The car rental market is one market that is constantly getting greener, offering a growing number of green services from the newest electric cars to car sharing programs. Yet surprisingly, none of the major car rental companies, until now, have published a sustainability report. Well, that was true until last week when Enterprise Holdings (which owns and operates Alamo, Enterprise Rent-A-Car and National Car brands) took the lead and announced the release of its first ever sustainability report.
If you have followed TriplePundit for a while this news shouldn’t come as a surprise to you – reports on Enterprise’s commitment to sustainability and green initiatives date back to 2008 and 2009. This year you could also read here how Enterprise is the first to offer Chevy Volts for rent and is rolling out the largest EV rental fleet in service. It also makes sense that as the leading rental car company in the world (measured by revenue, employees and fleet,) Enterprise also leads this market when it comes to sustainability reporting.
Here are some of the report’s highlights:
Besides the 20/20 vision’s goal mentioned above, Enterprise includes in this report couple of interesting goals: reducing its Scope 1 and Scope 2 emissions by 10 percent by 2015, converting all airport shuttle buses in its fleet to B20 biodiesel by 2015 and increasing participation in its annual Enterprise Holdings health assessment to 10,000 employees companywide by 2015.
Looking at the company’s carbon footprint reduction goal, it seems reasonable at first given these are the company’s first steps in calculating and managing its carbon emissions. Yet, it’s important to note that this goal relates only to Scope 1 and Scope 2 emissions, which represent only 3 percent of the company’s overall impact. The rest, 97 percent, are Scope 3 emissions generated mainly from the cars as Enterprise’s customers drive them. If you do the math, you find that the company’s goal equals a 0.3 percent reduction, which doesn’t seem to be too challenging, to say the least.
Enterprise is not the first company that has made big commitments for small sections of their footprint. We also see this pattern in other companies’ reports, like Timberland and Vodafone. I have to say I’m not a big fan of these sorts of goals, as they might lead to a misrepresentation of the company’s efforts to reduce its overall impact. Yet, I do have to commend Enterprise for being fully transparent, giving clear and detailed explanations about their decision not to include Scope 3 in their goal for now (it’s seems they just don’t have the information now), and committing in their goals for the next report to “establish a baseline for Scope 3 emissions within our supply chain. Other indirect emissions such as fuels, transport-related activities – and, in our specific case, the GHG emissions of our cars as our customers drive them.”
It was also encouraging to read in the report on their chairman’s task force – a cross-functional group of 15 department heads and subject-matter experts that is at the core of Enterprise’s sustainability effort. Founded last year, the task force identified priorities for Enterprise’s sustainability program and it transcends individual departments to bring a full-scope approach to important issues and makes addressing them a responsibility of the entire company. Creating such a senior governing body not only helps to integrate sustainability in the company in a strategic way, but also ensures the company’s commitment to this process on all levels and throughout all of its operations.
With a fleet of more than 1.2 million cars and trucks, Enterprise has the power to push the transportation space forward and make it more sustainable. It is becoming more important as we see a growing demand for SUVs and light trucks. This trend means that without a gas tax or similar economic incentives, we need the help of companies like Enterprise to make the market greener. Therefore, this report is very important, providing a clear indication that sustainability has become an essential part of Enterprise’s DNA.
Raz Godelnik is the co-founder of Eco-Libris, a green company working to green up the book industry in the digital age. He is also an adjunct professor in the University of Delaware’s Alfred Lerner College of Business and Economics.
Nike is a US$19 billion company with brand recognition that ranks up with Coca-Cola, Apple, and Cadbury. With a global following and global demand come enormous responsibility. The company operates and leads within an industry where performance rules, sosustainability intuitively is not a fit. Nevertheless Nike and its VP of Sustainable Business and Innovation,Hannah Jones, are turning the idea of how to approach sustainability on its head. And with such a strategy, Nike rethinks design, innovation, and progress. To that end, Jones set the tone ofGreenBiz’s Innovation Forum this week in San Francisco.
Like many companies, Nike faces a future of constrained resources and rising prices. “Sustainability” to most companies means creating a product that is “less bad” or “more better,” but Nike decided to learn how its employees could view sustainability through a design lens. Balancing those goals while focusing on Nike’s core capabilities, the road to high-performance yet more sustainable products was bumpy. The results, however, have transformed a company’s culture and purpose.
Jones and her team spent 18 months surveying other company’s work on sustainability issues, benchmarked Nike against those firms, and asked professionals a bevy of questions. CEOs, CFOs, and research and development teams were among the teams on her target list–but curiously, not sustainability teams. Jones and her staff had a mission to find out how a company like Nike could blend art and science–and also how Nike could get is most creative people to not only innovate, but execute. And in the meantime, a sporting apparel company had its executive talking to Eli Lilly and Procter & Gamble to learn how it can push the envelope in product innovation and manufacturing.
The upshot is that Nike has integrated sustainability and innovation processes throughout the organization. Sustainability professionals have to think about the company’s systems, while employees are encouraged to view innovation through the lens of sustainability. And “innovation” applies at all levels of the company: in its products, processes, revenue generation, business model, and throughout its industry. Furthermore, while companies traditionally kept their research and development work locked and hidden, Nike took the approach of Linux and Napster and decided to take an open sourced approach towards sustainability.
Nike’s mission statement is to inspire and innovate on behalf of the athlete. So the sustainability questions for Nike included how to incorporate materials great for performance but that are also regenerative and recyclable; how to transform the supply chain; and finally balance this new mindset with pushing products quickly to market. The cool company in Portland found itself needing to align more closely with agriculture, chemistry, and now must learn from other industries–plus balance a new way of designing and manufacturing products with materials that come from many time zones away.
The task is not easy and is still a learning process. Just start with Nike’s product lines, which are made from about 75,000 different materials. One sneaker could have as many as 300 different components. Its supplier rolodex has at least 2000 companies. And meanwhile you have a consumer base that demands zero compromise on price and performance.
The learning curve is still turning and winding for Nike, but the company has made progress. During last year’s World Cup in South Africa, Nike made waves among football players and fans for its jerseys made out of recycled plastic bottles. Within its industry, Nike has led with efforts such as the Sustainable Clothing Coalition and GreenXchange. Not everyone is happy; the company reduced some of its philanthropic activities in exchange for investing in disruptive technologies that down the road could help build a better, cleaner, and safer planet. But for Nike, creating a company culture where innovation means invention with value has made it a leader not just in Portland and within the apparel industry, but among other industries that are now taking sustainability seriously.
Leon Kaye is a consultant, writer, and editor of GreenGoPost.com and also contributes to The Guardian Sustainable Business; you can follow him on Twitter. He lives in Silicon Valley.
Location: New York, New York
Education: Board Certified in Integrative Nutrition and Holistic Health, Institute of Integrative Nutrition; MBA in Luxury Goods Marketing & Management, Sup de Luxe in Paris; Masters in International Relations, Institut d’Etudes Politiques in Paris; BA in French Studies, University of Pennsylvania
Job title: Principal, Sequoia Lab; Owner, living épanoui
What she does: As a former Chanel executive turned wellness coach turned brand and business strategist, Eliza Niemtzow has worn many different hats over the years. But throughout her career, she’s always advocated well-being as one of the most important aspects of our lives. In 2007, Franco-American Elisa founded living épanoui, a wellness and lifestyle firm where she coaches clients by applying her “feel good, French style” philosophy. When she’s not working one-on-one with clients, she leads wellness workshops and discussions for companies like Barclay’s Capital and Barneys. She’s also the Principal of Sequoia Lab, a consulting firm that partners with CEOs and entrepreneurs to create profitable, sustainable and socially responsible businesses.
How she got her gig: Before focusing her career on individual and corporate wellness, Elisa managed multi-million dollar accounts as a Ready-to-Wear executive at Chanel and worked with Ernst & Young and Accenture as an auditor and management consultant in Paris. “I loved working with women at Chanel on their style. But something was missing,” says Elisa. “I wanted to help women feel confident and beautiful in their skin, and in their life, beyond just having the right outfit. When a colleague approached me for help with her diet, I decided to channel my passion for health and wellness into my own business.” She founded living épanoui (a French word for “happiness”) so she could help everyone from business leaders to Manhattan power moms achieve healthier, more balanced lifestyles. But her next venture wasn’t too far off: recognizing that health was not only important for individuals, but also for communities and the environment as a whole, Elisa became Principal at Sequoia Lab so she could help businesses with their Corporate Social Responsibility strategies.
Healthy habits: “After a more traditional corporate career, I wanted to focus on improving well-being,” says Elisa. So in 2007, she decided to pursue a certification in Integrative Nutrition and Holistic Health from the Institute of Integrative Nutrition, where she studied under some of the world’s leading natural health practitioners, including Dr. Oz. “With living épanoui, I help women feel good in their bodies and in their lives, without stress and deprivation. Helping my first women clients feel at peace with their food and excited about their lives was very gratifying.” And she’s extended the concept of “living épanoui,” or living “in full bloom,” to working with large companies who want to create profitable yet socially impactful businesses. “In working with companies such as L’Oréal and Sodexo, we see that making money and creating value in our world go hand-in-hand.”
The many meanings of success: Although Elisa has been named one of New York City’s Power Players by Gotham magazine and has worked with clients as big as Alicia Keys and major companies like GE and Dior, her idea of success has evolved over the years. “Today, being successful to me means staying in the moment, enjoying my everyday life and being engaged in the world.” But she still gets excited over wrangling in new business: “It’s a great feeling to bring in your own deals. This summer, I brought in my biggest yet with an Asian company.”
Money matters: While Elisa helps her clients focus on wellness, she also realizes that financial health is an incredibly important asset. “I would like to achieve more financial independence,” she says. “Even if you are doing what you love, you have to still make sure you are financially secure.” Her advice? “If you want to be in the health & wellness industry, make sure you have a way to earn a steady income. If you’re into CSR (corporate social responsibility) and sustainability, be open to broader corporate roles where you can do that on the side and grow your expertise.”
But family matters, too: Elisa relies on her family to get through the inevitable stress that comes with such a packed schedule. “I try to figure out what’s really stressing me, and treat the cause. My husband is an invaluable sounding board and support,” says Elisa. “I come from a family of strong women, and my mother always reminds me that I have succeeded through difficult moments before.”
This job’s for you if: you’re flexible and open to new opportunities each day. “There are few typical days although I’m always up early and keep regular hours,” says Elisa. But while she never knows how her day may take shape, some elements are always the same: “Mostly each day combines client work and business development. It’s important to make time to network over meals and attend conferences, which is easier to do when you’re your own boss.” And, as expected, Elisa always makes an effort to maintain her healthy habits, no matter what the day may bring: “My main form of transportation is walking, because I hate being indoors at a gym, and I always eat lunch away from my computer.”
“When you put your beer down, you leave a mark on the table or the coaster,” said Bart Alexander, vice president of corporate responsibility for Molson Coors. “In a similar way, that beer makes a mark on the environment. We’re asking our employees, ‘What kind of a print do we want to leave?’ Or ‘How do you grow the positive beerprint and decrease the negative beerprint?’
Alexander says the beerprint makes it easier for Molson Coors to tell its overall sustainability story, both to employees and the beer-sipping public. It isn’t just about water: the beerprint label describes the company’s end-to-end activities including water, energy management and waste reduction (for example, using the cast-off materials from the brewing process for ethanol or even animal feed).
Still, Molson Coors used the beerprint thinking to cut water consumption by 5 percent in its sustainability reporting period. The goal is for a 15 percent decrease in water usage by 2013 against a 2008 baseline year. That would mean the company would use about 4.4 hectoliters of water for every liter of beer brewed. The specific target for 2011 is 4.52 hectoliters of water for every liter of beer, according to some of the company’s presentation materials on this topic.
Overall, there are five basic pieces to the Molson Coors “CEO Water Mandate” (I am quoting these verbatim from the presentation):
Like other sustainability executives on top of the issues, Alexander is keenly aware that local strategies are necessary for the most effective water management. “Water you save in one place really doesn’t help you elsewhere,” he said. “We know that being a very efficient user of water is important. Often, there is a correlation between energy use and water use.”
Letting a revenue stream slip away from you, and actually paying someone to take it away, sounds like bad business. But that's what companies do when they send their trash to get dumped in a landfill.
Out of all the sustainability and efficiency efforts companies have adopted, one of the biggest shifts in thinking has come from goals on sending zero waste to landfill (usually shortened to "zero waste").
Companies in almost any industry are seeing significant savings -- General Motors, for example, has brought in $2.5 billion in revenue through recycling over four years and Walmart has cut by over 80 percent in one state alone the amount of waste it has to pay to send to landfill.
Not surprisingly, getting to zero is not an easy task. But as the examples from several companies who've traveled the path to zero waste show, there are some common elements to any successful strategy.
There is a common recipe for a lot of these initiatives -- a little bit of material reduction, a whole lot of recycling and reuse, and a bit of incineration (also called waste-to-energy) -- and they come down to four general categories that can help you structure your efforts:
Zero waste is not just for giant corporations -- the lessons that these companies and others have learned can help just about any company identify, reduce and even eliminate their waste streams entirely.
