An odd couple? HR and sustainability

March 19, 2013

savitz(5)Today’s guest post comes from Andrew Savitz, the author of a new book called  Talent, Transformation and the Triple Bottom Line: How Companies Can Leverage Human Resources to Achieve Sustainable Growth (Wiley 2013). As you can guess from the title, Andy argues that employees are the key to creating sustainable companies, but that they–and their colleagues  in human resources–are often overlooked when companies embark on environmental programs. I think he’s onto something. I’ve long thought that the single biggest business driver of corporate sustainability initiatives is the way they help better companies attract better people and motivate the ones they have.

Andy has been his career working with companies on social and environmental issues. A lawyer by training (and before that a Rhodes scholar at Oxford), Andy has been a congressional staffer, the general counsel for the Massachusetts Office of Environmental Affairs and head of the environmental advisory practice at PriceWaterhouseCoopers (PwC). Since 2005, he has led a consultancy called Sustainable Business Strategies.

Here’s our online conversation:

Marc: You say that you’ve written the book “in large measure to bridge the gap between sustainability and HR.” HR? Really? Why do we need human resource people to get involved with sustainability? They don’t know anything about carbon emissions, say, or LED lighting, do they? [click to continue...]

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Cause: Eat, drink, be merry, do good

March 17, 2013

IS2C6024 smallImagine a bar and restaurant that, like Newman’s Own, gives all of its profits to charity.

Beer and benevolence, it’s been called. Drafts and donations. More fun, in any case, than salad dressing.

That’s the idea behind Cause, a philanthropub (“a bar where having a good time helps a great cause”) that opened last October in the U. Street/Cardozo neighborhood of Washington, D.C., at 1926 9th St. N.W.  I’ve been three times–first to kick off the new year with the D.C. chapter of Net Impact, then to interview founder Nick Vilelle and this past week to have dinner with my wife.

Cause isn’t alone. “Have a pint, save the world,” says the Oregon Public House, which plans to open soon in Portland, a hub of both craft beer and NGO activity. In downtown Houston, bar owners came together last year to open the Okra Charity Saloon; customers, who get a vote with every drink, decide which charity should receive the next month’s profits. The ideas for these charity pubs evidently arose spontaneously and independently. They’re the latest in a wave of mission-driven businesses that blur the lines between the for-profit and non-profit worlds. [click to continue...]

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Meat lovers, rejoice! Cattle could be a climate-change solution.

March 13, 2013

cattle-ranch-sierra-nevada-mountainsIt’s become a truism of the environmental movement. Eating meat is bad for the planet. A few years back, a couple of researchers published a study claiming that livestock is responsible for 51 percent — 51 percent! — of the world’s greenhouse gas emissions. The FAO says it’s closer to 18 percent, but still…

Jim Howell, a lifelong rancher and the CEO of a company called Grasslands LLC, says this conventional wisdom is ill-informed and misleading. More important, he has set out to disprove it. Grasslands owns four cattle ranches in South Dakota and Montana, where the company is monitoring the environmental impacts of its unconventional approach to ranching — called holistic management – and forging relationships with nonprofits like The Nature Conservancy and the Natural Resources Defense Council, hoping to turn them into allies. Last month, Howell’s partner, mentor and friend, Allan Savory, who is a Zimbabwean farmer, politician and environmentalist, delivered a TED talk called “How to Green the World’s Deserts and Reverse Climate Change” that rapidly attracted about half a million views. Their argument, in brief, is that traditional ranching methods can degrade land and threaten biodiversity but that, when managed well, cows can actually be restorative.

What’s most interesting (to me, anyway) is that Howell, Allan Savory and their investor-partners in Grasslands believe that they can use markets to drive their unorthodox ideas about ranching to a much, much larger scale. They argue that holistic management is better for business, better for the land, better for the climate and, not incidentally, a way to raise more cattle on less land than conventional methods and thus help feed a hungry, growing planet.

