Putting stock in sustainability

Staff Writer
Mount Shasta Herald

A company known for tearing up earth has been recognized for not tearing up Earth.

We refer, of course, to Caterpillar Inc., which recently was renamed to the Dow Jones Sustainability World Index. The stock index, started in 1999, tracks the financial performance of about 300 Dow-listed companies that meet 'sustainability' criteria — basically, firms which analysts feel have a heart when it comes to the environment and to society.

This marks the seventh year in a row that Cat, ranked highest among industrial engineering firms, has made the cut. Certain folks may dispute the degree of Big Yellow's "greenness," just as they might with fellow Sustainability World Index members McDonald's, Nestle, Nike and Walt Disney. Whenever you're the company in a company town you endure a certain love-hate relationship with the locals, whether you directly employ them or not, but in fact there are many examples of Caterpillar being a good corporate citizen.

Cat and its charitable foundation have supported numerous environmental, social, cultural and medical causes. Cat has given to organizations as diverse as Ducks Unlimited, Opportunity International and the Heartland Water Resources Council, to name a few. It has pledged millions more toward the University of Illinois' planned Peoria cancer research center and the Downtown museum effort.

In January, the company put its mouth where its money is, as Chairman and CEO Jim Owens joined the Natural Resources Defense Council in urging the Bush administration to enact mandatory reductions of greenhouse gas emissions. A meat-and-potatoes Midwestern manufacturer agreeing with the granola crowd? Who knew?

The year 2005 was a particularly notable one for Caterpillar, as the company provided equipment after Hurricane Katrina. Cat also published its first-ever "Sustainability Report," pledging to do more for air, land and water. Since then it has worked toward fulfilling those promises: by slashing diesel engine emissions, by reducing and recycling its waste, and, most impressive, by donating a whopping $12 million to the Nature Conservancy for river projects, including here on the Upper Mississippi watershed. 

"Social responsibility is becoming more important in the corporate world," Russell Leiman, the Nature Conservancy's Asia-Pacific regional director, told this page last fall. "The market is starting to value corporations that have an environmental edge."

Indeed, the Dow's domestic and international sustainability indices seem to follow a larger trend, in which modern investors may care as much about a company's carbon footprint or labor practices as they do its share price. Folks attuned to buzz words like global warming and fair trade want reassurance that the industries in which they're investing aren't, say, exploiting workers or destroying protected habitat in the pursuit of profit.

In that way, promoting sustainability is good for Cat's bottom line. "They know they're in an industry that's essential, but nonetheless destructive" by nature, Leiman said. Here's to striking a suitable balance between being green and making green.