Analysis Of Disney's Environmental Behaviour 2005

Analysis Of Disney's Environmental Behaviour 2005

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Today, the world is decreasing, as a direct result of globalization. Distances are shorter; the number of habitants of the world is increasing in the same tempo as new companies appear. The environmental affects today are highly visible, we all agree on how much the weather has been changing the last ten years, pollution increases as we need more products, and global warming is now a fact.

The author of The World is Flat claims that we today are moving towards an era, which he calls "Globalization 3.0", which is driven by individuals, which are not only non-Western and non-white but also a group of individuals. This era makes it easy for everyone to play the game, (1) and we can therefore say that this is not the time where the big companies decide what we want, competition is increasing, and companies need to adopt, change and most importantly differentiate in order to keep on prosper. In the end, does thinking environmentaly solely lye on the big enterprises, or do we as individuals have any responsibility?

In this essay, we will be discussing one of these environmental strategies of differentiation. Think green. We will be exploring one of the biggest media company in the world, Walt Disney Enterprises INC, and what they do in order to gain a competitive advantage by implementing environmental care into their organization. The first part will contain a short presentation of the company, the main part will be focused on what aspects are important for thinking environmentally, how they implement it, and most importantly, what are the results. In the end, there will be a summary and finally an evaluation of the results found in the summary.

Some Disney facts from their "fun facts" page
• In 2003, Disney Volunteers around the world participated in more than 1,050 projects, contributing more than 400,000 community service hours.
• In 2003, Cast Members and employees throughout the United States partnered with nonprofit organizations to donate 527 tons of reusable materials.
• During the past seven years, water-saving initiatives at the Walt Disney World® Resort have saved nearly 2.5 billion gallons of water.
• Writers for the comedy series "According to Jim" reduced paper scripts by approximately 300,000 sheets of paper per year, utilizing wireless PC tablets.
• If every household in Florida used ENERGY STAR qualified cooling products, the annual energy savings would be enough to power the Walt Disney World Resort for eight years.

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Walt Disney, and his brother Roy Oliver Disney founded Walt Disney Enterprises, Inc. on October 16 1923. It started of as a cartoon studio, but today it is the second largest media company in the United States. Their headquarters are located in Burbank, California, is a component of the Dow Jones IA and had revenues of 30,8 billion dollars in 2004.

Today, Disney is run by Michael D. Eisner CEO, but will be replaced by the President and COO Robert A. Iger October 1 2005.

The company is divided into four divisions, which are their main operating units;

Studio Entertainment; Buena Vista Motion, Music, International, Home Entertainment, Theatrical (one of the largest producers of Broadway musicals) and Home Entertainment International. (6)

Parks and Resorts; Disneyland Resort, Walt Disney World Resort, Disneyland Resort Paris, Tokyo Disney Resort and Hong Kong Disneyland Resort, two cruise ships and ESPN Zone (sports-themed restaurants and TV-station) (4)

Media Networks; consists of television, radio, internet and cable companies such as the American Broadcasting Company (ABC), Disney Channel, ESPN, 10 local television stations and 26 local radio stations just to mention some. (5)

Consumer Products; They have Disney Stores all over the world except Japan and North America (outsourced on 50 year license in 2004) where Disney toys are sold, but this division does not only involve toys but also items such as interactive games, home décor, food, beverages, art, books and electronics.
(3) (Points 3-6 also serves information found under resource point 2)

However, this paper is focused on the environmental issues of the company, and of course, being such a big enterprise, there are several areas of which the company should be able to have environmental practices.

Their Environmental Report of 2004 has summarized their environmental views and practices into five different sections; Environmentality is
• Fiscal Responsibility
• Resource Conservation
• Research and Development
• Wildlife Conservation
• Education and Outreach

The main part of this paper will be explaining all five in order to give a picture of what Disney actually does, also within most of the different areas of the their own divisions.

Environmentality is fiscal responsibility
Tom Staggs (Senior Executive Vice President and Chief Financial Officer) claims that "In order to create shareholder value of the Walt Disney Company, our businesses are focused on delivering long-term growth, improving efficiencies, and building market share".

By taking corporate action to protect the environment, Disney believes the only way doing this is by consistently working towards conservation. By efficiently using their resources, this will in the long term create a positive impact.

"Vision" is a good example of some of the aspects the Walt Disney Studios IT division developed in order to save the environment for less damage. "Vision" is an online media asset management system that actually allows different business units to effectively manage Disney's important digital assets such as audio, photos and artwork. This system has especially been important to Buena Vista Pictures Marketing division. As a result, this has reduced the costs of print, duplicating, labor costs and shipping. Also today, over a thousand assets are accessed weekly, and the cost savings since the inception are estimated to a value of $40 million.

