Steering Committee. 44

ENERGY MANAGEMENT The global demand for energy security and supply continues to grow at a rapid rate. We are helping our clients meet the challenges by providing solutions to replace carbon intensive power generation with high efficiency, cleaner technology and developing renewable energy and demand-side management strategies. We believe this requires an integrated approach and delivery offering to support our clients in energy networks, thermal generation, renewable generation and storage solutions. We look for a ‘best for project’ approach that is M AY 2 0 1 9


focused on the requirements of the project; we are therefore not aligned to specific service providers. Our global power consulting capability (which is not included in the ECR sale) is focused on supporting our clients on the “pathway to zero carbon�. As part of this pathway we recognise that thermal generation will continue to play a significant part in the energy mix moving forward, alongside renewables such as solar and wind. We also have deep experience with renewable options such as hydro, pumped hydro storage and geothermal.

SUSTAINABILITY WITH OUR CLIENTS We are providing comprehensive infrastructure, technology and intelligence solutions to help our clients, cities and communities to create smart and connected places that function more effectively, are more resilient and sustainable, and are more responsive to the needs of the people using them. We help them prepare, adapt, mitigate and recover when facing climate, cybersecurity, biosecurity-related and other risks.

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ENERGY MANAGEMENT

46

WHAT IS THE BOARDROOM RESPONSE TO SUSTAINABILITY CHALLENGES? Dr James Robey, Global Head of Environmental Sustainability at Capgemini, explains how sustainability should be a boardroom priority and outlines why and how boards should respond to sustainability challenges WRITTEN BY

M AY 2 0 1 9

DR JA MES ROBE Y


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ENERGY MANAGEMENT

R

ecent attention on climate change issues and depletion of resources, with associated availability and cost

implications, have elevated sustainability issues to the boardroom. Ten years ago,

I would probably be sharing insights on ‘How to get your board to buy-in to sustainability’. However, over the past decade, environmental concerns have steadily climbed up the global agenda, with climate change and its related impacts featuring in the World Economic Forum’s top five Global Risks every year since 48

2011. Unconstrained year-on-year economic growth no longer seems as feasible as previously assumed and companies striving to maximise their economic profitability in the long-term have shifted thinking beyond ‘traditional’ boardroom topics. While I was studying for my doctorate at Henley Business School in 2016, I came across this insightful remark by Paul Hawken, the US Environmentalist and Campaigner, who argued that future growth may well be “restricted not by the number of fishing boats but by the decreasing number of fish; not by the power of pumps but by the depletion of aquifers; not by the number of chainsaws but by the disappearance of primary forests.” And as the late, distinguished writer, campaigner and economist M AY 2 0 1 9


“Corporate sustainability has now become a prerequisite for large organisations in their ability to sell their goods or services” — Dr James Robey, Global Head of Environmental Sustainability at Capgemini

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ENERGY MANAGEMENT

Kenneth Boulding expressed, “Anyone

true if they want to maintain their

who believes that exponential growth

competitive advantage. Edelman’s 2019

can go on forever in a finite world is

Trust barometer has shown an 11-point

either a madman or an economist!”

increase to 76%, of the general population agreeing that business leaders

STAKEHOLDER PRESSURE

should take a lead on these issues,

Other stakeholder groups are also caus-

rather than waiting for governments

ing business leaders to rethink their

to intervene.

response to the environment. There is

Indeed, after speaking to nearly 200

an increasing expectation from the

business leaders on sustainability during

general public that business leaders

my research, we confirmed the five

are best placed to address global

strongest business case components

environmental challenges - particularly

for sustainability in large companies:

50

M AY 2 0 1 9


CLICK TO WATCH : ‘CAPGEMINI AT THE AUTOMOTIVE RISING STARS AWARDS 2019’ 51 • The expectations of employ-

companies should be working on sus-

ees: Both existing employees and po-

tainability projects before they invest.

tential recruits expect an organisation

• Non-Governmental Organisations

to invest in sustainability. This was

(NGOs): Organisations need to meet

identified as the strongest driver for

the concerns and expectations of NGOs,

the companies’ investment in becoming

particularly if the company is reliant on

more sustainable.

securing access to natural resources

• Demand from clients and customers: Corporate sustainability has now

to operate. • Opportunities to increase profits

become a prerequisite for large organi-

by making efficiency gains: Sustainabil-

sations in their ability to sell their goods

ity programmes can actually affect

or services.

a company’s bottom line by reducing

• The expectations of sharehold-

waste, energy use or business travel.

ers: There is now an expectation among

Interestingly, this factor emerged

shareholders and other financiers that

as the least strong component of the w w w.c so ma ga z i n e. com


ENERGY MANAGEMENT

“Ultimately business leaders must take responsibility for ensuring that organisations deliver in an ethical, responsible and sustainable way” — Dr James Robey, Global Head of Environmental Sustainability at Capgemini

52

demonstrating a more established

IN THIS CONTEXT, WHAT IS THE BOARDROOM RESPONSE TO SUSTAINABILITY CHALLENGES?

attitude that while sustainability

My research also demonstrated that

delivers costs savings, it’s not the

an important factor in the success of

primary driver for implementing

a company’s sustainability performance

sustainability initiatives.

was the commitment of the CEO to the

business case for the large companies included in the research – most likely

Added to this, the rise of the ethical

programme. They play a critical role in

consumer with instant access to social

galvanising commitment to the agenda

media ‘news’, has completed the shift

across the entire organisation.

from sustainability being something ‘out there’ to being ‘in the boardroom’. M AY 2 0 1 9

Reflecting on my research, combined with over ten years’ experience leading


53

the sustainability agenda at Capgemini,

must actively monitor performance and

I believe that boards have seven key

step in where necessary to ensure that

roles to play in driving forward the

operational teams are delivering against

sustainability agenda:

those targets.

1. Strategy: The primary role of any

3. Accountability: Ultimately a board is

board is to set the strategy for the

accountable for the behaviour, actions

business – but boards today must ensure

and impact of the entire business. To do

social and environmental impacts and

this they need to understand the material

the expectation of all the business’s

impacts backed up by comprehensive

stakeholders are considered.

and reliable data.

2. Performance: Leaders are respon-

4. Transparency: The board must

sible for ensuring targets are met - they

also be responsible for ensuring that w w w.c so ma ga z i n e. com


ENERGY MANAGEMENT

54

a business is open about its approach and progression against its targets, which must be meaningful and stretching. Progress and good news stories should be balanced with reporting on what has gone less well. 5. Risk: Businesses leaders must implement strategies that mitigate climate-related risks and disruptions. According to the World Bank, $158 trillion of physical assets – double the total annual output of the global economy – are at risk without preventative action to mitigate climate change. M AY 2 0 1 9


6. Innovation: A board must be responsible for seeking to establish new and better ways of delivering, allowing the development of new products/services, processes and business models to meet the need of the changing environment. 7. Authenticity: Actions, and not lip service, will dictate how stakeholders perceive a business. In this age of technology, where the truth is often ‘what people say’, the board must ensure that responsibility and sustainability strategies are represented and delivered authentically throughout the business.

