The Triple Bottom Line

A Critic Shows How Reporters Get The Eco-Story Wrong

noreply@blogger.com (KW) — Thu, 26 Jun 2008 13:57:00 +0000

Check out this nice little piece from the Columbia Journalism Review online about how and why environmental reporting goes wrong, often generating more buzz and controversy than information (let alone wisdom).

Some of the problems highlighted by author David Downs are pretty much unavoidable. For example, there's the need to constantly define and explain environmental terms and scientific principles, which eats up precious column space and frustrates journalists who want to write brief, snappy, alluring stories. Other problems are products of today's culture of journalism, such as the pressure to build stories around great quotes (whether or not those quotes are truly enlightening) and the urge to treat every factoid or scientific study as important (whether those details represent outliers or genuinely meaningful symptoms of real change).

In any case, it's clear that journalists and editors who read Downs's article and make a conscientious effort to avoid the mistakes he lists will do a better job of informing readers about environments issues. Come to think of it, there are reporters covering lots of other fields, especially politics, who could benefit from a similar analysis.

Charity By Business--A Great Stopgap, Not A Great Solution

noreply@blogger.com (KW) — Mon, 23 Jun 2008 19:36:00 +0000

Fairbanks, Alaska, is one of the most isolated cities in the United States--so much so that, until recently, it had no affordable way of recycling paper, plastic, aluminum, and other waste materials. Unlike governments in more southerly Alaskan cities, the Fairbanks municipality can't afford to ship its recyclables to a plant in Washington state for reuse.

Now a big private-sector player has stepped in to offer a solution to the problem. It turns out that the local Wal-Mart is already regularly sending trucks back to Washington--mostly empty, after goods for sale in Fairbanks are unloaded. So now Wal-Mart has started its own recycling program, shipping its waste products to Washington for reuse, and it has offered to include refuse from local people at no cost to the community. A few details:

The store's decision to accept recyclables--in reasonable quantities, as it will fall to the store’s paid employees to handle them--is sure to be a hit with its regular shoppers, who live in a community that lacks a conventional recycling program. It's also likely to create an interesting decision for Wal-Mart critics in Fairbanks who either avoid super-retailers in protest of their significant, indirect impact on locally owned businesses and the labor pool or those who believe Wal-Mart is simply hoping recyclers will be inclined to buy more merchandise from a friendlier company.

Suzy Fenner, a community recycling advocate, said Fairbanks residents are currently left with imperfect options--such as burning gasoline to haul paper and plastic to a willing business, which then burns more energy to ship the products out of state. Fenner applauded Wal-Mart's initiative and suggested it will help nudge public awareness of recycling options closer toward the point of a public program or more private-sector involvement. . . .

Store officials made it clear: They’re not turning into a recycling center. But they also said they can accept some common, everyday recyclables, such as loose paper or old newspapers, empty plastic soda bottles or milk jugs, and empty aluminum cans--during business hours. Managers said anything larger than a heavy armful should be bundled or bagged to help associates manage. Recyclers should also phone ahead with bigger loads and use the company’s back loading dock. They should also separate plastics--Nos. 1 and 2--by type, which is identifiable by the number imprinted on the bottom of products.

Wal-Mart, naturally, is proudly trumpeting this news of its latest "good neighbor" policy. But as is usually the case when private/public lines get blurred, the most appropriate feelings seem to be mixed ones. When cash-strapped governments are unable to provide basic services to their citizens, it's nice that big private companies are willing to fill the gap. (We all remember the spate of stories about Wal-Mart and other firms providing disaster relief after Katrina on a more timely basis than FEMA.)

But let's face it, having private enterprise offer public benefits on a charitable basis is not a sustainable long-term program. What happens when Wal-Mart's trucks get filled with their own recyclables, crowding out public materials? What if the demand for recycling services becomes so great it takes up too much costly time on the part of Wal-Mart employees? At a fundamental level, why should a necessary public good like recycling be provided purely as a "favor" by a self-interested business, rather than as a right funded by taxpayers for the benefit of taxpayers?

After all, unlike rights, favors can always be taken away.

So two cheers to Wal-Mart in this case--but here's hoping the people of Fairbanks won't be willing to settle for this as a long-term answer to their recycling dilemma. It's not one.

Compact Packaging--Does It Really Add Up?

noreply@blogger.com (KW) — Sun, 22 Jun 2008 18:26:00 +0000

Shortly after we wrote this post commending Wal-Mart for moving to all-compact detergents in its stores, our friend Dennis Salazar alerted us to a story he'd recently written about the same phenomenon. After shopping for detergent and buying the new compact bottle, Dennis's take on the change wasn't quite so positive:

The [old] 200-ounce bottle, which sells for $9.99, promised it was good for 64 loads. The new 100-ounce bottle, the one that was double strength so only half the usual amount was now needed, also sells for $9.99--but promised only 52 loads.

The bottom line for my sustainable purchase? A load of laundry which used to cost my family 13.2 cents in detergent now, thanks to the new sustainable design, will cost 15.6 cents per load. That, my co-consumer friends, amounts to a price increase of 18.2 percent--a splendid windfall for the manufacturer by any standard.

Of course, these calculations do not even take into account that we are all creatures of habit. No doubt, the manufacturer realized and even projected that most of their customers would use more than the recommended "half" of their more expensive product, despite the new concentrated formulation and labeling. Hmmm . . . sell the consumer more product at a substantially higher profit margin? You've got to love this sustainability. And incidentally, the big-box store where I shop, the one that took credit publicly for driving the package design change, isn't complaining about the windfall, probably because they are participating in it.

We asked Dennis whether this apparent windfall applied to just one one detergent brand or had affected many brands. He told us that, without doing an exhaustive survey, he noticed that several detergents seemed to exhibit the same kind of unannounced price increase (most smaller than the one he wrote about).

Dennis also told us he'd written his article with two lessons in mind:

1. For the businessman--to help dispel the misconception that green always costs more. The fact is that going green usually reduces costs and re-sizing is a marvelous opportunity to re-price your product.

