Sustainable 60 winners are changing the way we do business
They're altering the face of business and building future-proof companies. So who are 2009's Sustainable 60 winners?
Thursday, December 03 2009 || Features || BY Caitlin Sykes
The four exemplars or overall winners chosen by the Sustainable 60 judges - Locus Research, The New Zealand Merino Company, Urgent Couriers and IAG - run that sustainability thread through all aspects of their business.
What can we do? We’re dirty car drivers!” That was the response from Steve Bonnici’s team when he first broached the idea of sustainable business practices in the late 90s.
Something is better than nothing was his reply. “And that was really the approach we took — let’s do little things,” says the founder and managing director of Urgent Couriers.
They may have started with small steps but the sum total of the courier company’s efforts is verging on heroic, says Rob Fenwick, Living Earth co-founder and a Sustainable 60 judge.
Bonnici and Urgent Couriers have taken on the challenge of sustainability in one of the toughest sectors in business. The courier business is all about getting from A to B in the shortest time possible, as cheaply as possible. Yet Bonnici, concerned about the financial viability of his drivers, raised prices incrementally to ensure they could make a sustainable income.
Urgent has also made a commitment to boost the number of low-emission vehicles in its fleet, helping its contractor drivers source such vehicles and then assisting with finance.
If Urgent Couriers, a predominantly urban business taking on the transport sector and the spectre of a fossil fuel-burning business model, is the yin of the Sustainable 60, the New Zealand Merino Company is the yang. It’s hardly surprising that judges couldn’t choose between them in the medium exemplar category.
The New Zealand Merino Company couldn’t be further from the concrete jungle in which Urgent Couriers operates, says Fenwick.
“Here’s a sector that has rescued itself almost from the brink of extinction in New Zealand by using the sustainability brand, and did it with great integrity and pervaded it throughout the whole business — from farm to shop,” Fenwick says of the merino wool marketing and industry organisation — a 50/50 joint venture between merino growers and PGG Wrightson. “It’s a seamless quest for a low footprint and high standards of environmental responsibility throughout every step of the value chain and with great results in terms of securing a profile for that brand based on 100% brand New Zealand.”
CEO John Brakenridge calls it a paradigm shift that presents a wider opportunity for New Zealand Inc. Historically, merino farmers sold their wool at auction to a top maker (who scours and combs the wool), who sold to a spinner, who sold to a knitter or weaver, who sold to a retail brand. Each person in the supply chain would jealously guard their customers and argue each week over price, convinced that others in the chain may be making more money.
“Everybody in that supply chain needs to exist, but they need to exist collaboratively,” says Brakenridge. “We target the retail brand, back-fill the supply chain, and that supply chain works together.
“If New Zealand and our grower/suppliers are going to get more money, that can only happen if you’ve got more money happening at retail and you’ve got a more effective and efficient supply chain.”
The company’s strategy has been to grow new categories for merino wool, for use in active outdoor wear, through partnerships with retail brands like Icebreaker, Smartwool and Ibex. It has then focused on breaking down the traditional barriers between producers and retail brands by building a culture where openness and interaction between all parties is fostered. Growers and retail brands share in-depth meetings, for example, and all parties get together to mix business and pleasure at an annual conference, this year called ‘Woolstock’.
Importantly, the collaborative model has enabled the company to establish three-year supply contracts in New Zealand dollars for a substantial amount of fibre, giving confidence to both growers and the end market.
New Zealand Merino has also developed the Zque ethical brand of merino fibre, with credentials supporting its economic and environmental sustainability, as well as animal welfare and traceability standards.
It isn’t rocket science, says Brakenridge; the challenge lies in changing attitudes and behaviours. There is a massive opportunity for New Zealand to take advantage of a global shift to more traditional values, he says.
“It is probably the best opportunity that New Zealand has had in decades for us to ensure that we are selling our products on platforms of product integrity and ensuring that we have got the substance and the sustainability and the traceability.
“For New Zealand as a country there needs to be, in my opinion, substantial paradigm shifts. The older and more entrenched the industry, the greater the push back is going to be. But done right, the greater the reward will be for this country too.”
