Thursday, July 25, 2013

"Sustainability" takes many forms and means different things to different audiences.  This blog is devote--quite generally--to corporate environmental sustainability, with a hope that corporations will play a part in ending the mad-cap dash down the path to climate chaos.

But in that context, other types of sustainability come in to play--not the least of which is the durability of the corporate brand.  While some would love to see particularly destructive brands sink into the muck of history, those companies that choose to become part of the climate solution

I recently read an article that posited the following: "Protecting the Brand is the Riskiest Strategy."  It got me thinking of the vital inter-play between sustainable business practices, and sustainable companies, and that fact that you can't merely change core operations to address climate change: you have to integrate them into the corporate DNA.  In the end, that DNA is most vividly expressed in the corporate brand.  So for those of us in the business of corporate sustainability, understanding the interplay between brand and operations is an important and often neglected domain.

Setting aside for the time being that "protecting the brand" to be is a goal and not a strategy, I am unaware of any convention--at least among brand experts--that advocates a laissez-faire brand strategy as a path to safety.  True, brands are to be guarded jealously, but protecting brand equity is far different from leaving it to the fickle winds of fate, which is the only result when you "do nothing".
That said, I wouldn't argue Mr. Steinberg's implication that--in a dynamic, global economy--doing nothing amounts to brand neglegence, and would certainly agree that many iconic brands are in decay.  The driving force behind that erosion, however, is more likely to be poor product development than a failure of the brand strategy--the unhappy inversion of how Apple's (or, more accurately, Steve Jobs') maniacal obsession with design, product features and market re-invention rocketed the company's brand to unrivaled heights.
Atari didn't die because of a poor brand strategy, any more than Cadillac is no longer "the Cadillac of Automobiles" because the brand team took a long nap.  Both companies got passed in the fast lane by better, smarter, more innovative competitors who had their finger on the pulse of the market and were not beset by the sclerosis of complacency.  the point is simple: brand is a whole-system corporate imperative, not something that can be cultivated, nurtured and grown by an isolated box on a complex org chart.

If you believe the old saw that "a brand is a promise realized", then you understand that  brand manager's job does not start and finish at the threshold to the Corp Comm department.  Rather, the brand team must work with senior management and the product team to ensure the business is capable of fulfilling the promise of the past--quality products that have true value for customers.  For all involved in the business of brand-building, it is thus helpful to recall the words of the essayist Hugh Walpole: "Don't play for safety; it's the most dangerous thing in the world."

The sustainable brand is much like the sustainable company, both of which analogize to the sustainable planet.  They require great care and vigilance, and boldness in their stewardship.  The companies that incorporate sustainability into their mission will--by necessity--incorporate that ethic into their brand.  There is risk in doing so.  Because current business practices are systemically unsustainable.  When the system collapses, all symbiots will as well.

Wednesday, June 5, 2013

Is Global Warming Real?

I pose this question with no intention of answering it.

Rather, the question is a springboard for addressing a situation that many in the sustainability community have to face: curiosity, doubt, cynicism, and often-times outright hostility about the topic of man-made Global Warming. Corporate sustainability is not limited to questions of climate.  However, there is no other aspect in the field that inflames passions so greatly (on both sides of the debate)--and therefore no issue that potentially can impede your successful execution of a corporate sustainability program.   The point of this post is merely to give you both a strategy and some tactics for overcoming this particular objection. 

As a sustainability professional, one of your principal job requirements is salesmanship: you are asking a lot of very busy people to do things very differently; doing so will benefit them, but that doesn't mean that they see that end-game when you first walk through their office doors.  And because Global Warming is such a radioactive topic, the likelihood of deep-seated objection increases greatly.  The Japanese martial art of Aikido emphasizes non-violent resolution of conflict, often by pre-empting the attack before it can gather momentum--a strategy that works well when you enter the ring of Global Warming debate.  I hope that the following approach enables you to side-step an unwinnable debate about an un-knowable topic, while advancing toward your goals of building internal partnerships that will achieve sustainability goals.

