Archive for the ‘Sustainability’ Category

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Doing good doesn’t drive business giving in US

Private companies in the US tend to be more generous than companies in other countries in giving to charity, according to an international survey discussed in the June issue of Inc. magazine. Companies in all surveyed countries are primarily motivated by promotion of employee recruitment and retention; however, private US firms are much less likely than their international counterparts to be motivated by “saving the planet.”

The survey’s supervisor believes employees are commonly the ones pushing their employers to donate to charities and support community service. So employers, seeing this desire among their workers, figure giving is a good way to keep and attract employees. The survey spokesman was surprised that “saving the planet” did not rank higher as a motivation in the US.


I’m not surprised by the finding, but I hope the next survey reveals some changes. The drive to give must come more from the top than the rank and file. Only then will we see the giving continue and expand. And along with that, US business owners and senior managers must accept the challenge and need to do the right thing for our planet. Not that employee retention and recruitment isn’t important. It is. But giving out of concern for the planet signals to all of your stakeholders that you recognize your organization has social and environmental responsibilities. The reward is inherent in the action of taking responsibility, not in the profits, or even the retaining of employees.

I don’t have other studies at my fingertips to prove this, but I believe companies whose owners and leaders operate from a place of commitment to the common good will also enjoy the greatest employee loyalty and generate more interest among desirable employee prospects. These social and environmental values need to start at the top and be embedded in all aspects of a company’s behavior and practices. Giving to charity or community groups flows naturally from the values of a triple-bottom-line company: people, planet, profits. 

That businesses give back to their communities, even for selfish reasons, is a good thing. But when the majority of business employers are motivated solely or primarily by their employees to do good, we have a serious misplacement of values at the top. We need business leaders to embrace their responsibility to the common good and become committed and active citizens of their communities and the world at large. Until many more do, there will be no solving the daunting social and ecological challenges in front of us.
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Friday, June 27th, 2008
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Posted in Business & Economics, Climate Change, Sustainability | No Comments »

There’s no consuming our way to green

I find it difficult to avoid the topic of Wal-Mart when speaking of sustainability and marketing. The company came up again today at a breakfast presentation by two professors of business from the University of Portland, sponsored by the Oregon Natural Step Network. And once again I find myself bristling at the notion of Wal-Mart playing any part in the ultimate sustainability solutions for our planet.

Professors Diane Martin and John Schouten conduct research related to sustainable marketing. Included in their work is the study of Wal-Mart’s aggressive sustainability initiatives. They receive no payment from Wal-Mart as part of their research. Nor do they shop there.

Martin and Schouten peppered their presentations this morning with examples of what Wal-Mart was doing to lessen the environmental impact of its business operations, the products it sells and the global supply chain that feeds its stores. Schouten says the company is so serious about its sustainability efforts it has reached out to detractors such as the World Wildlife Federation, Sierra Club and Conservation International to involve them in their green initiatives.

But when asked whether she was aware of Wal-Mart actually encouraging their customers to consume less, Martin quickly replied, “No.” Schouten said the mindset that “growth is good” is still very much present in Bentonville, although its managers are all evaluated by metrics of sustainability. He didn’t say what those metrics were, but clearly they don’t involve helping Wal-Mart customers buy fewer products. Wal-Mart doesn’t plan to relinquish its role as the world’s largest retailer — indeed, its revenues make it the equivalent of the world’s 19th largest economy, Martin said.

This raises what I believe to be the fundamental question for companies and marketers embracing sustainability principals: Can humans consume their way to green? In other words, can we simply switch from brown products to green products across the board and create the sustainable future we all want? 

Wal-Mart and most other companies can’t envision a future where their customers dramatically lessen the amount of goods they buy. After all, what would happen to their growth ambitions and their need to create adequate shareholder return? Their solution is to get us to consume differently: less brown, more green. 

I don’t believe we have the luxury of simply shifting to green products. In fact, I can’t imagine a sustainable future where humans — at least in the developed countries — don’t reduce their consumption many fold. That’s a prospect few in business, including those of us in marketing, want to either accept or condone. Where’s the money in non-consumption?

Last week, I heard author and Boston College Professor Juliet Schor speak for the second time in several months, this time at the national conference of the Business Alliance for Local Living Economies (BALLE) in Boston. Schor is a well-known critic of over-consumption by the middle/upper classes of developed countries. She cited new data that illustrate how the growing scale of consumption among higher-income people is swamping virtually all the product greening steps our society is taking. 