An independent validation by McKinsey & Co found that the New Zealand Merino Company is adding value for growers to the tune of $10 million to $15 million annually.
| Urgent Couriers managing director Steven Bonnici |
What can we do? We’re dirty car drivers!” That was the response from Steve Bonnici’s team when he first broached the idea of sustainable business practices in the late 90s.
Something is better than nothing was his reply. “And that was really the approach we took — let’s do little things,” says the founder and managing director of Urgent Couriers.
They may have started with small steps but the sum total of the courier company’s efforts is verging on heroic, says Rob Fenwick, Living Earth co-founder and a Sustainable 60 judge.
Bonnici and Urgent Couriers have taken on the challenge of sustainability in one of the toughest sectors in business. The courier business is all about getting from A to B in the shortest time possible, as cheaply as possible. Yet Bonnici, concerned about the financial viability of his drivers, raised prices incrementally to ensure they could make a sustainable income.
Urgent has also made a commitment to boost the number of low-emission vehicles in its fleet, helping its contractor drivers source such vehicles and then assisting with finance.
If Urgent Couriers, a predominantly urban business taking on the transport sector and the spectre of a fossil fuel-burning business model, is the yin of the Sustainable 60, the New Zealand Merino Company is the yang. It’s hardly surprising that judges couldn’t choose between them in the medium exemplar category.
The New Zealand Merino Company couldn’t be further from the concrete jungle in which Urgent Couriers operates, says Fenwick.
“Here’s a sector that has rescued itself almost from the brink of extinction in New Zealand by using the sustainability brand, and did it with great integrity and pervaded it throughout the whole business — from farm to shop,” Fenwick says of the merino wool marketing and industry organisation — a 50/50 joint venture between merino growers and PGG Wrightson. “It’s a seamless quest for a low footprint and high standards of environmental responsibility throughout every step of the value chain and with great results in terms of securing a profile for that brand based on 100% brand New Zealand.”
CEO John Brakenridge calls it a paradigm shift that presents a wider opportunity for New Zealand Inc. Historically, merino farmers sold their wool at auction to a top maker (who scours and combs the wool), who sold to a spinner, who sold to a knitter or weaver, who sold to a retail brand. Each person in the supply chain would jealously guard their customers and argue each week over price, convinced that others in the chain may be making more money.
| New Zealand Merino Company CEO John Brackenridge |
“Everybody in that supply chain needs to exist, but they need to exist collaboratively,” says Brakenridge. “We target the retail brand, back-fill the supply chain, and that supply chain works together.
“If New Zealand and our grower/suppliers are going to get more money, that can only happen if you’ve got more money happening at retail and you’ve got a more effective and efficient supply chain.”
The company’s strategy has been to grow new categories for merino wool, for use in active outdoor wear, through partnerships with retail brands like Icebreaker, Smartwool and Ibex. It has then focused on breaking down the traditional barriers between producers and retail brands by building a culture where openness and interaction between all parties is fostered. Growers and retail brands share in-depth meetings, for example, and all parties get together to mix business and pleasure at an annual conference, this year called ‘Woolstock’.
Importantly, the collaborative model has enabled the company to establish three-year supply contracts in New Zealand dollars for a substantial amount of fibre, giving confidence to both growers and the end market.
New Zealand Merino has also developed the Zque ethical brand of merino fibre, with credentials supporting its economic and environmental sustainability, as well as animal welfare and traceability standards.
It isn’t rocket science, says Brakenridge; the challenge lies in changing attitudes and behaviours. There is a massive opportunity for New Zealand to take advantage of a global shift to more traditional values, he says.
“It is probably the best opportunity that New Zealand has had in decades for us to ensure that we are selling our products on platforms of product integrity and ensuring that we have got the substance and the sustainability and the traceability.
“For New Zealand as a country there needs to be, in my opinion, substantial paradigm shifts. The older and more entrenched the industry, the greater the push back is going to be. But done right, the greater the reward will be for this country too.”
An independent validation by McKinsey & Co found that the New Zealand Merino Company is adding value for growers to the tune of $10 million to $15 million annually.