2. For the consumer--Don't take everything at face value. Do the homework it takes to determine the best value.

Both are good lessons, of course. But the first lesson makes us a little nervous. If clever business people start regularly using green initiatives as an opportunity to reap windfall profits through "re-pricing," the already significant cynicism many people feel about green propaganda will surely get a lot worse.

One more point. Wal-Mart's own original blog post about the switch to compact detergents drew a number of comments, some of which raised the issue of price. The most substantive of these, by "Sunny," read as follows:

There are two reasons why the cost [of detergent] isn't going to go down, and neither of them really have much to do with the cost of oil.

First, believe it or not, smaller containers are quite a lot more expensive to product than the bigger ones, because the ratio of empty space per unit of plastic is much lower in a smaller bottle. In other words, it doesn't take four times as much plastic to make a one-gallon bottle as it does to make a one-quart bottle. The cost difference isn't as drastic with cardboard cartons, but it exists--and small boxes aren't cheaper per bottle inside than big boxes.

Second, the only thing being taken out of the formulation is water--for which the manufacturers' cost is negligible. It's the surfactants and cleaners and other things that make up the cost--so eliminating the water doesn't change the price enough to be able to mark it down.

So . . . it will take less packaging (but not as a direct ratio to the smaller package size)--and less cardboard--less space on the shelf--less effort to stock the shelves (and carry it home!)--and will allow the manufacturers to load more in a single truck--and the empties will be easier to recycle or will take less space in a landfill.
So--the tangible benefits are many, but the cost savings directly to the consumer really won't change that much.

Realistically, we all know that prices tend to rise, and it's no great shock when the unit cost of an item creeps upward at the same time that a new package, new product formula, or other change is introduced.

But we hope manufacturers and retailers who are trying to earn "green cred" will be very careful about how they handle those increases. The last thing they want to do is besmirch the concept of sustainability and inspire a consumer backlash against it.

A Useful Overview of the Coming Water Crisis

noreply@blogger.com (KW) — Sun, 22 Jun 2008 12:27:00 +0000

Since the average business person doesn't regularly read The American Prospect--a liberal magazine focused mainly on politics--we want to call your attention to this special report on water. It includes no fewer than thirteen well-researched and well-written stories on one of tomorrow's hottest environmental, social, political, and economic issues--supplying water to the world.

Topics covered in the report include issues around water supply privatization, the backlash against bottled water, how new water technologies can help alleviate long-term shortages, and close looks at exemplary water struggles in places like Cambodia, the Phillippines, and the Middle East. Well worth a look, especially since water issues will soon be affecting every business in the world.

Making Sustainability Part Of Your People Strategies

noreply@blogger.com (KW) — Tue, 03 Jun 2008 11:46:00 +0000

If you happen to be a human resource professional, or if you own or run a smaller company and have "people" functions as part of your mandate, check out this good article by Adrienne Fox from the current issue of HR magazine. (It also happens to quote our fearless leader Andy Savitz, but that's not the reason we like it.) The piece offers a fine, thorough overview of lots of ways companies can get the HR department aligned with broader sustainability goals. Read it and ask yourself: How many of these strategies have we tried? Which ones should we experiment with?

Compact Detergents--A Big Little Change For The Better

noreply@blogger.com (KW) — Fri, 30 May 2008 11:49:00 +0000

It's a hopeful sign when eco-friendly initiatives by business are becoming so numerous that it's possible for a relatively important one to come in under the radar, producing social and economic benefits without a lot of fanfare. That seems to be the case with the shift to compact detergents. As reported by the WBCSD, compact detergents save water, energy, space (in shipping containers and on store shelves), and even significant amounts of petroleum (since smaller packages require less plastic).

Now Wal-Mart has announced it will be selling only compact detergents in the future. It's noteworthy, as most policy shifts by Wal-Mart are, because of the company's sheer size. Anything Wal-Mart does is, by definition, mainstream. And it's encouraging to note that Wal-Mart is evidently doing a good job of training its employees to explain the benefits of compact detergents to customers (see the reader comment to this effect on the company blog we linked to). That's important because, in the absence of such explanation, it would be easy for customers to get the wrong idea: "I'm paying the same amount for a smaller package?! What is this, some kind of rip-off?"

Wal-Mart's move to stocking compact detergents exclusively is also important because it eliminates one potentially major source of supplier reluctance to "go compact"--the fear that my smaller product will be overlooked on the store shelves alongside a competitor's giant-sized package. Many purveyors of packaged goods think of "shelf space"--retail acreage, in effect--as a measure of competitive presence. By selling only compact detergents, Wal-Mart is creating a level playing field for every manufacturer and removing the perverse incentive to keep using bulky, wasteful formulations.

Like any strategic change, sustainability moves need to be thought through carefully and completely to ensure they work as planned rather than triggering the dreaded "unintended consequences" we've all learned to fear. This looks like a case where Wal-Mart (and far-sighted manufactuers like compact pioneer Procter & Gamble) have done their homework.

The Urban Village: New York, 1948

noreply@blogger.com (KW) — Mon, 26 May 2008 17:35:00 +0000

Returning to our theme of sustainable city design, here is an intriguing article from the website of the World Business Council for Sustainable Development titled, "Building Better Cities: Cities as Villages." A couple of key passages:

According to the UK Institution of Civil Engineers (ICE), the concept of an urban village is where a settlement is small enough to create a community in the truest sense of the word--a group of people who support each other--but big enough to maintain a reasonable cross section of modern facilities and amenities.

Such villages are usually created within existing neighborhoods, but they can be created on abandoned brownfields or on greenfield sites. Walking determines their size--usually measured in terms of a 10 minute walk from one side to the other. . . .

These villages can improve existing communities by combining housing, commercial, employment centers and schools together. By blending these components into one community the village design overcomes many of the problems that arise with today's reliance on urban monoculture, i.e. single-use developments such as large housing tracts, gated communities, industrial-commercial zones, etc.

The article goes on to describe the environmental and social advantages of these "cities made out of villages" and discusses projects along these lines currently under way in the U.S., Canada, Britain, and China.

