This year marks GreenBlue’s 10th anniversary. At the end of our first decade, what will the next decade bring for the sustainability movement? We’re asking this question of visionaries, thought leaders, business innovators, scientists, and educators. Read other interviews from the Next Decade series about the future of the sustainability, products, and business.
Over the past ten years, the s
ustainability movement has evolved beyond simply raising awareness or complying with environmental standards. It has now become an essential strategy for business to maintain a competitive advantage. A leading voice for this point of view is Bob Willard, who was the keynote speaker at last month’s SPC Spring Meeting in Toronto.
After three decades in senior leadership at IBM, Bob now dedicates himself full time to building corporate commitment to sustainability, and he has spoken to hundreds of companies to sell the business value of new ways of working. Last year, Bob was one of the five inaugural members of The International Society of Sustainability Professionals Hall of Fame, along with Gil Friend of Natural Logic, Amory Lovins of the Rocky Mountain Institute, Karl-Henrik Robert of The Natural Step, and Ray Anderson of Interface, who recently passed.
Bob’s landmark book, The Sustainability Advantage, just came out in a revised 10th anniversary edition, as The New Sustainability Advantage. A single sentence from the book sums up his whole philosophy: “The business case for sustaining the planet is stronger than the business case for trashing it.” We asked him to elaborate.
Your work provides a compelling economic case for sustainability. If it can save money and increase profits, why isn’t everyone doing it?
That question was screaming in my head when I finished the first edition of The Sustainability Advantage in 2002. So I did a doctorate at the University of Toronto to research what the inhibitors were, and I found that the biggest obstacle for companies is an entrenched mindset. Based on regulation-driven end-of-pipe efforts, business people can’t believe that anything to do with “environment” or “green” can be good for business. To overcome that mindset, we have to show the value in hard-nosed business terms: how much more revenue could they make, how much they could reduce expenses, and how could they mitigate material risks. That is, we need to meet them where they are and sell them on the competitive advantage of embracing sustainability strategies.
You identify five business models in progressive stages of sustainability: (1) Pre-Compliance, (2) Compliance, (3) Beyond Compliance, (4) Integrated Strategy, and (5) Purpose/Passion. The primary difference between stages 4 and 5, you explain, is that one does the right thing because it’s good business; the other practices good business in order to continue to do the right thing. You’ve said that currently there are no large, publicly traded companies that have achieved even stage 4. What will it take for that to change?
They have to want to get to Stage 4 and fortunately some companies do. Regulations drive laggards to Stage 2, but can’t drive them to Stage 4. The only reason they will aspire to Stage 4 is if they realize that they could be more successful at that stage than at Stage 3, where they are simply capturing the low-hanging fruit of savings on energy, water, materials, and waste expenses. That’s why the Sustainability Advantage Dashboard and Worksheet Simulators are so helpful. They help executives project how much more bottom-line profit they could reap if they were to reach Stage 4. Once they are at Stage 4, they will have the courage to officially change the purpose of their business to embrace the environmental and social dimensions of sustainability and move to Stage 5. Stage 4 is an interim stage. A few companies, like Interface, might make the leap from Stage 3 directly to Stage 5, but most companies will need to get to Stage 4 using today’s business model before changing to become more values- and purpose-driven. Ironically, this does not require any sacrifice of business success. In fact, it is where the sustainability advantage really kicks in.
Who are some of the companies you feel come closest to achieving sustainability today?
Any B Corp, such as Patagonia, Seventh Generation, any co-operative, Interface, Ben and Jerry’s, New Society Publishers (my publisher), and many other small- and medium-sized companies founded by enlightened owners have many of the right criteria. I am increasingly distrustful of sustainability rankings, out of concern that they are celebrating the best of a bad lot. We need a better “gold standard” against which to assess companies’ progress.
The 10th anniversary edition of your book shows how much business has changed in recent years. How do you think business might evolve before the 20th anniversary edition comes out?