The de-materialization of our economy is not happening. For example, in what Schor calls “the Ikea effect,” American consumption of furniture in material weight increased from 6 billion kilograms in 1998 to 12 billion kilograms in 2005. Our population increased 10 percent in that time, but our furniture consumption doubled. We consumed 2.9 billion kilograms of ceramics in 1998 and 5.7 billion kilograms in 2005. Our electronics consumption — despite the ongoing miniaturization of digital gadgets — increased from 3.8 billion kilograms in 1998 to 6.2 billion kilograms in 2005.

Schor’s solution is to engage people in redefining the good life. One where we acquire more time and far less stuff. A life in which we work fewer hours, and use that time to reconnect with ourselves, our families, our communities and nature and rediscover our happiness. Schor didn’t say it, but I’m pretty sure you won’t find even a green Wal-Mart in her picture of the good life. You certainly won’t in mine.
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Wednesday, June 11th, 2008
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Posted in Business & Economics, Consumerism, Marketing, Oregon, Sustainability | No Comments »

The accidental benefit of higher gasoline prices

There’s going green. And then there’s saving green. We’re seeing the difference now as gasoline prices climb over $4 per gallon. 

In the post-“Inconvenient Truth” era, many Americans are finding ways to drive less or volunteering to trade in their gas guzzlers for gas sippers to do their part for the environment. That’s going green. Lately, people are selling gas hogs and driving less for a different reason. To save green. Whether the motivation is to save the environment or to save money, the results are the same: fewer gallons of gas consumed and fewer greenhouse gases emitted. 

But the environmental benefit rarely gets mentioned when reporters cover the broader economic and personal financial costs of expensive gasoline. As much as it pains me to say it, an economist quoted in the New York Times is probably right when he says:

“Al Gore came out with a movie called ‘An Inconvenient Truth’ in 2006, when Hummer sales were still good. The inconvenient truth, in fact, is that prices are what matter. With gas prices soaring, Gore is going to get his collapse in Hummer sales, not because people went green, but because they wouldn’t spend the extra green to buy the gas.” 

 

My hunch is a lot of Americans have wanted to do the right thing for our warming climate by downsizing their automobiles, but have waited for financial incentives. When gas was closer to $3, the incentive wasn’t great enough. At $4 and climbing, it is.

Sustainability marketers should take note. There are a certain number of eco-minded customers who choose the environment over saving money. But most customers are guided by their pocketbooks and probably always will be. In the case of gasoline, they find ways to consume less, so they can save money. Period. The environmental benefit is unintentional or, at best, icing on the cake. 

Not that enviros should be complaining that Americans drove 4.3 percent fewer miles in March 2008 than March 2007. We’d just all feel a lot better if we knew environmental values, more than economic reactions, explained the drop. Maybe then, we’d trust that Americans are serious about fighting climate change. 

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Monday, June 2nd, 2008
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Posted in Business & Economics, Climate Change, Marketing, Sustainability | No Comments »

A banker who gets sustainability

Good piece in the June issue of Sustainable Industries (subscription req.) on Dave Williams, CEO of ShoreBank Pacific bank and a resident of the Portland area. The magazine named Williams one of its 20 Leading Green Executives for his success in taking ShoreBank Pacific into the black using a triple-bottom-line (people, planet, profits) approach to its business.

A couple of Williams’ comments struck me as right on. One was his comparison of the cultures of Oregon and the Bay Area around sustainable business development:

 

“Oregon has historically been a small-business state, so the strength of any particular community is dependent on the strength of the business in it,” he says. “But in the Bay Area, business is oddly independent of community.” Williams attributes that to a venture-capital mindset in the region. “The thinking is, ‘How do we build it and make it international then sell it off and do something else?” he says. “There’s a different approach to business and community that you get in Oregon where the feeling is more that we need these businesses and we’ll keep them going for the next 100 years.”

From my two decades in high tech, I know the VC model of the Bay Area (and elsewhere) has its place, especially in fostering innovation. But Williams perfectly captures the limitation of the VC business culture: it operates independent of community.

The mindset of fund it, build it and sell it has yet to translate into most urban areas, much less rural areas. That’s certainly the case in Oregon. What’s needed and wanted in most communities are stable, locally rooted businesses that provide solid jobs over many years and understand their success cannot be divorced from the communities in which they operate. The VC model doesn’t serve that need.

 

Williams, a Portland area resident, also drew an important distinction between green and sustainability. He says his bank distinguishes itself from other banks by focusing on sustainable communities not just green.