1. Know What You Have
To do something about your trash, you first have to know what you're dealing with. Look at your trash. No, really look at it. Sort it out. Find out what you're making. And only then can you do something about it.
The only way some companies have accurately determined what trash they're dealing with is by getting their hands dirty -- literally -- with a dumpster dive.
Procter & Gamble's waste reduction teams have sorted through trash at its various facilities, which make everything from makeup to shampoo to batteries to dog food.
Walmart, meanwhile, has identified around 100 waste streams created from products, packaging and food, coming from its sales floors, break rooms, bathrooms and parking lots.
And construction equipment maker Caterpillar's plants produce more than 30 waste streams like concrete, scrap metal, plastic and sludge.
Once you've figured out what kinds of waste you're creating, then you've got to keep it separated.
Before grocery retailer Supervalu started its landfill waste reduction push, its Albertsons stores in southern California were sending 2.4 million pounds of waxed corrugated cardboard to the trash. The material, which is used to ship produce, frozen food and other wet items, can't be traditionally recycled due to the wax coating.
Two Albertsons stores -- which now send less than 5 percent of their waste to landfill -- found a solution by partnering with a company that turns the cardboard into fireplace logs. But first the store started sorting their different wastes, keeping waxed cardboard separate from other fiber-based materials as well as trash.
Sorting waste, though, needs to become second nature. It needs to be accessible and be treated as just the way things are done.
Sometimes it's not just how to sort waste, it's where. When Caterpillar's Aurora, Ill., plant started working on its waste, it quickly became clear that the best way to address it was to go right to the source. To that end, the plant put recycling in place along assembly lines and set up a conveyor to use for sorting waste. Just three months later, 40 percent of the trash along the lines was getting recycled instead of dumped, creating a projected savings of $200,000 a year.
2. Track and Set Goals
Other than "low-hanging fruit," the most overused adage in green business is "you can't manage what you don't measure." But setting goals and working to meet them is still a tall order for just about any type of waste-reduction initiative, so it's worth noting how goals and metrics can keep a company on track to zero waste.
General Motors, which has 76 zero waste manufacturing facilities and 10 zero waste non-manufacturing sites around the world, says a key to its effort has been rigorous tracking of waste along with setting goals and metrics to hold plants accountable.
Each facility has specific goals, and the plant scorecards are tied to plant manager performance evaluations. "Tying revenue to various waste streams tends to generate more interest and helps us approach waste reduction from a sustainable financial perspective," said John Bradburn, GM's manager of waste-reduction efforts.
Pete Pearson, director of sustainability for Supervalu, says a metrics-based approach, although not as accurate as something like tracking energy, is key. "Although measuring waste is not a perfect science, every effort must be made to accurately account for materials being diverted from landfill," he said. "It must be clear to stores the correlation between landfill diversion and cost savings." Key to that is making the whole process, from sorting to tracking, easy to integrate in to employees' workdays.
Don't make recycling something that is seen as an extra effort; it needs to just be the way things are done.
A couple of Walmart's efforts on its journey to zero waste have been to change how employees think about waste (i.e. it's not trash until it's in the trash can) and the location of waste bins.
Doug Sanders, Walmart's senior manager of store operations and sustainability, said stores have looked at where they have waste containers and reallocated where bins for trash or recycling should be. In some cases, trash cans are turned into recycling bins, and one of the biggest-impact changes was also a no-brainer: The company put recycling bins at cash registers.
In addition, when employees are stocking merchandise, they now have recycling bags attached to the carts they use to make it easy to collect things like plastic wrap. "It's not a major change to their job. It's a simple function that makes it easy for them," Sanders said. "If it's difficult, it's going to be very difficult for them to want to execute the programs we want to put in place."
3. Put Employees in Charge
Companies with successful zero waste programs don't just make recycling and waste sorting a job employees have to do, but something they want to do and can get excited about.
Some have created special designations or titles for waste managers, such as PepsiCo U.K.'s "waste marshals," who are empowered to do what's necessary to deal with waste. In the U.S., PepsiCo has 13 Frito-Lay manufacturing sites sending less than 1 percent of waste to landfill. Frito-Lay plants have "site champions," and team members are assigned specific waste streams to oversee. Waste teams create scorecards and use waste bills to track the effectiveness of programs.
In addition to making waste a part of plant manager evaluations, GM rewards employees for new waste-reduction and recycling ideas.
"The key to converting these plants is people and process. For the team, it becomes a sense of pride for those that work at those facilities, and it reflects in quality and throughput," Bradburn said.
Supervalu has also developed a rewards program, Pearson said. "Whether a store director is being proactive and creating partnerships with a community farmer, or if a store associate is stepping up to lead recycling efforts in the break room," he said, "there has to be engagement from all levels of leadership, including executive leadership encouraging and praising the positive behavior."
4. Find a New Life for Waste
One company's waste is another's raw material. While that doesn't have the same ring as the original axiom, but the fact remains that there are plenty of companies that thrive on the trash of others, either using it to make new products or running their operations in some way.
Procter & Gamble has devoted an entire group of employees to seeking out others who can use its wide variety of wastes, and also to find a use for inventory the company is unable to sell or would toss in the trash. The company's Global Asset Recovery Purchases (GARP) team has worked in countries around the world to find new uses for P&G's scrap product and packaging.
Feminine hygiene pads from a Hungary plant get shredded and burned to power a cement kiln, mascara gets turned into tire shine, shampoo goes into a car wash -- the list really goes on and on.
Through GARP and other efforts, P&G now has eight zero waste manufacturing plants in Belgium, Hungary, Italy, the United Kingdom and elsewhere.
GM has developed innovative ways to take byproducts from manufacturing operations and turn them into car parts or supplies.
For example, cardboard used in shipping finds a new life as sound-absorption material, tires from vehicle testing are shredded and made into air and water baffles, and paint sludge is turned into plastic shipping containers.
Walmart has also found plenty of solutions through other companies or non-governmental organizations. When the company was seeking out places to send its food waste, Walmart worked with the Environmental Defense Fund and the U.S. Environmental Protection Agency. But Sanders said that in its search, Walmart found plenty of individual sites it could send compost or animal feed, but no nationwide infrastructure that all of its stores could take advantage of.
So it did what only Walmart could do: It created its own network.
The company went state-by-state, looking for potential partners in companies and service provides, and identifying what was lacking. In addition to connecting composters and others who could take the waste with one another, Walmart put out calls for business in areas where solutions were needed.
In some cases, Sanders said, entirely new companies were started to serve Walmart's needs, knowing they'd be able to pull in other customers as well by putting a food waste program in place where none existed before.
View Zero Waste is a Journey
Let's pull out another cliché to close on: Like any sustainability initiative, zero waste is a journey, not a destination. If you want to be successful, don't just look at zero waste a goal to be met and then moved on from. The best and most effective programs are a constant process that, like energy efficiency or water reduction, can always be improved on.
Once you've hit your original targets, read about what other companies are doing, search for new partners and others that can reuse waste, try to make as little trash as possible, and whatever you do, don't put anything in the landfill.
Because that's just wasteful.
One of the most exciting developments in the auto industry today has to do with the sustainable innovations that make cars run -- improved petrol and diesel engines, ethanol and biodiesel, compressed natural gas, electricity, or some combination thereof.
It's a topic that will only become more pronounced as car engines are built to do more with even less, especially with President Obama's recent announcement to green the industry as a whole through aggressive fuel efficiency standards.
This is also a concept that can serve as lessons for those outside of the auto industry. In other words, what can companies do to make their operations more sustainable beyond the end product? Well, a good start would be to look at what is going into those outputs. This trend of replacing traditional materials with sustainable alternatives is something that's emerging across almost all industries, and like car makers, those companies that aren't participating in it are setting themselves up to fall behind.
The good news for those that haven't started yet is, if a 109-year-old car company with one the most expansive and established global supply chains in the world can re-imagine its design process, any company can.
Companies leading the way in such innovations, like Levi's and its new water-efficient manufacturing process used in its Waterless Jeans line, Clorox Company and the reformulated cleaning products that make up its Green Works brand, and Coca-Cola's PlantBottle -- the first ever recyclable PET plastic beverage bottle made partially from plants -- have all reaped the benefits of improved sales and improved reputation through these efforts.
At Ford, we're not just focused on fuel economy numbers alone. We also are re-thinking the way we build cars and the materials used inside of them -- an approach that a lot of business and operations leaders need to start integrating into planning and decision-making processes.
Seats and headliners are now filled with soy-based foam instead of traditional petroleum-based plastics. Old blue jeans are used for carpet insulation. Wheat straw and other plant-reinforced plastic are used for storage bins and door panels. Carpets and fabrics are made from recycled soda pop bottles. And overall, about 95 percent of materials used to make Ford vehicles are recyclable.
The above innovations are examples of the impact that designers, materials procurement specialists, and engineers can have on an industry when they put their minds to it. Also, these examples should serve as a message to senior leadership that their employees should be challenged and encouraged to substitute whatever they can with sustainable alternatives.
There are countless examples of companies re-imagining their design and operations processes, and we as business leaders can ensure that more companies join them.
The next time you're faced with supporting an option between a traditional process and a more sustainable and innovative alternative, know that by making the more eco-friendly choice, you're not only making an immediate impact, you're sending the message that you recognize the importance of environmental considerations in the design process -- from a product's development until the end of its life. And your employees and customers will support you for it.
For more on how companies are making sustainable innovation happen, check out our upcoming GreenBiz Innovation Forum, October 11-13 in San Francisco.
Assembly-line photo by the National Photo Company Collection.
Save a Tree! Save a Whale! Save your breath. Today’s consumer is too socially savvy to be impressed by companies who simply write a check to a cause whose mission has no affiliation with their brand’s position or offset to their impact on society. Consumers want companies to make thoughtful choices in determining where their donations are directed and furthermore, they want to have a say in the matter. Does your company’s philanthropic giving align with your overall strategic goals?
Strategic Philanthropy is a powerful way to connect with your customers and your community and to create a positive association with your brand in a relevant way. A recent Harvard Business Review article spotlighting smart philanthropy highlighted Nike, Intel, and Goldman Sachs for their integrated and large-scale approaches to corporate philanthropy – each of which were different from each other but relevant to their respective organization’s mission.
Nike’s Girl Effect stems from their core belief in the power of human potential; Goldman Sachs 10,000 Women and 10,000 small business programs provide training and funding to individuals around the world in depressed economies to start and maintain small businesses; and the Intel Teach program serves to measure Intel’s success in training 8 million teachers in 60 countries.
How can your organization make an impact on both your community and your bottom line using smart philanthropy?
A vital aspect to smart philanthropy lies in choosing which organizations to support based on the core strengths of your business or based on the industry you are in. When a company in the electronic industry sponsors a service dog training center, it is certainly magnanimous but not relevant to the electronics industry. Furthermore, it doesn’t create a positive association with their product. The most effective corporate philanthropy will strengthen your business and will support the community.
One example is Moody’s, the rating agency, who sponsors the annual “Moody’s Math Challenge” for high school students to prove their aptitude for quantitative analysis. They award scholarships and internships for the school to put these skills to work. The Moody’s Foundation wants students to study math and economics so that they can work in financial services and that is exactly what their contest promotes. How does the destination for your donations align with your company’s purposes?
Making contributions to relevant organizations sets the tone for smart philanthropy but you can take it a step further by engaging with those as members of the board. According to a recent Fast Company article, if you aren’t, you are “missing out on a number of valuable opportunities, including: government and community relations, economic development, leadership development, and effective stewardship of your costly grant-making.” Serving on a non-profit board also allows your executives to be trained on being effective board members and potential board leaders. The idea is an all around win for you, the non-profit, and the community.
Engaging Your Customer
You’ve heard the old adage: two heads are better than one? Well imagine what could be done if you had access to all of your customers’ heads. Many companies originally engage in corporate philanthropy for the purpose of creating goodwill with customers. These days it is about engaging your customers.
This goes beyond inviting them to participate in a community service project. Companies like Global Giving can help with crowdsourcing tools that help connect companies with donors in need. Beth Kanter of the Huffington Post identified crowdsourcing as “creating collective knowledge or wisdom, crowd creation, crowd voting, and crowd funding.” Crowdsourcing is an opportunity for you to bring your customer to the table and find out what they think is the most relevant way for you to give back. Have you opened the dialogue with you customers about corporate philanthropy?
These are only three ways that companies can improve their impact through corporate philanthropy. The more innovative you get and the more customized you can make a program, the more likely you are to be successful at executing that program. International Philanthropy Day is February 28, 2011 led by the Committee Encouraging Corporate Philanthropy (CECP). How will you, your company, and your customers celebrate?
Emily Cangie contributed to this article.
The term “differentiated green” refers to companies who pursue green strategies to go beyond clearing regulatory and negative PR hurdles. It refers to companies who create green strategies for reasons such as cost savings and creating a larger and more loyal customer base.
The most notable country to not sign the Kyoto Protocol is, as we know, the United States of America. Despite the size of its economy and the living standard among its citizens, the U.S. has historically been behind its sovereign peers as far as adopting regulations and in turn encouraging its corporations to adopt sustainability strategies. However, on an optimistic note, three of America’s most iconic companies find great value in pursuing comprehensive green strategies. At least to them, “differentiated green” is real, valuable, and achievable.