As I read the article, I couldn't help feeling that something about it sounded vaguely familiar (and indeed the authors concede that "the idea of an urban village is hardly knew"). Then the specific source of the sense of familiarity hit me. This is a long, wonderful paragraph from E.B. White's classic 1948 essay "Here Is New York":

The oft-quoted thumbnail sketch of New York is, of course: "It's a wonderful place, but I'd hate to live there." I have an idea that people from villages and small towns, people accustomed to the convenience and the friendliness of neighborhood over-the-fence living, are unaware that life in New York follows the neighborhood pattern. The city is literally a composite of tens of thousands of tiny neighborhood units. There are, of course, the big districts and big units: Chelsea and Murray Hill and Gramercy (which are residential units), Harlem (a racial unit), Greenwich Village (a unit dedicated to the arts and other matters), and there is Radio City (a commercial development), Peter Cooper Village (a housing unit), the Medical Center (a sickness unit) and many other sections each of which has some distinguishing characteristic. But the curious thing about New York is that each large geographical unit is composed of countless small neighborhoods. Each neighborhood is virtually self-sufficient. Usually it is no more than two or three blocks long and a couple of blocks wide. Each area is a city within a city. Thus, no matter where you live in New York, you will find within a block or two a grocery store, a barbershop, a newsstand and shoeshine shack, an ice-coal-and-wood cellar (where you write your order on a pad outside as you walk by), a dry cleaner, a laundry, a delicatessen (beer and sandwiches delivered at any hour to your door), a flower shop, an undertaker's parlor, a movie house, a radio-repair shop, a stationer, a haberdasher, a tailor, a drugstore, a garage, a tearoom, a saloon, a hardware store, a liquor store, a shoe-repair shop. Every block or two, in most residential sections of New York, is a little main street. A man starts for work in the morning and before he has gone two hundred yards he has completed half a dozen missions: bought a paper, left a pair of shoes to be soled, picked up a pack of cigarettes, ordered a bottle of whiskey to be dispatched in the opposite direction against his home-coming, written a message to the unseen forces of the wood cellar, and notified the dry cleaner that a pair of trousers awaits call. Homeward bound eight hours later, he buys a bunch of pussy willows, a Mazda bulb, a drink, a shine--all between the corner where he steps off the bus and his apartment. So complete is each neighborhood, and so strong the sense of neighborhood, that many a New Yorker spends a lifetime within the confines an area smaller than a country village. Let him walk two blocks from his corner and he is in a strange land and will feel uneasy till he gets back.

Now there's a self-sustaining community.

White's description still holds up pretty well with reference to the typical New York neighborhood, although many of the details have changed. There are no more radio-repair shops or ice-coal-and-wood cellars, of course, and most neighborhoods in New York now boast a sushi place and an exercise center as well as, alas, a Starbucks.

But the neighborhood ecology White describes, which as far as I know simply grew up with the city over the generations of its development, seems to me a pretty good model for what some of today's best urban planners are now trying to create deliberately. (Although I notice that White's neighborhood size parameters--two or three blocks on a side--are actually smaller than those suggested by the urban planners; his neighorhood would take only five minutes or so to walk rather than the ten minutes they mention. White is more realistic, I think. A pizza shop five minutes away is worth the walk; stretch it to ten minutes and I bet the amount of business they draw will be cut by 80 percent.)

Some of the best ideas for sustainability are to be found by looking backward--or, in some cases, all around us . . . so long as you know where to look.

Apocalypse Nau? No, Just Business Reality

noreply@blogger.com (KW) — Wed, 14 May 2008 13:35:00 +0000

It seems as if there's a bit of angst among believers in sustainable business over the demise of Nau, an apparel company based in Portland, Oregon, that aimed to make and sell outdoor clothes and sportswear made from recycled materials using environmentally friendly business methods. "Is this a bad omen for sustainable startups?" wonders at least one blogger.

For what it's worth, my answer is No. The failure of Nau reflects less the inherent weakness of the sustainable business concept and more a series of miscalculations made by the company's management, most of which had nothing to do with environmentalism or social consciousness but rather with plain old business sense.

As this article details, Nau committed some of the same management blunders that have doomed thousands of other startups. They counted on a website to generate 50 percent of their sales, then dawdled over repairing the site when it proved to be awkward and difficult to use. They chose not to make their products available through traditional retailers, thereby eliminating a potential source of vitally-needed early revenue. They decided to "mute" the appearance of their logo on their garments, eschewing a powerful tool for building brand awareness and loyalty.

And most dangerously, they overspent, especially on personnel: "Among the 60 employees at [Nau's] Pearl District headquarters, about 10 held the title of vice president or higher . . . Most hailed from large companies such as Nike." In other words, they hired pricey talent accustomed to big-company perks and working conditions--always a risky choice for a brand-new company.

Given these mistakes--all of which, I hasten to add, are easier to spot in retrospect than they would have been at the time--it's not hard to see why Nau ran out of funds and couldn't find a venture capitalist willing to provide another infusion of money.

The lesson of Nau's collapse? A would-be sustainable company needs to be run at least as well as a traditional firm--because having great environmental and social goals doesn't exempt you from the laws of business physics.

Timberland And Stonyfield Farms--Two Little Guys Showing The Big Guys How It's Done

noreply@blogger.com (AS) — Fri, 02 May 2008 19:00:00 +0000

This week, I hosted a panel at the Ceres Conference at which Jeff Swartz, the CEO of Timberland, the boot company, and Gary Hirshberg, the CEO of Stonyfield Farms, the organic yogurt company, answered questions about the role of business in society. Prior to the panel, I spoke with them about sustainable consumption.

I was very pleasantly surprised.

Rather than the usual canned answers one often gets from CEOs at these events, both these Red Sox fans proved to be deeply committed, not to selling less shoes or yogurt, but to sustainable consumption and enlightened consumerism as a potential way out of the ecological and societal quicksand in which we find ourselves.

Gary explained that only about half of what we eat is real food, in terms of its nutritional value. For him, sustainable consumption starts with optimizing the food value chain, which will reduce waste and create value simultaneously. The resources we now waste to make Twinkies can actually feed lots of people.

Gary believes that we need enlightened consumers, i.e. a critical mass of organic yogurt eaters to really change the equation. Twenty years ago, when Gary realized this, he started Stonyfield.

