McDonald’s: Mainstreaming sustainability?

About 64 million people visit McDonald’s every day. That’s a stunning number. They’ll see changes in the year ahead, some driven by a renewed sustainability push at the $24-billion fast-food giant.

LED lights in new and renovated stores. “Greener” packaging. Eco-labels on fish sold in Europe.

None of this is earth-shattering or, more importantly, earth-saving, but it’s the start of something big, says Bob Langert, McDonald’s v.p. for sustainability.

“We’re on a path to mainstream sustainability,” Bob told me by phone the other day. “This is transformational for us. We want to be bolder, and we want to make a bigger impact.” Most important, he said, the company wants to embed sustainability into its operations and, eventually, into its brand.

Business-friendly environmentalists who work with McDonald’s–groups like the World Wildlife Fund, Conservation International and Environmental Defense Fund–will applaud any sign that the company is ready to integrate sustainability into its core business and dig deeper into its supply chain to find ways to raise beef and chicken that are better for the planet. Skeptics, and there are many, will call this greenwashing, or perhaps “farmwashing,” a term I hadn’t heard until yesterday when I saw this anti-McDonald’s posting in Grist.

In a way, McDonald’s is like Walmart–it’s never going to be beloved in the Whole Foods-shopping, arugula-eating, tony precincts of Berkeley, Brooklyn or Bethesda. But the company is much too big to ignore or wish away.

Today, McDonald’s released its 2011 Sustainability Scorecard. Under the umbrella of sustainability, the company includes environmental responsibility, its supply chain, nutrition and well-being, employees and community grants and programs, albeit in a way that highlights accomplishments and isn’t easily transparent. (Please let me know if you can find an accounting of the company’s carbon footprint or a greenhouse gas reduction goal, because I couldn’t.)  But McDonald’s can feel good about a couple of big initiatives in the year just past. [click to continue...]

Look who’s coming to Brainstorm Green

Next April, FORTUNE will again bring together some of the smartest people we know in sustainability for Brainstorm Green, the magazine’s annual conference on business and the environment.

This is will be our 5th Brainstorm Green–hard for me to believe, since I’ve been involved since the beginning–and we’ve again got a first-rate lineup of leaders from corporate America, the  environmental movement, the investment community and government, as well as a scattering of interesting writers, thinkers and doers about “green.”

Once again, the event will be held at the spectacular Ritz Carlton in Laguna Niguel, CA. Dates are April 16-18, 2012.

Alan Mulally

New faces for 2012 from the corporate world will include Alan Mulally, the president and CEO of Ford; Rob Walton, the chairman of Walmart; Andy Taylor, the chairman and CEO of Enteprise (they buy more cars than anyone in America); C. Larry Pope, the chairman and CEO of Smithfield Foods (they make more hot dogs than anyone in America, as I wrote in Smithfield Foods: Sustainable Pork?); Vance Bell, the chairman and CEO of Shaw Industries (the world’s largest carpet manufacturer, see my blogpost, This carpet has moral fiber); John Faraci, the chairman and CEO of International Paper; Gary Hirshberg, the CE-Yo of Stonyfield Farm; Russ Ford, the executive vice president of Shell; Bea Perez, the chief sustainability officer of Coca-Cola; and Trae Vassallo of Kleiner Perkins. [click to continue...]

What a long, strange trip it’s been for McDonald’s Bob Langert

Bob Langert worked in logistics for McDonald’s in the late 1980s when he was asked to take on a “temporary” six-month assignment to get chlorofluorocarbons out of the company’s clamshell packages.

Twenty years later, Bob has worked with WWF and Conservation International on marine stewardship and sustainable beef, spent a decade with Temple Grandin dealing with animal welfare issues, visited chicken farms and slaughterhouses, picked tomatoes with migrant workers in Florida, lectured on sustainability in China and taken a nine-day raft trip down the Amazon River with his pals at Greenpeace.

“I never, ever imagined this,” Bob said. “To have the good fortune to do this work, and make a difference in the world is beyond my expectations.”

I interviewed Bob, who is vice president for corporate social responsibility, at McDonald’s, today at the State of Green Business Forum in Chicago. We talked about what he’d learned about working with NGOs, his accomplishments, frustrations and whether selling hamburgers can be “green.”

Here are a few highlights:

A pioneering partnership: Langert’s work with packaging led to a partnership with the Environmental Defense Fund, which ruffled feathers in the corporate world and the environmental community.

“Fred Krupp [EDF’s chief] was a visionary back then,” Bob said. “It was not politically correct to work with big companies.”

EDF’s crew did a shift working in a McDonald’s, and proceeded to help with dozens of initiatives—from trimming the size of straws to using recycled paper in napkins.

Recalled Bob: “We didn’t spend one penny more. We saved millions and millions of pounds of packaging and costs.”

The future of fish: McDonald’s joined with the WWF to develop guidelines for the companies that supply its fish. What’s the business case, I asked, for investing corporate time and money in sustainable fisheries?