From 2004-2008 General Electric’s new Ecomagination program not only reduced its greenhouse gas emissions by 30% but also delivered $100 million in cost savings to the company. The profitability of Ecomagination did not stop there. By focusing on green initiatives through this program, the company has made innovating energy-efficient products a core competency. While often the value of sustainability programs are discussed relative to the bottom line, for GE, the real value has been realized in its top line. The $100 million cost savings of this period seems minuscule compared to the $17 billion ANNUAL revenue GE generated in new energy-efficient products such as light bulbs, MRIs, and locomotives.
In addition to financial results, GE has leveraged Ecomagination to improve customer retention and brand awareness. The company recognized that it had an opportunity to boost its brand by educating the public on its commitment to environmental responsibility. According to Interbrand, “GE Ecomagination is cited as a leading contributor to the 17% rise in GE brand value since its launch in 2005.”
Ford Motor Company recently rolled out its impressive Ford Focus EV. It seems that everyone is going after the Electric Vehicle market and it is looking like Ford may have nailed it. In addition to product development, Ford has also hired in-house climate scientists to set scientific mandates on its production as a whole in an effort to guarantee that the company does not contribute to certain catastrophic climate change metrics. All this has resulted in a wealth of good publicity for the company and is promising to give Ford a drastic image makeover. Not only is it acquiring a reputation as a socially conscious organization, but also, perhaps something no one thought it would ever be, an environmentally friendly company.
This is the type of marketing magic that cannot be bought with expensive advertising or a massive PR campaign. Ford saw the future and decided to make the real changes earning them praise from even some of their toughest critics in the grass-roots environmental blogosphere and from formerly skeptical consumers who may even be converted into brand evangelists.
Nike recently produced jerseys for world cup teams made of plastic bottles found in landfills in Taiwan and Japan. Nike’s focus on repurposing started in 1993, by reusing materials from old shoes to produce basketball courts and track surfaces. Since their first decision to “go green” in 1993, Nike has been an early adopter of numerous sustainable strategies. It has taken a serious stance on selling recyclable components, reducing waste, and reusing byproducts like rubber or plastic to create new products. This has resulted not only in cost savings but in a wave of positive PR.
Its financial results are also staggering. In the last 10 years, Nike’s stock price has increased 216%, and year to date, has increased 31%, relative to the S&P 500’s 4% decrease and 19% increase respectively.
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As a business owner, American or otherwise, are you missing out on an opportunity for growth and brand equity? As discussed above, cost reduction is now only part of the equation. If embracing green leads to top line growth, there is no time like the present, especially in the United States. We are on the cusp of another commercial revolution. The advent of electricity caused a revolution that built GE. The advent of the automobile did the same for Ford. The wellness revolution that started in the 1970s opened the door for Nike. Most recently, the technology revolution has created some of the largest market cap companies in the world.
The green revolution is just starting and there is plenty of market-share up for grabs. The United States has historically been known as a great innovator and has led the pack in many of these revolutions. If US companies actively embrace sustainability, they stand to see great profitability from this global movement. If your business embraces it, so can you .
> >Sequoia Lab consultant Trey Trenchard contributed to this article.
Photo credit: www.howcast.com
On Wednesday, Kim Kardashian is going to die a little. So is her sister, Khloé, not to mention Lady Gaga, David LaChapelle, Justin Timberlake, Usher, Serena Williams and Elijah Wood.
That day is World AIDS Day, and each of these people (as well as a host of others — the list keeps growing) will sacrifice his or her own digital life. By which these celebrities mean they will stop communicating via Twitter and Facebook. They will not be resuscitated, they say, until their fans donate $1 million.
“Dry your eyes, everybody,” Ryan Seacrest, the “American Idol” host and another participant in this cyberstunt, says in a videotaped “Last Tweet and Testament” that will be posted on his Facebook profile — and appended to a final post on Twitter — sometime after midnight on Tuesday night. “I don’t plan to be dead for too long.”
He adds, "Please buy back my life."
“Come on, y’all,” the actress Jennifer Hudson says in a similar videotaped plea. “Buy my life back. Go on a shopping spree and buy as much of it as you can.”
It’s all part of the latest gambit by the singer-songwriter Alicia Keys to raise money for her charity, Keep a Child Alive, which finances medical care and support services for children and families affected by H.I.V. and AIDS in Africa and India.
It’s rare that the Prototype column pays attention to celebrities, but Ms. Keys is the second one who has caught our attention by harnessing fame to philanthropy in an innovative way. The actor Ed Norton, who was featured in the September column, created a Web site that makes it easy to rally people to your cause.
Ms. Keys is up to something slightly different. She knows that she’s not alone in thinking that America increasingly treats its celebrities like commodities. But she believes she’s the first to tether that reality to technology to do some good.
“It’s really exciting. No foundation has used the technology before like we are,” says Ms. Keys, 29, a multiple Grammy Award winner.
On Sept. 30, Ms. Keys and her charity’s co-founder, Leigh Blake, started Buy Life, which sells $35 gray T-shirts imprinted with a bar code. People who have uploaded a Stickybits or Wimo application to their smartphones can donate $10 to Keep a Child Alive simply by scanning any Buy Life T-shirt’s bar code.
“This Shirt Fights AIDS,” the shirts say on the back. “Scan the bar code or Text ‘BUYLIFE’ to 90999 to Join the Fight.”
The planned “Digital Death” this week will take that idea a step further. Famous people with lots of friends, fans and followers will go silent online, but not before calling for an outbreak of generosity. The participants are believed to have nearly 29 million fans on Twitter alone.
And as of Sunday, three days before World AIDS Day, stylized full-color photographs of celebrities lying in coffins, seemingly lifeless, with eyes closed, are to be displayed on the Buy Life Web site.
“Kim Kardashian is DEAD,” says the text that accompanies one of those photos, which features the reality-show star in a low-cut sequined burial outfit that suggests she “died” after a night out clubbing. “Kim sacrificed her digital life to give real life to millions of others,” it adds, asking fans to “visit Buylife.org or text ‘KIM’ to ‘90999’ to buy her life now.”
The strategy here is not just to shock people into paying attention but to enable them to give by doing, as Ms. Keys pu ts it, “what you always do.”
“You’re always texting your friends,” she says. “Now, you’re going to text to Buy Life.”
All that fans have to do is text the first name of the celebrity they’re “mourning” to 90999, and $10 will be donated.
“It’s a really instant way of grabbing their compassion ,” Ms. Blake says.
You’ve heard of impulse buying. These women hope to create a new phenomenon: impulse giving. But the twist is that they’re still couching it in retail terms — winking at people in a way that makes them want to join in. “We’re taking the fixation with retail and with buying and all of that, and we’re turning it on its head,” Ms. Blake says.
Ms. Keys first learned the power of texting a couple of years ago, when she appeared on “American Idol” and, with a single on-the-air plea, raised “half a million dollars in about four minutes,” Ms. Blake says, adding that to date, Keep a Child Alive has raised $27 million.
More recently, when Ms. Keys set out to recruit her fellow luminaries to “die” along with her — she made all the calls herself — she was struck that “when I laid down the whole concept, it was impossible to say no.”
Ms. Blake has a theory about why. By packaging famous people like any other consumer product, she says, Keep a Child Alive is acknowledging something that many A-listers already know. “The artists and celebrities get that they are sort of being devoured already,” she says. “So they might as well have a bar code.”
She adds, however, that she expects the Buy Life campaign to spread far beyond its most recognizable participants: “My dream is to walk around New York City and see the traffic stopped because people are all scanning each other’s T-shirts.”
Whether people will miss their favorite stars’ 140-character missives enough to pay money to restore them remains to be seen. But if even one in 1,000 of the 3,465,527 followers of @jtimberlake is willing to donate $10 to reactivate the account on which he recently posted “Happy Halloween everybody!” — well, it will start to add up.
Similarly, if each of the 3,649,592 people who follow @RyanSeacrest texts “RYAN” to 90999, well, it won’t be long before we all can again enjoy such pearls of wisdom as this recent post: “have u ever been getting a massage ... then feel some gurgling in ur stomach ... and fear a gas attack?? What do u do?!”
Ms. Blake says she is braced for the digital-death campaign to create some confusion. “I’m sure there will be some people who get it wrong,” she says, predicting “a flurry of freak-outs among a few who think Kim Kardashian or Alicia Keys are actually dead. That will be outrageous.”
But that’s part of the point.
“We’re not one of those enormous twinset-and-pearls kind of bureaucracies; we’re a small, energetic activist organization,” Ms. Blake says. “And we think the language of donations is boring.”
Ms. Keys agrees, describing her philanthropic approach as simply “rock star.”
“Everything is done just rebellious,” she says. “You want to show all your folks and your friends: ‘Look what I’m into. Get into it, too!’”
If you could reduce your product packaging costs by 38% while offering a more sustainable solution to your customers, would you think twice? Many companies are taking bold steps to incorporate sustainability into their core business strategy, reaping not only brand and customer benefits, but bottom line benefits as well.
In a recent example, the outdoor industry, whose customers are known for their environmental savvy, is embracing sustainability through industry wide collaboration. A sub-group of the Outdoor Industry Association called the Eco Working Group spent the past four years creating the Eco Index - an environmental assessment software tool designed to advance sustainability practices among the apparel, footwear and equipment manufacturers.
Launched in the summer of 2010 and backed by supporters like REI, Target, Timberland, Patagonia, Brooks, Levi's and Nike, the Eco Index is quickly earning credibility and has the potential to drive major changes in the apparel industry. The Eco Index addresses two of the biggest challenges companies face in making a case for socially responsible business practices - quantifying the costs and savings and standardizing performance metrics that can be easily communicated to customers.
According to their website, the Eco Index “provides companies throughout the supply chain a way to benchmark and measure their environmental footprint, allowing them to identify areas for improvement and make informed sourcing and product life cycle decisions.” Furthermore, the index seeks to create “common language” around sustainability for consumers and retailers alike that will allow for more informed decisions.
The Eco Index is similar to Energy Star, the EPA’s rating program that ranks the energy efficiency of appliances such as refrigerators, which has become the international standard in measuring appliance energy efficiency. In the Eco-Index, products are ranked based on suppliers’ answers to survey questions and then assigned a score that is some percentage of "perfect" in each of 7 “lenses”: Land Use Intensity, Water, Waste, Biodiversity, Chemistry/Toxics – People, Chemistry/Toxics – Environment, and Energy Use and Green House Gas Emissions.
Unlike the Energy Star program, the Eco Index is currently only an internal supply chain tool and is not a consumer-facing label. In order for the Eco Index to reach such a level of adoption, it would have to be made available at the point of sale. For now, "it's a tool for a company to use to make a better choice," Amy Roberts, vice president of government affairs for the Outdoor Industry Association explains.
While the Eco Index does provide a methodology that is easily applied across categories, it is only in Phase 1 roll out and there are still some big questions to address. For example, some survey questions rely on estimates from suppliers, which could call into question the accuracy of a score; and currently there is no total score, although one may be incorporated during later phases of the project.
Despite the fact that it’s still a work in progress, the Eco Index has proven that a focus on sustainability can impact the bottom line. Even at the most basic level, programs that reduce, reuse and recycle frequently lead to cost savings. According to the Eco Index website, Patagonia's efforts to encourage its supply chain to adopt more sustainable practices have resulted in eleven of its textile mills adopting the Bluesign standard - allowing Patagonia to reduce the costs and time associated with monitoring those vendors.
A Wall Street Journal article reports that, in and effort to improve their Eco Index score, “Brooks got rid of moisture-absorbing silica bags, which turned out to be ineffective, and stopped stuffing the insides of shoes with tissue paper. As an added benefit, the " green" changes reduced the cost of the shoe box by 38%.”
With both proven bottom line impact and growing consumer feedback favoring green minded companies, as a business leader, are you adequately engaging your customer around your sustainability efforts?
Many consumers cite that they recognize that sustainability and social responsibility is a developing conversation in the business world and they want to hear about the work in progress. They don’t expect companies to have all of the answers, but they do expect a response.
As the Eco Index, and tools like it in other industries, moves toward a more consumer-facing model, there will be increased incentive for companies to incorporate sustainability in all facets of their business from product design to supply chain. Will you be a leader in green innovation, or will you be left standing in a pile of tissue paper and silica bags?
Sequoia Lab consultant Emily Cangie contributed to this article.
Photo credit: www.rei.com
Photograph: Ali Haider/EPA
I am a shameless buzzword aggregator, touting whatever word of the week I can call my own, so "social intrapreneur" chimed with me for many reasons.
For the sake of this blog post, I define social intrapreneur as "an entrepreneurial individual, within a private company, driving the business towards making social impact while achieving it's business objectives".
It's important to distinguish a social intrapreneur from the CSR team, the sustainability lead, the community team, and the well-meaning who enjoy organising get well cards from the office.
Social intrapreneurs create lasting social change, they believe in the power and purpose of the company they work for and they believe you can do well and do good whilst in business.