A NEW LEADERSHIP With current political and economic uncertainty in many key markets, and rising social and environmental issues, we need strong and good leadership more than ever before. Ultimately business leaders must take responsibility for ensuring that organisations deliver in an ethical, responsible, and sustainable way, creating long term value for all stakeholders.

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TECHNOLOGY

56

MAPPING OUT THE FUTURE OF SMART CITIES Heiko Schilling, Head of Navigation and VP Engineering at TomTom, says that to create sustainable and smarter cities, high-definition mapping is critical WRITTEN BY

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HEIKO SCHILLING


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TECHNOLOGY

R

eaders of a certain vintage will remember

the video game series SimCity, in which players built and managed massive

metropolises, controlling everything from city

taxes to transport infrastructure. SimCity managed the seemingly impossible task of making urban planning fun. A key reason why it worked was because players could scroll through the map to identify problems in their city, or access “real-time” data to make their decisions. The player was, in effect, omniscient and all-seeing. While this was a real-world 58

impossibility at the time of the game’s release, these abilities are now tantalisingly within reach in so-called smart cities. As in SimCity, digital mapping is crucial to delivering and managing smart cities. But before we explore why high definition maps are so important, it’s worth defining what we mean by ‘smart cities’. These are often painted as visions of the future, but the truth is that cities have had ‘smart’ elements for years. A more accurate term would, therefore, be ‘smarter cities’, which build layers of systems and functionalities upon existing technologies to provide even deeper, more accurate and more up-to-date insight into city infrastructure. The examples are potentially limitless, but most applications tend to focus on the biggest M AY 2 0 1 9


59

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TECHNOLOGY

“Having a digital map of the urban environment enables planners to simulate the effects of infrastructure upgrades, roadworks or new transportation services on the city” — Heiko Schilling, Head of Navigation, VP Engineering at TomTom

60

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bugbears of urban living – transportation and associated infrastructure. The cities of the future will, we hope, eliminate gridlock through smarter public transport, including autonomous vehicles and ‘micro-transportation’ such as eScooters and delivery drones. Connected, centralised systems will gather and share data to improve traffic flows of both vehicles and pedestrians and will also manage available parking spaces more efficiently. Above all, they


CLICK TO WATCH : ‘PARTNERING IN SUCCESS – UBER’ 61 will provide urban managers with the

or distance between vehicles in autono-

ability to take a holistic approach to city

mous transportation systems.

infrastructure, ensuring that they can keep the traffic moving. As in SimCity, these abilities all depend

Without a highly accurate, centimetre-scale digital map, it will be impossible to make autonomous vehicles

on urban planners and managers being

aware of their location, environment

omniscient, and this is where high-defi-

and pathways around the city. City

nition mapping has such an important

managers (and logistics and transport

role to play. These maps provide more

operators) don’t just need to know

than just a digital representation of the

the rough location of their vehicles:

real world, important as that is. To

they must also have absolutely precise

enable the next generation of smart

information on lane models, road

services we need to represent every

geometry and signs. This knowledge is

element at centimetre-scale – for

critical for tomorrow’s sensor-based

example, to manage the exact position

vehicles, enabling them to make sense w w w.c so ma ga z i n e. com


TECHNOLOGY

62

of their environments they perceive, ensuring that they are in the correct lane, and supporting advanced driverassistance systems – all of which adds up to safer and smoother traffic flows. For all this to work as it should, we need more than the types of digital mapping software that humans use to plan their journeys or orient themselves. As the task of driving gradually shifts from the driver to in-vehicle systems, the role and scope M AY 2 0 1 9


“Without a highly accurate, centimetre-scale digital map, it will be impossible to make autonomous vehicles aware of their location, environment and pathways around the city” — Heiko Schilling, Head of Navigation, VP Engineering at TomTom 63

of digital maps shifts accordingly.

from their surroundings and feed it

Smart cities, therefore, depend on

back into the map. This ensures that

machine-readable maps.

maps can be constantly updated to

Automated vehicles today come equipped with a variety of sensors used for perceiving its surroundings and for

ensure that they are always an exact match to the reality on the ground. If developing smart, high-definition

localisation, including cameras, radars,

mapping sounds like a highly complex

and LiDARs (3D laser scanners). These

task, you’d be right. It will take initiative,

technologies not only enable vehicles

vision and investment to put such

to take their cues from sensors embed-

projects into effect – but forward-look-

ded within roadside furniture; they also

ing cities like London, Singapore and

mean that vehicles can capture data

Seoul are already putting these very w w w.c so ma ga z i n e. com


TECHNOLOGY

64

building blocks into place. One of the most significant challenges to overcome, however, will be managing the huge volumes of information on which these systems rely, including data collection and verification, processing, and security. That’s why the most important person in tomorrow’s smart cities will be the “city CTO”, who will have the same God-like view of urban infrastructure and transportation data as the SimCity player. Indeed, local authorities in Salford and the West Midlands have already appointed Chief M AY 2 0 1 9


Digital Officers to provide the necessary digital and data strategy to make these projects a success. And this brings us on to another key benefit of HD mapping to the smart cities of the future: simulation. Having a digital map of the urban environment enables planners to simulate the effects of infrastructure upgrades, roadworks or new transportation services on the city as a whole, and so identify unexpected consequences before the project begins. Like Rome, smart cities won’t be built in a day. Instead, they will evolve gradually as new layers of intelligent services are added – but only once they have been rigorously modelled and tested. While intelligent transportation infrastructure is only one part of tomorrow’s smart cities, it will have probably the most important impact on their citizens and make the biggest difference to the city’s “liveability”. High definition, intelligent mapping provides the foundation – and the roadmap – to a smarter, faster future.

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65


CSR

66

Preparing your business for next generation energy procurement Simon Skillings, Head of Business Development at Open Energy Market, shares his insight on why and how the energy industry needs to ready itself for a new generation of procurement professionals who are addressing the industry’s challenges head on WRITTEN BY

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SIMON SKILLINGS


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CSR

H

istorically, the procurement element of a business wa,s the sole responsibility of facilities or engineering man-

agers. Their relationship management exper-

tise – from the golf course to the meeting room – was instrumental in getting the signatures on energy contracts that had, at that time, a limited impact on the business. But now, processes, data, legislation, and tighter margins have made energy-buying a far more significant and demanding role within an organisation. With energy falling into the top three costs 68

for most companies, procurement decision makers are under greater pressure and scrutiny to deliver best results. Until now, those working in energy procurement have been the dealmakers. They have demonstrated their industry knowledge, negotiating skills and talent for fostering relationships. However, with heightened expectations coming straight from the top, they will also have to be far more analytical going forward. What this means is that the old analogue approach to procurement won’t cut it anymore: there needs to be improvement across the board to enable greater savings, more efficient processes and better analytics to understand spending, controls and risks. To achieve this, legacy structures and M AY 2 0 1 9


69

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CSR

“The world is now equipped with massive volumes of data requiring both accuracy and intelligence. Making sense of this data will be critical” 70

— Simon Skillings, Head of Business Development, Open Energy Market

approaches will need to make way for next-generation procurement.