Jeff represents the third generation of Swartzes to run Timberland, and has a harder case to make with boots. But he and Gary are on the same program. Timberland's mission is "to equip people to make a difference in their world," which includes showing consumers, employees, other companies, and his children how commerce and justice can go hand in hand.

Timberland works hard to sell boots on the basis of its environmental and social actions. This is "cause marketing," yes, but also a deeper attempt to change consumer preferences by helping people "to be the change they want to see in the world." And, yes, quoting Gandhi is apropos here--Jeff is deeply motivated by spiritual and inter-generational concerns.

I know when I am being sold a bill of goods, and this time I was not. Both of these guys have thought deeply about their actions, and they're not just walking the talk, they're running it. When we finished the panel later that morning, they deserved the prolonged standing ovation they received.

As for me, like some other unenlightened "experts" in sustainability, I had wrongly assumed that smaller companies like Timberland and Stonyfield were sideshows to the main event—that the GEs and GMs of the world would move us forward, not the little guyes. Now I see the role that deeply committed CEOs like Gary and Jeff are playing and I would not be surprised if they had more of an impact, in the long run, than companies that are hundred of times as big.

And that size gap may not last forever. Under Jeff, Timberland has grown from annual revenues of $159 million to $1.6 billion, and the company now competes directly with Nike and Adidas. And while organic foods represent only three percent of the food consumed in the United States, Stonyfield sells six times the amount of yogurt as Kraft foods and is growing every day.

Maybe the answer lies in one of my favorite lines from The West Wing: "They'll like us when we win."

Where Has Your Breakfast Been? Practically Anywhere

noreply@blogger.com (KW) — Wed, 30 Apr 2008 17:59:00 +0000

Check out this excellent article from the New York Times about the environmental costs of shipping foodstuffs around the globe. It's filled with remarkable facts like these:

Cod caught off Norway is shipped to China to be turned into filets, then shipped back to Norway for sale. Argentine lemons fill supermarket shelves on the Citrus Coast of Spain, as local lemons rot on the ground. Half of Europe's peas are grown and packaged in Kenya.

In the United States, FreshDirect proclaims kiwi season has expanded to "All year!" now that Italy has become the world's leading supplier of New Zealand's national fruit, taking over in the Southern Hemisphere's winter.

But perhaps the most revealing paragraph of the article is this one, which helps to explain why it (counter-intuitively) makes economic sense for food processing firms to move stuff from one continent to another:

Under a little-known international treaty called the Convention on International Civil Aviation, signed in Chicago in 1944 to help the fledgling airline industry, fuel for international travel and transport of goods, including food, is exempt from taxes, unlike trucks, cars and buses. There is also no tax on fuel used by ocean freighters.

Get that? Shipping foods around the world is not some market-tested, economically efficient business strategy developed in response to consumer demand. It's actually the perverse result of an indirect subsidy originally created for an entirely different purpose more than half a century ago.

Free-market fundamentalists often criticize environmentalists (and other non-fundamentalists) for wanting to interfere with the natural, unfettered workings of the economy, which are supposed to embody some quasi-mystical perfection. Their argument would carry more weight if those supposedly simon-pure markets hadn't already been endlessly tinkered with in order to tilt the playing field in favor of one business interest or another.

Most Companies See Environmental Management As An Ally In Tough Times

noreply@blogger.com (KW) — Tue, 29 Apr 2008 11:02:00 +0000

Courtesy of the World Business Council for Sustainable Development, here's an important story from The Financial Times about how the looming recession is affecting corporate attitudes toward sustainability. Facing tough economic times, are companies backtracking on their environmental commitments? It turns out that the answer, at least for now, is no--because in the last few years, companies have come to see that energy reduction, streamlined packaging, and trimming waste are all money-saving as well as eco-friendly programs.

It seems to me that the sustainability challenges for companies will be greater on the social, labor, and community fronts. For example, will corporations with supply chains that trail deep into the developing world maintain their stated commitments to humane labor policies when sales begin to slump? Stay tuned.

Six Ways That Businesses Are Prodding And Dragging Government Toward Sustainability

noreply@blogger.com (AS) — Mon, 28 Apr 2008 19:42:00 +0000

I had the opportunity to speak last week about the relationship of sustainability to public policy in Washington's chandeliered, blue-carpeted Senate Caucus Room where, I was informed, John Fitzgerald Kennedy announced his candidacy for President of the United States 48 years ago.

That was only one of the day’s many humbling moments. Another was that I was addressing an awesome group of CEOs from Massachusetts who have formed the Progressive Business Leaders Network, dedicated to creating sustainable companies and pushing for public policy that will advance sustainable business development.

(Sometimes, despite the weather, the traffic, and the persistent but badly outdated attitude that Boston is the "Hub of the Universe," I love living here. This is one of those times.)

I'm blogging today because I saved the public policy part of the presentation for last, and ended up being severely time-constrained because an annoyingly tall, tanned, and dapper senator, also from Massachusetts, showed up and took most of my air time, which everyone present, I am sure, felt was a good trade. But here is what I was going to say . . .

Companies have a mind-boggling number of ways to advance public policy in favor of sustainability. The following are some proven approaches, presented in order from least to most obvious.

Regulating government: Here I am referring to businesses applying pressure to governments to do the right thing. Over the years, a public expectation has developed (at least in some quarters) that businesses with use their influence in this way. For example, most people expect Google to stand up to the Chinese government on censorship. The big precedent, of course, is the battle against apartheid. South Africa's racist regime finally fell apart when enough businesses threatened to leave the country over the issue.

The Extractive Industries Transparency Initiative, a voluntary agreement by the oil and gas companies to publish details on bogus extraction fees or facilitation payments they must pay in certain countries, is another example of businesses working to regulate government practices--in this case bribery demanded by corrupt officials. The companies are acting in concert since they cannot hope to win by acting individually. I believe the verdict is still out on whether this is working, and I would welcome any update.