It's my personal opinion, that the right social intrapreneurs, in the right organisations, pulling the right levers, can affect far greater change than most social entrepreneurs can dream of; but I don't think they need to work together in order to do so.
I asked Liam Black, who used to run Fifteen and FRC, and whose new company Wavelength connects brands including Rolls Royce and Delloitte with dynamic social enterprises such as Sidekick Studios and MyBnk, what he thought of social intrapreneurs. He wasn't overjoyed at the new term. "Social intrapreneur? Oh great, just what the world needs, another unnecessary term to define what we do. Actually, I have met a lot of poor people recently and funnily enough, exactly what they said they needed is another hard to understand phrase."
He went on. "It's about collaboration, you need someone on the inside, who's got the access to money and authority that will give someone on the outside credibility and the narrative. Have you got a daft phrase for that?" And then he softened and named his top candidate for the monicker, "the next generation at some of the world's biggest firms are very exciting, we're seeing the best of them at Wavelength, guys like James [Elias] at Google are the future."
James Elias is head of business marketing at Google UK. He had the vision, imagination and balls to create a Google programme transforming young offenders with natural business talents into legitimate entrepreneurs.
Elias said: "Social intrapreneurs potentially deliver a lot more social impact, at greater scale, but their challenge is culture within a major corporate. Partnering with social entrepreneurs creates opportunity for proof of concept that can translate into a corporate environment. Social entrepreneurs are closer to the front line, more nimble and are plugged into social enterprise in a way corporates aren't.
"Everyone at Google is encouraged to have ideas, and when you do you're encouraged to find the right people to make them work. Most people at Google believe that it really is a company changing the world, and that the core of the business, providing access to public data, is a good thing."
But Google is one thing, they have publicly promised to "do no evil". What about the multinationals more often written off as faceless profit machines? It's easy to criticise the likes of Unilever for their global dominance, so I spoke to Geoff McDonald, global vice president of human resources at Unilever.
McDonald said: "how are we going to make a social impact, money, grow business, and still be here in 100 years? Social change has to start from a profit model if it's going to make a lasting difference. I call it capitalism with care. Social intrapreneurs have by far the greatest chance to make a social impact at scale, but it has to be in partnership with social entrepreneurs.
"I truly believe it's the big boys that will change the world, not governments or churches but P&G, Nestle and us. But it must be done in partnership with social enterprises and others to really make the greatest social impact.
"But we need to move away from CSR and make it core to the business. To effect change within a multinational you need to create a moral purpose, If you can create a culture around that moral purpose, more social intrapreneurs will occur."
Brilliant social intrapreneurs are everywhere, at every level. When Livity pitched an idea to .html">O2, to launch a social enterprise package and create mainstream awareness of social enterprise, it was a big ask. Luckily, the decision maker, responsible for SMEs was the awe inspiring Simon Devonshire, co-founder of One Water, who seized the idea of bringing social enterprise and the private sector together and is now leveraging the channels O2 has to grow the social enterprise sector in the UK.
I think O2's support for social enterprise will be a game changing moment for big business and social enterprise in the UK, and I'm proud to have had a role in it. Sadly however, luck played the greater part. I had no idea of Devonshire's background when I approached O2 with the idea. I aimed for the board and was directed to Devonshire from within.
Social intrapreneurs might just be yet another term, but for social change I suspect it's a very important one. Social enterprises and social intrapreneurs need to seek each other out, using areas of mutual interest as their compass.
Currently there is no directory of social intrapreneurs at UK firms, although it might not be a bad idea to create one (nudge, nudge Guardian). For now you have to bang on doors, make yourself known, do your research and generally aim as high up in an organisation as you can, to have a chance of coming back down in the right direction.
For a more theoretical and thoughtful (and slightly smug) perspective the field guide to Social Intrapreneurs is an interesting read that defines them as:
"Someone who works inside major corporations or organisations to develop and promote practical solutions to social or environmental challenges where progress is currently stalled by market failures. Someone who applies the principles of social entrepreneurship inside a major organisation. One characterised by an 'insider-outsider' mindset and approach."
The Social Intrapreneur, a field guide for corporate changemakers available to download from http://www.sustainability.com. The guide contains case studies and contacts. It is produced by the Skoll Foundation and others. The same publication does however also use the phrase "Torpedoing Beavers" without the slightest sense of irony, a wry smile or a even a snort, and frankly if you're going to take on the challenge of working with big business, to convince them to become more serious about achieving social aims, you're going to need more of a sense of humour than that.
Sam Conniff is the co-founder of Livity - a socially responsible youth communications agency
There's a lot to be said for viewing the year just passed through the rear-view window.
Toyota's hybrids hit the wall, so to speak, in terms of being seen as a paragon of safety. BP spouted all too vividly the perils of the petro-based economy. The bigger peril, climate change (or global warming, or whatever it's called) became, somehow, a non-issue, politically speaking. Indeed, the political climate in the United States turned against pretty much all things environmental. Meanwhile, toxic substances and gender-bending chemicals found their way into everything from mattresses to baby bottles. I could go on.
But please, kind readers: Step away from the ledge. There's much to be hopeful about.
I've just finished an annual ritual, combing the past year's stories -- all 2,139 of them -- published on GreenBiz.com and its sister sites in order to identify significant trends in the world of sustainable business. I do this each year in preparation for our annual State of Green Business report, the 2011 edition of which will be released on February 1, the eve of the first of three State of Green Business Forums we'll be staging this year. The report identifies 10 key trends and 20 key indicators that show how, and how much, companies are transforming their operations in environmentally responsible ways.
Doing this review is tedious and time-consuming, but also heartening. There was much to celebrate over the past 12 months. Here, in no particular order, are 10 stories we published that I believe represent significant, hopeful developments:
General Electric is by no means the first or only company to make a significant pledge to buy large quantities of electric and plug-in vehicles, though its recent commitment is one of the largest. In doing so, large fleet buyers like GE (and Enterprise, Frito-Lay, UPS and others) are proving that there is a mainstream market for these vehicles -- that they're not just the playthings of well-to-do techies and greenies. And GE's initial purchase of 12,000 vehicles from General Motors, including the Chevy Volt, was a strong vote of confidence for the re-emerging U.S. automaker.
For two decades, the world's largest consumer packaged goods company pretty much out stayed of the green marketplace. Its few forays were either ill-conceived (such as early 1990s commercials claiming that diapers were compostable) or focused solely on money-saving benefits (such as its successful Tide Coldwater detergent). But that changed in dramatic fashion with a series of long-term goals which, if met, would bring the company's factories to be 100 percent renewably powered, use 100 percent renewable or recycled materials for all products and packaging, and send nothing to landfills. Those bold goals are mid-century but the company set 10-year interim benchmarks that would set a trajectory for how products are designed and manufactured going forward. P&G still won't necessarily be overtly marketing green, but it could demonstrate that significant green commitments aren't incompatible with mainstream products and profitability.
The sustainability-minded carpet maker said it would complete something called "Environmental Product Declarations" or EPDs -- detailed documents explaining the life-cycle impacts -- for all of its products by 2012. EPDs analyze products from their raw material stage to disposal and are certified by independent third parties. In doing so, Interface took the lead on a growing trend of product transparency -- not just for carpets, but for a wide range of other goods whose ingredients had previously been protected as trade secrets. We'll be hearing more about EPDs in the future, as more companies follow Interface's lead and make product transparency a core ingredient in their operations.
Transparency doesn't come without a great deal of investigation and quantification, the metrics of which are still in their infancy. Those metrics took a leap forward, at least for one industry, with the emergence of the Eco Index, a project of the Outdoor Industry Association, a trade group of apparel, footwear, and equipment manufacturers. The Index, a web-based tool, provides guidelines, indicators and metrics aimed at enabling companies to score individual products related to their materials, packaging, manufacturing and assembly, transportation and distribution, use and service, and end of life. This is a terrific example of industry collaboration to solve collective challenges and get all players speaking the same language and using the same yardsticks. The presence of leadership companies like Levi's and Timberland will help ensure that the Index isn't intended for just a small circle of niche players.
Sustainable agriculture hasn't generally been the domain of large food growers or retailers, residing principally in the world of locavores, farmers markets, and natural food stores. But the world's largest retailer is helping to bring it into the mainstream with a commitment to support local farmers and their communities. Specifically, Walmart pledged to sell $1 billion in food sourced from 1 million small and medium farmers and provide training to farmers in sustainable farm practices, all while increasing these farmers' income. And while $1 billion over five years represents a tiny fraction of Walmart's annual grocery revenue -- more than $250 billion in 2009 alone -- it signaled that sustainable ag has matured into a mainstream means of production.
Large chemical manufacturers have been turning gradually to green chemistry in recent years, but Eastman Chemical Company's goal -- to derive two-thirds of revenue from new products that have sustainability benefits relative to other products on the market -- represents a new direction for the 90-year-old Fortune 500 firm. Eastman also laid out some broader goals, such as working with customers to help them meet sustainability plans, using sustainability as a key factor in identifying growth opportunities, and using its internal Innovation and Sustainability Council to manage investments and determine priorities. It's not a 180-degree turnaround for the company, which claims to already derive one-fourth of its revenue from greener alternatives, but it sends a message that a fundamental shift is underway for an industry long linked to some of humanity's and the planet's worst health impacts.
Amid political squabbling over whether curbs on carbon emissions would harm the economy, Nike reached a milestone, and did so profitably. The world's leading maker of athletic footwear and apparel announced it had dialed back its greenhouse gas emissions to 2007 levels. And it did this despite having announced in 2009 that it would stop buying carbon offsets and concentrate instead on reducing emissions through curbing business travel and reducing the embedded energy in materials and energy used in its manufacturing process. None of this, it seemed, hurt the bottom line. While Nike's fiscal 2010 revenue dropped 1 percent from the previous year, "We've never been more profitable," reported Nike President and CEO Mark Parker in the company's 2010 annual report, adding: "Gross margins came in at 46.3 percent for the year -- that's a record." Nike has proved that addressing climate change can go hand in hand with scoring points with investors.
This is the latest milestone in a decade-long effort GM has undertaken, getting 76 of its 145 plants worldwide to be "zero-waste." On average, 97 percent of the waste at these 76 sites gets recycled or reused to make new car parts, while 3 percent is incinerated to generate energy. The car maker is hardly the only company these days pursuing a waste-free goal, though it's been doing it longer than most. What's most remarkable about its achievement is that the company didn't put the brakes on its zero-waste efforts during its financial woes, bankruptcy, and multiple management changes, showing that eliminating waste can be and enduring and profitable pursuit.
The Korean industrial company was just one of several Asian manufacturers to make significant commitments last year to clean technology and greener products. Panasonic unveiled a three-year plan called "Green Transformation 2012," which it said will lay the groundwork for it to become the world's leading "Green Innovation Company" by 2018, Panasonic's 100th anniversary. Hitachi, which reached its century milestone in 2010, said it would put environmental innovations at the core of the company's operations for the next 100 years. Samsung said it spent $865 million during 2009 to develop greener products and make its manufacturing sites more efficient as part of a multi-pronged efforts to become one of the world's most environmentally friendly companies. And NEC Corp., Japan's largest PC maker, unveiled plans to invest $1.1 billion over eight years in battery and smart grid technologies. LG, for its part, said it would spend nearly $18 billion over the next decade cutting its carbon footprint by 40 percent and developing greener products. The ultimate impact of these efforts won't be known for years, but collectively, they made it loud and clear that Asian firms view green and clean innovations as their path forward to growth and profitability.
This was a largely unreported yet landmark achievement. Nearly all corporate charters, at least for large companies, mandate that management keep their eye focused solely on the financial bottom line, with no regard for environmental or social impacts. Indeed, diverting profits to invest in reducing those impacts could be seen as a violation of management's fiduciary responsibility to shareholders and subject the board to lawsuits or worse. Intel's board sought to change that, amending its charter to require that its Corporate Governance and Nominating Committee "Reviews and reports to the Board on a periodic basis with regards to matters of corporate responsibility and sustainability performance, including potential long- and short-term trends and impacts...." It was the highest elevation to date of the triple bottom line as a matter of shareholder concern.
According to a McKinsey Corporate survey, 92 percent of senior executives from around the world agree that consideration of environmental challenges will be one of the central issues of the 21st century. Successful firms are realizing that cognizance around environmental values is saving them money and improving shareholder performance, so much so that even large low-cost retailers like Walmart are getting in the game. But at what expense?
As the world’s largest retailer covering nearly every product category, Walmart has the potential to impact green retailing practices. To that end, in the last several years, Walmart has been determined to use that influence in a positive way. By focusing on a “zero waste” policy, Walmart has reduced packaging and shipping materials waste and launched recycling initiatives in order lessen the impact on local landfills and limit their dependency on non-renewable resources. They are committed to offering more socially and environmentally conscious product lines for items such as coffee, bananas and wine, as well as locally grown produce in support of regional farming efforts. Walmart has even gone as far as leveraging its buying power against manufacturers in China, mandating that they become 20 percent more energy efficient by 2011 in order to maintain their contracts.