GENERATIONAL DIFFERENCES Energy buyers are faced by a number of sticky challenges. It is imperative that the next-generation of procurement professionals not only take the traditional costs and terms and conditions into account but consider the following when creating their procurement strategy: reporting and forecasting, spend analysis, market exploration and SLAs. More recently, supplier risk is also an increasing factor given seven energy firms went bust in 2018. To help them solve their problems and drive stronger business results, a push for more tech innovation will be crucial – which will actually give way to a more simple, transparent and intuitive buying experience that users will actively embrace. Digital procurement – and the use of bots and apps, for example – automates tasks to increase efficiency by streamlining the manual, routine procurement tasks. As well as reducing costs, it also prepares all involved with a greater understanding of real-time insights and analytics through AI and user-friendly platform tools. Ultimately, digital

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71

procurement deploys new and smarter

(or because of) financial or political

ways to permeate data models to

uncertainties facing a business, catego-

improve routine decision making.

ry managers will need to redefine their

The demand for tech innovation –

strategy to incorporate advances in

and its benefits – is becoming clear in

technology if they are to be in a position

this field: according to consumer insights

where they can deliver greater savings

analyst, Aleksei Gontsarov, the Procure-

and added value in the coming years.

ment Leaders’ Category Planning Guide indicates, for the first time, what category

GETTING SMARTER

managers hope to achieve in 2019 and

Procurement and supply chain fields

the levers they intend to use to succeed.

are now facing disruption from AI and

These include e-auctions, supplier

IoT and, while there is a positive move

collaboration strategies and demand

towards embracing technology, we, as

management. Therefore, in spite of

an industry, need to stay smart about w w w.c so ma ga z i n e. com


CSR

72

the ‘how’, ‘why’ and ‘where’ investment

review their approach to buying. This

in technology should be made, and not

will help them understand where sticky

just join the procurement revolution

processes need modification. It isn’t just

through a fear of missing out.

about driving down unit costs, it’s about

We have put together some pointers

divergent thinking, being smarter and

for businesses on what they need to be

removing cost from the process itself.

thinking about to get themselves ready for next-generation procurement.

MAKE SENSE OF THE DATA The world is now equipped with massive

REVIEW

volumes of data requiring both accuracy

To kick start the right changes, procure-

and intelligence. Making sense of this

ment players – new and old – need to

data will be critical. And this means

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“To kick start the right changes, procurement players — new and old — need to review their approach to buying” — Simon Skillings, Head of Business Development, Open Energy Market 73

understanding what was purchased,

the right digital technology – combined

as well as ‘why’ it was purchased. To

with the know-how of expert energy

do this, and to provide intelligent

and facilities specialists – can make

support, will require the right technol-

this happen.

ogy, especially analytics, AI and bots.

EDUCATE: LEVERAGE KNOWLEDGE AND TECH:

With any technology-powered change

There was a time when procurement

it will be vital for leaders to also focus

decisions were based on past experi-

efforts on the education and retention

ences and an individual’s knowledge

of their existing personnel. And it’s no

or perceptions. But a deeper analytical

different in the procurement landscape.

approach is needed today. Implementing

Their knowledge and experience will be w w w.c so ma ga z i n e. com


CSR

“To be sure you don’t miss out on accessing the right talent for your business, it’s important to adopt a culture that welcomes, not fears, technology” — Simon Skillings, Head of Business Development, Open Energy Market 74

M AY 2 0 1 9


instrumental to the successful roll-out of these changes. Encouraging a more collaborative relationship with vendors will also help them to reap the real benefits the technology can deliver: stretching beyond cost savings, to delivering positive long-term financial results and ultimately a better service. If your procurement team isn’t educated on the changes or engaged, they won’t be able to deliver the results – so they shouldn’t be left behind in any digital transformation journey.

ATTRACT TALENT:

75

Today’s new breed of procurement professionals are in high demand. They are equipped with creative and agile thinking, and have an innate ability to navigate technologies that can impact your margins. But demand is fast outstripping supply. To be sure you don’t miss out on accessing the right talent for your business, it’s important to adopt a culture that welcomes, not fears, technology. Because, with the right technology-powered solution you open up opportunities that will benefit your team, your business and your bottom line.

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The Global Summit of The that unites CEOs from so manufacturers and service destination where 1,000 b under one roof every year insights and learnings from voice and discuss the key and in the future. It’s abou

2019 SPEAKERS INCLUDE:

Jean-P Chairm L


e Consumer Goods Forum is the business event ome of the world’s most successful retailers, e providers. This unique event is the essential business leaders and key stakeholders gather r. It is where CEOs talk to CEOs with additional m global and regional experts. It is the place to issues and challenges facing our industry now ut purpose and driving positive change globally.

To learn more about The Consumer Goods Forum and how to become a member, please visit our website: www.theconsumergoodsforum.com

Paul AGON man and CEO L’Oréal

Sarah DAVIS President Loblaw Companies Ltd

Max KOEUNE President and CEO McCain

Mark SCHNEIDER CEO Nestlé

Captain Scott KELLY Astronaut


T O P 10

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TOP 10

Electric vehicle manufacturers CSO Magazine reveals the top 10 electric vehicle (EV) manufacturers in the world, according to Clean Technica’s findings WRITTEN BY

SOPHIE CHAPMAN

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T O P 10

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10

Groupe PSA 3.2mn sales

Groupe PSA, which was founded in Paris in 1976, has a market capitalisation of US$21bn. The company claims it will introduce 15 electrified versions of its brand’s existing models, and has featured on the CDP Climate Change A List. “Reducing our vehicles’ environmental impact has been one of the major challenges guiding our technological choices for more than 20 years, with innovative solutions that are publicly recognised for their effectiveness in reducing CO2 emissions,” stated Carlos Tavares, CEO of Groupe PSA.

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81

09

Renault

3.4mn sales

Renault’s market capitalisation has reached $20bn. The French company is very popular in Europe and offers two electric cars and two electric vans. In February 2019, the firm had sold 200,000 EVs across Europe, and noted 100,000 registered EVs in France alone. The business claims to provide continuous upgrades to its electric fleet such as increased range, faster charging, and more powerful motors.

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Photo: Alexander Migl

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08

Fiat Chrysler 4.7mn sales

In October 2014, Italy’s Fiat and the US’s Chrysler merged to form the holding company Fiat Chrysler, the eighth largest automaker in the world. The Italian American company has a market capitalisation of $25bn. The firm recently showcased its latest electrified offerings at the 2019 Geneva International Motor Show such as its plug-in hybrid Jeeps and new Fiat model. “The Fiat Concept Centoventi [is a] concept car that perfectly expresses the Italian brand’s idea of electric mass mobility in the near future,” the company stated in a press release.

