 Welcome to the session and in this session, we will try to understand what is sustainable product and how do companies introduce sustainable product. Now, before getting into the sustainable product, let us summarize what we are trying to do in the last class about that why do company they undertake the sustainable initiative. And it is more about they have to mitigate the risk and in that process they will also get the profit. So, these are few of the factor which is summarized by brain click in his book, The Financial Time Briefing in Sustainable Business and this covers everything that why this company they should take this sustainability initiative. The first point about this is that this is for the because there is a concern for the people and environment. It is altruistic benefit and that is why the company they undertake the sustainability initiative. This gives us a license to the license to grow because if you are known as good and sustainable company, the growth in the market space is good and this gives us a license. There is a direct financial benefit in term of the reduced energy, material cost and also the cost associated with pollution abatement. This gives us the ability to continue. So, if you remember we introduced the concept of limit, there is a limit to resources. So, if there is a limit to resources unless this is being not responded well, that will stop the ability to continue in the production. Then the regulatory compliance stakeholder acceptance makes the company to undertake sustainability initiative and as we discussed in the last class also this gives a protection against risk and through this they can also enhance the or they can do a competitive advantage by addressing the sustainability agenda. Now what is sustainable product? The first definition is from Wikipedia. Sustainable product are those product that provide environmental, social, economic benefit while protecting the public health environment over the whole life cycle from the extraction of raw material until the final disposal. So, if you look at it talks about everything, it gives us the benefit that is environmental, social, economic benefit to the respective stakeholder. It protects the public health environment over the whole life cycle of the product from the extraction of the raw material to the end disposal. Now, if you have seen in most of the cases we use the word in synonym. Sometimes we use the word sustainable, sometimes we use the word green, sometimes we use the word eco-friendly, sometimes we use the word environmental friendly. So we use this interchangeably, but let us see what the differences between this different kind of product what we use in synonym. So green typically green covers almost everything related benefiting to the environment from the movement for environmental benefit to architecture to design and to the fashion everything that comes under green. Green products are energy efficient, durable, usually require low maintenance and these are often made from recycled materials from renewable sources and can be biodegradable or easily reuse recycle at the end of their life cycle. Now what is eco-friendly? It is not as broad as the previous two types of product. It means something does not have the planet and it can be used to define any product claiming minimal or no harm to the ecosystem and environment. That is what we call them as the eco-friendly or environmental friendly and this consists of the product that claiming minimal or no harm to the ecosystem or the environment. So if you look at green eco-friendly and sustainable product, possibly in the sustainable product it we represent the wide scope of issues and activity according to the UN that is do not compromise the ability of the future generation to meet the need. This is what from the definition of sustainable development. So our actions, our activity, our the way we consume produce it should be such that it should not compromise the ability of the future generation to meet their needs and sustainable product try to represent those issues activity which has been the part of the sustainable development definition. So sustainability includes eco-friendly activities, green product but green does not necessarily be sustainable like a product made from renewable resources is considered green. But if you do a life cycle analysis of the product you will find that it requires lot of energy to manufacture and ship to you. So there is a energy associated with manufacturing, energy associated with logistic. And if you there is no proper way to dispose the product then it will also create the harm to the environment. So this is not considered sustainable. This can be green because product made from the renewable resources but if you do a life cycle analysis you will find that there is a impact associated with the other loop of the product life cycle. So we cannot consider as a sustainable. So it is very difficult to get a sustainable product as a whole where the impact is lower, impact is minimum at each loop of the product life cycle. Now this is given by Kevin Braddy in Green Bees that what is the sustainability attributes of a product and it is initially the attributes are given by classical and more detailed eco design and sustainable strategy by Han Bregit and Martin Charter which is further added or further like complimented in by Kevin Braddy in his side that is Green Bees. And this is what the sustainability attributes of product. And what are the sustainability attributes of the product? We start with the, we do the attributes starting from the resource base, what is the life cycle impact and benefits? What is the human and ecological toxicity profile of this product? Then socio-economic impacts and benefit, total cost and the life cycle cost and finally the technical performance and fit for purpose. So typically when we do, we evaluate the product whether those are sustainable products or not. Typically these attributes are being used starting from the resource base what kind of resource are being used till the time this is the technical performance of the product is done and how much they are fit to you for the purpose or fit to the use. Now I will give you three examples which can be taken as a sustainable product example. This is again these examples are taken from financial time briefing on sustainable business this is by Brain Click which is published in 2011. The first example is Amazon Kindle. So this is a, Amazon comes out with this e-book reader Kindle. Now what are the impacts? They give positive impact because since it is e-reader there is no paper use over here. There is reducing paper use, there is no paper use, there is no energy in manufacturing the paper or the books. Then there is no energy associated with the distribution of books because this is electronectrically you can get and there is impact in term of reduction of, there is no reduction of tree, there is no reduction of paper use, there is no reduction, there is no use of energy in manufacturing and also there is no energy or the other cost associated with the distribution of the books. The e-link technology is energy efficient what is being used in this product and it only consume energy when we turn the page. It gives financial benefit, how it gives financial benefit because we are not using paper, there is no cost in the manufacturing, there is no cost associated with the distribution of the books. Now what is the problem with this product? Till the time the behavior, the consumer behavior of accepting such kind of product. So when it comes to book or newspaper we always prefer to or many people prefer to go for the conventional medium. So they still feel that if it is a book they want to have a hard bound book what they can read, keep after 20 years, 30 years they again want to read that book. And also there are, so initially there was no competitors but over a period of time the competitors they started also getting into the space. So mostly two problems associated with the product, one the consumer behavior associated with the product, how consumer the respond to