This is of course great news; putting pressure on international manufacturers will be critical to the green movement’s momentum and may help to influence other retailers with similar positioning to weld their power in kind. Yet unfortunately, much of Walmart’s efforts towards incorporating sustainability efforts have been overshadowed by the negative publicity surrounding other aspects of their business. Aside from being referred to as “Sweatshop Retailer of the Year” by many watchdog groups, Walmart has been criticized for a variety of personnel practices, including policies surrounding wages, benefits, employment of illegal aliens and strong dependence on foreign labor for imported goods.
In truth, Walmart is not the first, and will not be the last, mass retailer or major corporation to struggle with reconciling both sides of the corporate social responsibility agenda. However, thes e public criticisms may serve as a catalyst for firms like Walmart to examine their entire value chains more holistically. Developing and implementing a socially conscious human resource approach is challenging, but it is likely that some of the existing sustainability strategies can be adapted so people and planet are not mutually exclusive.
Walmart’s progress, and potential areas for socially responsible growth, has opened new channels of conversation about how these practices should go hand-in-hand. Hopefully this corporate dialogue will facilitate opportunities for innovations that will both improve both the quality of what’s on the retail shelves and the lives of the people stocking them.
THE 2010 WOMEN FOR EDUCATION AWARD
The Women For Education prize was created in 2007, as an initiative of the Women’s Forum and ELLE magazine. It is organized by the ELLE Foundation and supported since its creation by the Renault-Nissan Alliance.
This prize, funded by the Renault-Nissan Alliance, have rewarded for 4 years, under the Women’s Forum, an individual and/or an activity which encourages the economic and social emancipation of women and girls through education and training.
Since its creation in 2007, this prize enables the distinguishment of four associations:
2007: Free Afghanistan Association (Afghanistan) for the emancipation of Afghan women through the development of quality education in rural areas.
2008: Basha Trust and Publication Centre Association (India), for the Development of new information technologies and communication (NTICS) for job training, life and reproductive health of adolescents in Gujarat and Himachal Pradesh.
2009: El Camino Association (Mexico) to create a community center for training and marketing for 150 weavers in the Maya region of Chiapas.
2009: ACEDE Ouest Association (Ethiopia) for vocational training of young mothers in the streets of Addis Ababa
In 2010, the prize will be offered to 10 Haitians students enable them to continue their studies in France, and ultimately encourage their participation in rebuilding their country after the earthquake of January 2010.
The Women For Education Prize reflects primarily a concrete commitment to solidarity from the Women’s Forum, ELLE, ELLE Foundation and the Renault-Nissan Alliance in favor of women in situations of economic and social fragility, since the establishment of the Forum.
Since September 2008, many devoted luxury shoppers have been hiding their shopping bags. Customers feel conflicted about what they really “need” in this new economic landscape, discouraging purchases that previously wouldn’t have garnered a second thought. In addition, customers increasingly seek to align their purchases with their social values and sustainable lifestyle.
This new consumer mindset poses an interesting challenge to luxury brands. While on the one hand, global luxury sales have rebounded nicely with projected growth of 10% in 2010, on the other, this uptick does not necessarily translate into profitability over the long term.
As the aging Baby Boomer population scales back on its spending, and more awareness develops around where products come from and how they are made, the luxury sector will have to seek out alternative growth strategies. In this era of consciousness around spending habits, specifically amongst the socially and environmentally aware Gen X and Y’rs who wield the new spending power, luxury brands have a lot to gain by conveying they are committed to corporate social and environmental responsibility.
In previous years, a marketing executive at Hermes might have balked at the idea of diluting brand image by suggesting to customers they are “green”. However, the values luxury brands stand for align perfectly with green practices. The se include timelessness, d urability, innovation, craftsmanship, and a meaningful brand and retail experience -- all characteristics that mirror the underlying goals of sustainability and social responsibility.
Today, CEO’s and brands are asking themselves a new set of questions: How do we position our products to reflect this new customer mindset? How do we preserve our DNA while taking a sustainable approach? What should we do internally so that the message of conscious branding is understood, integrated and transmitted throughout our organization?
Some prestige brands are leading the charge in this capacity. Kate Spade, the accessories and handbag company, has launched an extraordinary effort with Women for Women International in order to promote job opportunities in Afghanistan. The women employed by the program will create bracelets with the goal of developing long-term growth and stability in the country. Nordstrom, one of the nation’s leading fashion specialty retailers, is using their new location in New York to test a retail concept devoted to philanthropic efforts that will donate all proceeds to non-profits. And despite the fact that Levi’s is marketed as a brand with mass, as opposed to designer, appeal, their commitment to sustainability within their supply chain merits attention. The new "Water Less" denim line will utilize washing and finishing techniques that use 28 to 96 percent less water, depending on the style, than the 42 liters of water it now takes to produce the average pair of jeans.
By examining their supply chains and core values and translating that into intelligent messaging and operational practices, luxury brands can enjoy the advantages of being both profitable and sustainable.These strategies can help them reach new customers and breathe new life into the industry for decades to come.
Photo credit: Lily Cole in Katharine Hamnett's T-shirt © Matthew Eades
Now more than ever consumers are purchasing with a purpose. In the fourth annual Edelman goodpurpose® Study, experts indicate that what consumers want goes beyond just form and function to include a positive community impact.
As a business leader, are you doing the best job possible to develop sales if you focus on innovation, design, and brand loyalty? Not really. According to the study, nearly half (47%) of respondents said that social purpose ranks higher than brand loyalty and design and innovation as a purchase motivator. In addition, another recent PRWeek/Barkley Cause Survey suggests that a full 88 percent of American men say it’s crucial for a brand to support a social cause.
When business leaders think about how to engage their customers and communities around social causes, social media presents an ideal vehicle. Social media channels offer powerful opportunities for organizations to bring these purpose branding and marketing strategies to life. Exposure through Facebook, Twitter and YouTube, etc. engages existing and potential customers, increases transparency, and solicits feedback. Yet with this relatively new frontier of branding and marketing opportunities comes many questions.
CEO’s are asking themselves: What are the leading companies doing? What should you keep in mind as you launch your next (or first) social media campaign? How do you make it effective, relevant, and consistent with organizational objectives?
Ultimate ly, the recipe for success centers on creating compelling content, building “living” campaigns and acting with creativity. Industry innovators like GE, Pepsico and Intel recognize that people want to buy from responsible companies and engage with purpose-driven brands. To achieve success, they go beyond simply communicating the social causes they support through a blog or a Facebook page. Their messaging resonates authenticity, directly connects to their brand and business, and incites action in their customer base.
When Anvil Knitwear, for example, convinced Disney to use its organic cotton knitwear line for all of its branded t-shirts, it turned to social media to communicate the significance of these efforts. Anvil operates a website called Track My T which allows younger customers to see the evolution of their t-shirts from farm to retailer. They also have posted this video on YouTube which educates consumers about the negative impact of pesticides on farmers and the environment, further reinforcing their leadership position in organic and sustainable apparel.
Secondly, successful organizations treat social media as a living campaign, as opposed to traditional marketing where companies simply dispense ideas and hope for the best. Social media’s immediate connection with customers humanizes brands and provides a platform for engagement. To achieve a sustained community and build long-term relationships, companies listen to, track and solicit feedback carefully and towards a purpose. The GE Ecomagination project shows this best practice in action. The initiative calls for stakeholders to submit their ideas, inventions and strategies around clean energy. The winning proposals receive up to $200 million in funding, business strategy evaluation with GE technical teams, and opportunities to leverage GE’s extensive network of customer relationships.
Finally, social media offers many opportunities to interact that rely on creative thinking and not necessarily on a large advertising budget. One recent campaign organized by Keep a Child Alive, musician Alicia’s Keys’ foundation, featured celebrity social media “deaths” whereby celebrities stopped tweeting until fans donated $1 million to support AIDS-related causes in Africa and India. The campaign raised the money in less than a week and helped generate awareness through a creative and unique social media undertaking. Though not every organization is backed by the star power of a Grammy winner, every company has the potential to come up with inspired ideas and engage their customers to help those ideas take flight.
As a leader, how do you approach these issues? Are you sure that your social media strategy is really innovative, driving not only brand awareness but also sales and customer retention? By creating compelling content, building living campaigns and acting creatively, companies can leverage both their social media and social purpose strategies, enabling them to build meaningful relationships with their customers. It is these relationships, built on the power of social media, which ultimately drive sales and facilitate sustained success for a brand.
Photo credit: www.keepachildalive.org
On average, jeans are washed 3-10 times--using 42 liters of water for each pair--in their finishing process; that's before they even reach the hands of the consumer. At Levi's Workshop in New York City last night, Levi's announced the latest in their sustainability initiatives: the "Water Less" jeans collection, which reduces water consumption on an average of 28% per pair of jeans and up to 96% for some styles.
But how did do they do it? Not with a new chemical, or a new machine, they simply switched up their jean finishing process. Hear more from Levi's Carl Chiara, director of brand concepts and special projects, in a video interview, below.
The latest sustainability initiative from Levi's is not about inventing a new machine or a new chemical that uses less water, it's about pairing innovative thinking with a goal to reduce water and using existing materials and techniques. This new way of finishing jeans, joins Levi's other sustainability initiatives, which have included "Donate to Goodwill" tags, an air-dryer design competition, and their taking a stand against purchasing sandblasted jeans.
Some examples of how they reduced water use include combining multiple wet cycle processes into one, incorporating ozone processing into the garment washing, and removing water from the stone wash.
This Water Less process was a year, from idea to final product, in the making. In the video, below, Carl Chiara describes how the the final Water Less product came about, from the inspiration behind the collection to the laundries.
Levi's spring 2011 collection will include 1.5 million pairs of jeans that used the Water The goal is to apply such innovative thinking to other aspect of Levi's production process. Four laundries in total were used to create the Water Less collection and the brand will introduce these finishing techniques to more of their supplier factories around the world--which include hundreds of factories (an exact number, could not be confirmed). Erik Joule, senior vice president of merchandising and design at Levi's, says "We're excited about the results we've achieved so far, and we know we can make an even bigger impact by applying this innovative thinking to other aspects of our production process," according to the press release. Later in conversation, Chiara described how the Water Less process is an "amazing tool that doesn't have an expiration date," meaning that it is not a trend. Chiara hopes that the industry will follow Levi's lead with their reduction of water use, but also with their treating and cleaning of water before it released back into the environment. With the current rise in the cost of cotton, I asked how this would effect Levi's prices, Anderson said "We're working hard to leverage the relationships in our global supply chain so that we don't have to pass on price increases to consumers. We did take selective price increases for Spring 2011 and the rise in cotton prices was one of the contributing factors." Levi's contracts for fabric and finished products in advance, so price changes in the marketplace are not visible to the consumer until 6-12 months out. The first collection will be available in January 2011 and will include twelve Levi styles, like the Levi's 501 jeans, the 511 and 514 jeans, and the Levi's trucker jacket. Read more at Levi Strauss & Co. and if you're in New York City, visit Levi's Workshops for fun and free interactive events, open to the public. Check out the video of Levi's Director of Brand Concepts, Carl Chiara, at Levi's Workshop in New York City.
The goal is to apply such innovative thinking to other aspect of Levi's production process. Four laundries in total were used to create the Water Less collection and the brand will introduce these finishing techniques to more of their supplier factories around the world--which include hundreds of factories (an exact number, could not be confirmed). Erik Joule, senior vice president of merchandising and design at Levi's, says "We're excited about the results we've achieved so far, and we know we can make an even bigger impact by applying this innovative thinking to other aspects of our production process," according to the press release.
Later in conversation, Chiara described how the Water Less process is an "amazing tool that doesn't have an expiration date," meaning that it is not a trend. Chiara hopes that the industry will follow Levi's lead with their reduction of water use, but also with their treating and cleaning of water before it released back into the environment.
With the current rise in the cost of cotton, I asked how this would effect Levi's prices, Anderson said "We're working hard to leverage the relationships in our global supply chain so that we don't have to pass on price increases to consumers. We did take selective price increases for Spring 2011 and the rise in cotton prices was one of the contributing factors." Levi's contracts for fabric and finished products in advance, so price changes in the marketplace are not visible to the consumer until 6-12 months out.
The first collection will be available in January 2011 and will include twelve Levi styles, like the Levi's 501 jeans, the 511 and 514 jeans, and the Levi's trucker jacket. Read more at Levi Strauss & Co. and if you're in New York City, visit Levi's Workshops for fun and free interactive events, open to the public.
Check out the video of Levi's Director of Brand Concepts, Carl Chiara, at Levi's Workshop in New York City.
Queue up another round of controversy for San Francisco -- the city has just voted to ban the practice of marketing unhealthy food to children. Specifically, it has outlawed the practice of using Happy Meals or other similar toy-based promotions to sell foods proven to lead to childhood obesity. The law will require that foods meet certain nutritional standards before they can be sold with toys. San Francisco is the first major city to pass such a law -- and its impact will likely be widely felt:
San Francisco has become the first major U.S. city to pass a law that cracks down on the popular practice of giving away free toys with unhealthy restaurant meals for children. San Francisco's Board of Supervisors passed the law on Tuesday on a veto-proof 8-to-3 vote. It takes effect on December 1, 2011. The law, like an ordinance passed earlier this year in nearby Santa Clara County, would require that restaurant kids' meals meet certain nutritional standards before they could be sold with toys.