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07

Honda 5mn sales

Honda’s Chief Executive Officer, Takahiro Hachigo, recently announced that the firm would be selling plug-in EVs in Japan by 2020. The business launches its first plug-in EV in Europe in 2019. In March this year, the company committed to “total electrification in Europe by 2025”, meaning it aims to “move 100% of its European sales to electrified powertrains”. The firm was also ranked as the most fuel-efficient automaker in the US by the Environmental Protection Agency (EPA).

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06

Nissan

5.6mn sales

Nissan offers the LEAF, E-NV200 COMBI, and E-NV200 VAN models within its range of EVs. “Nissan has installed more quick chargers across Europe than all other manufacturers put together,” the company claims. The Japanese firm’s market capital is worth $35bn, and it intends to sell 1mn electrified vehicles per annum by 2022. Nissan was founded in 1933, and since 1999 the company has been part of the Renault-Nissan-Mitsubishi Alliance. The company’s headquarters are based in Nishi-ku, Yokohama, Japan.

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05

Ford

6.4mn sales

The US manufacturer’s market capitalisation has been valued at $36bn. The company, which was founded in Michigan in 1903, aims to launch 16 electric vehicles and 40 electrified vehicles by 2022. “Our aspiration: To become the world’s most trusted company, designing smart vehicles for a smart world,” Ford’s website states. The company currently offers the MONDEO HYBRID, NEW MONDEO HYBRID, and TRANSIT CUSTOM PHEV. Ford globally employs 202,000 members of staff and is working towards developing its autonomous technology.

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04

General Motors 7.8mn sales

General Motors’ (GM) brands include Chevrolet, BUICK, GMC, Cadillac, Holden, and SAIC-GM-Wuling. The company has called for a National Zero Emission Vehicle program in the US “to move [the] country towards an all-electric, zero emissions future... Our proposed NZEV program will conserve energy and reduce emissions, while encouraging American innovation and preserving our industrial strength,” says GM. In order to achieve the goal, the firm has proposed infrastructure investment, incentives for EVs, and incentives for battery suppliers. GM’s market capitalisation is $46bn.

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03

Hyundai/Kia 7.9mn sales

Hyundai and Kia Motors formed a unique partnership in 1998, and now the South Korean companies have a market capitalisation of $30bn. Hyundai owns around a third of Kia’s total shares, whilst Kia owns approximately 20 Hyundai subsidiaries. Hyundai offers the IONIQ Hybrid, IONIQ Plug In, and IONIQ Electric models, and Kia has developed the Soul EV, Niro Self-Charging Hybrid, Niro Plug-in Hybrid, and New Optima Sportswagon PHEV.

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02

Volkswagen Group 10.1mn sales

Germany’s Volkswagen was founded in Berlin in 1937. The firm has a market capitalisation of $78bn, and offers 88

two EVs – the e-up! and e-Golf. “One battery charge. Up to 372 miles. That’s the technology we’ve been working on to support the world’s need for emission-free mobility,” states the firm. The company aims to produce 50 EVs by 2025, and in order to achieve this goal, it will invest $40bn into EV-related technologies.

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01

Toyota

10.2mn sales Japan’s Toyota has gained a market capitalisation of $170bn since it was established in 1937. The company is headquartered in Toyota, a city that was named after it in the Aichi Prefecture in Japan. Within Toyota’s Hybrid range are the Yaris Hybrid, Prius, Prius Plug-in Hybrid, and Prius +. The company revealed that it has partnered with Japan’s Subaru to develop a joint electric car, which could reach the market by 2021.

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EVENTS & A S S O C I AT I O N S

The biggest industry events and conferences WRITTEN BY ANDREW WOODS from around the world

10–12 JUNE

18th Responsible Business Summit Europe 2019 06–09 JUNE

92

[ NOVOTEL WEST, LONDON UK ]

ASEAN Sustainable Energy Week (ASE)

If businesses want to address social and

[ BITEC, BANGKOK, THAILAND ]

need look no further than the Responsi-

This massive show expects 27,000

ble Business Summit Europe. Attendees

visitors, over 1,500 brands and over

can join over 600 CEOs, business

80 seminars tackling renewable energy

leaders, investors, government repre-

sources and the latest technology in

sentatives and NGOs to identify new

this area. Wind and solar power are

innovations, materials, technologies and

among the many systems and programs

partnerships that will help them become

featured and discussed along with

more sustainable businesses. With

thermal and waste-to-energy, hydro-

speakers from Mars Petcare Europe,

powered programs, bio-mass and other

UN Women, UNFCCC and more, the

green technology. Renewable energy

summit promises to be a market-leading

and energy efficiency clinics staffed by

event that will shape the future of

experts are also conducted at the show.

sustainable business.

M AY 2 0 1 9

environmental challenges then they


20–22 JUNE

Intersolar Europe 2019 [ MESSE MÜNCHEN, MUNICH, GERMANY ]

10–12 JULY

Intersolar Europe is the world’s leading

ees North America 2019

exhibition for the solar industry and its

[ CALIFORNIA, USA ]

partners and takes place annually at

Celebrating its tenth anniversary, Ees

the Messe München exhibition center

will welcome hundreds of exhibitors

in Munich, Germany. The event’s exhi­

and 15,000+ trade visitors. The confer-

bition and conference both focus on

ence features 40 sessions and 25

the areas of photovoltaics, solar ther-

workshops with more than 200 speak-

mal technologies, solar plants, as well

ers. With over 20 years of experience,

as grid infrastructure and solutions for

Intersolar brings together members of

the integration of renewable energy.

the solar industry from across the

Since being founded 26 years ago, Inter-

world’s most influential markets. Inter-

solar has become the most important

solar exhibitions and conferences are

industry platform for manufacturers,

also held in Munich, San Francisco,

suppliers, distributors, service provid-

Mumbai, Beijing and São Paulo.

93

ers and partners of the solar industry.

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EVENTS & A S S O C I AT I O N S

17–19 JULY

94

POWER-GEN & DistribuTECH Africa

28–30 AUGUST

[ SOUTH AFRICA ]

Intersolar South America 2019

With 3,000 attendees,

[ SÃO PAULO, BRAZIL ]

100+ speakers and 70+

With 11,500+ visitors, 1,500+ conference attendees

exhibitors, POWER-GEN

and 180 exhibitors, Intersolar has become the most

is Africa’s premier elec-

important platform for manufacturers, suppliers, dis-

tricity industry forum that

tributors, service providers, investors and partners

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of the solar industry. Intersolar South America takes

tional business leaders

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and technical experts

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committed to powering

ics, PV production technologies, energy storage

up a continent.

and solar thermal technologies.