I have found that the best approach to what I will term "Global Warming Deniers" is preemptive action.  I try to dispense of objections before they can even be raised.  This means introducing the topic early and proactively, and framing it in a non-threatening way.  In all formal presentations and in many less-than-formal discussions, my goal is to de-fuse the Global Warming dynamite before the fuse even ignites.  My standard opening gambit goes something like this:
"Is Global Warming real?  Who knows.  And more importantly, who cares?  Because the (political/management/regulatory/market) concensus is that Global Warming is real, dangerous and already underway.  So unless you are (US President/company CEO/agency director/market maker), what you and I believe, or what we think we can prove doesn't matter.  The context in which you do your job must be that Global Warming is real--because the rulemakers have deemed it so."
For some people, this is enough, and the subject is put to bed.  For many others, however, this is just the opening they've been waiting for.  If you don't control the discussion, you may be in for a protracted and thorny interchange that bears only passing resemblance to productive dialog. Sadly, Global Warming incites nearly religious fervor, and certain opponents demand the opportunity to advance their dogma.  For example, I was recently told:  "You have to admit that the emails [day-lighted leading up to the Copenhagen summit] prove that Global Warming is a hoax."  Even if I believe that assertion (I believe the emails raise additional questions about the causes of current Climate Change, but that they prove nothing about the actual inter-relationship of man and climate), there is ABSOLUTELY ZERO constructive result that can emerge from engaging in a dialog on the subject.

In such instances, I try to move quickly beyond the the environmental impact of corporate sustainability, and onto its potential for reducing costs and increasing profits.  That dialog goes something like this:
Global Warming Denier: "Well, I don't believe in Global Warming, and therefore, I don't see any reason to support any program that will reduce our carbon footprint."
Me:  "Okay, so I'll concede for the sake of this discussion that reducing your company's carbon footprint won't make any difference related to global temperature.  But what if I told you it will increase your company/business unit's profitability?"
Usually, this tactic yeilds the "tell-me-more" response.  But I believe that its success depends on two pre-requisites.  First,  you must shift the discussion out of the realm of climate dogma and back to business basics: what if that which I am describing can make good business sense? This approach can rapidly migrate a person from global warming denier to curious capitalist.  But I also think it is crucial to frame this issue as a question.  This has a dual effect: it takes the counter-party out of the pulpit of his expertise, and shifts the dialog to an arena where you are--at least between the two of you--the expert.  It therefore gives you control of both the direction and the tenor of the conversation.  What was momentarily contentious can swiftly become instructive.  Finally, it gives you credibility in the eyes of the counter-party: since you are demonstrating a willingness to supplicate at the Temple of Almighty Profit, you can't really be a total lefty-loony bugs-and-bunnies eco-nut.

The majority of people in business are coldly profit-driven.  By migrating sustainability discussions into constructive dialog focused on balance sheets and P&L performance, you will have greater success in building internal partnerships and advancing your sustainability mandate.  Internal stakeholders, whether "global warming deniers" or not, who see the business sense of reducing material inputs and lowering costs associated with waste stream remediation, become valuable allies.  Over time, such recruiting is your central mission.  The enterprise that unifies the most employees under the banner of sustainability--whether to curtail Global Warming or simply to enhance profitability--is the one that will see the greatest success.

Full disclosure:  On balance, I believe the evidence supports the thesis that anthropogenic forces account for a rise of atmospheric carbon levels from a pre-industrial revolution average levels of 280 ppm to current readings around 385 ppm.  But those findings do not prove causation.  As an advocate of the Precautionary Principle, I therefore am also a strong proponent of all reasonable efforts to curtail human-driven GHG emissions, especially in concert with a reduction in industrial dependence on fossil fuels. 
Put more simply:  Do I believe that Global Warming is real?  Who knows. and who cares: the evidence suggests it is, and it would be a really bad idea to proceed down a business-as-usual path that results in irrevocable damage to our people and our planet.