Opponents of the law include the National Restaurant Association and McDonald's Corp, which used its now wildly popular Happy Meal to pioneer the use of free toys to market directly to children.
When news first broke that Santa Clara passed a similar ban, it gave rise to a heated debate in the comments -- mentions of the nanny-state were common, and a general sentiment cropped up that banning Happy Meals is a case of governmental overreach. Needless to say, this decision will likely be even more intensely debated.
After all, San Francisco is a major consumer market, and the impact of such a ban will have a much greater ripple effect than the previous ban in Santa Clara. Not only that, but the law will be put under much closer scrutiny -- if we start to see childhood obesity levels drop there, we should see more interest from other municipalities in pursuing similar policy.
I understand the discomfort with the law, especially since it seems that for many, Happy Meals have an emotional resonance from childhood -- which to me, speaks to the power of this kind of targeted marketing. But it seems like a reasonable idea to make the foods paired with toys designed to appeal to children more nutritional (Happy Meals are indeed for the most part extremely unhealthy, and, well, invincible).
And nobody can argue that we're not in the midst of an obesity epidemic here, and much of it, of course, stems from the development of bad eating habits early on. This could, in fact, turn out to be a powerful incentive for kids to eat better -- if you're going to sell food to kids by enticing them with cheap, colorful toys made in Taiwan, you might as well use those marketing powers to encourage a healthy diet, right?
Wonderful discussion this morning between Carlos Ghosn, Nissan CEO, and Jessy Tolkan, environmental activist. We watched it live at the Women's Forum in France and here is the video for you.
Adman David Jones reveals why campaigns have to keep it real
When BP's Deepwater Horizon rig exploded in April, killing 11 workers, the company's pretty green and yellow floral logo was about as much use in stemming the resultant 2,000 square mile-plus oil slick that contaminated the Gulf of Mexico as it was in convincing us of BP's corporate commitment to the environment. We're all wiser these days to the subtleties of greenwashing, the practice of companies using advertising and marketing messages to persuade us that they care that bit more about their ecological responsibilities. So David Jones, one of the world's foremost admen and the global chief executive of the advertising and communications group Havas, will have his work cut out addressing the Sustainable Planet forum, which takes place in Lyon over the next three days. He will have harsh messages for business, he promises. The days when the corporate world could pull the wool over the eyes of consumers with slick but hollow slogans are long over and, thanks to the growth of social media, it is the public that now has the whip hand in evaluating a company's green credentials. Jones, 42, is something of an expert in this area, a long-standing advocate of the need and value of putting corporate responsibility at the core of a business. He is the global chief executive of the Havas-owned advertising agency Euro RSCG, which ran the TckTckTck climate change awareness campaign with the former United Nations secre tary-general Kofi Annan last year and is an adviser on sustainability to Nicolas Sarkozy's French government. According to Jones, companies have had drastically to alter their stance on green issues over the past 20 years. BP, he says, was the poster child for what he describes as the "decade of image", the final 10 years of the last century. "In the decade of image, the majority of people did not genuinely change their business but decided that if they had a couple of nice marketing messages, they could convince the world that they were a great company and do better because of it," he says. "I think BP were the poster child for that, the rebranding into a flower and the Beyond Petroleum campaign and all of that." In its Beyond Petroleum campaign, BP boasted of its work in producing solar energy and natural gas and, alongside beautiful imagery of partially submerged trees, opined that "Beyond... means starting a journey that will take the world's expectations of energy beyond what anyone can see today." Jones derides the campaign, from 2000, saying: "Quite frankly, it was probably the biggest over-claim we have ever seen in the world of marketing." With the coming of the new millennium, business started to become more sophisticated, he argues. In the "decade of advantage", the smartest companies "genuinely put socially responsible business at their core and actually gained significant competitive advantages because of it". Jones, an Englishman based in New York, praises Walmart for having transformed its image in the United States, through a green approach. "It completely re-engineered its reputation in North America and became one of the most respected and admired companies in terms of what it was doing. A decade earlier, it had real [image] problems," he says. "The critical point was that it was genuine and it probably did more to change its supply chain and logistics in terms of sustainability than any major company has ever done." He cites Marks & Spencer as a British company that achieved a similar effect with its Plan A campaign (so called because there was no Plan B) setting out 100 commitments to "do the right thing ". Jones says: "Plan A repositioned the company in a completely different way in people's minds. It was incredibly overt and everywhere across print and websites. I think it was genuine and had a very positive impact on their image." Which brings us to 2010 and the start of the "decade of damage", as Jones calls it. "We are now moving into a decade where consumers can vote against you with their wallets and your business will be damaged. Consumers now have the power through social media to really 'punish' those companies who don't live up to their standards." Once again, BP is the prime example. Jones points to the Twitter account @BPGlobalPR, set up by a man calling himself "Leroy Stick (aka a guy in his boxer shorts)". Stick started his Twitter account "because the oil spill had been going on for almost a month and all BP had to offer were bullshit PR statements. No solutions, no urgency, no sincerity, no nothing". So he began making jokes at the company's expense. The account quickly attracted 180,000 followers, vastly more than the official BP Twitter account. Stick also restyled the logo in a splattered black. "It was a very interesting lesson for the world we live in today," Jones says, "that one individual can have over 10 times the followers that one of the world's biggest companies has." The name Leroy Stick was itself a pseudonym, inspired by the piece of wood the Twitter author and his father used to curb a dangerous dog called Leroy that terrorised their neighbourhood in his childhood. BP was being treated as a corporate Leroy. Before the economic downturn, Euro RSCG conducted a global survey of consumer attitudes to ethical business and found that 80 per cent of respondents believed they had a responsibility to censure unethical companies by boycotting their products, while 83 per cent believed ethical business should be the norm and they should not be made to pay a premium price for ethical goods and services. Chief executives have a key role to play in emphasising the sincerity of a company's approach. Jones argues that Apple's recent problems over faults with the iPhone 4 were largely due to the company's reluctance to communicate more with consumers. "The culture of Apple is not open and transparent," he says. "It closed off and denied it and only after $9-10bn of share price erosion did it start getting its act together. It's all about transparency, authenticity and speed. Those three things are critical in the social media world." Jones, who is fluent in French and German, has long been one of advertising's leading global thinkers. He was the youngest board member of the giant Abbott Mead Vickers/BBDO at the age of 28 and was running Australia's leading agency at 32. When he was overseeing Euro RSCG's global accounts in London, he commuted to the office from Paris via Eurostar. He is advising Nicolas Sarkozy's government on the issue of sustainability during France's presidency of the G20. Tomorrow, he will be in Zurich to launch the next instalment of One Young World, an annual Euro RSCG initiative to gather inspirational young people from around the planet under the same roof. The TckTckTck campaign ahead of the UN Climate Conference in Copenhagen drew the support of more than 10 million "climate allies" without a penny being spent on traditional media campaigning. "The whole idea was to create an open-source idea, something people would pass on," Jones says. "We would advise clients that it's much more important today to create content that people can share than to create content that you control and own." In pursuing that strategy, he warns, companies should be careful not to promise something that they know they can't deliver. "If you start trying to make a small initiative into claiming you are the most green and ecologically friendly company in the world, it will come back to bite you, and one of the reasons that BP fell so hard was because of the huge over-claim," he says. "I'm not saying the oil business is easy and if tomorrow we all had to live without oil we would be in serious trouble. But you don't have to change your logo to a flower and give everyone the impression that you press wild daisies for a living. That's one of the reasons why the backlash against them was so harsh."
When BP's Deepwater Horizon rig exploded in April, killing 11 workers, the company's pretty green and yellow floral logo was about as much use in stemming the resultant 2,000 square mile-plus oil slick that contaminated the Gulf of Mexico as it was in convincing us of BP's corporate commitment to the environment.
We're all wiser these days to the subtleties of greenwashing, the practice of companies using advertising and marketing messages to persuade us that they care that bit more about their ecological responsibilities. So David Jones, one of the world's foremost admen and the global chief executive of the advertising and communications group Havas, will have his work cut out addressing the Sustainable Planet forum, which takes place in Lyon over the next three days.
He will have harsh messages for business, he promises. The days when the corporate world could pull the wool over the eyes of consumers with slick but hollow slogans are long over and, thanks to the growth of social media, it is the public that now has the whip hand in evaluating a company's green credentials.
Jones, 42, is something of an expert in this area, a long-standing advocate of the need and value of putting corporate responsibility at the core of a business. He is the global chief executive of the Havas-owned advertising agency Euro RSCG, which ran the TckTckTck climate change awareness campaign with the former United Nations secre tary-general Kofi Annan last year and is an adviser on sustainability to Nicolas Sarkozy's French government.
According to Jones, companies have had drastically to alter their stance on green issues over the past 20 years. BP, he says, was the poster child for what he describes as the "decade of image", the final 10 years of the last century. "In the decade of image, the majority of people did not genuinely change their business but decided that if they had a couple of nice marketing messages, they could convince the world that they were a great company and do better because of it," he says. "I think BP were the poster child for that, the rebranding into a flower and the Beyond Petroleum campaign and all of that."
In its Beyond Petroleum campaign, BP boasted of its work in producing solar energy and natural gas and, alongside beautiful imagery of partially submerged trees, opined that "Beyond... means starting a journey that will take the world's expectations of energy beyond what anyone can see today." Jones derides the campaign, from 2000, saying: "Quite frankly, it was probably the biggest over-claim we have ever seen in the world of marketing."
With the coming of the new millennium, business started to become more sophisticated, he argues. In the "decade of advantage", the smartest companies "genuinely put socially responsible business at their core and actually gained significant competitive advantages because of it". Jones, an Englishman based in New York, praises Walmart for having transformed its image in the United States, through a green approach. "It completely re-engineered its reputation in North America and became one of the most respected and admired companies in terms of what it was doing. A decade earlier, it had real [image] problems," he says. "The critical point was that it was genuine and it probably did more to change its supply chain and logistics in terms of sustainability than any major company has ever done." He cites Marks & Spencer as a British company that achieved a similar effect with its Plan A campaign (so called because there was no Plan B) setting out 100 commitments to "do the right thing ". Jones says: "Plan A repositioned the company in a completely different way in people's minds. It was incredibly overt and everywhere across print and websites. I think it was genuine and had a very positive impact on their image."
Which brings us to 2010 and the start of the "decade of damage", as Jones calls it. "We are now moving into a decade where consumers can vote against you with their wallets and your business will be damaged. Consumers now have the power through social media to really 'punish' those companies who don't live up to their standards."
Once again, BP is the prime example. Jones points to the Twitter account @BPGlobalPR, set up by a man calling himself "Leroy Stick (aka a guy in his boxer shorts)". Stick started his Twitter account "because the oil spill had been going on for almost a month and all BP had to offer were bullshit PR statements. No solutions, no urgency, no sincerity, no nothing". So he began making jokes at the company's expense.
The account quickly attracted 180,000 followers, vastly more than the official BP Twitter account. Stick also restyled the logo in a splattered black. "It was a very interesting lesson for the world we live in today," Jones says, "that one individual can have over 10 times the followers that one of the world's biggest companies has." The name Leroy Stick was itself a pseudonym, inspired by the piece of wood the Twitter author and his father used to curb a dangerous dog called Leroy that terrorised their neighbourhood in his childhood. BP was being treated as a corporate Leroy.
Before the economic downturn, Euro RSCG conducted a global survey of consumer attitudes to ethical business and found that 80 per cent of respondents believed they had a responsibility to censure unethical companies by boycotting their products, while 83 per cent believed ethical business should be the norm and they should not be made to pay a premium price for ethical goods and services.
Chief executives have a key role to play in emphasising the sincerity of a company's approach. Jones argues that Apple's recent problems over faults with the iPhone 4 were largely due to the company's reluctance to communicate more with consumers. "The culture of Apple is not open and transparent," he says. "It closed off and denied it and only after $9-10bn of share price erosion did it start getting its act together. It's all about transparency, authenticity and speed. Those three things are critical in the social media world."
Jones, who is fluent in French and German, has long been one of advertising's leading global thinkers. He was the youngest board member of the giant Abbott Mead Vickers/BBDO at the age of 28 and was running Australia's leading agency at 32. When he was overseeing Euro RSCG's global accounts in London, he commuted to the office from Paris via Eurostar. He is advising Nicolas Sarkozy's government on the issue of sustainability during France's presidency of the G20. Tomorrow, he will be in Zurich to launch the next instalment of One Young World, an annual Euro RSCG initiative to gather inspirational young people from around the planet under the same roof.
The TckTckTck campaign ahead of the UN Climate Conference in Copenhagen drew the support of more than 10 million "climate allies" without a penny being spent on traditional media campaigning. "The whole idea was to create an open-source idea, something people would pass on," Jones says. "We would advise clients that it's much more important today to create content that people can share than to create content that you control and own."