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11–15 DECEMBER

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[ BOMBAY EXHIBITION CENTRE, MUMBAI ]

Offshore Wind Executive Summit

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Bringing together decision makers from

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Executive Summit looks at technology

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95


Driving sustainability and growth together WRITTEN BY

MARCUS LAWRENCE PRODUCED BY

JUSTIN BRAND

96

M AY 2 0 1 9


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ANHEUSER-BUSCH INBEV

Matthew Frost, Global VP for Raw Materials Procurement and Sustainability at Anheuser-Busch InBev, discusses the company’s Sustainability 2025 goals, the four pillars that define its aims, and the positive impact they have had on its supply chain and sales

98

C

ompanies worldwide are finding that manoeuvring towards sustainability driven operations is not only boosting profits but

is also enriching the lives of communities along their supply chains and mitigating their impact on the environment. One such firm to experience this is Anheuser-Busch InBev (AB InBev), the largest beer manufacturer in the world, which has accelerated its historic commitment to sustainability with its ambitious 2025 Sustainability Goals. Broken down into four pillars – Smart Agriculture, Water Stewardship, Circular Packaging and Climate Action – the sustainability drive is seeing a revolution of AB InBev’s supply chain operations. Matthew Frost, Global VP Raw Materials Procurement and Sustainability, is passionate about the multifarious, intersectional benefits of this transformative initiative, and firmly believes that strong sustainability practices are intrinsically linked with improved M AY 2 0 1 9


99

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ANHEUSER-BUSCH INBEV

CO M PAN Y FACT S business operations and innovation. “I think the organisation as a whole is learning more and more that sustainability really is our business now,” he says. Frost notes that, from a commercial perspective, the gradual shift in consumer interests means that this initiative is not only driven by a sense of responsibility, but is also simply good business sense. “Consumers are very much aligned to the message of sustainability, so we find that consumers are seeking out products from com102

panies which are doing something to positively influence the planet through their supply chains. More and more, that’s actually helping us to sell beer,” he adds. “The past two sets of sustainability goals were certainly achieved, but they weren’t as far reaching as our new 2025 ones. They’re helping us to drive growth in the business, innovation, supply security and cost reduction. The more we get into it, the more we realise how beneficial it is for the business overall.”

SMART AGRICULTURE AB InBev aims to ensure that 100% of its direct farmers, from which the firm M AY 2 0 1 9

• AB InBev directly sources 3mn tonnes of barley each year • AB InBev’s electricity will be 100% renewably sourced by 2025


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ANHEUSER-BUSCH INBEV

directly sources 3mn tonnes of barley

they benefit much more from having

each year, are skill connected and

training and direct access to agronomi-

financially empowered by 2025. Frost

cal advice on how to grow crops more

notes that this means different things

effectively.”

in different territories across the supply

106

As one of the largest users of

chain, highlighting the fact that the

malting barley worldwide, AB InBev

skills of its farmers in the US are largely

has established its own Barley

well-established, efficient, and less

Research Centre in Fort Collins,

likely to benefit from AB InBev’s direct

Colorado, to ensure that barley

input. The biggest impact to be made is

remains a competitive crop for their

with its smallholder farmers in less

farmers to grow. “We are constantly

affluent countries and regions. “When

working on breeding new varieties of

it comes to farmers growing cassava in

barley that are more disease-resistant,

Mozambique, for example, these are

capable of surviving droughts and

smallholders, family operations, so

flooding, and able to produce more in

“Consumers are very much aligned to the message of sustainability” — Matthew Frost, Global VP Raw Materials Procurement and Sustainability

M AY 2 0 1 9


CLICK TO WATCH : ‘HOW AB INBEV IS EMPOWERING BARLEY FARMERS IN UGANDA’ 107

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the field depending on the climatic and

in developing countries such as

soil conditions. Therefore, they are

Uganda and Zambia. “Blockchain gives

able to yield more,” explains Frost. “All

smallholders a digital identity, making

of this makes barley less risky for our

them credit-worthy and bankable,”

farmers to plant, whether they’re in the

says Frost. “They can then take out

Ugandan highlands or in Argentina with

loans, grow their business and become

a fully automated farm.” The unifying

more successful. With farmers in more

element between its farmers, whether

developed countries, like the US or

they are smallholders or large agricul-

Argentina, AB InBev’s focus is on

tural cooperatives, is the digital

providing cost effective crop insurance

platforms that AB InBev provides.

and facilitating access to credit.”

These platforms enable the company’s goal of financially empowering its

WATER STEWARDSHIP

farmers, with one example being a

In addition to ensuring that clean water

blockchain-enabled platform deployed

is available to communities surround-

E X E CU T I VE PRO FI LE

Matthew Frost A British National and trained Chemical Engineer, Frost has 30 years of End2End Blue Chip FMCG Supply Chain experience acquired through roles in Research and Development, Engineering, Manufacturing, Logistics and Procurement. Having worked in the UK, Germany, Russia, Switzerland and Africa, Frost has developed a holistic knowledge of procurement across a range of markets. Having served as Chief Procurement Officer at SABMiller, Frost was appointed as AB InBev’s VP Global Raw Materials Procurement and Sustainability when it acquired the firm in 2016.

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109


ANHEUSER-BUSCH INBEV

ing its breweries, AB InBev is working

“Saving a few gallons of water in our

to create long-standing change in

breweries isn’t going to change the

water consumption across its supply

world,” he says. “We have to get stuck

chain. “A lot of manufacturers look at

into managing the watersheds in those

their water consumption in their

areas in a literal sense.” In different

manufacturing processes and attempt

countries, water rights vary not only

to drive it down. We’ve got ours down

in entitlement but delivery, limiting the

to a low level already, but that’s kind of

efficiency with which farmers can

the wrong focus,” Frost says, adding

make use of their water.

that 37 of AB InBev’s breweries around

110

In the Bajío region of Mexico,

the world are located in high water

farmers have the right to a certain

stress areas and, with the increasing

volume of water for irrigation. When

impact of climate change, it is expect-

the opportunity to have it arises, they

ed that this will rise to 50 by 2030.

must take all of it at once or risk having

“I think the organisation as a whole is learning more and more that sustainability really is our business now”

— Matthew Frost, Global VP Raw Materials Procurement and Sustainability

M AY 2 0 1 9


CLICK TO WATCH : ‘HOP SUMMIT 2018’ 111 their entitlement cut. “Because of this, they use what we call flood irrigation, which is very costly and inefficient. You saturate the place with water and only so much of it is used by crops while the rest is -wasted,” explains Frost. The challenge here is that, while AB InBev can advise on the best time and volume with which to irrigate crops, the water regulations throw up a barrier to optimising the process. “This is an area where we’re getting involved by emphasising the issue, demonstrating what can be done to resolve it, and trying to use our corporate affairs w w w.c so ma ga z i n e. com


ANHEUSER-BUSCH INBEV

$54.6bn+ Approximate revenue (2018)

2008

Year founded

112

182,915+

Approximate number of employees

M AY 2 0 1 9


CLICK TO WATCH : ‘100+ 2025 SUSTAINABILITY GOALS’ 113 muscle to get things to change for the

returnable bottle fleet, as we call it,”

common good.”

says Frost. “This is by far the most sustainable packaging; you just send

CIRCULAR PACKAGING

the bottle back to us. In some countries,

As part of its Circular Packaging pillar,

we can get 40 turns out of that return-

AB InBev has set the target of ensur-

able bottle. There are some costs

ing that by 2025 100% of its packaging

associated with transporting the

will be either returnable or made from

empty bottles back and cleaning them

majority recycled materials. Drinks

so they can be reused but, ultimately,

bottles have traditionally had the

that’s massively outweighed by the

propensity for being single use, and AB

fact you’re not remanufacturing those

InBev has been working tirelessly to

bottles 40 times over.”

