First ever ‘Green 50’ list shows booming green sector

MEDIA RELEASE

Friday, 29 June 2012

First ever ‘Green 50’ list shows booming green sector

New Zealand’s first definitive list of companies making money improving the environment has just been launched by strategic research company New River.

Top of the New River Green 50 list is Auckland-based Chem Recovery, which recovers and recycles heavy metals to produce 99.9 per cent pure re-usable metals; followed by Stonewood Homes, builder of a 7-star green building; and Reid Technology, a New Zealand leader in solar power. Other companies on the list include Flotech, a technology pioneer allowing organic waste to be converted into methane for pipeline gas; and Outgro an innovative fetiliser company enabling farmers to reduce phosphorous and nitrogen run-off into waterways while increasing their yields.

The New River Green 50 list is the first of its kind in New Zealand and was developed from in-depth research that involved interviews with multiple managers in each of the 54 sectors of the economy. Over 150 companies that have a product, service or technology to improve the environment were considered, and those where this is over 50 per cent of their business were eligible to make the top 50 list. They were then ranked by a mixture of revenue and growth rate.

New River managing director Roger Parker said with a combined revenue of $1.1bn, the list demonstrated the value of the green economy in New Zealand.

“In doing this research, we found that the individual companies on the Green 50 are growing at a phenomenal rate, on average 260% per annum. As a segment, the Green 50 grew at 15 times the speed of the New Zealand economy over the last year,” he said.

“What’s more, the most companies were in agriculture, which means there are a lot of farmers buying products, services and technologies to improve the environment, something we hear little about. It’s also encouraging to see the number and performance of larger companies that don’t necessarily make the list because improving the environment is not their core business, but are still doing lots of incredible stuff in the sustainability space and improving their performance as a result.”

Exporters made up the majority (71 per cent) of companies on the list, compared with 18 per cent of the New Zealand economy. The most common area of environmental improvement was reducing pollution (52 per cent of companies) followed by reducing greenhouse gas emissions (40 per cent) and resource recovery (30 per cent).

In total, 320 companies were short-listed and studied, and divided into two ‘types’ based on how they improve the environment and make money. ‘Type One’ companies are those that have a product, service or technology to improve the environment. Only Type One companies are on the Green 50 list because they meet the criterion, which is that their product, service or technology generates revenue improving the environment, and this makes up more than 50 per cent of their business.

‘Type Two’ companies are where they lower their environmental impact usually to make an existing business more environmentally sustainable. These are companies trying to green a traditional business, where the products, services or technologies sold are not to improve the environment as such. These are primarily cost reduction / compliance / reputation-models.

The list of leading companies doing environmental sustainability initiatives includes many of New Zealand’s top companies like Fonterra, Air NZ and Fulton Hogan. The research suggests environmental sustainability in leading companies is now mainstream.

Wayne Cartwright, former Professor of Strategic Management at the University of Auckland and editor of the book Strong Sustainability for New Zealand, said the results were very encouraging, and the research has substantial potential value through analysis and reporting that can inform business strategy and sector policy.

“These findings should help to bring the green sector into greater prominence in terms of economic development policy, and should also help to reduce the perceptions of risk that have deterred investment in the sector and affected the credit available to companies.”

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