In pursuing that strategy, he warns, companies should be careful not to promise something that they know they can't deliver. "If you start trying to make a small initiative into claiming you are the most green and ecologically friendly company in the world, it will come back to bite you, and one of the reasons that BP fell so hard was because of the huge over-claim," he says. "I'm not saying the oil business is easy and if tomorrow we all had to live without oil we would be in serious trouble. But you don't have to change your logo to a flower and give everyone the impression that you press wild daisies for a living. That's one of the reasons why the backlash against them was so harsh."
Manufacturers of products that claim to be environmentally friendly will face tighter rules on how they are advertised to consumers under changes proposed Wednesday by the Federal Trade Commission.
The commission’s revised “Green Guides,” last updated in 1998, warn marketers against using labels that make broad claims that cannot be substantiated, like “eco-friendly.” Marketers must qualify their claims on the product packaging and limit them to a specific benefit, such as how much of the product is recycled.
“This is really about trying to cut through the confusion that consumers have when they are buying a product and that businesses have when they are selling a product,” said Jon Leibowitz, chairman of the commission.
One of the most notable updates to the guides concerns the use of environmental seals and certifications seen on many packages. According to the Ecolabel Index, there are currently 349 seals and certifications for marketing green products worldwide, with 88 used in North America alone. While the commission does not require the use of a specific label, it considers them endorsements that should be substantiated.
“No longer are you going to be able to make broad unqualified green claims,” said Christopher A. Cole, a partner at the law firm Manatt, Phelps & Phillips who practices advertising law.
The revisions come at a time when green marketing is on the rise. According to a new study by the TerraChoice Group, now part of the Underwriters Laboratories, the number of advertisements with green messages in mainstream magazines has risen since 1987, and peaked in 2008 at 10.4 percent. In 2009, the number of ads dropped to 9 percent.
But while the number of advertisements may have dipped, there has been a “proliferation” of eco-labeling, according to Scott McDougall, the president of TerraChoice, who says there are both good and bad players in the eco-labeling game.
“Consumer demand for better green claims has grown, and this can also be blamed for the use of eco-labeling that may not offer the type of third-party verification that comes with legitimate eco-labeling,” Mr. McDougall said in an e-mail.
Mr. Leibowitz, referring to consumers, said: “In the last five years or so there’s been an explosion of green claims and environmental claims. It’s clear that they don’t always know what they are getting.”
In a news conference to announce the revisions, Mr. Leibowitz said the commission was expecting a lot of voluntary compliance from businesses and that the guidelines could be put in place as soon as the first half of next year.
In response to a question about how the commission plans to enforce the guidelines, Mr. Leibowitz said that he expected most businesses to comply, and added “for those companies that don’t, that fall on the wrong side of the final ‘Green Guides,’ we’re going to go after them.”
The commission has dedicated a new section in the guides specifically to handling issues surrounding certifications and seals of approval. Companies will be obliged to tell customers if the seals they use are certified by their own companies as opposed to being certified by a third party. Companies that are members of a trade organization that certifies their product must disclose that relationship to the consumer.
The new rules call on seals and certifications that connote general environmental claims to be more specific. A company would have to use a label like “Green Smart, Recyclable Certified” instead of just “Green Smart,” for example. And companies that use third-party certifications will also have to make sure they substantiate the claims they make.
“I think everybody that’s doing these claims now is going to have to take a fresh look at them,” Mr. Cole said. “I think that some claims will drop based on the fact that you’d have to do so much explanation to adequately qualify it in the F.T.C.’s eyes.”
A handful of lawsuits have been filed in recent years against companies accused of using misleading environmental labels. In 2008 and 2009, class-action lawsuits were filed against SC Johnson for using “Greenlist” labels on its Windex and Shout cleaning products. The lawsuits said that the label was misleading because it gave the impression that the product had been certified by a third party when the certification was the company’s own. The cases are pending.
“We are very proud of our accomplishments under the Greenlist system and we believe that we will prevail in these cases,” Christopher Beard, director of public affairs for SC Johnson, said in an e-mail, while acknowledging that “this has been an area that is difficult to navigate.”
Companies have also taken it upon themselves to contest each other’s green claims.
David G. Mallen, the associate director of the national advertising division of the Council of Better Business Bureau, said in the last two years the organization had seen an increase in the number of claims companies were bringing against each other for false or misleading environmental product claims. Some of the cases involve Clorox, Heartland Sweeteners, Apple and Seventh Generation.
In 2009, the Federal Trade Commission brought its first enforcement actions in 10 years against companies making environmental claims. In one case, the commission chargedKmart, Tender Corporation and Dyna-E International with making false claims that their paper products were biodegradable. In another case the commission charged clothing retailers with deceptively labeling products as being made from bamboo when they were made of rayon.
Much of the problem involves an abundance of seals and labels that assure environmental worthiness, experts say.
“About once a week, I have a client that will bring up a new certification I’ve never even heard of and I’m in this industry,” said Kevin Wilhelm, chief executive officer of Sustainable Business Consulting, a Washington-based company that helps businesses plan green marketing strategies. “It’s kind of a Wild West, anybody can claim themselves to be green.”
Mr. Wilhelm said the plethora of labels made it difficult for businesses and consumers to know which labels they should pay attention to. “There’s no way for the average consumer or even for a C.E.O. to know which ones to go for or what they should get,” he said.
The revised guides introduced on Wednesday also give marketers parameters for a number of other claims. Products that are labeled as degradable must decompose within a year. Products or packages that claim to be compostable must break down in the same time as the materials they were made with.
Marketers who make claims about renewable materials must explain how the materials are sourced and whether the item is made entirely by renewable materials or not. Products claiming to be nontoxic or “free of” something will have their own set of rules; for example, an item cannot claim to be “free of” a substance that it has never been associated with. Manufacturers will not be able to make “renewable energy” claims if the power used to manufacture any part of the product was derived from fossil fuels. Marketers will also have to be more specific in their promotion of carbon offsets and must disclose if the emission reductions funded by the purchase will not occur for two or more years, according to the new guides.
The Federal Trade Commission held a series of workshops in 2008 to discuss issues central to the guides’ revision, like green packaging, and also conducted surveys online with 3,700 consumers. The commission will accept public comment on the guides until Dec. 10, after which it will publish a final version.
Gary Hirshberg is the CE-Yo of Stonyfield Farms, an organic yogurt company, advocates that it is possible for businesses to be part of the solution when it comes to sustainability. It's been a point he's successfully lived out through his company for years, and at Bioneers he made the point that it is possible to scale up organic foods, feeding the masses while staying sustainable. It's a contentious point and one of hot debate among, well, most anyone, but during his talk he landed on five essential elements of making organic mainstream.
We're big fans of how Stonyfield Farms is run. The company puts sustainability before profits every single time. But the best part is the profits are never sacrificed -- the business is growing hand over first because it is run with the environment as a priority.
At this year's Bioneers, Hirshberg gave a presentation highlighting that it's often considered impossible to be a big business and have a minimal environmental footprint. But he countered that notion with examples of how Stonyfield Farms has zero sludge from its wastewater facility since it coughed up the extra $600,000 it would take to install an anerobic facility instead of a traditional wastewater facility. They earned their money back in just the first 9 months, in addition to the benefit of zero waste. Also, the company is able to support 1,750 organic farmers through their milk purchases, and fair-wage co-ops in their banana and sugar purchases. The fact that the company was able to create 46 new jobs while every one of their non-organic comp etitors had to lay off workers during the recession emphasized that sustainable practices are profitable for both business and nature.
But perhaps the biggest point that Hirshberg wanted to drive home is that this type of business practice is scalable -- it doesn't have to be just the small businesses that are green. He named five must-do items for scaling up.
1) Be activists where we shop
Hirshberg stated that consumers have to drive the demand, so we all must do our research and make sure that we're buying the greenest product (which might not always be the local product).
2) Recycling means we've failed
Businesses have to figure out how to reduce and reuse so that recycling is unnecessary.
3) Organic is not just for the elite
Organic foods often seem like they're only available to those with enough money to buy them, but Hirshberg is adamant that it doesn't need to be this way. We need to make organic foods affordable for everyone.
4) Design sustainable products and packaging
Hirshberg noted that Stonyfield Farms recently switched all of its packaging to plant-based plastic. He stated that while that reduces the company's oil consumption, corn isn't a perfect option. So they ensure that they counter their footprint with GMO offsets, which goes to literally paying GMO corn growers to switch to non-GMO corn.
5) Engage in politics
Hirshberg pointed out that the five largest agriculture interests spent $28 billion on lobbying since 2008. Organic businesses have to get active too, pushing for the regulations that protect the environment and businesses together. He also noted that we have to become more open source -- Stonyfield Farms keeps no secrets, letting their competitors know their moves because they feel this will lead to faster advances on sustainable practices.
It might be easier said than done, but the principles set out by Hirshberg out are a good starting point for areas businesses can focus on if they want to help boost organic products in the marketplace without losing sight of the bigger goal of going organic. Stonyfield Farms is a perfect example of how a business can grow not only its bottom line, but the bottom line of other sustainable businesses and the health of the environment.
Here is Gary Hirshberg speaking about the sustainable business practices that have brought such high levels of success to his company while keeping their footprint tiny.
WHEN it comes to sponsorships, brands tend to attach their names to sporting events and arts festivals, but Marcal Small Steps, the paper products brand, has taken the unusual step of laying claim to a seasonal phenomenon, declaring itself the Official Sponsor of Fall Foliage.
In advertisements by Topspin Group, of Princeton, N.J., the brand is publicizing its fanciful sponsorship to highlight that its toilet paper, paper towels, facial tissues and napkins are made entirely from recycled paper. Most major brands, like Charmin toilet paper and Bounty paper towels, both made by Procter & Gamble, use only virgin fiber (except for recycled cardboard cores).
“Most big paper companies cut down more trees to make their paper which destroys natural habitats,” says a new Marcal print ad. “Our small company doesn’t.”
M. J. Jolda, senior vice president of marketing at Marcal Manufacturing, said the promotion was a way “in this low-interest category to break through the clutter and have an emotional sell on the side of saying our products don’t use trees.”
Small Steps is also the sole advertiser on YankeeFoliage.com, a Web site produced by Yankee Magazine since 1998. An interactive map tracks foliage stages throughout New England, like “green,” “turning,” “peak,” “fading” and “gone.” The Small Steps Facebook page, meanwhile, features an autumn photo contest, with prizes including a digital camera and Best Buy gift certificates.
Consumers use plenty of recycled paper products — though often not of their own volition. According to the Natural Resources Defense Council, while less then 10 percent of paper products purchased for the home contain any recycled content, about 60 percent purchased for out-of-home locations do.
Darby Hoover, senior resource specialist at the council, said that while consumers might not balk at the quality of recycled toilet paper at restaurants and hotels, when it came to purchasing it themselves, they were swayed by decades of advertising promoting softness.
“Now there’s so much softness being sought, but how much do we need?” Ms. Hoover asked. “If you’re only looking at softness as you’re choosing, then you’re missing the environmental impact.”
When Consumer Reports rated 16 brands of toilet paper in 2009, Small Steps ranked 14th, bested by brands including Charmin and Cottonelle on factors like softness and wet strength. Still, Marcal was deemed a good value, and one of just six brands the magazine recommended, given, as the article stated, that, “you’re willing to trade some softness for a greener roll that’s 100 percent recycled.”
Introduced in 1950, Marcal products used recycled paper from the outset, although initially for strictly practical reasons: When the founder, Nicholas Marcalus, first entered the paper business in the 1940s, he faced wartime wood pulp shortages. It was not until 2009 that the company rebranded its products, which were previously known simply as Marcal, as Marcal Small Steps, and adopted the tagline “A small, easy step to a greener Earth.”
Much of Small Steps’ recycled paper comes from the curbside recycling program in New York.
“We tend to think of New York as our urban forest since we don’t make our products from cutting down trees,” said Ms. Jolda, of Marcal.
Dwarfed by major players like Kimberly-Clark, whose brands include Cottonelle, Scott and Kleenex, and Procter & Gamble, which counts Charmin, Bounty and Puffs among its products, Marcal’s market share in paper product categories ranks only in the low single digits, but the company has grown markedly over the last year.
In the 52 weeks ending Sept. 5, for example, as revenue totals in the overall toilet paper category dropped 1.1 percent, Marcal grew 11.8 percent, and while facial tissues sales over all dropped 3.5 percent, Marcal grew by 7.3 percent, according to the Symphony IRI Group, a market data firm whose totals do not include Wal-Mart.
In 2009, Marcal, which tends to feature its full line of products in advertisements, spent a total of $6.8 million on advertising, far less than toilet tissue brands Charmin ($65.9 million) and Cottonelle ($35.2 million), according to the Kantar Media unit of WPP.
Kimberly-Clark is also going after eco-minded consumers with a sub-brand of its Scott brand, Scott Naturals, which was introduced in 2009.
“We wanted to come out with products that you can’t distinguish the quality from other mainline products in the category,” said Aric Melzl, senior brand manager for Scott. “We referenced off products like our own Scott Extra Soft Tissue.”
To that end, Scott Naturals’ products are only partly made of recycled content, with the toilet paper using the least at 40 percent and napkins the most at 80 percent.
“You can have a product that’s 100 percent recycled with a smaller following or you can have Scott Naturals, where you choose to deliver the quality that folks are expecting with more mass appeal and a bigger business and more impact on the environment than a business that has a smaller following,” Mr. Melzl said.