both enable and incentivise recycling

In markets where there is less of

of its bottles. “We use returnable

a social impetus to recycle, AB InBev

bottles in a lot of our geographies – our

deploys ‘one-way glass’ that it anticiw w w.c so ma ga z i n e. com


ANHEUSER-BUSCH INBEV

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CLICK TO WATCH : ‘BREWERS ON TAP | EXPLORING THREE BREWERY FOUNDERS’ UNABASHED PASSION FOR BEER’ 115 pates will be smashed or otherwise damaged, aiming to reclaim as much of this glass as possible for remanufacturing. These efforts are mirrored by its commitment to recycling aluminium and PET, with AB InBev setting targets for its third-party suppliers to increase their use of recycled materials alongside the optimisation of recycling at its own vertical plants. Its endeavours in this area are given a boost by shifting moods on a generational level. “We are finding that young, legal drinking age

“We gave those startups some additional seed capital and inserted them along our supply chain” — Matthew Frost, Global VP Raw Materials Procurement and Sustainability

adults are becoming ever more aware of the environmental impact of manuw w w.c so ma ga z i n e. com


ANHEUSER-BUSCH INBEV

“It’s really a win-win-win: a win for us, a win for the environment and a win for the local grid” — Matthew Frost, Global VP Raw Materials Procurement and Sustainability

116

facturing and the products they

by another significant commitment:

consume,” notes Frost. “People are

ensuring that the company’s energy

more attuned to it, and we’re definitely

consumption is 100% renewable by

trying to push that agenda and

2025. This aim goes deeper than

continuously explain why returnable

simply purchasing green energy

bottles are the better option.”

contracts, however, as AB InBev has invested in purchase power agree-

CLIMATE ACTION

ments (PPAs) that generate additional

All of these factors tie into the overall

renewable electricity for the local grid.

mitigation of AB InBev’s environmental

“Because the unit cost of wind and

impact. They are joined, however,

solar power has been coming down

M AY 2 0 1 9


InBev worked with a carbon disclosure project in 2017 to set a baseline for its supply bases’ CO2 emissions and subsequently set goals for those suppliers to cut their emissions. Frost adds that realisation of its ambitious goals across each of AB InBev’s pillars has been driven in part by its sustainability accelerator, set up to define the challenges the supply chain transformation poses in relation to those goals and inviting startups to solve them. “We gave those startups some additional seed capital and inserted them along our supply chain, enabling them to grow faster by working directly with the people in it,” says Frost, citing its blockchain platform as an example of the success the accelerator substantially in the past few years, we

has produced. “That’s been extremely

have found that every deal we do leads

successful, so we have a number of

to a guaranteed lower cost of power

startups which are growing very quickly

versus grid-available in each of our

as a result of having that involvement in

locations,” Frost explains. “It’s really

our supply chain.”

a win-win-win: a win for us, a win for the environment, and a win for the local grid.” In addition, the company’s Climate Action pledge includes a commitment to reduce carbon emissions across its value chain by 25%. To tackle this, AB w w w.c so ma ga z i n e. com

117


118

Mobile assets: Vantage Drilling’s mature supply chain WRITTEN BY

JOHN O’HANLON PRODUCED BY

DENITRA PRICE

M AY 2 0 1 9


119

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VA N TA G E D R I L L I N G

Maturing Vantage Drilling’s supply chain function over the last six years, with full buy-in from senior management, has seen the department morph from support to partner, says Director of Supply Chain Andy Poosuthasee

B 120

ased in Houston, Texas, Vantage Drilling is one of the most effective players in that specialized niche of the oil & gas busi-

ness: offshore drilling. Offshore operations are generally not as easy as onshore or littoral operations – major, national and independent oil and natural gas companies require a dependable partner to carry this out. Vantage has five ultra-premium jackup rigs capable of operating in up to 375ft of water and drilling to depths of 30,000ft. It also has three ultra-deep-water dynamically positioned drillships designed to operate in water depths down to 12,000ft and drill to 40,000ft. It’s no secret that the entire oil & gas sector is on a slow climb back from its boom days. According to the industry analyst Rystad, offshore drilling in particular may not fully recover till 2027. This has affected drilling contractors like Vantage in a number of ways, says its Director of Supply Chain Andy Poosuthasee. The most notable of these is M AY 2 0 1 9


121

Photos Š Greg Williams

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VA N TA G E D R I L L I N G

“We won’t sacrifice quality or compliance in order to get something quicker” 122

— Andy Poosuthasee, Director of Supply Chain

that where the norm used to be longer term, multi-year contracts, these days contract terms are often counted in months. This in turn means that the company’s assets have to be moved much more frequently than before. From a supply chain point of view frequent movements call for a greater degree of maturity, says Poosuthasee. “Probably the major challenge we face currently is that our rigs don’t tend to spend a lot of time in one particular country – we’re jumping around to different locations,” he explains. With seven of its eight rigs under contract Vantage is doing a lot better than its peers – the industry average is around 61% utilization, and there’s no lack of rigs waiting to come out of shipyards to further dilute that percentage. Still, the brevity of contract duration that is the price for high utilization is a supply chain challenge. “Even if we are working in the same country, the agreements these operators have with us and with the country itself are different. Looking ahead, I think we will be seeing more rather than fewer movements and that means that we have to be very nimble from a supply chain perspective.”

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CLICK TO WATCH : ‘VANTAGE DRILLING SHORT FILM 10 DAILY SAFETY TOOLS’ 123

KEEPING IT CLEAN

West Africa, customs procedures are

A fact of life for Vantage is that much of

more complicated, fickle and constant-

its business is conducted in countries

ly changing. In addition, countries that

that occupy the bottom 30 percentile

are highly dependent on oil are even

of the Corruption Perceptions Index.

more so severely affected in the

“This brings in a whole new level of

downturn, which has a knock-on effect

compliance and complexity into the

of potential added corruption. That has

supply chain organization where we

affected our supply chain strategy

must absolutely comply with transpar-

tremendously. We will obviously

ency and anti-bribery legislation such

comply with the anti-corruption laws

as FCPA (US). If you are working in

and have no tolerance for any devia-

places like the Gulf of Mexico or

tion. Recognizing that import clearance

Canada it is simple enough to organize

times may be measured in months

a compliant and predictable supply

rather than days, a rethink of strategic

chain, but in other locations such as in

sourcing and inventory management w w w.c so ma ga z i n e. com


VA N TA G E D R I L L I N G

124

strategies is called for,� he adds. Poosuthasee is not daunted by such

forced offshore drilling contractors to find ways to be more effective, espe-

difficulties though. As a certified lean

cially within their supply chain. Conse-

sensei from his earlier experience with

quently, supply chain has become

the oil & gas services company

more important than it used to be in the

Halliburton, he looks on both the

past. I believe most companies

general downturn, and the rise in

(especially large ones) don’t take the

corruption that in part comes out of

total cost of ownership into account

that, as opportunities for refining best

because it is difficult to calculate

practices. “In the good times, compa-

especially when they may be working

nies tend to stagnate and the focus

in silos. For example, strategic

was more topline driven for offshore

procurement may be negotiating

drillers. I actually think the downturn

global/regional fixed price agreements,

has been a good thing because it

but not considering the import duties

M AY 2 0 1 9


(which in some countries can be up to

We have seen tremendous benefits

30% of the purchase value), customs

from that exercise.” These benefits

clearance times, freight, and inventory

include a significant reduction in lead

impact because that’s managed by

times, eliminating exposure to import

other departments within supply chain.”

