The debate over the need for strict and costly environmental regulations may continue to rage, but some mall owners are already seeing positive results from their early efforts to curb energy and water consumption. Sonae Sierra is one of them. Last year the Lisbon, Portugal–based mall developer was named the most sustainable retail real estate company in the world by the Global Real Estate Benchmark Foundation. And in competition with property holders in general, Sonae Sierra came in third after two Australian office space owners.
Sonae Sierra owns centers not only in Portugal, but also in Spain, Germany, Greece, Romania and Brazil. The firm provides third-party services in Colombia, Cyprus, Morocco and Serbia. Sonae has cut its electricity consumption some 30 percent since 2002, saving roughly €9 million (about $11.5 million) across some 50 malls accounting for 24 million square feet. It slashed greenhouse emissions 60 percent. Moreover, between 2003 and 2010 it reduced water usage about 12 percent, saving €545,000 last year alone.
Elsa Monteiro, who heads the company’s sustainability program, credits investors for recognizing early that good ecological sense is good business sense. “Our shareholders decided that incorporating environmental issues into our business strategies would make us more competitive in the medium term,” she said. “Longer term, our survival depends on it.”
Former CEO Alvaro Portelo, who worked closely with Monteiro over the years, attributes much of the success to her leadership, passion, persistence and hard work. “Elsa was the one who launched the environmental program and, later, the full corporate responsibility program, not me,” he said. “As CEO I believe that my merit was just to agree and support her.”
Sonae Sierra’s sustainability effort began in earnest in 1995 when Monteiro joined the company as head of institutional relations, environment and communications. She was promoted to head of sustainability in 2008.
Before joining Sonae Sierra, Monteiro was chief of cabinet for Portugal’s Secretary of State of Local Administration and Urban Planning, a position that prepared her well for her current job. The main challenge there, she says, was to determine how industry policies affected Portugal and to balance those policies with the welfare of the country at large.
Monteiro’s has an undergraduate degree in geography, which, in Europe, comprises a curriculum that includes the study of people, communities and science. Her postgraduate studies took her to Harvard Business School, Switzerland’s International Institute for Management Development and other schools; she studied urban planning, business management, environmental law and corporate social responsibility.
Guiding the 1,500-employee company in these new and sometimes controversial directions required single-mindedness and fortitude. “As in all kinds of organizational change, we had different attitudes from the innovators, the supporters and the resisters,” she said. But even the skeptics were eventually converted when they saw the results. “Now we can say that sustainability is a key element of the company’s business strategy.”
It would have been much harder to reach this point without Monteiro, Portelo says. “She fought with me for the resources and tools to progress with the programs and with everybody else in the company in a convincing way, so the concepts were taken seriously and results were achieved,” he said. Furthermore, she accomplished these goals without benefit of a particularly high rank within the company, he says. “She could only give orders to her strong staff of half a dozen scattered around four or five countries,” Portelo said. “It was her persuasiveness and tenacity that produced the results.”
This success is attributable in part to a strategy that enables the company to carry out continuous revision and improvement, says Pedro Caupers, a Sonae Sierra board member responsible for improvements and asset management. “Every year Sonae Sierra establishes a corporate responsibility plan as part of its general strategy, with well-defined, measurable and quantifiable objectives that enable all levels of the company to work to achieve them,” he said.
Now the company aims to cut greenhouse gas emissions by 70 percent and to raise energy-efficiency levels to a maximum usage of 400 kilowatt-hours per square meter annually, across its portfolio. Monteiro is confident of success, and Portelo is convinced she can make it happen.
“I was very lucky in picking her to lead my team,” he said, “and then to have said yes to what sometimes looked like crazy, expensive and useless ideas from her.”