On its Web site, the Natural Resources Defense Council rates the environmental impact of paper products, with green being best, followed by yellow and red. Scott Naturals earned a yellow. Small Steps received a green rating, as did brands like Seventh Generation and eco-friendly store brands by CVS and Whole Foods, all of which are made 100 percent of recycled material. Like all Procter & Gamble brands evaluated by the group, Charmin was given the worst rating: red.
“Our consumers count on Charmin for its softness, absorbency and strength,” Lisa H. Jester, a Procter & Gamble spokeswoman, wrote in an e-mail message responding to questions. “We do not use recycled fiber in our tissue, as the process of recycling can break and damage the fibers, which could lead to less strength, absorbency and softness.”
Luxury brands like Louis Vuitton are embracing new values: socially responsible chic. This is the first time an LV ad will feature clothes from Bono's Edun line. LVMH acquired 49% of the company last year.
In this Annie Lebovitz photograph, Bono and his wife, Ali Hewson disembark from a plane outside Upington for the Louis Vuitton Core Values advertising campaign.
This is the first time Bono has appeared in an ad without his band, U2, and the first time a label other than Louis Vuitton is getting a fashion credit in one of its campaigns. The couple is wearing Edun, the ethical clothing label they founded in 2005 to encourage fair trade with Africa, and in which Moët Hennessy Louis Vuitton, the luxury group took a 49 % stake last year. The focus of the Core Values campaign is not fashion. Always relating to travel in some way, it is about social activism, and features people who have tried to make a difference.Bono, whose real name is Paul Hewson, is famous for fronting U2 and for his extensive campaigning for African humanitarian causes, which has led to three Nobel Peace Prize nominations
MasterCard is eyeing the emerging middle classes of women in Asia and Cambodia is as good a test case as anywhere else -- and it offers a CSR branding point.
Cambodia has been attracting a fair amount of corporate and "social business" interest in local seamstresses. Socially motivated businesses like Eve Blossom's Lulan Artisans and Elizabeth Kiester's Wanderlust, both for-profit social enterprises that use the talents of marginalized seamstresses, have set up shop here. But now two larger and much more corporate players have entered the scene: MasterCard and the ultra chic Hotel de la Paix, which begs the question of why now and why the focus on women?
Answer: purchasing power.
Goldman Sachs published a report last year highlighting the growing global middle class and the increasingly leading role of women in making financial decisions. The findings are true especially in Asia, where such economies as Indonesia, Vietnam, and the Philippines are expected to grow and increase its middle class populations considerably.
Cambodia is not too far behind and MasterCard is smart to jump in now. The credit card company has been doing research on the subject of female purchasing power in Asia and based on their findings have been rolling out female empowerment programs across the region.
Over the next few months, according to the press release, "MasterCard will donate USD50 towards the reconstruction of Hôtel de la Paix’s Sewing School, for every room bill paid with a MasterCard card." The partnership is also a branding point for the hotel, as guests are taken to see community sites to get a glimpse of local Cambodian life. Essentially, MasterCard is making its name known to the very women who will shortly join the growing middle class with their own businesses and thus have more money to spend.
"I know that de la Paix has been actively involved in helping train women in sewing for quite some time, as well as being involved in social programs throughout Cambodia," Elizabeth Kiester, who relocated to Cambodia in 2008 after a successful career as Creative Director at LeSportsac and a Senior Editor at Jane magazine tells Fast Company. She set up her socially conscious, summery, clothing line in Siam Reap after moving there. She partners with marginalized female seamstresses and just launched a collection for J. Crew. "I think what they're doing is amazing, and I welcome the efforts--I would love to utilize some of their seamstresses some day!"
Little work opportunities exist for women in Cambodia, one of the world's least developed countries, and they're often found working on construction sites. "Sewing and crafting is indigenous to Cambodia, but also sewing offers women, in a country where perhaps they are not yet 'equal,' a chance to own and run their own businesses, which otherwise they may not have the opportunity," Kiester says.
The partnership between MasterCard and Hotel de la Paix may sound like straight-up corporate social responsibility, the same stuff you've heard before, but actually, it's rare to find a set of players and causes that fit so well together. The financial incentive is gravy.
While MasterCard is looking for a way into the female market and continue its CSR efforts in an emerging economy, Hotel de la Paix gets to add an angle to the hotel that doesn't make it look so out of place as a high-end hotel in a desperately poor nation (in fact, this may just fight off some heavy criticism and also encourage local stakeholder buy-in). It's not that similar types of partnerships haven't been done before, but in this case it's been done well, which takes a fair amount of pizazz and a sprinkle of innovation.
It is hard to overstate the role and impact of business today. As an area of human endeavor, Business — with a capital B — is clearly the most powerful force in the world. It can boast the greatest concentration of talent, resources, and fresh thinking.
And many aspects of western civilization appear to be in crisis. Health care, education, transportation, environment, wealth distribution, energy ... the list goes on. The needs are great, and solutions are shockingly scarce.
Whether Business is responsible for the current crises can be argued forever. We don't have time for that argument. The point I want to make is that, as the dominant power in the world, Business will have to be a major part of the solutions.
For many business leaders, that fact is energizing. They know that they are in command of powerful organizations that could be powerful forces for change. But there's a problem: corporate law in the United States compels any publicly traded corporation to put the financial interests of shareholders above all other interests — and shareholders have come to expect immediate and sizable returns on their investments. As a result, much of the creative talent housed in many businesses is focused on maximizing shareholder value in the near term, even at great risk, and even when the means of achieving it might not be in the long-term interests of anyone — including shareholders. Shortcutting safety procedures in deep water oil drilling immediately comes to mind.
It's an interesting notion that Business, held captive by a narrow definition of fiduciary responsibility, is not able to make the long-term investments that could benefit communities, the environment, and ultimately the shareholders. If this notion is even partly correct, then our most powerful institution will be unable to do enough to solve the social and environmental crises confronting us.
Earlier this spring, Vermont made a new path available. Through an initiative called the Vermont Benefit Corporation, it provided for a different class of organization — one that exists not simply "for profit" but "for benefit" and therefore expands the definition of fiduciary responsibility beyond an exclusive obligation to shareholders to encompass the interests of all corporate stakeholders, including employees, the local economy, and the environment. Are the directors of a Benefit Corporation still obliged to act in the best interests of the company's owners? Absolutely. But they have legal protection to make investments with an eye to the long term, aiming for sustainable returns, not fast paybacks for shareholders. (To learn more about the Vermont Benefit Corporate Charter see this pdf of the enabling legislation, or you can read an excellent article here.)
In 1994, on the Fourth of July, Czech Republic President Vaclav Havel gave a speech in Independence Hall, Philadelphia, that resonated with many. "Today, many things indicate that we are going through a transitional period," he said, "when it seems that something is on the way out and something else is painfully being born. It is as if something were crumbling, decaying, and exhausting itself — while something else, still indistinct, is rising from the rubble."
For some, it seemed clear what was crumbling and decaying: an economy based on consumption, and driven by overdependence on growth. Some made it their business to give the future a less indistinct shape. Business may or may not be the root of our problems, but the solutions will come more quickly and be more durable if we can find a way to involve Business in them. The option of Benefit Corporation status may be just what Business needs in order to do the right thing for all of us.
I don’t mean to steal the Sustainability Movement’s increasingly sonorous thunder. But I would like to steal its principles for a different mission.
I’ve had a couple revelatory conversations over the past weeks (can I use that as an excuse for my blog-negligence?), and despite very different starting points, they all found their way around to the drum-roll worthy question for advertisers everywhere: What happens when your consumers decide consumption isn’t the panacea they thought it was? What happens when they decide it’s more than a dirty word or defunct disease—that the ‘buy more’ telos in fact does violence to their peace of mind?
We’re about to find out. More and more of us our reevaluating our shopping habits and coming to the conclusion that not only do they transgress the prudent function of fulfilling basic needs, they actually perpetuate a southward spiral of consumption, waste, empty aspiration and malaise. Uh-oh.
While major brands have only just begun to grapple with the questions raised by a consumption-weary age—let alone answer them—some consumers are well on their way. The journey seems to be a totally un-Frostian intertwining of two diverging roads: one goes forward, one goes ‘backwards,’ and the enlightened among us are taking both.
Impossible? Not according to the principles of sustainability.
At the macro level, limited resources are demanding that businesses find a way to marry progress and so-called reversion, too. The most forward-thinking use cutting edge technology to create the products and systems that will get us back to a low-impact, close-to-nature state we left a thousand years ago.
But at the micro level, leading a low-impact ‘have less, do more’ simple life has little to do with resource scarcity. And if it sounds more like serfdom than wisdom to you, you’ve been in Manhattan too long. Just talk to Tammy Strobel, who pared down her stuff-congested, hyper-complicated life to less than 100 items, 400 square feet and a dog. She’ll tell you it’s not hunting and gathering; it’s latter-day happiness achieved through inspired volition and a shockingly difficult recognition that bliss is our scarce resource, and following it a choice.
Is it a more sustainable way to live? Certainly. But does it fall under the banner of the sustainability movement? Nah, it’s much bigger than that. It’s a Happiness Mission; and for individuals, more sustainable living is just a byproduct.
Semantics aside, one thing’s clear: there’s no room for extraneous products and push-sell marketing in this simpler world.
But, there is lots of room for conscientiously designed products that aren’t so much ‘have’s (a 75th pair of Jimmy Choos) as facilitators of ‘do’s (a first pair of recycled-material hiking boots). (Jimmy, how do you do with Vibram?) There’s also room for fresh marketing that teaches us how to make our stuffless cocoons more stylish (Method), that engages us in co-creative efforts to make lower-impact products (Starbucks Beta Cup Challenge), and that creates ‘do’-focused experiences that demonstrate how a product can contribute to our long-term joy (Gatorade Replay).
Appraised correctly, a consumption-weary age need not mean the death-knell of products, services and their advertisers. But it does mean we have to align products and marketing with values that feel antique and post-modern at the same time—where simpler and happier means enlightened and advanced. (Your planners will have fun with that one.)
LOS ANGELES — Encountered in an Echo Park bistro, Tom Gage looks fit, relaxed, and not at all haunted by the fact that he didn't create the Tesla Roadster (and isn't Elon Musk, for that matter). Instead, he's moving forward, having put the electric drivetrains in BMW's quickly ramped Mini E program (600 cars around the world). Now he's focused on producing cars in China and Taiwan for an Asian market that he thinks might be accelerating faster than that of the U.S.
Gage's San Ditmas, Calif.-based company (founded in 1992) is called AC Propulsion, and its stock in trade is "advanced vehicle technologies," not building and selling cars. Nonetheless, between 1997 and 2003 the company (using a kit car as a base) built three Tzero prototypes, the second of which (featuring 6,800 lightweight lithium-ion batteries) was remarkably similar in concept to what became the Tesla Roadster.
"We wanted to make a car that exemplified high performance, and we did that," Gage said. "But the car we build had made no concessions to manufacturability or safety. We looked at the idea of producing it, but the hand assembly was beyond our capabilities at the time."
The Tzero made some noise for its blistering performance, with 60 mph coming up in just 3.6 seconds. But it wasn't headed for series production. And that's why AC welcomed the idea of licensing the Tzero to people who could take it forward. And that turned out to be Tesla's co-founders, first Martin Eberhard, and then Elon Musk (who had sold PayPal and founded Space X).
"I had approached Elon about investing in the eBox [a converted Scion xB sold by AC Propulsion]," Gage said. "Both Martin and Elon were involved, but Elon put far more money into what became Tesla."
I visited Tesla earlier in the week, and it's grown far beyond its AC beginnings. More on that later. But AC hasn't stood still, either, and Gage pulled up in a Taiwan-built Yulon minivan with AC Inside. Yulon is Taiwan's largest automaker, and it has an agreement to produce cars (including electrics) in a joint venture with mainland China.
Initially, only 50 of the electric minivans will be built. The prototype I built would probably pass European crash standards, Gage said, but not those of the U.S. It has a 100- or maybe 120-mile range. The 41-kilowatt-hour li-ion battery pack are Chinese-sourced, and produce 240 horsepower.
I was able to drive the hilly Echo Park neighborhood at the wheel of the van, which was impressive both in its styling (Honda inspired) and apparent level of fit and finish. Like the Mini E, it had a pronounced regen braking effect, but Gage was able to dial that out. The 240-horsepower in a relatively lightweight van produced really sprightly performance, even on the steep hills.
"Growth is in our plan," Gage said. "We have a factory in Shanghai, which operates as a 100 percent subsidiary of AC Propulsion. And we do think that a lot of our growth could be in the Chinese market, which could be huge for electric vehicles." Other joint ventures with Chinese companies are pending. Gage pointed out that China has overtaken the U.S. in annual car sales, and that discrepancy is likely to grow. "Their growth curve is up," he said.
Gage looks around the growing EV field, and says that Nissan (the Leaf), Toyota (with the RAV4, an upcoming collaboration with Tesla), and General Motors (the Volt) are most likely to succeed. "We built a car like the Volt," he said. "It worked great--most of the time."
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