duties (which can be as much as 30%) and customs fines, and enabling leaner

PARTNERING WITH OPERATIONS

inventories. In just three years, he adds,

When moving into a new country, the

Vantage’s local content in all categories

first task is for the procurement and

went from 33.2% to 56.7%, while in the

logistics team to go in, find local

same period lead times were cut by

suppliers and set up a local supply

nearly 40%. Another benefit of local

chain. “In challenging countries, where

sourcing is that it grows the local

it is very difficult to import, our strategy

economy, coupled with the fact that

is to source as much as possible locally.

many countries require foreign 125

E XE CU T I VE PRO FI LE

Andy Poosuthasee Andy Poosuthasee is Director of Supply Chain at Vantage, as well as looking after Engineering, Maintenance and Technical Support. Reporting to the COO, Poosuthasee is responsible for a key part of the company’s strategy. He joined Vantage in 2013, having previously worked at Transocean where he was also a supply chain manager. Prior to this, Poosuthasee was at Halliburton, one of the world’s largest suppliers of products and services for the energy sector.

w w w.c so ma ga z i n e. com


expect more

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127

operators to maximize local sourcing. Any supply chain organization adds

importation delays or potential ‘penalties’ and ‘fines’. Countries that

value to operations through quality

are heavily dependent on oil and gas

delivery and pricing – in that order of

especially are constantly changing

importance, Poosuthasee believes.

their import/export requirements.

“We won’t sacrifice quality or compli-

Therefore, the potential for significant

ance in order to get something quicker

fines or penalties by local customs is

and we won’t sacrifice meeting our

there if you are not diligent and

internal customer’s operations delivery

focused on trade compliance. Of

requirements just because it’s going to

course among local suppliers, there is

save us some money,” he says. “One of

also a level of corruption so you must

the biggest benefits we see is that

spend a lot of time auditing them and

when you source locally you don’t have

doing due diligence to ensure compli-

to deal with trade compliance issues,

ance with the FCPA.” w w w.c so ma ga z i n e. com


VA N TA G E D R I L L I N G

Vantage now has a mature process for moving into a new market. Its Rig Move Checklist covers 30 logistics actions and 29 supply chain and procurement actions that are done before the rig moves to its new location. “We are very confident with the process because we have successfully used it so many times before,” he asserts. “I think taking the time to complete these 59 actions in advance is one reason we’ve had such success as we go into new countries. Of course, close liaison with the operations team 128

is very important: they are our customer so we spend a lot of time communicating with them to ensure we cover all of their needs prior to the rig’s arrival.”

TECH TOOLS FOR THE TIMES The priority for Vantage has been to identify cost effective rather than big ticket solutions to deliver automation, data management and reporting in the areas of procurement and inventory management as well as other parts of the business, such as maintenance and engineering. This is no time for heavy investment in this industry, and Vantage’s supply chain team discovered inexpensive, cloud-based M AY 2 0 1 9


solutions at a fraction of the price of managed software to be the answer. One implemented cloud-based solution has proven to be a collaborative and work management platform with a relatively straightforward user interface. “It is a tremendous tool that has allowed us to eliminate many of our manual processes. The downturn has meant doing the same job with fewer people but we have not seen a degradation in the service that we provide. That’s because we have been able to automate many of our manual processes through the use of simple and really economical applications.” As a lean six sigma practitioner, Poosuthasee asserts: “One of the hardest things to do is to eliminate a piece of paper from the process.” Even so, a lot of paper processes have been automated by transferring them to this intuitive cloud based system. It’s clear though that he sets more store by the attitudes and commitment people bring to their task than the methodology. “I’ve learnt a lot from mistakes I have made in the past. One of the biggest ones was chasing too many initiatives, too many strategic goals. Now I tell my team to focus on what w w w.c so ma ga z i n e. com

129


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131

“We have to be very nimble from a supply chain perspective” — Andy Poosuthasee, Director of Supply Chain

Franklin Covey calls the wildly important goals; focus on less so that your team can achieve more.” In furtherance of this principle, which Poosuthasee also characterizes as going “an inch wide but a mile deep”, the supply chain team is focusing this year on trade compliance, both to minimize the risks thrown up by different customs regimes and to further automate procurement systems and processes. w w w.c so ma ga z i n e. com


VA N TA G E D R I L L I N G

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A PARTNER IN THE ENTERPRISE When Poosuthasee joined Vantage in 2013, the company was still in “start-up” mode, and supply chain was doing a good job, but more as a support function. Since joining, he has worked to build the organization in three phases. The first phase was to strengthen the foundations and streamline the processes to be as effective as possible; the second was to start demonstrating and adding value to the company. “I wanted to show that we could actively impact KPIs and other value-added activities such as on-time delivery, quality, local sourcing, negotiations and inventory management. Show the company we can do more than just transactional tasks such as issuing POs.” Phase three was to become a true partner in the business, being asked to support non-traditional supply chain tasks such as sourcing service personnel and labor, real estate, catering, auditing, compliance, and even marketing right from the bidding stage. “It was truly pleasing from my viewpoint to see us moving from being a support team to being asked for advice on things we w w w.c so ma ga z i n e. com

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OIL & GAS DIVISION We operate two shipyards in the Canary Islands. Supporting drilling contractors for their SPS, rig reactivation, maintenance, repair and upgrade projects as well as MPD readiness and 2nd BOP Deck Reinforcement in the Canary Islands. We support local workforce knowledge and skills development to meet our global clients

OUR 16,000 yard FACILITIES • Subsea & heavy Mechanical workshop with 126 tons overhead Gantry Crane • Mechanical and Hydraulic workshop

• Blast & paint shop • 500 mtrs quay side with water depth 19mtrs

Our Capabilities • Rig repair and upgrade, SPS projects. • MPD Readiness and 2nd BOP Deck Reinforcement

• Re-engineering and structural analysis with ANSYS

Ontime safely Delivered projects within fixed price contracts Our facilities and capabilities at Las Palmas are also similar

A member of

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VISIT OUR SITE

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+34 922 104 982 gara.socas@hidramar.com commercial@tenerifeshipyards.com

CONTACT US


“We have been able to automate many of our manual processes through the use of simple and really economical applications” — Andy Poosuthasee, Director of Supply Chain

weren’t involved with in the past and becoming a true partner in the organization.” Andy Poosuthasee and his supply chain team are certainly finding ways to add value. Even some relatively mature locations have seen some dramatic results. For example, trade compliance turned out to be a big issue in Indonesia where even airfreight imports were taking a fortnight to clear. By developing local suppliers Vantage went from sourcing 47% to 81% locally. A different challenge faced the company in Qatar following the imposition of sanctions by GCC countries from which most supplies had previously been sourced. In just a couple of years, local suppliers have been brought on, at first being given short contracts but more recently these have been extended and today, he says, it is one of the easiest locations, with more than 80% locally sourced.

