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Sustainability Faceoff: Dow vs. DuPont

Dow DuPont faceoff

Massive materials companies like Dow and DuPont generate so many products that it's difficult to get a comprehensive picture of their sustainability as a whole. Nevertheless, author and investment adviser R. Paul Herman compares the two in the new book The HIP Investor. Below, we do the same.

Dow deserves credit for starting relatively early on its sustainability initiatives--the company established 10-year goals for environment, health, and safety in 1996. Since then, the goals have been updated. By 2015, the company has myriad ambitions in sustainable chemistry, climate change, energy efficiency, product safety, and more. Curious consumers can already learn about the safety of individual materials using Dow's Product Safety Assessment Finder. By 2015, Dow hopes to have safety assessments for all of its products.

But Dow is far from perfect. The company's greenhouse gas emissions intensity actually increased by 7% from 2007 to 2008--a disheartening statistic for a company that has been working on environmental goals for the past 14 years. And according to the Center for Public Integrity, Dow is responsible for 96 Superfund toxic waste sites in the U.S.

Like Dow, DuPont has plenty of sustainability goals for 2015, including advancements in products that protect people, increased revenue from non-depletable resources ($8 billion by 2015), reduced greenhouse gas emissions, and increased fleet fuel efficiency. In an interview with Herman, DuPont's Director of Sustainable Development, Dawn Rittenhouse, explained the company's philosophy behind its goals: "We make all of our goals absolutes. This is one of the things the environmentalists told us early on--'the Earth doesn’t care what you are doing per pound of product.'" DuPont is also a founding member of the World Business Council for Sustainable Development.

However, DuPont has multiple issues to work on. Some company products contain PFOA, a Teflon processing aid that causes developmental problems in laboratory animals. And DuPont tops the Political Economy Research Institute's 2009 list of the Toxic 100 Corporations. Dow comes in at third place--not much better.

Ultimately, we can't say that one of these companies significantly outperforms the other. So we have to declare a tie between the two companies for now--although that may change depending on how well Dow and DuPont fulfill their 2015 sustainability goals (note: this is the opinion of and not The HIP Investor).

Check out the full HIP Investor chart below.

  Dow   DuPont  
Overview 57,903 employees, $57.5 billion in annual revenue   60,000 employees, $31.8 billion in annual revenue  
Product Since 1994, have decreased energy used per pound of product by 22% resulting in $8.6 billion of savings benefiting customers and shareholders   Goal of 1,000 or more products that “protect people” by 2015; seek to double revenues from “non-depletable resources” to $8 billion; in 2007, revenue for these products reached $5.8B  
19 of 25: Comprehensive 2015 goals tracker updated quarterly; billion dollar investments need to evaluate sustainability impacts and analyze lifecycle metrics   18 of 25: Mission is sustainable growth, defined as “creating shareholder and societal value” while reducing company, customer, and supplier environmental footprints  

of 20%

At the end of the second quarter 2009, the Injury and Illness rate was 0.21 per 200,000 hours of work with a 2015 goal of 0.08 7% Between 2006 and 2007 DuPont reduced total recordable injuries by 25% and total incidents by 22% 4%

of 20%

About 51% of eligible employees enrolled in discount stock purchase program 13% Defined contribution programs cover substantially all U.S. employees; contributes 100% of the first 6% of employee retirement contribution plus another 3% regardless of level of compensation 14%

of 20%

 During 2008, greenhouse gas emissions were 0.602 metric tons per metric ton of production, about a 7% increase in intensity from 2007
7% In 2007, 6% of total energy came from renewable sources 10%

of 20%

Overall workforce is 26.5% female employees 11% Overall workforce is 26% female employees 12%

of 20%

At the end of the second quarter, there were 203 Product Safety Assessments (PSAs) posted at; the 2015 goal is to have publicly available PSAs for all applicable Dow products
10% In 2008, Environmental Resources Management conducted an evaluation of DuPont's Safety, Health, and Environment Audit Program and concluded that DuPont's Program is generally consistent with, and in some cases, exceeds expectations of the established criteria 10%
Human Impact

of 100%

 TOTAL 49%
Corporate Profit

of 20%

+3.5% return on equity (2008)

13.4% annualized total return, including reinvested dividends (6/2004–6/2009)

-21.8% annualized total return, including reinvested dividends (6/2006–6/2009)

  +22.5% return on equity (2008)

-7.0% annualized total return, including reinvested dividends (6/2004–6/2009)

-11.4% annualized total return, including reinvested dividends (6/2006–6/2009)



Read more Sustainability Faceoffs.

HIP InvestorTable excerpted from The HIP Investor: Make Bigger Profits by Building a Better World by R. Paul Herman Copyright (c) Published by John Wiley & Sons. Used with permission.

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