Fortune Brainstorm Green, and the limits of corporate sustainability

Harrison Ford at Fortune Brainstorm Green

Harrison Ford at Fortune Brainstorm Green

The 2013 edition of Fortune’s Brainstorm Green conference was, by most accounts, a hit. We had a record number of attendees, including more than 50 CEOs of companies and nonprofits, big and small; plenty of entertaining and informative conversation; and a healthy dose of fun, with celebs like Harrison Ford, will.i.am and (my favorite) ultra marathon runner Scott Jurek. As co-chair of the event since the first Brainstorm Green in 2008, I love to reconnect with colleagues and sources, meet new folks and learn from and, occasionally, by inspired by our top-notch speakers. The theme of the conference has been a constant: How can business profitably help solve the world’s most important environmental problems?

Unavoidably, the challenge of an event like Brainstorm Green (as well as a conundrum for anyone who writes about corporate sustainability) turns on the question of how much to cheer or jeer the efforts of companies that are trying to “go green.” My job, as I see it, is to do both–to applaud the leaders, to prod the laggards, and to do my best to tell one from the other. That’s difficult balance to do in a conference setting where the mood is one of bonhomie, where the speakers are our “guests,” and where the presumption is that everyone is doing the best they can. The trouble is, that’s usually not good enough.

Mark Tercek at Brainstorm Green

Mark Tercek at Brainstorm Green

As Mark Tercek, the CEO of The Nature Conservancy, who I interviewed at Brainstorm Green, put it in his excellent new book, Nature’s Fortune:

Nearly every precious bit of nature–teeming coral reefs, sweeping grasslands, lush forests, the rich diversity of life istelf–is in decline. Everything humanity should reduce–suburban sprawl, deforestation, overfishing, carbon emissions–has increased.

Sad but true.

So if corporate America is changing for the better when it comes to the environment–and no doubt, many companies are–the pace of change is too slow and the ambitions of business leaders are too modest. Incremental change is not getting us where we need to go. [click to continue...]

Guess who’s coming to Brainstorm Green?

FORTUNE’s Brainstorm Green conference is more than just talk.

Ann Hand, the ceo of green-building startup Project Frog, recently told me that she met venture capitalist Chuck McDermott at the first Brainstorm Green in 2008. That helped lead to her current job. [See my blogpost, Project Frog's Ann Hand: Disrupting construction ]

At Brainstorm Green 2010, Bill Ford, the chairman of Ford Motor, got to talking with Scott Griffith, the ceo of Zipcar. That helped bring about a Ford partnership with Zipcar to get Ford cars onto college campuses.

Later, Ford and Zipcar together invested in Wheelz, a car-sharing startup whose ceo, Jeff Miller, spoke last year at Brainstorm Green. [See my blogpost, Car sharing, revving up]

Brainstorm Green is about making the connections that help drive market solutions to environmental problems. The people and the issues have changed over the years but the theme has remained constant: How can corporate America help solve the world’s biggest environmental problems?

With some interesting tweaks to our format, a new and improved Brainstorm Green will be back in 2013. Dates are April 29-May 1, and we’ll be back at the spectacular Ritz Carlton Hotel in Laguna Niguel, CA. Our programming partners will be Environmental Defense Fund, the Natural Resources Defense Council, The Nature Conservancy and Conservation International.

We’ve been recruiting CEO-level speakers for a couple of months now, and have generated an enthusiastic response. Ted Turner, the legendary enterpreneur, environmentalist and philanthropist, has agreed to join us, and if you’ve never heard Ted speak, you’re in for a treat. [See my blogpost: Ted Turner: Telling it like it is] Ted is always entertaining but, more important, he’s nearly always right, whether the topic is global warming, nuclear disarmament or raising bison for his Ted’sMontana Grill restaurant chain.

Another headliner will be the big-thinking, green-minded (pun intended)  investor Jeremy Grantham, whose GMO asset management firm manages about $100 billion. “Global warming will be the most important investment issue for the foreseeable future,” Grantham wrote in a letter to his investors a couple of years ago. If you don’t know much about him, read this excellent profile from The New York Times Magazine. He’s a fascinating guy who, like Ted, has been ahead of the curve more often than not. [click to continue...]

P&G: A bold green vision but…

Procter & Gamble, the world’s largest consumer products company, today unveiled a bold new sustainability vision.

Don’t start the cheering yet.

Yes, the company eventually aims to power of all its operations with 100% renewable energy, to use 100% recyclable or renewable materials in all its products and to have no waste from the manufacturing or use of its products end up in landfills.