Leading government: Many companies in the U.S. are leading the administration and Congress on climate change by participating in the Chicago Climate Exchange or other voluntary mechanisms for addressing the crisis. The Wall Street Journal (subscription required) recently reported:

Mr. Bush has opposed comprehensive legislation to curb emissions. But like an increasing number of utilities and manufacturers, he is aiming to join the discussions in the hopes of shaping the debate and creating a system that won't be too costly to industry or consumers.

Well, hello, Mr. President! This breathtaking piece of reportage by the nation's leading business newspaper underscores the fact that that proactive companies have already framed the debate to the point that this administration is and forever will be on the outside looking in at one of the most important public policy issues of its time.

Partnering with government (and with NGOs): This approach is considered the holy grail by many people--the only way to get the needed traction and speed to climb out of the all the holes we are digging--and it was the basis for any progress made at the World Summit on Sustainable Development in 2002. No treaties were signed there (as compared to the five or six multi-national treaties signed the Rio Earth Summit in 1992), but 300 or so voluntary partnerships were created before, during, and afterwards. (Does anyone know how those have worked out?)

Another example: Wal-Mart met with a coalition of mayors last week, including NYC's Mayor Bloomberg and Boston's Mayor Menno, and reached (per the New York Times) a "ten-point agreement with Wal-Mart, the country's largest seller of guns, to track the sale of firearms more closely."

This is likely an important and hopefully effective partnership and I thought it was telling that the mayors, not Wal-Mart, announced the agreement. Governments now need the active participation and, in many cases, the leadership of private companies to provide even basic goods and services like public safety. Our public agencies are increasingly dwarfed in stature and effectiveness by the world's largest companies. (Remember how FEMA's ineptitude during Katrina was emphasized by the fact that some of the nation's largest companies got private rescue operations going days before the federal group of bozos figured out where New Orleans was.)

Forming your own government: Many industries are, or at least purport to be, self-regulating with various certification schemes sponsored by entire industries, including Responsible Care, established by the chemical companies in the aftermath of Bhopal, the Sustainable Forestry Initiative by the American Forestry and Paper Association, and the recent proliferation of Fair Trade certification programs. Many of these schemes have real teeth: a company cannot belong to its industry's primary trade association unless it is on the program.

Regulate as if you are government: Wal-Mart again. The behemoth has such enormous purchasing power that almost anything it says has the force and effect of law with its 60,000 suppliers. The company's recent packaging guidelines are but one example of the way in which large companies now regulate their suppliers.

Even small companies are now working with their suppliers on environmental or social issues, creating supplier codes of conduct that supplement standard contract language.

Influence the real government: This is good old fashioned lobbying, and many companies have banded together to push Congress or state legislatures for changes in law or regulation that advance the cause of sustainability, usually with their own economic self-interest in mind. (There is nothing wrong with finding that sweet spot.) US CAP consists of corporate climate leaders like DuPont and GE pushing for climate change legislation which will be good for the planet and good for business.

I like to call this "sustainability ju-jitsu": taking the sustainable side of an issue, like investing in clean coal technology and then pushing to make it more expensive for your competitors who are lagging--turning your responsibility into an opportunity and making the other guy pay.

All in all, it's a pretty amazing assortment of strategies (some of them quite new) that businesses are using to pursue sustainability--and their own corporate interests--through governmental and quasi-governmental action.

And that's more or less what I would have said in Washington last week had I not been big-footed by an actual policy maker. But it's my blog, and nobody can pull rank on me here . . .

The Sustainable City--Ecological Dream or Technocratic Nightmare?

noreply@blogger.com (KW) — Fri, 25 Apr 2008 20:07:00 +0000

I'm fascinated by this article from Globe-Net News about the future of urban design--specifically, about the wave of "sustainable city" projects now being built in some of the world's fastest-growing regions, from China, India, and Korea to the Gulf states of Dubai and Abu Dhabi. And while the little boy in me thrills at the science-fiction stylishness of some of the architects' renderings of these cities of the future (of which the picture above is a sample), another part of me wonders whether the promises now being made about these projects have even a chance of being fulfilled.

To explain my built-in biases: I'm a New Yorker from the generation that visited the 1964 World's Fair as children and marveled at the late-post-war visions of urban futurity on display at places like the General Motors pavilion, with its models of gleaming high-rise cities where cars glided soundlessly on highways suspended in space--mid-century versions of Corbusier's famous vision of the "Radiant City."

Then I got a little older, saw how the post-war high-rise apartment projects dotting New York's outer boroughs had become pockets of loneliness, crime, and decay. I read how attempts to build entire cities along modernist visionary lines (like the centrally-planned Brasilia) produced lifeless, boring failures. And I read Jane Jacobs, who explained how the technocratic dream of the centrally-planned city was really a quasi-fascistic nightmare that destroyed neighborhoods. (This is obviously a somewhat simplified whirlwind summary of the issues.)

I became a convert to what I understood to be "the new urbanism," which was all about human-scale, mixed-use, pedestrian-friendly neighborhoods that captured some of the charm, variety, and freedom of traditional city communities like Jacobs' beloved Greenwich Village.

Today of course human civilization is at a crossroads due to global warming, peak oil, population growth, and the challenges of rapid development in what used to be called the Third World. Around the globe, tens of millions of people are pouring into cities in search of economic opportunity, meaning that hundreds of new or enormously expanded cities will be sprouting up in the next twenty or thirty years.

This creates a wonderful opportunity for us to try to leverage the advantages of higher-density living by trying to construct the world's first truly sustainable cities, using all the latest knowledge and technologies for energy conservation and renewal, waste recycling, efficient transportation, and so on. The idea that urban planners, in cooperation with governments and businesses, are already designing and building such sustainable cities is truly exciting.

Yet the images I am seeing and the descriptions I am reading make me a little nervous.

The artists' renderings of such cities-in-the-making (or re-making) as Dongtan, Guangzhou, and Harbin in China, Gugaon in India, Songdo City in Korea, and King Abdullah Economic City in Saudi Arabia (the one pictured above) look a lot like "Radiant Cities" right out of the old Corbusier playbook--right down to the isolated high-rise dwellings that, in my experience, relatively few people actually want to live in.