The take-up in sustainability strategies as enablers of business success in the last five years has been very encouraging. Based on a survey of 1,251 companies referenced in the UN Global Compact Annual Review 2010, 54% of business leaders agree that we will reach the tipping point by 2020, when over 20% of influential companies embrace sustainability strategies. That would be wonderful, and may happen sooner.
You give away your work readily. For example, your website provides a free calculator for businesses to estimate the cost savings they might achieve with various strategies. Why don’t you charge for such a service?
As a certified B Corp, my business model is a bit unusual. I am purpose driven. I would hate to look back in 10-20 years and regret that we had not progressed as far and as fast as we needed to on the sustainability agenda because we had not provided sustainability champions with easy access to helpful tools to get the job done.
My mission is to provide effective resources (books, DVDS, worksheets, dashboard, slides, etc.) to ensure that sustainability champions can credibly accelerate the pace of change. This is not about making money. This is about changing the world. Fast.
Tag: The Next Decade
This year marks GreenBlue’s 10th anniversary. At the end of our first decade, what will the next decade bring for the sustainability movement? We’re asking this question of visionaries, thought leaders, business innovators, scientists, and educators. Read other interviews from the Next Decade series about the future of the sustainability, products, and business.
Legendary business thinker John Elkington recently suggested that he might declare the years 2012-2022 “The Decade of Sustainable Capitalism.” Two decades ago, the co-founder of SustainAbility introduced the now-standard concept of the “triple bottom line,” the proposition that business should be judged through not just economic but also social and environmental measures. In Cannibals With Forks (1997), he questioned whether capitalism itself is sustainable, and now Elkington proposes that this could be the central question of the next decade. We asked him to elaborate.
Fifteen years after Cannibals, have you decided whether capitalism can be sustainable, or is it inherently unsustainable?
It’s amazing how much has changed in that time, but also how much hasn’t. Capitalism is both inherently myopic, focusing on some capitals at the expense of others, and at the same time unstable and open to change. We are entering a period of increasingly intense creative destruction. Our key challenge is to ensure that what emerges by way of 21st-Century capitalism—or perhaps capitalisms—offers our rapidly expanding human populations greater resilience and sustainability.
Is business important to advance sustainability, and why?
Business is among the very top necessary conditions for transformative, systemic change. Too often, incumbent industries with sunk capital lobby furiously to stall change, for fear that they will be left with “stranded assets”.
Define “sustainable capitalism.”
For me, sustainable capitalism is value creation that would work for 9-10 billion people, within the limits of our one planet, and create blended (or shared) value across multiple forms of capital—financial, physical, human, natural, social, and cultural.
You’ve declared this next ten years “The Decade of Sustainable Capitalism.” Why now? What is critical about this point in history and the evolution of sustainability?
On the downside, if we don’t do it now we’re—to use a technical term—screwed. On the upside, many of the building blocks are more or less in place—all we need is the political will to change things. And the shocks that will both create that political will—and risk driving the whole system into darker responses like protectionism and xenophobia—are coming. Declaring this “The Decade of Sustainable Capitalism” signals the sort of extended timescales we need to think and invest across.
What actions and priorities would you point to as most essential in the coming decade?
We need to transform global governance, tax and legal systems, and the incentives for investors, managers and consumers. We need to create the cultural context within which the appropriate behaviors become second nature.
Are there particular barriers that need to be overcome?
This is a subject I dig into in my new book, The Zeronauts: Breaking the Sustainability Barrier. The book looks at a series of risks and opportunities, including the challenge of driving population growth, pandemics, poverty, pollution, and the proliferation of weapons of mass destruction down to zero. I look at the changes that will need to happen at the level of the citizen, the city, the corporation, the country and, ultimately, our entire civilization.
What are the top goals for this next decade, and how will we recognize success?
A key task is to break away from the incrementalism that has marked the past 25 years and push towards systemic change. While the politics could end up being off the scale, scaling solutions will require us to embrace new politics. That’s why I say business is only a necessary condition of success. Our decision as to whether or not we want to survive as a species, insofar as it is in our hands, is ultimately political.
