AHC Group

Defining the environmental compass points for exelon

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In this case study, a lead executive from a major producer of electricity explains how, through better business alignment and environmental strategy, the company out-maneuvered the financial pressures of post-Enron debt barriers.

The fundamental challenge that Exelon leadership and the ESD Team sought to resolve was defining the direction or intent for the environmental strategy. Some felt that the new corporation should more aggressively promote what it had already accomplished and that further investment in environmental philanthropy would be difficult to justify; others felt that Exelon could position itself as an environmental leader, if not within the utility sector, perhaps even more broadly. The ESD Team assimilated all of leadership's input, and focused on defining an environmental strategic intent for the corporation that would leverage past accomplishments and establish a future direction while complementing Exelon's business strategy and creating value.

Exelon was able to draw on the successes of a host of other corporations to help focus our efforts. During the past several decades, many corporations have evolved their environmental strategies from a compliance-based focus that was considered exclusively a cost to the business, to a more value-based environmental focus. The research conducted by Exelon, and their strategic consulting partner, Five Winds International, concluded that, in the current market, leading companies are demonstrating environmental leadership and corporate social responsibility through an integrated focus on economic, environmental, and social performance, i.e., sustainability. Corporations that are recognized globally as environmental leaders have developed their environmental programs well beyond a compliance focus, and are setting the benchmarks for environmental performance. In many cases, their leadership is defined by their commitment to pursuing sustainable business strategies. Royal Dutch/Shell Group, BP, Ontario Power Generation, Dupont, Rohm & Haas, Baxter, and others have recognized that their future economic growth is dependent on finite natural resources and the quality of life of their customers, employees and the communities where they operate.

Sustainability is commonly defined as 'meeting the needs of the present without compromising the ability of future generations to meet their own needs.' It challenges us to meet a triple bottom line of economic prosperity, social responsibility and environmental quality. In essence, it requires that we balance the needs and interests of our various stakeholders while operating in a manner that sustains our business, communities and environment for future generations.

The implication for Exelon is that sustainability has become a standard against which our environmental performance will be judged.

Shifting to a strategy base, proactively managing risk and promoting environmentally sustainable business practices will enable Exelon to address new opportunities and increasing demands, and will position us to be recognized as a corporate environmental leader.


Launching and sustaining the momentum of the environmental strategy will require the ongoing engagement of management at all levels of the corporation; the tone that is established by the CEO and the Management Committee will set the strategic imperative. Borrowing form the success of other corporations that have been recognized for their leadership and accomplishments, Exelon has adopted the recommendation to form an Environmental Council comprised of senior level officers. The Environmental Council is charged with translating the leadership team's sponsorship into action at the business unit level, and serving as an advisory board for setting the next stage of performance improvement goals.

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