These supposedly sustainable cities of the future, with their glittering towers and pristine open spaces that appear devoid of humans, look all too much like the regimented visions of the mid-century planners whom Jane Jacobs wrote about so scathingly. The fact that these cities are being built in countries with authoritarian regimes strikes me as another worrisome symptom.

I'd like to be unreservedly enthusiastic about this new trend, and it's quite possible I am at least partially wrong. Herbert Girardet, a widely-respected expert on urban sustainability, is a consultant on the Dongtan project and has written glowingly about its potential as a truly eco-friendly city:

Dongtan's design is based on the principle that all its citizens can be in close contact with green open spaces, lakes and canals. Its buildings will be highly energy-efficient, and the city will be largely powered by renewable energy--the wind, the sun and biomass.

Most of Dongtan's waste output will be recycled and composted. The bulk of its organic wastes will be returned to the local farmland to help assure its long-term fertility and its capacity to produce much of the city's food needs. Chongming's existing local farming and fishing communities will have significant new marketing opportunities with the development of Dongtan, ensuring a high degree of local food self-sufficiency and enhancing the island's long-term environmental and social sustainability at the same time.

It sounds good! And surely something like this is what we need to build in order to house the hundreds of millions of people who will be joining the world's urban population in the next generation.

It's probably dangerous and misleading to lump the various "sustainable city" projects together (as the Globe-Net News article does). It's quite likely that some will prove to be really sustainable--in human, social, political, and esthetic terms as well as in technological and economic terms. But I suspect that some others may fall prey to the problems that have plagued past attempts at heavy-handed, top-down, utopian city planning, ending up as vast, lifeless ghost towns that no one with free choice would willingly inhabit.

I hope this post will attract a few comments from people with deeper knowledge of the subject than I have.

No Peace For The Guy With A "GetSustainable" Address

noreply@blogger.com (AS) — Sat, 19 Apr 2008 11:24:00 +0000

This is starting to get annoying. Two years ago, when the book came out and I set up my mini-consulting firm, my genius computer guy Dan suggested I use the e-mail address andy@getsustainable.net. I thought that was kind of cute, so I said okay.

For about a year and a half, no one except people in my circle remarked on this address.

But about three months ago, something weird started happening. I was on the phone with Expedia trying to reserve a flight for the next day when the Expedia representative on the phone asked me for my email address. I said “andy@getsustainable.net” and expected to move on. Instead, a long pause ensued, then the guy said,”That’s cool, I’m into that” and proceeded to tell me about the solar panels he had installed on his roof in 1993. For about five minutes, which I did not have, he went on and on.

Just now, I was trying to renew my subscription to MLB.com so I could listen to the Sox game up here on the third floor, when after a ten-minute wait to get an operator on the line, I got one who wanted to know all about why I had the email address, what I did, and where could she get a copy of the book? (Hey, fair is fair.) She was way into recycling and human rights and was all about sustainability and, and, and . . .

I put my foot down when she started to read from my website, and I realized that the Sox were scoring runs left and right (I could get the box score) and I was missing it. But she wouldn’t hook me up until she told me how important this was to her. Jeez . . .

Anyhow, there is something going on out there. But I’m going back to andysavitz@comcast.net

The Five Stages Of Sustainability Grief--Which One Are You In?

noreply@blogger.com (KW) — Fri, 18 Apr 2008 10:49:00 +0000

Little did we know there is an entire website devoted to sustainable packaging! Now that we've discovered it (and added it to our blogroll), we can recommend this amusing post--couched in the form of a report from the Housewares Show at Chicago's McCormick Place convention center--titled "Sustainable Packaging, the Housewares Show, and the Five Stages of Grief."

Blogger Dennis Salazar shows how consumer products companies confronted with the new demand for sustainable packaging are passing through psychiatrist Elisabeth Kubler-Ross's famous "Five Stages of Grief"--Denial, Anger, Bargaining, Depression, and Acceptance. You'll have fun reading his post and figuring out which stage you and the companies you work with are currently passing through.

"Powered By BP"?--The New Republic Is Actually Powered By Readers

noreply@blogger.com (KW) — Thu, 17 Apr 2008 13:02:00 +0000

If you keep tabs on media coverage of the environment, you may have heard about the recent about-face at The New Republic regarding its new blog focusing on energy and the environment. When the blog was first launched a week and a half ago, it bore the logo and message, "Powered by BP," representing sponsorship by the somewhat controversial UK oil company. It was the only portion of the magazine's website to bear such a logo (though advertising not linked to any particular magazine feature does appear elsewhere on the site).

Readers protested, the blog's chief writer wrote a post explaining his own discomfort with the sponsorship, and within hours the other shoe dropped. The following note appeared on the blog:

You may notice that this blog looks a little different. The phrase "powered by BP," which appeared in the banner when we launched yesterday, led to some (justifiable) confusion about the blog's relationship with BP. But TNR's agreement with BP was and is purely an advertising deal, and the company never had any say in our editorial content. Today, the TNR business staff and BP decided to remove their logo placement to make sure that relationship is clear.

It's an interesting story that illustrates yet again the great and growing power of grassroots stakeholders--in this case, the readers of The New Republic--to force companies to back down from policies or practices of which they don't approve.

What I find most interesting, however, is the reason those readers objected to the BP sponsorship. It wasn't, apparently, any fear that BP would be dictating or influencing the content of the blog. Writer Bradford Plumer had addressed this issue in his post expressing concerns about the relationship, titled with disarming frankness, "Are We in the Tank?" His answer, obviously, was no--and judging by the comments he received, most readers accepted it.

No, what bothered the readers was the possible impact of the sponsorship on BP itself. As a commenter known as Nippers wrote:

The danger for T[he] N[ew] R[epublic] is not so much that BP will influence its writers as that TNR will lend BP integrity and eco-cred. Running BP ads would be one thing. But pinning that little petrochemical boutonniere to the web site's lapel--well, it's a mistake the magazine would do well to reconsider.

In other words, readers of The New Republic for whom the magazine's reputation is important were upset with the idea that that reputation would provide a little borrowed luster to an oil company.