Tuesday, August 21, 2012

New Nukes: The Rise of Thorium

In the context of Global Warming and climate change, the attraction of nuclear power has re-emerged among serious energy policy discussions after a 30-year hibernation.  Three Mile Island (TMI) and later Chernobyl badly chilled tolerance for "nukes", and the broader zeitgeist surrounding nuclear decommissioning in the wake of the Cold War cooled possbilities even further.  Despite well known cost considerations (read: over-runs), permitting challenges, construction delays and rampant NIMBYism, nuclear power is now receiving renewed consideration: it has the potential to provide vast amounts of electricity with comparative minor greenhouse gas emissions, especially with the popular re-emergence of an alternate fuel source, Thorium.  As a result, certain traditional opponents of nuclear power are experiencing a sort of philosophical glasnost moment, and even environmental activists--long the entrenched skirmish line against nukes--are opting for a second look.  But challenges remain.

Electricity--cheap, reliable and clean. Pick two.   In corporate project management, clients often seek a trifecta of results: a high quality work product, a quick delivery and a low budget. Corporate project managers have an axiom when responding to such requests: "You can have it good, fast or cheap. Pick two."

A similar cost-benefit trade-off tightens the turnbuckle of tension between global warming and industrial-scale electricity production.  Society can have it cheap (conventional fossil fuel), reliable (the lights come on every time we want them), and clean (low-carbon intensity, with side benefit or reduced "conventional" pollutants). But it has not, at least to date, been plausible to have all three. 

For the most part, utility scale generators have generally opted for cheap and reliable.  This trade-off has had relatively minor environmental ramifications--acid rain, particulate matter emissions, localized extraction impacts (think coal tailing ponds and Appalachian-style "mountain-topping").  The spectre of anthorpogenic global warming, however, has changed the calculus, as policy makers and electricity entreprenuers alike have aggressively sought out alternate and ideally magic-bullet energy sources.  The message has been that the clock is ticking, and irreversible climate change lurks around a not-too-distant bend on humanity's timeline.  Things are urgent, the argument goes, and a solution must be found now.

Along Comes Thorium
And a funny thing happened on the road to climate catastrophe: the once-great environmental threat from energy sector suddenly seems like a potential savior.  Not only is nuclear power getting a second look, but proponents are dusting off a technology from the second generation of nuclear reactor development and enabling a "new" type of utility-scale nuclear power.  Recent fanfare surrounding thorium-based reactors, however, suggests that a parallax shift in how we address the energy equation may be at hand.  Thorium reactors resolve several of the problems that bedevil nuclear power on a global scale:
1.  Sourcing and fuel conversion.  Thorium is both naturally more abundant than uranium and enrichment techniques are easier, effectively making thorium even more "plentiful" than uranium.
2. energy density.  Thorium contains up to 200X the energy of uranium1. 
3. weaponization.  Enriched thorium--as well as its by-products--are unsuitable for both weapons-grade and "dirty bomb" development.
4. waste remediation.  A thorium reactor can actually "burn" plutonium, eliminating it from the waste--as well as the weapon--stream).
5.  Reliance on the Imperium.  Almost 90% of known reserves are concentrated in countries that are both politically stable and economically partnered with the United States--which itself holds a 15% of proven resources.

As an added benefit, thorium reactors can be micro-sized to operate at load centers--thereby reducing expensive transmission and distribution (T&D) infrastructure.

The current accomodation for most of the industrialized world--France, certain parts of Scandanavia and Spain notwithstanding--is fossil intensive.  The commercial grid depends on extensive and complex  (T&D) systems that link central power stations to load centers such as cities and high demand industrial zones. To reliably respond to the "demand curve" that typifies most of Europe, North America and the manufacturing economies of Asia, regional and national electricity systems require a bipartite supply: base load, which runs 24 hours a day and fulfills the minimum constant level of demand on the electricity system; and marginal (intermediate/peak) load, which varies by time of day, time of year, weather and other variables and which is dispatched by a central operating authority in reponse to the demand ebb and flow. Baseload is generally fulfilled with low-cost generation such as coal plants and natural gas-powered "combined cycle" facilities. In addition to high environmental impacts, these facilities have the disadvantage of slow start-up and ramp times, and thus cannot be used to meet variable demand such as high air conditioner use on hot summer afternoons. Marginal load rely on generation types that are easily and quickly dispatchable (turned on), but that are higher cost for reasons such as start-time and fuel efficiency. So-called "peaker" units can start up in as little as 30 minutes, but burn fuel at rates that make them expensive to operate. In combination, the baseload/marginal service is highly reliable, but is requires trade-offs in either costs of operation or GHG emissions.