If it sounds too good to be true….well, their arguments have been controversial for decades, and certainly since 1988, when Savory described his methods in a 564-page book called Holistic Resource Management,  In a book review[PDF, download] in the Journal of Soil & Water Conservation, a Berkeley range ecologist named James Bartolome wrote: “Holistic resource management itself is a model for a management system with little novelty and severe technical problems…Those who apply Savory’s approach do so at their peril.” The Savory Institute has compiled a portfolio of supporting evidence, including peer-reviewed papers, but the debate rages on.

Jim Howell

Jim Howell

Howell, 44, comes from a family that has been ranching in Colorado since the late 1800s. He intends to bring further science and economics to bear on the question of whether ranching, done right, can help regenerate the planet, improve the farm economy and, as one of his investors, John Fullerton, puts it, “harness the power of capital and markets to shift the course of capitalism onto a more just and sustainable path.” A former managing director at JP Morgan, Fullerton is now president of the Capital Institute and an investor in Grasslands LLC, along with Larry Lunt, a private investor and environmentalist who runs a family office called Armonia. The Savory Institute, a for-profit company that carries out Savory’s work–Howell’s wife is CEO–is also an owner of Grasslands. Other investors will be brought on as Grasslands grows, as its owners expect it to. [click to continue...]

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Verlasso: Farming salmon the right way

March 10, 2013

salmon“In the fish counter, all the salmon are dead, all the salmon are red, and none of them can tell a story. It’s incumbent on us to tell the story.”

That’s Scott Nichols, the director of Verlasso. Verlasso, a joint venture of DuPont and AquaChile, farms salmon in Patagonia, and seeks to do so in a responsible way. So Scott has a story to tell.

“We feel a tremendous urgency to get this right,” Scott said, when we met recently in Washington. “We have to learn our way into it. We don’t have all the answers, and we may not have all the questions.”

Scott Nichols

Scott Nichols

A PhD. biochemist who studied business at Wharton, Scott, who is 57, never expected to find himself in the business of fish farming. But as he researched new business opportunities for DuPont in the mid-2000s — he had earlier worked on improving the productivity of maize and beans and on Sorona, the company’s plant-based fiber — he got interested in salmon aquaculture. Aquaculture was booming, for obvious reasons: demand for fish is growing, and the supply of wild-caught fish is flat. The problem, was, salmon aquaculture then and now usually relies upon fish feed made in part from forage fish, such as anchovies, herring and sardines. About four pounds of wild-caught feeder fish are typically needed to produce the fish oil to make one pound of salmon, according to Verlasso. So salmon aquaculture, rather than easing pressures on the ocean’s stocks of wild fish, was actually making things worse.

“The system was broken,” Scott said.

Scientists at giant DuPont (2012 revenues: $35 billion) discovered that they could substitute a genetically-engineered yeast for the fish oils, and preserve the [click to continue...]

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Can a solar-powered plane help curb climate change?

March 7, 2013

solar-impulse

If you are among those who believe that the environmental movement needs more upbeat and inspiring stories, and less gloom and doom, you will want to hear about Bertrand Piccard, Andre Borschberg and their solar-powered airplane, Solar Impulse.

Solar Impulse is an engineering marvel. Its has the wingspan of an Airbus A340 — it’s 208 feet across — yet weighs only about 3,500 pounds, about the same as mid-sized family car. Powered only by the light of the sun, which is captured in nearly 12,000 solar cells (built by US manufacturer SunPower) arrayed on the wings, it can reach an altitude of more than 27,000 feet and stay aloft for more than 24 hours, day and night. In May, Piccard and Borschberg, the Swiss adventurers who founded and built Solar Impulse will fly the plane from California to Virginia.

Piccard, left, and Borschberg

Piccard, left, and Borschberg

This is very cool. I’m not a tech geek, but I was intrigued enough to take the opportunity to meet Andre Borschberg when he visited Washington early this week. Piccard, who is the better known of the duo, comes from a family of explorers; his grandfather August was the first person to pilot a balloon into the stratosphere, and see the curvature of the earth with his own eyes. He’s a psychiatrist by profession. Borschberg, by contrast, is a 60-year-old MIT-trained engineer and entrepreneur, who led the team of engineers, physicists, software designers and who have spent nearly a decade (and about $120 million) designing and building several versions of the aircraft. A round-the-world trip is planned for 2015. [click to continue...]