The vision is unimpeachable.

But the path to get there is not so clear.

And the reason to withhold applause? In the next decade or so, if P&G continues to grow, its environmental impact is more likely to get worse that it is to get better.

This is a fundamental conundrum for consumer goods companies with traditional business models and even the best of intentions: The more stuff they sell (and of course they want to sell more stuff), the more they pollute.

What P&G does matters, a lot. It’s an $80 billion company (annual revenues, for the year ended June 30). Its brands include Tide, Pampers, Crest, Gillette, Bounty, Cascade, Oral-B, Pepto Bismol, Ivory, etc.  It reaches 4 billion–4 billion!–consumers around the world and aims to reach 5 billion in the next five years. And like General Electric, P&G is an executive training machine; many ex-P&Gers (Meg Whitman, Steve Ballmer, Steve Case, many more) have gone on to do big things.

You can read a straightforward account of the P&G sustainability plan here at Greenbiz and a thoughtful (and favorable) analysis from my friend Joel Makower here. This is the latest iteration of P&G’s sustainability commitment, and the company has some meaningful accomplishments, as Joel reports. Just the past six months, P&G has:

introduced to the U.S. its Future Friendly campaign, born in Europe, a multi-brand and multi-platform effort to raise awareness about greener products and greener practices;

created a high-profile panel of sustainability experts to advise on its Future Friendly efforts;

launched a supplier scorecard to measure their environmental impacts;

reformulated a bestselling shampooto reduce toxins;

announced concentrated versions of powder laundry detergentsthat significantly reduce packaging and energy use; and

introduced sugarcane packaging to three of its shampoo and makeup brands.

Another good sign: P&G’s chairman and chief executive, Bob McDonald, joined a conference call with Len Sauers, P&G’s sustainability chief, to announce the new vision. Having the CEO put his stamp on the message tells everyone at P&G that sustainability matters to the company.

So why not cheer?

First, these are all visionary long-term goals. No target dates are attached to them.

Second, P&G has been slow to develop this vision–which is strikingly similar to the the one laid out by Walmart in 2005. Indeed, while comparisons are inevitably imperfect, my impression is that when you measure P&G against Walmart, the world’s biggest retailer, or GE, the world’s most admired industrial company, or IBM, whose Smart Planet work is path-breaking, P&G is moving more slowly and timidly than any of those iconic FORTUNE 500 firms. It’s also trailing innovative competitors like Method (See Revolution in the laundry room) and Seventh Generation. More evidence that P&G is following, not leading? P&G’s Tide, the market leader, trailed Unilever’s All in the race to shrink laundry detergent packaging.

Third, and most important, P&G is mostly talking about eco-efficiency, as Sauers, to his credit, acknowledges. To pick just one example, P&G’s interim goals for 2020 include a commitment to reduce “packaging by 20 percent per consumer use.” This won’t be easy, I’m sure, and it’s admirable. But….let’s assume that P&G grows by a not-unreasonable 25% over the next 10 years. The company will then be producing more packaging, not less, than it does today.

P&G also tends to measure its reductions of  greenhouse gas emissions and water usage on a per-unit, rather than absolute basis. Strictly from a business standpoint,  this makes sense because as the company buys and sells businesses, it needs a consistent metric against which to define progress. But, as I wrote back in 2008 at Fortune.com with respect to P&G (See Buy Toilet Paper, Save the Planet):

Relative efficiency doesn’t matter to the planet. What matters is how many tons of greenhouse gases are emitted, and most scientists say those numbers need to first stabilize and then go down, dramatically.

Like most companies, P&G is still wrestling with the challenge of how to grow revenues and limit its footprint at the same time.

Given that, let’s hope that P&G’s talent for innovation will be focused on making consumption more sustainable. This page on P&G’s website offers a few examples, some impressive, most not so. If P&G can persuade more consumers to use Tide Coldwater or, in Europe, Ariel Cool Clean, both of which eliminate the need to heat water for laundry, we’ll all be better off. Opportunities around sustainability also lie in emerging markets, from which much of P&G’s growth will come.

As Len Sauers told Joel & Greenbiz:

I have a firm belief that all issues of sustainability will be solved by innovation. And at P&G, one of our core strengths is innovation, so as we go down this path to tackle these issues that the world is facing, I believe it’ll be our innovative solutions that are very helpful there. I see this as business opportunity for the company.
At least P&G understands that eco-efficiency, by itself, will not get us where we need to go.