Ratings and Rankings:Solving Human Problems for Profit

R. Paul HermanCEO + FounderHIP Investor

2

Do Good, Make Money, or Both?

HIP™:Human Impact + Profit

Do Good Make $$$

3

Individuals Want to Be HIP

INVESTORS

66% see “doing good” as positive

indicator

19% REFUSEto invest if firms

not “doing good”

CUSTOMERS

65% want to “do good” by

BUYING

49% DON’Tbuy if not good

38% tell a friend

EMPLOYEES

77% want to “do good” at

work

84% of exec’s say “doing good AND maximum

profit” is POSSIBLE

4

Solving Four Core Human ProblemsLeads to Sustainable, Profitable Growth

©2007 All rights reserved

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How HIP Practices Deliver ProfitFive Core Areas Leading Examples Leading Firms 1. Vision 50% by 2015 AMD

Zero by 2020 Interface

2. Measures 10-point balanced scorecard PG&E, HP, McD’s

3. Financials $10B, $20B, $50B revenue GE$400mm cost savings Interface+2% more; 40% less energy Liberty PropertySolar tax credits Walgreens

4. Accountability Board committees; GE, ChevronPerformance targets for Intel Corp.VPs, managers, staff Herman Miller

5. Decision Making Approval / integration of United Tech’snew product designs Sun Microsystems

5 HIP management disciplines drive Human Impact

©2007 All rights reserved

6

HIP Companies Are Outperforming

GS Sustainoutperforms

+25% beyond

MSCI World in 22 months

©2007 All rights reserved

7

Always Ask: “HOW HIP IS IT?”

• What human problemdoes this solve?

• How do you design for both Human Impact + Profit?

• What management practicesare in place to be HIP?

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CIGARETTES: “HOW HIP IS IT?”

How does it deliver Human Impact +

Profit?

What human problemdoes this solve?

What HIP management practices are in place?

• Reduce stress – emotionally• Lose weight – physically• Socialize – new friends

• Communities of interest (weight loss)• Short-burst physical exercise (gyms)• Online “venting” (see: the Internet)

• Vision: “Long life, not short tokes”• Accountability: Life expectancy goals • Decision-making: Kids as approvers?

9

BIG OIL: “HOW HIP IS IT?”

How does it deliver Human Impact +

Profit?

What human problemdoes this solve?

What HIP management practices are in place?

• Mobility – vehicle fuel• Productivity – lights, action!• Safe delivery – health care

• Nature-based fuels (sugar)• Renewable energy (wind)• Eco-plastics (green chemistry)

• Vision: “100% renewable energy”• Accountability: GreenHouse Gas

(GHG) targets for staff • Decision-making: “Go/No Go”

criteria

10

Fast Company magazine’s1st Annual HIP Scorecard

©2007 All rights reserved

11

Low diversity, not open

Health & safety for ALL workers

Investing in green energy

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How Will You Be HIP?

©2007 All rights reserved

13

Do Good, Make Money, or Both?

HIP™:Human Impact + Profit

Do Good Make $$$

http://sustainablelifemedia.com/