So the conumdrum remains. The industrialized west has extremely high demand for electricity and high population emerging economies such as China and India understand that cheap and reliable electrification is a cornerstone of modernization. Fuel is being burned at geometrically-increasing rates, which has corresponds directly with GHG emissions and threatens climate stability.

Conventional nuclear power is at best a difficult political pill to swallow and at-worst a catastrophe in-waiting.  Thorium could be the comfortable compromise.  But much would have to be done, from revised permitting processes, to a successful (and honest) public education campaign, to neutralizing the fossil fuel lobby that would oppose a nuclear renaissance.  In sum, this represents a sort of public policy Rubic Cube, where a lot of inter-linked variables would have to line-up "just so."  Is it possible?  Cynicism is justified: For a nation that split the atom, but the gridlock of entrenched interests in national politics are a force of a whole-other magnitude.


Friday, June 1, 2012

Marketing of Sustainability Programs to Internal Stakeholders: A Blueprint

The success of a Corporate Sustainability program depends in large measure on its adoption by employees--even if the executive suite has bought into it completely.  While that's a big if, let's suppose that you are one of the few--and extremely lucky--sustainability professionals working under just such a forward-thinking leadership team.

In such an ideal situation, your strategy is simple (as distinct from easy, but more on that below):
Step 1: Educate--explain what sustainability is, how it works and how it benefits the triple bottom line of "people, planet and profit."
Step 2: Demonstrate--if education is telling, demonstration is showing; this phase of the program equates to an academic practicum, in which every employee has an opportunity to participate; after educating with theory and examples, develop a simple, easy to engage initiative that will have easy to see results.
Step 3: Recruit--after the demonstration phase, invite employees to leverage their experience, insight and unique perspective in order to indentify new opportunities to reduce waste and improve efficiency.
Step 4: Reward--find ways to give both emotional/personal ownership and financial reward to employees who originate ideas that become actuated programs.

These are the essential program components, and it is extremely helpful to think in terms of education as the over-arching strategy as you design your communications/outreach materials.  Why?  Because the idea that something that is good for the environment can also benefit the bottom line is extremely counter to the corporate culture that has grown up in the United States.  As a result, your job is not merely to role-out a new initiative, but to give all employees the conceptual tools to adopt sustainability, own it, and drive it forward as part of their day-to-day job function.  This latter point is especially important, because the most successful sustainability programs are strategically "top-down", but find that their greatest waste reduction opportunities areidentified on the "shop floor."  Therefore, management is doubly-incentivized to actively recruit rank and file employees into its sustainability mission.  Education is the key to this recruiting process.

Underlying any successful education campaign is a standard communication planning process.  As a result, the standard marketing challenges are in place: defining a value proposition, building awareness, over-coming barriers, getting "prospects" to try your product and building repeat "purchases."  The good news: You have a dynamite value proposition, one that virtually every one in the company should want to embrace--after all, who doesn't want to work more efficiently, while also saving money?  So the value proposition of sustainability is as universal as it is simple: sustainability increases profitability.
The bad news is your prospects are all extremely busy.  While sustainability can reduce inputs and thereby reduce costs, someone has to design the actual operational program that yields such wonderful results.  Employees recognize that this probably means they are the ones who will have to fill the role of architect.

Because you won't be able to count on most employees to jump right in and re-design core business processes (or even on them having the time to listen to and process the sustainability Gospel that will be the salvation of  their company), you will have to rely on old-fashioned hard work.  Most notably, developing a communications plan, and executing it across the entire enterprise. 

