Kurt Kuehn

Lynnette McIntire

As a CFO who advocates sustainability, I’ve noticed that many of my peers take a lukewarm view of the idea, perhaps because they simply don’t see how sustainability can produce returns for a business. I can relate: I, too, am always looking for ways to allocate resources effectively and create value. Yet most companies do have sustainability programs, and the finance folks obviously approved the expenditures. My question is, What was the process by which those investments got green-lighted? In particular, how were certain projects chosen over all the other possibilities?

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Reprint: R1404D
As the CFO of UPS&#8212;and a founding member of its sustainability steering committee&#8212;Kuehn wrestled with the question of where and how to most effectively direct the company&#8217;s resources. The approach he developed is rooted in two beliefs: Companies have a responsibility to contribute to society and the environment, and every investment a company makes should return value to the business. These beliefs don&#8217;t have to be at odds, he writes, although they often mean that sustainability programs must be subjected to alternative financial evaluation models. In fact, the programs with the most impact not only align with companies&#8217; strategies but move in tandem with their activities.
UPS&#8217;s breakthrough came when it recognized that efficiency would be greatest in any initiative where momentum existed and where the company was positioned to make a pivotal or tipping-point difference. To guide its sustainability choices and investments, UPS has implemented a clear process of (1) assessing its strengths; (2) choosing its spots; (3) finding momentum; (4) building productive partnerships; and (5) convening other sources of strength. This approach avoids missteps such as executive pet projects and directing the volunteerism of employees to tasks at which they are not actually good. Kuehn draws lessons from UPS&#8217;s own experience and from that of others, including Campbell Soup, Pfizer, and Marks &#038; Spencer.

Sustainability a CFO Can Love

Reprint: R1404D As the CFO of UPS—and a founding member of its sustainability steering committee—Kuehn wrestled with the question of where and how to most effectively direct the company’s resources. The approach he developed is rooted in two beliefs: Companies have a responsibility to contribute to society and the environment, and every investment a company makes should return value to the business. These beliefs don’t have to be at odds, he writes, although they often mean that sustainability programs must be subjected to alternative financial evaluation models. In fact, the programs with the most impact not only align with companies’ strategies but move in tandem with their activities. UPS’s breakthrough came when it recognized that efficiency would be greatest in any initiative where momentum existed and where the company was positioned to make a pivotal or tipping-point difference. To guide its sustainability choices and investments, UPS has implemented a clear process of (1) assessing its strengths; (2) choosing its spots; (3) finding momentum; (4) building productive partnerships; and (5) convening other sources of strength. This approach avoids missteps such as executive pet projects and directing the volunteerism of employees to tasks at which they are not actually good. Kuehn draws lessons from UPS’s own experience and from that of others, including Campbell Soup, Pfizer, and Marks & Spencer.

Sustainability a CFO Can Love

Summary.

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