corporate finance – sponsored feature 17 Sustainability versus cashflow


As opportunities beckon for businesses in the region to take the lead with environmentally-sustainable strategies, Lloyds Bank Corporate Markets is taking steps to ensure companies and organisations emerge vigorously from the region’s economic recovery. Lloyds Bank hosted business leaders from across the region at a number of private dinners which discussed how businesses are adding value by implementing sustainable strategies. Paul Turner, head of sustainable development at Lloyds Bank, who spoke at the dinners, explains why there is real business value in tapping into the emerging green economy


There are many businesses in the Thames Valley and south region feeling the impact of the economic and social changes that come from addressing climate change and other environmental challenges. At present, there is an abundance of information about sustainability available – maybe too much – but addressing environmental issues can also be at the heart of business value creation. The long-term environmental challenges caused by a rising global population and rapid industrialisation are likely to make the business environment even more complicated but as we begin to emerge from the downturn there are real opportunities to develop strategies that unlock value and help to position businesses to manage some of the challenges that lay ahead.


There is already evidence of organisations in the region developing solid sustainability strategies, with some businesses looking at energy efficiency and renewable energy and others looking at driving greater operational efficiencies through their supply chains. However, there are still mind-sets to be changed for some organisations. Sustainability is no longer merely a PR or box ticking compliance exercise.


Cutting through the ’noise’ on sustainability is where we can add most value, with trusted support on issues and strategies that matter most to businesses. Lloyds Bank Corporate Markets can help build an understanding of the essential links between environmental issues and business value, to support customers in identifying the commercial risks and opportunities. By developing strategies businesses can


reduce costs, build brands and reputations, increase workforce engagement, access new markets, deepen customer relationships and manage emerging risks, including increasing legislative risks. The business case is compelling.


And ’green strategies’ don’t need to cost more. With increasing energy and other commodity costs, making decisions on the basis of the whole life cost, not just the initial outlay makes good business sense. We have seen a wealth of examples of where additional investment in for example energy efficiency have resulted in a rapid payback, relieved cashflow over the long term and helped protect a business from increasing energy costs.


There is of course the risk that with the pressures in the public and the private sectors from the government spending cuts, developing sustainability strategies may be viewed as a step too far. But, progressive organisations don’t view the two in isolation. Sustainability strategies can not only reduce costs, but they can also unlock real and long lasting additional value.


While embracing sustainable development is not always easy, a strong commitment in this area makes good commercial, social and most importantly environmental sense. Whether it be reducing consumption or increasing efficiencies, a real impact can be felt on the bottom line. By engaging more deeply with sustainability a company will start to see the economic benefits to their business.


Dr Neil Smith, environment manager at the University of Southampton, attended one of Lloyds Bank Corporate Markets’ sustainability dinners. Smith is responsible for managing the University’s environmental performance.


”There are sound economic reasons for us to reduce our environmental footprint, such as rising energy and waste costs, as well as addressing environmental and social concerns,” said Smith.


”As a leading research and development institution, Southampton is at the forefront of developing the thinking and technologies that will help us adapt to challenges posed by climate change. As educators, we prepare our students for their role in helping shape the future of society. Our leadership in these areas puts us in a strong position to help businesses respond positively to the environment agenda.”


THE BUSINESS MAGAZINE – SOLENT & SOUTH CENTRAL – JUNE 2011 www.businessmag.co.uk


Steve Clarke, area director, Lloyds Bank Corporate Markets


Lloyds Bank Corporate Markets, part of the wholesale division at Lloyds Banking Group, delivers corporate banking solutions to businesses with over £15-million annual turnover. Relationship teams in the Solent and the Thames Valley provide advice and expertise to businesses in the region.


Details: Steve Clarke Area Director 07920-207685 Steve.Clarke@lloydsbanking.com


Paul Turner, head of sustainable development, Lloyds Bank


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