Your main steps in this process are as follows:
  1. Refine the language of your value proposition to dovetail with your corporate culture and strategic goals.
  2. Define "success" for your program
  3. Develop metrics for measuring program performance
  4. Identifying barriers: Apathy, commitments that compete for mindshare; antipathy (a certain percentage of people not only don't care about environmental issues, they actively think pursuing environmental programs is a waste of time and resources); time; term to payback; insufficient ROI)
  5. Construct strategies for overcoming barriers
  6. Establish achievable goals.  This is huge, and the long-term survival--to say nothing of success--may turn on this issue. 
  7. Consider Multi-level marketing.  It may be a bad word, and certainly has a bad reputation.  But the underlying model works: build a network of passionate missionaries to carry the sustainability doctrine through-out the corporate community.  Recruiting opinion leaders or otherrs who are well-positioned to influence large numbers of employees is especially effective.
  8. Review and refine.  Just like the management strategy of "Continuous Improvement Process", your program must include a protocol for regularly reviewing your success and modifying your messaging and outreach to capitalize on any lessons learned.
  9. Anticipate fail-points and short-circuit them.  Many sustainability marketing campaigns--like marketing campaigns in general--are prone to fail.  Why?  there are two main reasons.  First, the product is ill-conceived; second, the marketing campaign is either poorly designed or executed.  In the former case, it isn't that sustainability is a bad "product" and one that your target market is pre-disposed to reject.  The history of the auto industry is strewn with the wreckage of failed models--yet we all know that cars are one of the most fabulously successful products ever introduced.  Sustainability is the same: it has inherent value, but it must be properly crafted, regardless of how good the marketing program that surrounds it.  Employee education  initiatives of all stripes are no different from consumer markets, where "nothing kills a bad product faster than good advertising."
The final point in this "To-do" list reveals some helpful additional planning considerations. 
Step 1: design and package the sustainability program honestly; don't fail prey to the path of least resistance suggested by green-washing: be honest with your stakeholders about the hard work ahead, but engage them as experts in the field who will be leaders in developing actual on-the-ground programs, and not merely on the receiving end of corporate mandates.
Step 2: Design the communication strategy, messaging and tactics for marketing it for mass appeal within your target audience.
Step 3: Establish easily achievable but nonetheless meaningful "first level targets".  Success demonstrates the legitimacy of sustainability to stakeholders, which in turn builds momentum and eventually loyalty to the program (also: cultural shift--the goal of a sustainability program is to get every employee to address every task by asking: how can I do this sustainably?); it also gives both the program and the executing team credibility with senior management which is necessary for on-going sponsorship and support.

A sobering word.
As noted, a successful roll-out of a sustainability program is a simple undertaking--but just because it's simply, doesn't make it easy.  It requires careful planning, studious preparation and willful conviction during the execution phase.  Just like running a marathon, or swimming the English Channel, sustainability program marketing is formulaic.  In the same way that endurance athletics is based largely on resolve and repetition, so too is program marketing that supports a dynamic and self-evident value proposition.  As long as you are prepared for a long ramp-up period of preparation, and you have the right support team in place, you will cross the finish line.

Summary: Marketing Sustainability to your internal stakeholders
GOAL: Adoption by rank and file at high rate
STRATEGY: Educate, demonstrate, recruit, reward
RESULT:  Succeed in achieving a high level of program participation and messaging uptake, reesulting in improved sustainability practices

Monday, November 22, 2010

Nike touts environmental record; continues to destroy environment

As we all know, greenwashing isn't limited to the energy industry or heavy waste-stream industries.  It also isn't limited to the environment, when you can also violate principles of social justice at the same time!

Exhibit A: Nike celebrates its environmental street cred while continuing to focus its manufacturing in China

Tuesday, September 28, 2010

Definition: Corporate Sustainability

Corporate Sustainability is a proactive, holistic strategy that necessarily creates shareholder value by reducing material inputs and waste stream outputs while maintaining productivity. It seeks to ensure the capacity of the enterprise, as part of an integrated natural system of limited resources and limited capacity as a waste sink, to endure profitably and in perpetuity. Sustainability will be, either as part of an explicit corporate mandate or as a direct and necessary dividend of corporate action, an instrument of value creation to the “triple bottom line” of profit, people and planet.

