The right message to shareholders.

• Author: Osgood, Peter
• Position: Leadership in Environmental Initiatives

Environmental deeds speak much louder than environmental words, but it is still essential to convey a green message to shareholders.

A number of years ago, an executive gave a very far-seeing speech on public issues entitled "Rivers and Boats." Boats, in his definition, were temporal issues -- issues of the moment -- which were carried from side to side by the prevailing winds of the day. Rivers, on the other hand, were generic issues -- those broadly based concerns of the body politic that remained impervious to the tides and currents of public opinion and the gale force gusts of media frenzy. Where boats could be measured in days or weeks or months, rivers were timeless in their sustaining impact on the human condition -- and while the rivers rise or fall in relative terms, basically like the Mississippi, "they Just kept rollin' along."

Our individual, societal, and corporate concerns for the environment are clearly a river, and not a boat. The environmental movement -- given all its hyperbole, its excess zeal, its frequent failures to accept legitimate economic concerns, and its sometimes mindless military -- still remains a fundamental force in our society and our economy, and will remain so for succeeding generations.

So when we are about to consider the priority of conveying a company's "green" message to shareholders, we are not just crystallizing another debate over accounting principles or responding to the latest blow-up over executive compensation. We are addressing a physical and human concern of substantial dimensions that has invested itself through sheer momentum into the basic fabric of all our institutions, both public and private.

A fundamental question we need to address is, "Do shareholders care?" If they do, what is it they specifically want to know about a company's green side? And does it make a difference?

The first of these questions -- do shareholders care? -- divides itself again by two: into individual investor and institutional investor considerations. The answer in both cases is, they care -- first and foremost about the potential financial impact of environmental performance, and then, close behind, about the environmental policies and actions of individual companies.

I say policies and actions because discerning investors -- particularly those at the institutional level -- are keenly aware that, in the future, environmental deeds will speak much louder than environmental words. These investors realize that it...