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If electric cars are the answer, what’s the question?

March 5, 2013
An eVgo charging station

An eVgo charging station

Like many environmentalists, I’d love to see lots of people driving electric cars. If  broadly adopted, electric cars will go some way towards limiting air pollution, reducing greenhouse gas emissions and undermining the power of oil oligarchs in the Arab world and elsewhere. Electric cars produce what economists call “positive externalities,” that is, consequences that benefit people other than their owners.

But what problem to do they solve for electric-car owners? That question has been on my mind since my recent visit to Israel, when I drove a Better Place car and experienced, first-hand, one of the obvious drawbacks of electric vehicles: They don’t go very far without refueling. [See my January blogpost, Better Place is alive but not well.] This is a problem not just for Better Place, but for other sellers of pure electric cars, like the Nissan Leaf and the Tesla Model S.

Today, I took a closer look at Better Place in a story for the YaleEnvironment360 website. Here’s how it begins:

If you want to sell electric cars, Israel looks like a great place to start. It’s a small country, with most people clustered around Tel Aviv and Jerusalem. Gasoline costs more than $7.50 a gallon, and oil revenues help support Israel’s Arab foes. So it’s easy to understand why Shai Agassi, an entrepreneur who was born in Israel and made a fortune in Silicon Valley, chose to launch his Better Place electric-car company in Israel, while preparing plans to expand in Europe, Australia, Japan, China, and the U.S.

What’s harder to understand is why things have gone so badly. Better Place, which staked out its position in the electric car market with an innovative battery-swapping technology, has sold only about 750 cars in Israel, while piling up losses of more than $500 million. Agassi was forced out of Better Place in October, his successor as CEO quit in January, and the company has put its global rollout on hold. Better Place needs to raise more money this year, and that won’t be easy, insiders say.

Start-ups often stumble, of course, but Better Place’s woes raise questions that matter to anyone who cares about electric cars and their future in a low-carbon economy. Has Better Place sputtered because of its own mistakes, or are the company’s difficulties a sign of the broader challenges facing electric cars?

As part of my reporting (much of which didn’t make its way into the story) I spoke to executives at General Motors, Nissan, the charging network eVgo and others, to see how electric cars are faring here in the U.S. Last year, Americans bought 52,000 all-electric cars or plug-in hybrids–vehicles, that is, designed to run primarily on electricity, like the Leaf,  the Chevy Volt and the Tesla. That’s about 0.35% of U.S. car sales, which topped 14.5 million in 2012. By comparison, the best-selling passenger car, the Toyota Camry, sold 405,000 units, without, incidentally, the benefit of the billions of dollars in government loans, grants and tax credits that have flowed to the electric car industry. EVs have attracted lots of attention but they have been slow to penetrate the mainstream. [click to continue...]

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d.light: Solar power for the poor

March 3, 2013
A girl in India, studying with d.light

A girl in India, studying with d.light

About three decades ago, Donn Tice was an MBA student at the University of Michigan, studying with the late C.K. Prahalad, who was developing his argument that companies can make money and do good by creating products and services for the world’s poorest people. It’s an exciting notion, popularized in Prahalad’s  influential 2004 book, The Fortune at the Bottom of the Pyramid.

Today, Donn Tice is the CEO of d.light, which sells solar-powered lanterns to the poor. He’s trying to prove that his teacher was right, that a fortune awaits those who can create and sell life-changing products that help the very poor.

For now, this remains an unproven hope. Dozens of startups have ventured into the global south, selling everything from $100 laptops, cheap bikes, clean cook stoves and solar panels to the poor. Some have enjoyed success [See, for example, my blogpost, Clean Star Mozambique: Food, fuel and forests at the bottom of the pyramid] but few have achieved meaningful scale. Or made anything approaching a fortune.

The good news is that d.light is getting there. The company is now selling about 200,000 solar-powered lanterns and lighting systems a month in about 40 countries. By its own accounting, d. light has sold nearly 3 million solar lighting products and changed the lives of more than 13 million people. And, if all goes according to plan, the company will turn profitable this year.