Imagine--a group of customers who care more about the halo effect of the company's reputation than the company itself does! And one that pays close enough attention to the behavior of firms in other industries (like energy) to consider itself capable of judging which companies are and are not suitable business associates for a magazine they respect.

Now that's what you call an active, involved set of stakeholders. The New Republic did the right thing by reversing the sponsorship plan so quickly. If you're lucky enough to attract customers who care that much about what you do, you'd better treat them with respect--as the business partners they are.

The Shallow End Of The Pool--Ten Simple Footprint-Reducing Steps For Businesses

noreply@blogger.com (KW) — Thu, 17 Apr 2008 10:51:00 +0000

In somewhat the same vein as the story we posted yesterday about reducing your computer systems' energy use, here is a nice little article about ten business practices that can lighten your footprint on the planet. It's from a site we just encountered called Ecopreneurist.com. No profound insights or amazing strategies here--just a collection of practical, down-to-earth tips you may find valuable if you're a business manager. If the concept of sustainable business is one you are just getting your head wrapped around--which we suspect is true of many visitors to this blog--this could be the shallow end of the pool that makes it easy for you to get used to the water. Enjoy!

Hershey Still Groping For A Sustainable Future

noreply@blogger.com (KW) — Wed, 16 Apr 2008 18:30:00 +0000

Following other signs of turbulence, including the resignation of the CEO, here's the latest in the saga of troubled Hershey Foods (makers of the iconic chocolate bar) and its largest single shareholder, the Hershey Trust:

In another high-level departure in Hershey, the chief executive of the Hershey Trust Co., Robert C. Vowler, said he would retire from the company that has overseen investing decisions for one of the world's largest educational endowments.

The Hershey Trust manages $8 billion in assets owned by the Milton S. Hershey School for underprivileged children. Among the school's assets is stock that controls the Hershey Co., the chocolate-bar-maker and major Pennsylvania employer, and the Hershey amusement park.

As president of the trust in 2002, Vowler played a central role in negotiating to sell the Hershey Co. to diversify the multibillion-dollar school endowment. But the deal encountered fierce community opposition and fell apart. Company and trust officials revived deal talks in 2007, again without success.

The Hershey Trust administers the estate of founder Milton Hershey on behalf of the school he created and the community he built. In our book The Triple Bottom Line, we told the story of the 2002 battle over corporate control among the company, the trust, and the town--a revealing parable of how the community where your company operates can exercise a virtual veto power over your business strategies in this day of intense mutual interconnections. Evidently the aftershocks from that struggle still aren't finished.

Taming Your Energy-Hogging IT Department

noreply@blogger.com (KW) — Wed, 16 Apr 2008 13:00:00 +0000

Here's a neat little column on making your company's IT department more environmentally friendly. It's from Preston Gralla, editor of GreenerComputing, and it's filled with simply, practical steps that take relatively little time or money but can reduce your energy consumption significantly. There are also links to other sites that flesh out the details and describe various techno-tools that can save you even more. And it does it all in just a few hundred words. It's a model of fine, useful sustainability reporting. Great job, P.G.!

P.S. Oh, and when you're ready to delve a little more deeply into the same set of issues, check out this article and the set of related links. As you can see, the folks at GreenerComputing have done a lot of thoughtful research into the kinds of practical info needed to make sure that environmentally-friendly IT practices really work. A great source for companies that are ready to travel this path.

Friendly Adversaries--Green Activists And Environmental Executives

noreply@blogger.com (KW) — Tue, 15 Apr 2008 11:21:00 +0000

Our friend Joel Makower sends us a link to the latest issue of GreenBiz.com, one of the best online sites for sustainability news. Joel also links to stories about how diverse companies--Ford, Wal-Mart, Fiji Water, and Sierra Pacific--are all shifting their business plans in response to pressure from environmental activists. In his email, Joel then comments:

Such developments notwithstanding, my sense is that many of the environmental watchdogs have lost their bite. One reason is that while times have changed, many activists haven't. Yesterday's politics of complaint--of saying no and accepting nothing less than perfect--resonate less in a world where companies increasingly are on the march, proactively examining and addressing their impacts. With few exceptions (Environmental Defense Fund being the most prominent), NGOs haven't yet learned how to play "good cop," saying to companies the equivalent of "Thank you, now do more." It's always, "No, that's not good enough."

Still, as these stories suggest, the bad cop is still very much on the beat. This is a good thing. A healthy activist sector is much needed--and even welcomed by some corporate types. More than a few environmental professionals inside big companies have confessed to me their appreciation of activists in prodding their bosses in ways that the professionals hadn't succeeded in doing themselves. In some cases, activist campaigns justify the professionals' existence, giving them a new lease on life--or, at least, their jobs.

There's an old story about Franklin D. Roosevelt that captures some of this interplay. A group of activists met with FDR in the Oval Office to urge his support for some liberal reform (it doesn't matter what). After listening to their arguments, Roosevelt responded, "Okay, you've convinced me. Now go out and put pressure on me."

Roosevelt's point: Even a president can't always act with perfect freedom. He too faces constraints--powerful leaders in Congress, bureaucratic resistance and inertia, opposition from state and local government leaders, potential roadblocks in the courts, and so on. Sometimes a president needs "pressure" in the form of a visible, well-organized, vocal, and articulate public movement to provide him with both political cover and supportive energy that permits him to do what he really wants to do anyway.

Environmental activists can play a similar role as "friendly adversaries" for sympathetic executives inside corporate America.

Globalization Meets Localization--Trends In Collision That Can Work For You

noreply@blogger.com (KW) — Tue, 15 Apr 2008 11:05:00 +0000

Andy Savitz and Melissa Tritter have penned this story in the current edition of Ethical Corporation, highlighting a shift that has sneaked up on many of us in business--the emergence of "localization" as a force that is beginning to rival globalization in importance. (Actually those crazy Brits at EC insist on spelling it "localisation"--go figure.)

The story explains the new trend, describes how companies like PepsiCo and Whole Foods are capitalizing on it, and offers some advice for business managers on what it all means. The elevator version of their take-away:

The key is to be both big and small at the same time--big in terms of resources, scale, and positive impact; small in terms of supporting local economies and the consumers who care about them. To the extent that a large company can do all this, the same forces that are currently fuelling the localisation movement will support them, making it easier to do business in a profitable, sustainable fashion.