Corollary: Corporate Sustainability may result in efficiency improvements ("doing more with less"), but is benchmarked against maintaining current productivity levels and revenue.

Sunday, September 19, 2010

A Sustainability Continuum

Sustainability in practice in the enterprise is a whole-system discipline.  Starting with source inputs and concluding with the final disposition of both waste stream and finished goods, a sustainability program has a cradle to grave scope.  All companies can be viewed through the sustainability lens, however, and one way to view the results is along a progression:

Legal-regulatory compliance: the company does only that which it must in order to comply with all applicable environmental regulations and statutes.  A reactive strategy.
Environmental Risk Management--The company anticipates potential future regulations and/or civil liabilities and executes strategies to limit corresponding risk.  A proactive strategy intended to reduce financial exposure.
Brand/Image/Reputation Enhancement.  Sustainability programs that are executed either piece-meal or without regard to a holistic, strategic plan can still create positive impact.  And the company may elect to celebrate such genuine efforts.  But a word of caution: low-impact initiatives (or worse yet, superficial programs undertaken to create the illusion of sustainability) may be perceived as "green-washing".
P&L Performance ("Value creation").  The company views sustainability as a profit center, and develops holistic, integrated strategies for both reducing costs and implementing line of business products and services.  The goal of Value Creation in sustainability is to improve financial performance while simultaneously reducing environmental impact.
Zero-net Enterprise.   Through aggressive strategies to improve resource utilization and multi-cycle the waste stream, total waste outflow is substantially reduced and remaining outputs are either fully remediated or offset.
Restorative Enterprise.  Beyond the achievement of a zero-net environmental impact, enterprise activities instead yield a net-gain for the environment, for example: C02 sequestiontration via industrial process.These require extensive planning, unwavering commitment from management, trail and error and an awareness that to migrate from business as usual to a zero-net impact is a complex evolutionary process.

No company arrives in the latter two stages easily or overnight.  This metamorphosis can be excruciating, complex and protracted, and brings to mind the observation of Teddy Roosevelt, himself a progenitor of environmental sustainability and the father of the National Park system: "It is only through labor and painful effort, by grim energy and resolute courage, that we move on to better things."

For most companies, "business as usual" probably falls into the first two strata; while management is awakening to the public concern with environmental sustainability issues, but remain skeptical that addressing them is anything other than a cost center.  Focused on shareholder value, management thus seeks to minimize costs, and therefore executes strategies focused on reducing legal and civil liability.

At this point, however, there is less and less room to simply comply with environmental regulations and go public with a position of "we are in full legal compliance with all state and local statutes."  This is because of both an increased cyncism among the green movement about the credibility of corporate PR, but also because of a recognition that most environmental laws do not go far enough.

When the Watchdog  Barks
Setting aside the frothy philosophical question of whether environmental solutions should be crafted by the hands of government or turned on the lathe of free markets, the reality is that current legal regimens are both not sufficient to address all sustainability concerns, and poorly enforced where they can.  As a result, groups like Greenpeace have entered the arena, and are actively pushing industry to do more.  Prodded by such external stakeholders, your firm may have to make a strategic, C-level decision about where it wishes to fall on the continuum.  If your enterprise has had a visit from Greenpeace or any other watchdog organization, residence in first three stages is probably no longer a comfortable accomodation.

Whether you like Greenpeace or not, you need to pay attention to organizations like them. They are a very real part of the sustainability landscape, and you must factor them in when developing any travel plans. Even if you are not in the electronics industry, Greenpeace provides an important lesson: someone may be watching your activities, and passive compliance as a risk management strategy is no longer sufficient. Instead, passionate advocates such as Greenpeace, especially ones with strong PR reach, have changed the rules: active involvement in sustainability activities is now the expectation and the yardstick against which industry can expect to be measured.