Making money from Green business

There are many simple environment-saving solutions that have not just made businesses greener - helping their public image - but are also good for the business itself.

Having seen companies in the US and Europe take a green lead, some businesses in the Middle East are now trying to catch up on this trend. However, they have yet to define whether becoming 'green' can be as attractive as gold in the region.

Starting with simple solutions

While energy continues to be one of the top costs in many businesses, solutions to make savings may be as simple as improving the lighting. Global retail chain Wal-Mart led the way with this simple method of both helping the environment and its bottom line, showing that a sustainability programme can mix with its business operations.

By replacing the traditional incandescent light bulbs in its in-store ceiling fan displays with super-efficient compact fluorescent light bulbs (CFLs), Wal-Mart has slashed an estimated US$7m from its annual electricity bill; that's 500lbs. of coal saved over the lifetime of one new-style bulb. Put another way, the company estimates that for every 10 traditional bulbs that ended up at landfill sites, now it is putting in only one.

General Electric also looked at its lighting when it wanted to improve efficiencies. According to a report by Climate Northeast Case Study, 2006, GE discovered that approximately two-thirds of its industrial business facilities were not using its own lighting technology and that nearly all were equipped with relatively inefficient lighting fixtures.

The company replaced its high-intensity discharge (HID) lighting fixtures with its own brand of fluorescent bulbs. It conducted energy audits by breaking down the electricity load by activity and then compared it with post-retrofit energy cost estimates, to see if such project would produce positive results.

Apart from improved lighting conditions for employees, the company is projecting a reduction of its indirect greenhouse gas emissions by as much as 18,000 metric tons per year. But the move didn't just save GE money, the project also pushed its 'Ecomagination' commitments to the fore, expanding revenue from its energy-efficient technologies.

In the Middle East, energy-efficient ideas are slowly picking up, but are visible only to a few companies which are aiming to market ideas such as greener buildings technologies.

The importance of a goal

For Middle East-based Aramex, going green means a full-fledged commitment that involves social, economic and environmental value. The transport logistics company recently announced its 2006 Sustainability Report. One of the most important parts of this CSR goal is to become the first carbon neutral global logistics operator in the world.

Aramex CEO Fadi Gandour believes sustainability as part of the company's business strategy will transform the way the company thinks about its business. 'It will lead to new types of services, new levels of understanding, new ways of collaboration, renewed respect for our place in the world, and a profound commitment to ecological preservation through sustainability innovation, all of which will benefit shareholders and stakeholders alike.'

As part of this goal, Aramex said it is introducing cleaner vehicles in 2007 by setting up two stations for unleaded fuels for any of its petrol vehicles, upgrading 33 per cent of its fleet to low alternative fuel vehicles and purchasing two hybrid vehicles, to reduce its carbon emissions.

Plastic Pursuits

While Wal-Mart may have forged ahead in the green stakes, French supermarket Carrefour recently launched a campaign to reduce its plastic bag usage in the UAE, Kuwait, Qatar, and Oman.

The 'Small Change, Big Difference' campaign of the Majid Al-Futtaim run hypermarkets (which operate Carrefour in the Middle East), sells reusable shopping bags to its customers for Dhs2 and will later replace them free of charge. The company claims that by reusing the bags four times, it reduces the number of plastic bags needed by 18 per cent.

In the first sixth months the company reported reusable bag sales of more than 600,000 across the region. But the company did not respond to questions asking whether this initiative had reduced the amount of plastic bags used by shoppers at Carrefour.

While these efforts are good first steps, business ideas that promote environmental sustainability still need more sparks for companies to take green business beyond merely filling up CSR reports. 'Green' businesses might have to take a back seat until companies finally realise its real importance, but once companies they see that such practices are good PR and help the bottom line, you can be sure they will quickly adopt them.

See also:
On the wane: The UAE's mudflats and mangroves
Saving the ghaf tree: a campaign diary
CSR at Cisco targets human capital