The company does not only access environmental practices only in their studio divisions, The Disney Resort designed "Environmental Review Form" because they had difficulties complying with all the environmental laws, and maintaining efforts in order to preserve the environment through proper utilization of resources, pollution and waste minimization. ERF helps them identify environmental issues in early stages of projects, and it gives the management time to obtain objectives concerning regulations, permits and waste managements before the project begins.

One of the biggest efforts concerning environmental issues is the project of "Environmental Circles of Excellence Advance Environmentality". There are more than 30 "circles" which consists of cast members, and they receive support and coaching from the Environmenatal Initiatives Department. They meet regularly to help communicate Environmentality in the best possible way; identifying and solving challenges facing the resorts. By having such meetings, the advantage is that cast members will encourage each other, and together they can discuss opportunities for ideas that might come up. For example in the theme park of the Magic Kingdom, there have been arranged contests. One of them involves cast members from each land participate in a competition to compete about which team can recycle most recyclable bottles. In order to make it all a bit more motivating and exciting, some of the bottles contain prize coupons, which are planted on purpose in the trashcans. As a result, more than 65.000 more bottles are recycled every month on average. In total, 425 tons have been recycled since 2000.

Environmentality is resource conservation
Disney claims that they are ahead of time when it comes to environmental management. "The values of conservation and respect for the environment that Walt Disney has instilled in culture of this company continue to influence our decisions today" Greg Emmer, Senior Vice President of Operations.

In other words it is smart business to apply resource conservation to the company. Energy and water management, conservation and reclamation, and waste minimization will in the long term give financial benefits.

For example, Disney's "recycle it" program involves reusing/selling hardware and software. This have saved the company over $1 million since launch. Also, they encourage their customers to think green and check into their "green hotels". In the ESPN X Games they where also "greening" by using sustainable green initiatives such as a solar powered sound system, sustainable harvested lumber and "Eco Faqs Collector Cards" featuring action sports stars giving environmental tips. (9) In Tokyo, they have taken water conservation to a higher level by using 4 million gallons of wastewater yearly in the different theme parks, 11.000 gallons are recycled every day and 40% of the wastewater is reused on property.

Results of Disney's work, can be viewed in several of their received awards such as the "Waste Reduction Awards Program" by the California EPA integrated Waste Management Board, and the "Waste wise Program Champion Award for a Very Large Business" by the US EPA. These types of awards are very good for Disney, it gives them the feedback of that what they are doing actually is giving results.

Environmentality is research and development
"We believe Environmentality is part of the elegance and value of new technology – power efficiency, simplicity of design, green materials, the list is long" Bruce Vaugn, Vice President Research and Development.

In this quote, Disney recognizes the importance of creating innovative technologies specific to environmental practices, and conduct extensive research on development. Results of the work can affectively be viewed in their "Fireworks Launch Cleaner Air" projects. They spent a 5-year research in order to develop technology so they still could give the spectacular firework shows they are known for, but still reduce smoke emissions. Disney has also donated 7 patents in order to share the same environmental technology to other firework makers, which again puts Disney in a good light; spending a lot of money on research and sharing their know how.

Disney has recently implemented pure-die cyan soundtracks for all 35mm film, which conserves water, eliminates traditional silver applicated tracks and caustic chemicals that are involved in the manufacturing process. This has saved so much water, that it actually supplies a town of 75.000 people with drinking water each year!

Environmentality is Wildlife Conservation
Disney established this fund in order to support research globally. They have given over $7 million to 350 projects all over the world in order to help conserve the wildlife. Over a 100 species have reproduced at the Disney Animal Kingdom, including white rhinos and African elephants. Animals also get recycled items such as linens and phone books to play with, and the company also donates money to non-environmental organizations.

Environmentality is education and outreach
"I am pleased to report that more than 1 million children have taken part in this important Disney program for the last 10 years… I was reminded of the extraordinary impact that our company has on children…" Bob Iger, President and CEO.

By being committed to education, Disney tries to inspire generations to develop environmental knowledge, and make things better. This can be reflected in for example the "Jiminy Cricket's Environ mentality Challenge", where they try to attract students to take action at school, home and in their communities. By arranging cross-school contest, students will be come more involved, and the winner class gets a field trip, a tour, and lunch on board the Disney Magic cruise-line. Disney also has introduced "Shuttles Drive Clean Air" transports for their cast members, powered by compressed natural gas, which reduces carbon monoxide by 80%. At last but not least, the Disney Enviroport 2004 of course is printed on recycled paper containing 35% post consumer waste. (10)

List of Resources

(1) Pg 10-11 The World Is Flat "A brief history of the twenty-first history" by Thomas L. Friedman ISBN-10: 0-374-29288-4 Distributed by Douglas & McIntyre Ltd.
Farrar, Straus & Giroux, 19 Union Square West, New York 10003 first edition









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