 

“My sense is there will be a backlash over the next three to four years about sustainability, caused by concerns about ethanol and rising food costs, and we need to be prepared for that and consistent in telling our story and why it makes sense.” In the end, Williams says ShoreBank’s commitment to sustainable communities may help it weather a shift in public opinion. “People who only characterize themselves as being ‘green’ will be under more stress than those that focus on community development and building sustainable communities.” 

 

 

I agree with Williams. Green is often more about how businesses see themselves, while sustainability emphasizes the interconnections among business, community and environment. In other words, sustainability is not all about you, the business. It’s about operating from a larger mission or purpose than simply finding ways to make money from your customers’ interests in green products or services. And I believe over time, people will reward those businesses, like ShoreBank, that understand the difference.


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Wednesday, May 21st, 2008
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Posted in Business & Economics, Oregon, Sustainability | No Comments »

Is sustainability possible without slowing down?

Do we Americans work too much or otherwise stay too busy to live sustainably? The question has been running through my mind since Saturday, when I joined about 50 other Portlanders in sampling a new discussion course on food by the Northwest Earth Institute. (I am a member of the NWEI board.)

I led a group of 10 people in discussing two articles from the course. One question from the readings, “Does slowing down in terms of food — shopping, preparation or eating — appeal to you?”, drew unsurprising consensus. Although some “hated” going to the grocery store and some “hated” cooking, the idea of slowing down around food appealed to everyone.

That is, until the follow-on question came: “What would be the trade-offs for you personally?” This was a group of well-educated adults whose intense work lives and family responsibilities seemingly allowed no room to slow down. Who has the time or the energy to shop, cook and eat in a manner that always makes a priority of sustaining the environment, our families and us?

We were talking about food, but the same could easily be said of any number of consumption, work and lifestyle choices we face everyday. Sustainable living requires conscious choices. When we’re overly busy or stressed we go on autopilot or revert to what’s convenient instead of what’s healthiest for all concerned.

One of the group members told me that slowing down would mean leaving her corporate job where she was held captive by the “golden handcuffs” — even though she had to work 60 hours a week to keep those handcuffs on. Millions of Americans find themselves in the same predicament. And when push comes to shove, most of us decide to keep our demanding jobs and the financial security they provide rather than choose a mode of living that leaves more time for the basic joys of life, such as preparing and sharing a meal with family or friends.

So what will it take for more Americans to choose to slow down? Or is the story we tell ourselves — that we can’t afford to slow down — true for most of us? And if the latter is the case, what does that say about the prospects for a sustainable future?

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Monday, May 19th, 2008
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Posted in Food and Drink, Oregon, Sustainability | No Comments »

Picking up where Nau left off

Sunday’s Oregonian attempts to explain what sustainable businesses might learn from the closure of apparel maker Nau early this month. The paper draws a conclusion similar to my immediate reaction when I heard the news: that Nau’s ambition got the best of it.

The Oregonian’s assessment is too brief to be of significant value to existing or would-be green entrepreneurs. For instance, the paper responds to one of its own questions, “Is a sustainable business unsustainable?”:

Nau wasn’t around long enough to tell. And certainly, organic food companies have profited as demand increases. And renewable energy ventures — biofuel, solar power — still attract investors’ bets. “There are a lot of sustainable plays that are more capital efficient and less risky,” said David Kirkpatrick, founder of SJF Ventures, a Durham, N.C.-based firm that invests in green companies.

I’m sure the paper felt compelled to ask this question because many who heard the news of Nau are probably asking it. It would be sad indeed if people concluded from Nau’s experience that operating a business with social, environmental and profit motivations equally in mind cannot be sustained long-term. Unfortunately, the paper’s response to its question doesn’t really get at the answer.

How about we flip the question: Is an unsustainable business sustainable? Or ask it from a macro view: Can our economy continue to run indefinitely on the backs of companies whose only measurement of success is financial return?

Throughout our history as a country that’s the way business has operated. And the American economy has flourished as a result. But for how much longer can this go on? Especially as China, India and other countries look to duplicate our success.

I hope people don’t see Nau’s failed attempt at “challenging the nature of capitalism” as evidence our economic system does not need serious repair. Yes, the company’s ambition exceeded its reach. But the folks at Nau knew there’s nothing sustainable about business as usual. And we all need to pick up where they left off.

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Monday, May 12th, 2008
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Posted in Business & Economics, Oregon, Sustainability | No Comments »
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