Follow the link to read the whole thing--worth a look, in our not-so-humble opinion.

It's All About Seoul

noreply@blogger.com (KW) — Wed, 09 Apr 2008 15:12:00 +0000

Congratulations to the crack Global Rights Department at our publisher, Jossey-Bass, for concluding a sale of the Korean translation rights to our book, The Triple Bottom Line, to Keorum Publishing Co. According to the company's website, Keorum Publishing's motto is "Enriched Lives, New Knowledge," which sounds fine to us.

An Excellent Primer On The Advantages And Drawbacks of Carbon Offsets

noreply@blogger.com (KW) — Sun, 06 Apr 2008 19:37:00 +0000

Recommended reading: From ClimateBiz, a fine article by Carolyn Sherwood Call on how carbon offsets actually work--exceptionally clear, thorough, and balanced. Call's bottom line:

If your company wants to put money toward reducing the amount of carbon in the atmosphere, look first to make changes that reduce your own carbon footprint. Often, such investments are not only good for the planet; they'll also save you money over time. Replacing incandescent light bulbs with compact fluorescents, using hybrid vehicles for the company's fleet, and installing building control systems to reduce energy waste can reduce your carbon footprint and improve the bottom line.

If you want to do more, offset purchases are worth considering. Revenues generated by offset purchases provide critical funding for many projects that reduce greenhouse gases. If you do decide to buy offsets, take the time to research the various offset providers. Look for details on their websites. The more transparent they're willing to be, the more likely that their projects and their calculations can stand up to scrutiny.

Managers considering carbon offsets as part of their green business strategy might want to circulate Call's article among their top decision-makers--it would be a good tool for getting an informed conversation about the topic started.

Some New Evidence On The Link Between Doing Good And Doing Well

noreply@blogger.com (KW) — Sat, 05 Apr 2008 16:35:00 +0000

Via Ted Samson's column at InfoWorld, here are the latest findings on the perennial question as to whether sustainable business practices help, hurt, or have no impact on the financial bottom line. According to a new report from the Economist Intelligence Unit, a focus on social and economic sustainability is associated with positive stock market performance among the companies surveyed. Key graf:

The survey does not claim that the adoption of sustainable practices causes companies' share prices to rise. It could be that companies with a strong financial performance simply have more resources to devote to sustainability. What the findings do show, however, is that it is possible to take a proactive position on social and environmental issues while still delivering robust financial growth. Indeed, companies in the survey that saw their share price rise by at least 50 percent in the last three years (share price climbers) place a greater importance on social and environmental goals than companies with share prices that have declined by more than 10 percent (share price losers). Social and environmental goals include improving environmental and human rights in supply chains, where 40 percent of share price climbers rank this as an important priority versus 18 percent of share price losers; reducing greenhouse gases (38 percent to 24 percent); and developing products which address social and environmental problems (49 percent to 35 percent). Share price climbers also put a greater emphasis on social and environmental considerations at board level.

Worth noting if you're among the many business people who find themselves occasionally having to defend an interest in sustainable business practices among skeptical or even hostile colleagues.

Transforming Human Desires From Part Of The Problem To Part Of The Solution

noreply@blogger.com (KW) — Wed, 02 Apr 2008 15:12:00 +0000

Mark Powell, a scientist in Washington state who blogs about oceans, fish, and conservation at Blogfish, writes here about the challenge of setting the right tone when it comes to conveying messages about sustainability. Key grafs:

. . . I think most environmentalists would identify human desires as a problem. In this view, people want more . . . more money, more toys, more fun activities. And almost all of it means more conservation problems as we use more resources to satisfy the wants.

Do we really focus on trying to defeat human desires to achieve conservation? Yes, we do. We try, usually with minimal success, to scare or limit people to stop them from fulfilling their wants. We tell stories of impending crisis so they'll stop out of fear, or we try to make rules that stop the damage by denying people their desires. Conserve water or we'll run out and you won’t be able to flush your toilet! Stop driving your SUV or we'll all cook together on a warming earth! Etc., you've heard it before.

It's a reasonable way to go, but it isn't working. And perhaps even worse, it creates problems for the environmental movement. It casts us as the enemies of human desire, not a good role to be in. In fighting desire, we cast ourselves as grouchy preachers promising fire-and-brimstone for those who stray from the straight and narrow. That might be ok if it worked, but with this approach, our successes are often partial and short-lived. And it takes a toll on us; when we KNOW we're right but we still lose, our attitudes turn pessimistic, cynical or even bitter.

Powell goes on to talk about chef Barton Seaver who is trying to promote sustainable seafood using a different approach, one that harnesses desire on behalf of eating and enjoying fish (like sablefish) that are abundant and well-managed, rather than fish (like Chilean sea bass) that are scarce and endangered.

Of course Powell's overall point is well-taken and important. From a marketing standpoint, you never want to be in the position of defending negativity (fear, guilt, No) against positivity (optimism, pleasure, Yes). This is the mistake the Hillary Clinton campaign got boxed into a few weeks ago, when their candidate started mocking Obama's message of change and hope. Does Hillary really want to be identified as the "anti-hope" candidate? I don't think so.

Here is a crucial role for businesses involved in sustainability--to lead the quest for the right ways to market sustainable lifestyles and to make them feel cool, joyful, satisfying, luxurious, and self-indulgent. Because, let's face it, the vast majority of people in the developed world are not interested in developing new value systems (even if that might be a good idea). So our challenge is to show them how sustainable consumption fits into, expresses, and even fulfills their current value systems.

And after all, this is not really deceptive. Because, if we are going to frame the conversation in terms of "human desires," what do people actually want out of life? It certainly includes good food, cars, hot water for a shower, etc., etc. But it also includes clean air and water, thriving forests, vibrant coral reefs, abundant species, and all the other goods that only sustainability can guarantee to us and our grandchildren. Surely selling the fulfillment of such desires shouldn't be an insurmountable challenge for the greatest marketing civilization in the history of the world.