The Dow Jones Sustainability Index:
Why We All End Up Winning

On Thursday, the annual rankings of the 2014 Dow Jones Sustainability Index (DJSI) will be publicly announced. Based on research by the Swiss-based investment group RobecoSAM, the Index assesses the sustainability performance of close to 90 publicly traded multinationals operating in the chemicals and coatings industries.

Each company is ranked based on a detailed analysis of a range of criteria related to standard management practices and performance measures, with the top nine designated as finalists in the DJSI.

At AkzoNobel, we are proud of having been ranked number one in our respective sector by the DJSI for the last two years in a row (ED UPDATE: Make that three years in a row). After all, the Index is one of the most respected independent sustainability ranking systems globally, and our rankings affirm our commitment to growing our business through promoting and implementing sustainable practices.

But as any business knows, you can never rest on your laurels — and as every industry knows, competition is the key to innovation.

So, while we eagerly anticipate the DJSI every year, achieving a high ranking is not an end unto itself. Many of us in the industry are equally, if not more, interested in hearing what the DJSI has to say about areas where we can be better.

After all, the DJSI also serves as an effective tool for enhancing corporate sustainability by “providing companies with crucial insights into their sustainability performance,” and a “scorecard comparing their sustainability performance against the global industry average and their peers.”

That is where we see ultimate value in the DJSI — a tool that helps companies continuously improve their sustainability performance, and assess what progress they are making towards their strategic sustainability goals.

To leaders at companies like ours where sustainability is intrinsic in everything we do, that is a critical point; understanding where we need to improve, what our peers are doing (and what they are doing better), and gaining actionable insights.

For example, in 2013, the DJSI identified operational eco-efficiency and talent attraction as areas where we could do better. So since the last Index came out, we’ve been working hard to improve in these areas. We have also aligned our internal corporate culture with our focus on sustainability — tying the remuneration packages of our top 600 executives to our ranking in the Index.

Further, the constructive competition stimulated by the Index within our industry only helps reinforce our commitment to our Planet Possible strategy — a strategy aimed at delivering more value from fewer resources through three key imperatives: improving resource efficiency across the full value chain; reducing our carbon emissions across the value chain by 25 to 30 percent per ton by 2020 (2012 base); and increasing revenue from downstream eco-premium solutions to 20 percent of our revenues by 2020.

Other companies have responded to DJSI in similar fashion. Solvay, the Brussels-based chemical company with whom we are partnering on several sustainability initiatives, including a way to better monitor the use of renewable raw materials, has developed the Solvay Way, a “sustainable development policy coupled with a progress measurement tool.” This is just one of several examples of how the Index is impacting our industry.

So yes, when this year’s DJSI rankings are announced this week, many companies in the chemical space may have cause for celebration. After all, being featured in the top three for each of the last eight years the Index has been issued has given us much cause to be proud.

But regardless of our and other companies’ ranking, we should all be watching closely to see whether our industry’s ongoing efforts to evolve our sustainability initiatives are moving in the right direction, and whether the improvements we have made are bearing fruit. It will also show us what else we need to do.

Everyone likes to win, and that top spot can feel great. But the real elegance of the DJSI is what we learn from the rankings about how to advance sustainability. And, of course, the real beauty of sustainability is that everyone — businesses, our industry, our customers, the public — wins in the end.


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