“Assured supply,” Langert replied. “The guy in charge of buying fish for McDonald’s, he was really concerned with being able to buy fish 10 or 20 years from now….The No. 1 job of everyone in supply chain at McDonald’s is to make sure we have stuff on the menu tomorrow.”

This kind of long-term thinking—so rare in big public companies—is a key to sustainability.

Picking tomatoes: When McDonald’s was urged to support efforts by migrant workers in Florida to win better wages, Langert worked side by side with the pickers. “ I couldn’t keep up with people half my size,” he remembered. “Females doing the work all day long in the sun and you see the living conditions which are not good at all.” Just last month,  the workers hashed out an agreement that should bring them higher pay.

Bears and the Amazon: When Greenpeace protesters dressed as chickens picketed a McDonald’s in London, accusing the company of destroying the Amazon, Langert’s first job was to calm down his colleagues.

He recalled saying: “Let’s not get all in a tizzy about their tactics. Greenpeace doesn’t have an advertising budget, so they had to use McDonald’s to get the word out. Let’s look at the issue.” The allegation was that tropical forest was being cut down to grow soy to feed chickens in Europe that became McNuggets.

When he asked trusted partners at Conservation International and WWF about the charge, he decided Greenpeace had a point. He approached the group and, before long, McDonald’s, Greenpeace and big suppliers like Cargill had agreed to stop buying soy from deforested land.

The raft trip came later. “We spent nine days—four of us from McDonald’s, four of us from Greenpeace, to get the lay of the land. I gave up a Chicago Bears Superbowl game to go so that tells you where my passion is. Anyone who knows me knows that besides my family and my faith, it’s the Chicago Bears.”

Langert’s to-do list: He’d like to find new ways to engage consumers in McDonald’s sustainability work. The company serves about 64 million people a day.

He also wants to do more to reduce the environmental impact of the company’s 33,000 stores, most of which are  owned and operated by others. “Energy’s a big issue for us,” he said. New initiatives are on the way, he hinted.

The problem with burgers: Because beef has such a big environmental footprint, I asked Bob how he could reconcile the company’s desire to grow—and sell more beef—with its environmental ethic. I told him that my rabbi, Fred Dobb, has said that one of the easiest things people can do to help the planet is to eat less beef, and asked if McDonald’s would try to wean its customers away from Big Macs.

“I’d like to talk with your rabbi,” Bob replied. He acknowledged the beef production has a big footprint, but said that “at the end of the day, we’re going to give people what they want. We’re going to do it in a good, responsible, clean, safe way. We’ve tried veggie burgers. They hardly sell at all. The day we can sell 500 a week in a restaurant, they’ll be on our menu forever and ever. I don’t have angst. You’ve got to face the realities of the world. And the reality of the world is that people eat protein from livestock and meat. Nothing wrong with that from my moral compass. I respect others that have a different moral compass. It’s our job as a company to make things better, though. We’re starting on that path–working with WWF on sustainable beef. That’s the  next step.”

Certainly McDonald’s offers choices to those who would prefer to avoid beef. Hey, the company even gave out pedometers and yoga CDs a few years ago to encourage people to be more active. But…given the climate crisis and the obesity crisis, maybe the next step ought to be to encourage those 64 million customers to make choices that are healthier for themselves and for the planet.

Marriott’s Queen of Green

Does global warming worry the Marriott hotel chain? “We face tremendous risk from climate change,” Kathleen Matthews tells me. “Our hotels will be underwater, literally.”

If, like me, you are a Washingtonian, you know Kathleen. She was an evening news anchor at the local ABC affiliate for 15 years as well a community activist who served on the board of Catholic Charities and Suited for Change (which provides clothes for women moving from welfare to work), among other groups. She’s been married to Chris Matthews of Hardball fame since 1980. And since 2006, she has been an energetic and effective advocate for sustainability at Marriott International, where she is exec vp of global communications and community affairs.

Last week, Marriott invited its hotel guests to “green” their hotel stays by buying carbon offsets to protect rainforests in the Juma reserve in the state of Amazonas in Brazil. Marriott, in cooperation with nonprofit Conservation international, had previously agreed to donate $2 million to rainforest preservation in Amazonas. Protecting rainforests, as you probably know, is an important way to mitigate the threat of climate change because tropical forests remove lots of carbon dioxide from the atmosphere.

Marriott’s initiative is noteworthy for several reasons.. First, it’s part of a broad green push by the company. Second, it’s a great way to expose millions of people to the role of rainforests in preventing climate change. (I’m told that about half a million people are staying in a Marriott property on any given night.) Third, the company says that its s efforts will help attract so-called “green” meetings. Finally, the way Marriott announced its news speaks volumes about where the media business—and corporate PR—are going today.