such product and second is that competitors getting into the space. Also since the entire product is just based on the technology or the technological solution displacing such kind of product becomes easy. And somehow even if the product look sustainable what is being ignore over here is that since it is a electronics product there is environmental impact associated with producing and disposing the electronics. Now let us get into the second example. Second example is the Dairy Lent and the Tagline is Power of Cows. This is by US cooperatives and what they do? They produce the biogas from the cow manure and use that gas to produce the electricity. Now what is the positive impact of the product? The positive impact of the product is that since typically the cow manure they produce the methane and they stay long in the atmosphere it because of since it is being used from use biogas and again to produce electricity it reduce the source of global warming and the gas what we get from this cow manure is typically cleaner than gas what we get from the other sources the natural gas what we get from the other sources. Then the other benefit is that there is a income generation through the electricity and also the carbon credit project can be taken from the since this is being used this can be also part of the carbon credit and the whatever the credit you own in this project that becomes the benefit. Now what is the problem associated with the product? The problem associated with product is that it needs lot of upfront expenditure. So unless there is no third party there is no businesses get business getting into this for the farmers getting into this system produce at a scale which will be again converted into electricity becomes a problem and also you will find in the countryside there is always a resistance for such kind of use. So there is a resistance for biogas there is also a resistance for also wind turbine. Now let us get into the third example that is NATURA that is the tagline over here is that cosmetic with a sustainable twist. This is a Brazilian company and their Ecos product is designed from sustainable use of materials from rainforest and farm. So how they do it? They do a sustainable plantation and also they do the fair trading with the farmer even they use the reusable container to reduce the waste. And what is the benefit? The benefit over is that there is a increased growth because the product is known as sustainable product. There are lot of awards rewards what they got because they have incorporated the sustainability and also they enhance their image that is image of a great employer by that they could retain their existing employee and they can also they could also find out or they could also employ the better employee for the company. Now the difficulty over here is that it is very difficult to get into 100 percent natural content in the product line of cosmetics. When you know that cosmetic is initially it is all about the artificial. So changing entire 100 percent to natural content in the product line in this place is difficult. So although they did a acquisition of the natural medicine company but it was still getting difficult that how do they change this entire 100 percent content into the natural. Sustainable in the product line. Now the other thing what is given is that what are the different paths to develop a sustainable product. Since I was giving you an example over here is that since they wanted to move into the 100 percent natural content in the product line they acquire in natural medicine company. So this is one of the path that how you create a sustainable product or how you create a sustainable product line. So this is given by Andrew and attention that there are three paths to develop a sustainable product. One accentuate that is through which we highlight the green attributes of the existing product. Second you acquire a brand which is green and you develop the sustainable product and architect is which is more difficult is that you start the sustainable product or the sustainable brand from the scratch. So it is up to the firms, it is up to the company that what kind of path they would like to choose, whether they want to accentuate just the highlight the green attribute of the existing product and working more on that and converting that into a sustainable product or acquire a green brand and develop a sustainable product or architect build from the scratch entirely a new sustainable product. Now whenever you plan whatever path you whatever the path the company shows whether they accentuate whether the architect or whether they acquire how to make a successful one when you are introducing a sustainable product or when you are launching a product in the environmental friendly product in the market how to make a successful one. The first thing is that it is it should not be ad hoc one the strategy of sustainable product or building a sustainable product it is not about a ad hoc plan it has to be a send it has to be part of the central strategy. Second the company has to be transparent about the product the success factor also about the failure factors. They should answer the sustainability benefit from new project it is not about only it is a cost center since you are offering a sustainable product if it is not it is creating only a cost to the company over a long period of time possibly this will not work it may not be a successful one. So answering the sustainability benefit of the new project or the new product being prepared to use new technology since you are developing a new sustainable product and typically sustainable product should not be something very new or not the part of the core business line. So whatever the company is doing well whatever the firm is doing well they should apply sustainability to that and see how they develop a sustainable product and there should be a clear goal setting, prioritizing and also there should be a provision for reward and recognition for the employees and other stakeholders who are making this product as the successfully successful one. Then few things what the companies need to avoid in order to make a successful one is that first thing is to avoid the green wash and how to avoid green wash or typically what companies they do is that they use a low impact green gesture to look more sustainable in the long run it is not going to work and it is be considered as the green washing. Second also you will find that few of the company they concentrate image rather than delivers they spend more effort in creating an image of a sustainable product rather than look really delivering a sustainable product. Both involves the green wash typically this has to be avoided in order to get a successful product on the sustainable brand. Always acquisition will not help unless the changes are not happening to the product or whatever the development of the sustainable product whatever the changes needed that has to be done only acquiring a brand will not makes the existing company a green brand. And also need to assess does it provide benefit to all stakeholders when I mean all stakeholders by producing this green product or the producing the sustainable product whether the company gets the benefit whether consumer gets the satisfaction or whether the other stakeholder they get the share of their share of benefits. If it happens then only the sustainable product become the sustainable one and the last one is that the company should not be trying doing everything on their own. So, in some of the part of the product life cycle if they find that they are not having the capability or it can be better if it is being outsourced possibly they should outsource what they cannot do or what they do not have the capability in order to meet the successful sustainable product. So, in this session what we are trying to understand is that what is known as the sustainable product what the company they should do in order to introduce a sustainable product or what are the different paths to develop what are the success factors and what may be the possible failure factors. Thank you.