‘Green to Gold’ Author Makes Amoral Argument for Sustainability
We had the opportunity to catch up with Andrew Winston, sustainability guru and author of the book Green Recovery in between sessions at the World of Business Innovation (WOBI) Summit in New York City this past June in a well-attended two-day session featuring a number of noted luminaries from diverse business disciplines. The venue for this event was the New York City Center in midtown Manhattan.
Being somewhat familiar with Winston’s work from reading his eye-opening book, Green to Gold - we led with the question: In your experience, what have you seen as the key drivers to push sustainability efforts in organizations?
“As I describe in my presentations, and again here today, there are forces coming to bear, including tectonic changes such as globalization, technology, and the rise of massive consumer spending (driving huge changes in resource availability and commodity prices) on the green economy,” Winston replied. “Then, in another bucket, you have companies that are feeling increased stakeholder pressures from government agencies, NGOs, their customers and consumers, their own employees; and all are asking tough questions. So envision all of this as a circle, with stakeholders surrounding the company, and these tectonic forces in another layer. Finally, there are deep environmental and social concerns, from climate change, water and waste to social concerns including equity and worker rights (take the example of the attention focused on how iPads are made in China) – transparency is a growing concern.”
Rudi Daelmans of Desso made a similar comparison to Apple products in another interview for Sustainable Plant recently.
Among the notable takeaways from Winston’s WOBI presentation are, “Sustainability is a rising tide of concern,” “Get creative and heretical,” and the provocative comment, “Why can’t innovation come from the bottom of the pyramid?” The bottom of the pyramid may be the key for pushing sustainability to the next level as more of us at the bottom rise to the occasion to become empowered enablers.
Given that backdrop, who do you feel are the key principles driving the greening of business, both from within the organization, and from the outside?
“Within the organization, it’s primarily the CSO and the environmental officer driving the charge, as they sit in so many places within the organization – in legal, in the supply chain – that I like to say that the C-level is driving this change.” (And depending upon the organization, the culture and structure is also important, according to our own anecdotal research.) Winston continued, “But ultimately we need leadership from the very top – for example, Paul Polman, Unilever’s CEO, is a true leader in the field.” Winston added, “From the outside, and going back to your first question, it’s the business customers driving in a real way the change. Consumers, on the other hand, not so much, as they tend to be more reactive than proactive. Then, we have the regulatory drivers as well.”
From all the work you have done, both as a practitioner, and from your previous work at Yale, what can you share as some notable lessons learned from your experiences?
“The major assumption [for many companies] is that green is a cost center, yet at its core, going ‘green’ is about doing more with less, and a way to actually save money.” Winston said “Now, the way to get there is with data, and data is critical. Another factor is behavior. For example, for those companies in the fleet/shipping industries, is Conway, which slowed their fleet to 62 MPH instead of 65 MPH, saving millions of dollars. This is only one example of using a lot less resources with small changes.”
Another example would be the shipping company Maersk evaluating collapsible containers to stack more empty containers on ocean-going vessels on return trips.
On the flip side, what are the roadblocks you have seen firsthand for companies greening their business and pursuing sustainability opportunities?
“If you view this issue from the macro level, the main roadblock is the short-term obsession of companies. Public companies, for example, focus on quarterly profits, and some sustainability initiatives – not remotely all of them – require longer-term investments,” Winston said. “But even the longer payback options, such as installing alternative energy systems, produce intangible value that is harder to measure by the conventional means companies use to assess their investments. Secondly, some companies have to deal with inertia in the company culture.”
How are successful companies managing their data to provide useful and meaningful metrics that get translated to their sustainability reports, or otherwise showcase their ES&G efforts?
“Companies often follow the GRI Guidelines, which help to provide a framework for what companies need to measure, and thanks to increased competition from software providers, it’s getting easier to find useful measuring tools,” Winston responded. “Now, this may sound simple to accomplish, but it’s really hard to crunch the numbers in some areas. Take, for example, calculating how much energy, water and waste did we use and generate? To get a more accurate result, one needs to look at the entire value chain, and identify where the hot spots are, which really helps a company understand its risks and opportunities.”
From your experience with corporate clients, in the area of product innovation, would you say that sustainability is a factor in product design/engineering processes?
“Leading companies consider sustainability part of product performance and they incorporate it into the product design. This is one area in particular that some software companies are providing programs to evaluate the carbon footprint of different product designs,” Winston said.
Can you provide some examples of companies that depict the corporate view of their environmental, health and safety (EH&S) responsibilities, and how this relates to their sustainable and socially responsible commitments?
“Most companies have both EHS and CSR functions. But it can get confusing to meld the two,” Winston said. “Some of CSR is absolutely about what’s right, moral and philanthropic, and that’s ok. But it’s a different argument than the broader sustainability discussion that, I think, is about core operations and profitability. Companies shouldn’t tackle, say, resource constraints because it’s moral (although it may be), but because it creates tremendous value to do so.”
With LEED as a growing system paradigm shift aimed at continually greening the building industry, what do you think about the efforts of architects and builders in the built environment?
“This is one sector that’s clearly moving fast,” Winston said. “Just look at the size of GreenBuild [http://www.greenbuildexpo.org/about/greenbuild.aspx] – tens of thousands of people gathering every year to talk about how to make buildings more efficient, less toxic, and more sustainable overall.”
The hospitality industry is also closely aligned with the USGBC’s LEED initiatives as a major tenet of the American Hotel & Lodging Association (AHLA). What do you think about this industry sector?
“It’s hard to gauge across a whole sector like this,” Winston said. “From the consumer’s point of view, it may not seem there’s much going on besides those cute cards in hotel rooms, but most of the big chains are doing much more behind the scenes on energy efficiency, for example. But there does seem to be resistance to really exploring sustainability with the guests [beyond asking them to hang their towels up].”
Let’s shift our focus to transportation and supply chain logistics. What are some of these companies doing to become more sustainable?
“Again, it’s hard to say across sectors this broad,” Winston replied. “Clearly there are tremendous efforts to reduce energy use in supply chains, from mode-shifting to making trucks more aerodynamic and energy efficient. There’s tons of competition now across the transportation sector to find new alternatives [hybrids and electrics] and generally improve fuel efficiency.”
What can all companies do now – the small stuff – to get on the green/sustainable path?
“Start with measurement,” Winston said. “Understand your footprint up and down the value chain. Get your people engaged and involved at all levels. Talk to your customers about what they want. Look for the easy wins that create buy-in and save real money that can be invested in the much larger, more disruptive innovation that we need.”
This insight is supported by the views of other sustainability practitioners and managers.