How Dow Chemical Ingrained Sustainability into the Company's DNA

Recently I reached out to Neil Hawkins, Corporate Vice President for Sustainability at The Dow Chemical Company, to hear his thoughts on a range of issues, including the company’s ambitious 2015 goals, natural capital valuation, and their preference to report voluntarily. I continue to be inspired by Dow’s commitment to, and leadership on, sustainability. Whether through their willingness to set (and meet!) highly ambitious goals, to challenging themselves to push the envelope on new products, technologies, and innovations that are good for their customers and the environment, Dow’s commitment to being a sustainability leader is clear.

Jennifer Gerholdt: Dow has set a number of highly ambitious goals for 2015, around energy efficiency, sustainable chemistry and climate change. Tell us more about these goals, how you are progressing, and if you’ve faced any surprises along the way.

Neil Hawkins: At Dow, sustainability is part of our DNA, and the goal establishment and reporting process has played a critical role in achieving much of what we’ve accomplished to date.

Dow’s goal-setting process dates back almost two decades to Dow’s 2005 EH&S goals, which were established in 1996. These 10-year goals called for an enhanced focus on the environment, health and safety as critical priorities; established a trajectory for the Company along with an actionable plan to drive results; and provided a way to hold ourselves accountable through public reporting. The result was incredible:  not only were we able to significantly improve our EH&S results, we were also able to demonstrate the financial benefit to the company – resulting in approximately $5 billion savings with a $1 billion investment. These goals led to sweeping cultural change at Dow, including a shift to an improved safety culture that is now ingrained in our employees and has avoided thousands of injuries.

In 2006, we launched our current set of 2015 Sustainability Goals, which focus not only on the Company’s footprint in our own operations but also our handprint through thepositive impact of Dow products and their role in global sustainable development. Focused on addressing global challenges like water, food, climate change, and energy, Dow has made significant progress against these goals. For example, Dow has announced two Breakthroughs to World Challenges, including Omega-9 Heart Healthy Oils and DOW FILMTEC™ ECO Reverse Osmosis Desalination Technology, which address global challenges in health and nutrition and clean water, respectively.

As we near 2015, we are proud to say we are largely on track to achieve most of our stretch goals. As we close out this chapter, we look forward not only to celebrating our results but also examining opportunities for improvement as we move forward. We are also taking a close look at our next-generation approach to sustainability and look forward to announcing more at a later time.

Gerholdt: Water has been identified as a top risk for business. How is Dow tackling the global water crisis?

Hawkins: Fresh, clean water is an incredibly scarce and precious resource. As the population of the world continues to grow, the demand for water – for individuals, communities and industry – will continue to grow as well, making water a critical topic in the pursuit of global sustainable development. Dow is also assessing and managing our water supply risks as part of the TNC-Dow Collaboration and the WRI Aqueduct project.

From a business growth perspective, Dow isalso committed to addressing the global drinking water challenge, offering solutions to help process fresh water and treat wastewater for reuse, efficiently and effectively. In fact, Dow technologies help process more than 15 million gallons of water per minute around the globe. Recently announced as Dow’s second Breakthrough to World Challenges, DOW FILMTEC™ ECO Reverse Osmosis Elements help deliver 40% better purification with 30% less energy than conventional technologies, and serve as just one example of many of our options for efficient water treatment solutions in use worldwide.

Gerholdt: Dow has been a champion for valuing natural capital and ecosystem services. What is the business case for putting a value on nature and integrating natural capital into your business decisions and strategies? What advice do you have for other companies that are just starting to get their arms around this issue?

Hawkins: Nature is invaluable, yet the services it provides – to communities, business, and society – are often taken for granted. Using a concept known as “valuation of ecosystem services,” Dow is working to account for and incorporate the value of nature in its business decisions, and is committed to helping others do the same. Better understanding and estimating the value of nature to business can better enable businesses incorporate it into decision-making processes, resulting in a win-win for all parties.

For example, a constructed wetland built in lieu of a new wastewater treatment facility at a Dow-owned site in Seadrift, Texas, not only serves as a thriving habitat for wildlife, benefiting  both the environment and local community; it has also saved the company more than $100 million in net present value since it was built in the late 1990s.

As our society grows, we are facing a number of substantial challenges associated with sustainable development. By working together – across businesses, NGOs, communities, and governments – we can achieve a tremendous amount more than we can achieve alone. - Neil Hawkins

More recently, in 2011, Dow joined forces with The Nature Conservancy as part of a six-year collaboration to better understand the benefits nature provides and develop methods for Dow and other companies to evaluate and incorporate these benefits into business decisions. We are excited to be part of this breakthrough collaboration, both for the benefits it can bring to business as well as those it can give back to nature.

Gerholdt: Dow relies on various partners to achieve its sustainability goals. What do you look for in a partner, and what have been some of the most fruitful collaborations and why?

Hawkins: As our society grows, we are facing a number of substantial challenges associated with sustainable development. By working together – across businesses, NGOs, communities, and governments – we can achieve a tremendous amount more than we can achieve alone.

That said, the pursuit of sustainability will require much more than just coordinating efforts or cooperating across parties; we must also collaborate with unlikely partners to drive real change. This may require the assumption of an element of risk by both parties involved, but it also has the potential to change the world. In collaborations like that between Dow and The Nature Conservancy, we can bring together unique and diverse perspectives in a way that challenges both to devise solutions to achieve the highest impact results, sharing them with others to  advance our collective pursuit of a more sustainable society.

Gerholdt: Dow is a clear leader in sustainability-driven technology and innovation, such as your recent efforts to green major sporting events. What is the business value for these initiatives? How are these types of solutions addressing key issues such as the need for clean air and water, and clean energy generation and conservation?

Hawkins: We were very proud to partner with the Sochi Olympic Games to mitigate the direct carbon footprint of the Games through demonstration of energy efficiency products and other technology implementation. In that way, we feel we really demonstrating true sustainable business practices --- helping the planet and society become more sustainable while also implementing a successful business model. We believe that platforms like this create large platforms for demonstrating Dow technology solutions for global sustainability challenges and that can only lead to more growth for Dow.

Gerholdt: Can you share with us latest developments we can expect to see from Dow in the next year?

Hawkins: We are always innovating, and with sustainability at the forefront of our customers’ and consumers’ minds, I suspect you’ll see a number of exciting new products and technologies coming out that seek to increasingly meet those needs. I never cease to be amazed by what science has the power to accomplish, and it’s exciting to be part of those solutions. Of course, I would also be remiss to omit our Sustainability Goals:  with 2015 rapidly approaching, we look forward to wrapping up our performance against our current goals and to also seeing what our future has in store!

Eunice Heath, Global Director, Sustainability Business Engagement and Education at The Dow Chemical Company, spoke about the company’s successful partnerships such as with The Nature Conservancy at our Accelerating Sustainability Forum on May 6 in Washington, DC. Check out the webcast here, and top 10 takeaways here, to learn more about the discussions around how companies can further leverage partnerships and innovation to accelerate energy and water sustainability solutions.