When Sylvain Guyoton was completing his MBA in 2002, he spearheaded a graduation pledge for his class to sign and promise that their business endeavours will not harm society. The pledge “to explore and take into account the social and environmental consequences of any job,” and, “try to improve these aspects of the organizations for which I work,” was signed by 50% of the graduating class during a time of little awareness about social responsibility. After graduation, Guyoton went on to work for Vigeo (now Vigeo Eiris), a French Environment, Social and Governance (ESG) research and business strategy firm, as their head of research and methodology. From the get-go, it was clear Guyoton would find a way to empower leaders to build a better world.
Fast forward to 2007, EcoVadis co-founder Pierre-François Thaler MBA’99 found his INSEAD network indispensable when he sought to launch his new venture with co-founder Frédéric Trinel. Their business idea was to help corporations bridge the information gap between corporate buyers and suppliers, focusing on extra-financial risk in environment, social and governance. EcoVadis evaluates supplier sustainability performance through a document audit and generates a ‘scorecard’ with the assessment result. Suppliers can share the scorecard with client buyers in the EcoVadis network, and buyers can monitor supplier sustainability performances.
Sylvain Guyoton, Senior Vice President Research at EcoVadis
Looking for someone with expertise in sustainability performance, the EcoVadis team found Guyoton through the INSEAD network and tapped him to develop their evaluation methodology. INSEAD Professor Luk Van Wassenhove, whose current research interests focus on aligning business models and new technologies with the UN Sustainable Development Goals, e.g. closed-loop supply chains, circular economy, and disaster and health logistics, and alumni Jaqueline Aloisi MBA‘71 were brought on as advisors for the EcoVadis scientific committee.
Twelve years later, EcoVadis has grown into a global company with 600 employees across 10 offices on five continents. Working with over 450 household brand names worldwide, the company has evaluated over 60,000 companies in 200 sectors and 155 countries, collectively accounting for more than US$1.5 trillion in procurement spend globally. After the company received an impressive €200 million funding from CVC Growth Partners in early 2020, it expects to grow the number of evaluations exponentially in the future. Supply-chain stewardship has promising prospects and Verdantix forecasts market growth from US$413 million in 2017 to US$578 million in 2020. In sustainability consulting, supply-chain and resource-management strategy grew by 7% annually in that same period. With an addressable market of four million suppliers in the supply chain of global multinationals, there was huge growth potential.
Inspired by his involvement with EcoVadis since its early days, Professor Van Wassenhove decided to write a business case on the company in 2018 for several reasons:
- The EcoVadis story is exceptional because it is a rare example of for-profit business, not a social enterprise, with a mission to solve sustainability issue. It is also not just a case of an established multi-national corporation aiming to green their business.
- EcoVadis’s success is a combination of its distinctive growth strategy in a fast-changing landscape that poses interesting questions and challenges.
- INSEAD plays an interesting catalyst role from the very genesis of the company.
Van Wassenhove invited Professor Andre Calmon, who currently teaches the MBA elective on Sustainability Business Thinking, to co-author the case. It just so happened that MBA’19D student Anne Huang was a former EcoVadis employee and agreed to work on the case. She was able to add some of her own observations and insights from contributing more than four years at the company. The business case EcoVadis: A Sustainability Rating Company Goes Global was published in January 2020.
Dean of INSEAD, Ilian Mihov was featured as the keynote speaker at EcoVadis’ 2020 Sustain conference, an annual conference that this year focused on sustainable supply chains. During his speech, Dean Mihov noted that the role of business is changing and the role of business education must change to raise awareness on the need to consider outcomes for business and society. “We’re in a very privileged position to have access to these thousand people and twelve thousand executive education participants every year – people who will be decision makers in the next decade and beyond. We can help them to better understand the concerns the world has about sustainability today.”
Much of this effort, and collaboration with EcoVadis, is led by the INSEAD Hoffmann Global Institute for Business and Society. The Institute shares knowledge, offers transformational learning experiences and engages students to inspire them to become future leaders that strive for sustainability in business.
Besides promoting sustainability through research and in the classroom, INSEAD strives to ‘walk the talk’ by improving sustainability in operations and engagement. Whether it is through elimination of single-use plastics on campus or in a community challenge, convening a health forum at the ChangeNow Summit or raising funds to empower and educate girls worldwide, the school and community are stepping up as a force for good.
In this context, EcoVadis has played a catalyst role. Since 2014, the school has participated in the EcoVadis sustainability assessment. The assessment provides guidance on specific areas and practices the school should prioritize in order to improve the sustainability score. The school scored 63/100 in its latest EcoVadis assessment, in the top ten percent of all ranked organizations. We are proud of this assessment because we have brought our score up from 38/100 in 2014. By looking at areas to improve the EcoVadis score, the school has improved our overall sustainability. This year’s assessment shows that INSEAD, like many organizations, can work on improving supply chain transparency.
With a relationship spanning almost two decades, INSEAD and EcoVadis will continue with future collaborations to advance sustainability in business and business education. EcoVadis management is thrilled that their growth story will be taught to students around the world. Both partners hope that students and business leaders alike are inspired by this innovative business model, and develop their own new ideas to make the world a better place.
EcoVadis: a business sustainability rating agency, bridges the information gap between corporate buyers and their suppliers. EcoVadis uses its sustainability assessment, a carefully designed document audit on the supplier’s management system on environment, social, and governance topics relevant to the company’s sector, size, and geography. Analysts examine and verify the supporting documents provided by suppliers with third party stakeholders input against the EcoVadis Methodology and generate a ‘scorecard’ with the assessment result. Suppliers share the scorecard with client buyers within the EcoVadis network, while buyers monitor suppliers’ CSR performances, both via the EcoVadis platform.