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Danone: sustainability transformation in food and beverage WRITTEN BY

LAURA MULLAN

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DANONE

Food and beverage heavyweight Danone has earned its stripes as a sustainability champion – But what’s the secret behind its success?

F

rom evian water to Activia yoghurts, Danone’s products are now a mainstay of any household fridge or supermarket

shelf. Under its banner, the food and beverage giant 138

hasn’t just invented iconic flavours, it’s also made a name for itself as a sustainability powerhouse. In 2017, Danone unveiled a refreshed logo and its very first company signature: ‘One Planet. One Health’. This slogan underlines the French multinational’s belief that the health of people and the planet are inherently interconnected. It also marked a call to action, urging consumers to join the ‘food revolution’ and adopt healthier, more sustainable eating and drinking habits. It’s an impressive mantra, but Danone’s commitment to health and sustainability stretches back much further. In fact, it’s almost as old as the company itself. In 1919, Danone’s founder, Isaac Carasso, noticed that many Spanish children suffered from intestinal infections. Echoing the previous work by Nobel laureate and Pasteur M AY 2 0 1 9


139

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â‚Ź24.7bn+ Approximate revenue

1919

Year founded

10,000+

Approximate number of employees 141

Institute director, Ilya Mechnikov, he

ment Goals of the United Nations,

launched a yoghurt which marked the

these objectives include: offering

birth of the Danone brand. Fast forward

superior food experiences and

to today and the Paris-headquartered

innovation; delivering stronger sustain-

firm is present in over 130 markets with

able profitable growth; becoming a

a slew of beloved and trusted products

certified B Corp; impacting people’s

including essential dairy and plant

health locally; and growing Manifesto

based products, early life nutrition,

brands as well as preserving and

waters and medical nutrition.

renewing the planet’s resources.

Keen to stay laser focused on its

On top of this, the firm has also

sustainable vision, Danone has

pledged to foster inclusion and growth,

pinpointed nine ambitious goals that it

serve the food revolution with partners,

hopes to achieve by 2030. Aligning

and entrust its people to create new

with the 2030 Sustainable Develop-

futures. Revealing these ambitious w w w.c so ma ga z i n e. com


DANONE

“In 2017, Danone unveiled a refreshed logo and its very first company signature: ‘One Planet. One Health’”

142

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PURPOSE LED, PERFORMANCE DRIVEN

The most comprehensive sciencebased animal nutrition solutions, intelligently scaled to solve the sustainability and commercial challenges we face in transforming how we feed the world. Stay connected at dsm.com/anh @dsmfeedtweet dsmanimalnutrition linkedin.com/showcase/dsm-animal-nutrition-and-health/


145

goals, Emmanuel Faber, Chairman and

cant strides towards these objectives.

CEO of Danone, said that he believes

Last year, Danone North America

“each time we eat and drink, we can

became the world’s largest B Corp, a

vote for the world we want”. He added:

key social and environmental milestone

“This has inspired the definition of our

for the firm which shows it has met the

long term goals which flow directly

“highest standards of verified social

from our ‘One Planet. One Health’

and environmental performance,

vision. As we strengthen our business

transparency, and accountability”.

model and nourish our dual economic

In 2017, the firm also reported that 86%

and social project, we have every

of its total packaging (and 77% of its

confidence we will deliver our business

plastic packaging) was reusable,

and financial agenda, as well as create

recyclable or compostable. This is just

and share sustainable value for all.”

the beginning: by 2025, the firm aims to

Danone has already made signifi-

ensure that every piece of packaging, w w w.c so ma ga z i n e. com


DANONE

146

from bottle caps to yoghurt cups, is

partnerships to make

recyclable, reusable or compostable.

At the same time, Danone has also

for instance, evian is taking part in

made consistent efforts to reduce its

a research mission with The Ocean

waste and optimise material use, for

Cleanup, a Dutch nonprofit startup that

instance, the firm plans to introduce

has created advanced technologies to

alternatives to plastic straws, launching

help rid the oceans of plastic, whilst

a pilot under its Indonesian brand

elsewhere Danone AQUA has pledged

AQUA. Additionally, it’s also trying to

to recover more plastic than it uses in

eliminate non-recyclable shrink film

Indonesia. On top of this, the French

by using specially designed adhesive

business is also a proactive member of

for its evian water brand.

the Sustainable Food Policy Alliance

Danone has also forged meaningful M AY 2 0 1 9

its plastic-free vision a reality:

alongside industry peers such as Mars,


147

Nestlé and Unilever. Aiming to advance

“a balanced, profitable and sustainable

public policies that improve transpar-

growth model”, according to the firm.

ency for consumers, support farm

Through this initiative, Danone aims

communities, and tackle climate change,

to generate cost savings of €1bn by

the alliance is set to be a game changer

2020 by making efficiency an ingrained

for policy action, shaping the wider

part of day-to-day business.

food and beverage industry at large. This sustainable ethos also extends

In order to include its employees on this sustainability roadmap,

to Danone’s top and bottom lines.

Danone’s workers are also set to

Indeed, the food and beverage firm

receive one Danone share to deepen

has recently launched an efficiency

their ownership mindset. The firm has

programme called Protein that

also developed an internal platform

is designed to help Danone build

with extensive sharing and learning w w w.c so ma ga z i n e. com


DANONE

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resources to help employees support

that “there is only one earth, we only live

the firm’s vision and goals. But it’s not

once.’’ Those words kick-started a vision

just employees who are an important

that lives on today. Now, sustainability is

catalyst of this sustainability drive.

an intrinsic part of Danone’s DNA, just

Indeed, Faber highlights how consum-

as much as its beloved brands and

ers are an integral part of this transfor-

flavours. With its 2030 goals, the

mation journey and how they’ve pushed

French food and beverage giant has an

the firm to better itself. “Consumers are

ambitious roadmap underway, which is

craving change,” he says. “They expect

about actions as well as words. Now,

large organisations like Danone to

with the help of its employees, con-

bring our scale of impact to change

sumers and partnerships, Danone’s

the world for the better.”

sustainability vision is almost in grasp.

With this in mind, it seems sustainability is set to remain a core tenet of Danone’s strategy in the years to come, just as it has been since the business was founded almost a century ago. Indeed, Antoine Riboud, the first Danone Chairman and CEO, said in 1972 w w w.c so ma ga z i n e. com

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CSO Magazine – May 2019  

CSO Magazine – May 2019