“In addition to bring lighting to people who need it and power to people who can’t acccess it –which is our mission–we think we have the ability to demonstrate that this is a business model that works,” Donn told me, during a recent visit to the d.light offices  in San Francisco. Earlier this year, d.light was recognized with the $1,500,000 Zayed Future Energy Prize.

[click to continue...]

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Shell: Get ready for a warmer world

February 28, 2013

image.1614211676Solar power and natural gas will grow rapidly in the next few decades, if new scenarios from global energy giant Shell prove accurate.

And as the technology to capture carbon from the burning fossil fuels reaches scale, and sources of clean energy grow, net carbon emissions could drop to zero by 2100.

Even so, it will be hard, if not impossible, to meet the goal set by the world’s governments of holding the average increase in global temperatures to 2 degrees centigrade.

6280287836_2ccdb72913_mToday in Washington, Royal Dutch Shell’s chief executive, Peter Voser, and Jeremy Bentham, the head of Shell’s scenarios team, unveiled a pair of “New Lens” scenarios, dubbed “oceans” and “mountains,” and available in much greater detail here. In essence (and it’s more complicated this), the “mountains” scenario envisions a strong role for government and coordinated global policy, while the “oceans” scenario sees dispersed power, greater volatility, a stronger role for markets and rapid economic growth. Shell has been generating scenarios for about 40 years, to help guide the company’s long-term planning as well as influence policy makers.

Underlying both scenarios, though, are assumptions about the world’s increasing population and economic growth that together will drive demand for energy by about 80% by 2050. That rising demand is all but unavoidable, Bentham said, even assuming strong policies to promote efficiency or high energy prices that discourage consumption.

Meeting that demand for energy, while reducing carbon emissions dramatically, will be extremely difficult, to say the least, the Shell executives said. [click to continue...]

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Oxfam America: Big Food is failing the poor

February 25, 2013

fig-2-brands-72dpi-1280px-nologosNew research by Oxfam America into the social and environmental policies of the world’s 10 biggest food and beverage companies puts Nestle, Unilever and Coca-Cola at the top of the list and Associated British Foods, Kellogg’s and General Mills at the bottom. In the middle of the pack are Pepsico, Mars, Danone and Mondelez International (formerly Kraft).

Oxfam American said in a presss release that the Big 10 food and beverage companies, which together make $1 billion a day, are “failing millions of people in developing countries who supply land, labor, water and commodities needed to make their products.”

That stark accusation was tempered more than a little during a telephone news conference where Oxfam America launched a new global consumer-focused campaign called Behind the Brands.

Ray Offenheiser, the president of Oxfam America, described the big food companies as “recognized industry leaders.” Jane Nelson, a senior fellow at Harvard who specializes in corporate responsibility, went further, saying these are among the “most responsible, best managed, well governed companies” in the food sector.

So which is it, really? Are these companies industry leaders or are they failing the poor?

Maybe a little of both. [click to continue...]

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Why sustainability has to be a team sport

February 21, 2013

imagesOne of the great virtues of market capitalism is that power is widely dispersed–among consumers, corporate executives, investors and regulators. Lots of people get lots of votes that collectively shape business, and that’s good. But decentralization creates a daunting problem for anyone who cares about corporate sustainability: It’s hard to get things done.

In conversations today at the GreenBiz Forum in New York, people who could be described as powerful—executives with big titles (vice chairman, vice president, CEO) at big institutions (NASDAQ, McDonald’s and Ingram Barge, America’s biggest barge company)–all lamented the limits on their influence over what their companies do, let along how industries can change.

This is why sustainability has to be a team sport. Very few people–or companies–can do much on their own.

Take Bob Langert, vice president for corporate responsibility at McDonald’s, who is one of the most respected sustainability executives in the US. He’s got credibility inside the company and with NGO partners. But to get anything done, he’s got to win over thousands of owner-operators of McDonald’s stores, as well as a a diverse set of suppliers and, in some instances, the tens of millions of people who eat at Mickey D’s every day.

“We are the world’s largest small business,” Langert said. The overwhelming majority of McDonald’s outlets are “owned and operated by independent business people. They have a lot of power in our system. That means we can’t dictate from on high. I challenge people to show me a company that’s more democratic than McDonald’s.” [click to continue...]

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