This year marks GreenBlue’s 10th anniversary. One way we plan to recognize this milestone is to organize a series of articles about the future of the sustainability, products, and business. At the end of our first decade, what will the next decade bring for GreenBlue and the broader sustainability movement?
Through the coming year, watch this space for features and interviews with visionaries, thought leaders, business innovators, scientists, and educators. The question we’ll put to everyone will be this: Over the next decade, what will be the most important ideas and trends that will advance business toward sustainability?
To kick it off, we took a stab at answering this question ourselves looking at product sustainability. Together, the whole staff identified nearly a hundred topics and narrowed them down to a handful. Here are GreenBlue’s top five topics that we believe will become increasingly important for product sustainability in the coming years.
1) Water is the new carbon
The United Nations calls water scarcity one of the most significant problems of the 21st century. Nearly half the world’s population—3.3 billion people—lacks access to clean water or soon will, and it’s only a matter of time before the rest of us feel the pinch. As water scarcity competes with carbon emissions for the public’s attention, the sustainability dialogue could shift from global issues such as climate change to local, community-based solutions in developing regions. Major multinationals already are taking action. Since 1999, Frito-Lay has cut its water use by 40%, and Coca-Cola plans to become “water neutral” by 2020.
2) Nature’s services get a price tag
The phrase “natural resources” often implies just the earth’s physical assets—water, fuel, materials, etc. But equally important are natural processes—the cleaning of water through the hydrologic cycle, for example—called “ecosystem services.” First formally defined by the United Nations in 2005, ecosystem services are declining, and their loss could become a significant market driver. Last month, the International Finance Corporation began requiring clients to “maintain the benefits from ecosystem services.” A project draining wetlands, for instance, would have to account for its impact not only on biodiversity but also on the loss of pollination services for surrounding farmers. The economics of a spike in True Cost Accounting could dramatically change how we do business.
3) Product transparency hits the tipping point
Despite the economic downturn, the demand for green products continues to rise, and with that demand comes more pressure for companies to disclose what’s in their products so that consumers can make more informed decisions. “We are approaching a tipping point,” declared the Financial Times in 2010, “beyond which everyone will want to know the provenance of their products.” Companies such as Patagonia, Method, Interface, and SC Johnson have led the pack with ingredient disclosure, and more and more businesses will follow suit.
4) Producer responsibility escalates
More aggressive ways to reduce waste and recover material at the end of a product’s useful life are increasingly urgent. Extended Producer Responsibility (EPR), or product stewardship, puts the burden of recovery on product makers, because, as the US EPA puts it, “manufacturers have the greatest ability, and therefore the greatest responsibility, to reduce the environmental impacts of their products.” Long required in many other countries, EPR is a growing trend here at home. To date, about two-thirds of the 50 states have product-specific EPR laws, and in 2010 Maine became the first state to enact a blanket EPR rule that in theory could apply to any product. The take-back programs of many electronics manufacturers and retailers, including IBM, Panasonic, Apple, Staples, and Best Buy, are reaping extraordinary financial benefits from the valuable scrap materials. From 2004 to 2009, Dell recovered 275 million pounds of computer equipment, and in the first year of its program Xerox saved over $50 million.
5) Planned obsolescence becomes obsolete
The making of products, compared to their use, has an enormous environmental impact. Manufacturing consumer electronics, such as cell phones and computers, accounts for about 80 percent of the total energy consumption of those products. Yet, the average life of a cell phone is 18 months, and many companies bank on continual churn to sell more of their latest releases. Nokia estimates that extending the life expectancy of a mobile phone by a year could cut its total energy consumption by more than 40 percent, and other sources suggest that continuing to use a computer can mean 20 times greater energy savings than recycling it. More companies could improve environmental performance and customer satisfaction at the same time by making their products easier to upgrade. Julius Tarng’s Modai concept phone includes modular internals that can be replaced easily without discarding the whole phone. Brand loyalty could get replaced by object loyalty.