As part of its overall environmental commitment, called Spirit to Preserve, Marriott has agreed to reduce its fuel and water consumption by 25 percent per room over the next 10 years, install solar power in as many as 40 hotels by 2017 and expand reuse and recycling programs. They are also greening their supply chain by buying key cards made of 50% recycled plastic (24 million a year!), replacing more than 100,000 pillows with new ones made from recycled bottles (let’s hope they are as soft as the old ones), eliminating cardboard from more than 2 million rolls of toilet paper a year, and buying Bic pens (47 million) made with recycled material. The company is also ramping up its development of LEED-certified hotels.

In other words, Marriott is getting its own house in order, or at least starting to—the essential first step to any corporate sustainability plan.

The new “green your stay” program invites guests who book on www.marriott.com to offset the carbon generated during their stay for as little as US$10, or US$1/day for 10 days. The cost to offset the carbon generated in a single night in a hotel is about $1, Matthews explains, but the $10 minimum contribution helps insure that the vast majority of the funds donated will go to rainforest preservation, rather than to administrative costs.

This program expands a relationship between Marriott and a nonprofit called the Amazonas Sustainable Foundation, which supports about 2,500 residents of the Juma area who help protect the forest from illegal logging and farming. Contributions help fund people and equipment to monitor the forest, as well as other community services, designed to provide an alternative livelihood for the Brazilian poor.

For now, the Marriott website is the primary means of recruiting guests to participate. But the company may well expand that to email blasts to members of its Marriott Rewards program, tent cards in the rooms or promos on the hotel TV sets. “It’s a big communications challenge,” Matthews said. “A lot of companies that have launched these offset programs in the past haven’t gotten huge traction.”

Speaking of communication, Marriott is using social media–often called Web 2.0–to spread the word about its new program. CEO Bill Marriott Jr. wrote about the program on his blog. There’s a video promoting the project on YouTube. Marriott has set up a twitter feed alerting people to its green initiatives. The company has posted photos on Flickr. And, of course, there’s lots of detail on Marriott’s own website.

“We’re going directly to the consumer, as opposed to trying to go through the media,” Matthews says. That’s smart, and it’s a strategy that both reflects and accelerates the decline of traditional media.

In fact, Matthews told me, there are times when she travels the world for Marriott when she feels like she never left her role as a local TV reporter and anchor. She reports stories, and does her standups. The only difference is, when reporting for Marriott, she’s got to do her hair and makeup by herself.

Biz and NGOs: too cozy?

Only a mindless anti-business zealot (and unfortunately there are still too many of those) would argue that environmental groups should not cooperate with big business when they have shared interests. Even activist groups like Rainforest Action Network and Greenpeace work closely with big companies like Citigroup and Coca-Cola, to help them make their operations more efficient or their strategy more environmentally friendly.

But there’s lots of debate about whether NGOs should accept money from their corporate partners. Does it compromise their independence? Threaten their credibility? Or enable them to bring in more money, and therefore have a bigger impact? That’s the topic of today’s Sustainability column.

By coincidence, I spent the day at the Net Impact conference in Philadelphia where corporate-NGO partnerships were one topic on the agenda. (Net Impact is an organization of business students and young business people who are committed to using business to make the world a better place. Some 2,400 people attended the very impressive event at Wharton.) I moderated a conversation about a corporate-NGO alliance with John Brock, CEO of Coca-Cola Enterprises and Carter Roberts, CEO of the World Wildlife Fund, and then listened to another where Ken Mehlman of private-equity firm KKR and Elizabeth Seeger of Environmental Defense Fund talked about their work together. CCE’s Brock and KKR’s Mehlman both said their firms got real value out of the partnerships—in terms of advice on how to better manage their operations, and from the public-relations value of the association with a green group. ”If we’re going to save the plant, we’re going to do it by making a profit,” says Mehlman. “That is the only way tit will be truly sustainable.” (When private equity firms, which are notoriously unsentimental, get serious about “going green,’ then you know the business case has become truly compelling.)

Interestingly, CCE and its sister company, Coca Cola, pay the WWF for its advice, and make donations to the group to help restore rivers and streams. But no money changes hands between KKR and EDF.

There are good arguments for both models, and you can read them in the column. My belief is that the NGOs, at a minimum, need to be transparent about their dealings with business. That is, they need to disclose how much money they are taking from their corporate partner over what period of time, and what services they are providing in return. One controversial partnership, a deal between the Sierra Club and Clorox, fails to meet this test. Here’s how the column begins:

Some environmentalists attack bottled water. Not Conservation International, a Virginia-based nonprofit that aims to protect the earth’s biodiversity.

When Fiji Water announced a sustainability initiative last spring to help protect forests on the remote Pacific Island of Fiji, Conservation International Peter Seligmann praised the move.

“We applaud Fiji Water for offsetting the climate impact of its products, reducing the impact of its operations, and funding crucial conservation efforts that support local communities and protect some of the last remaining forests in the South Pacific,” he said in a Fiji Water press release.

The endorsement didn’t surprise anyone who understands the relationships between Fiji Water and Conservation International. The privately-owned bottled water company pays Conservation International – neither party would say how much – to finance the work they do together. Stewart Resnick, who owns Fiji Water with his wife, Lynda, sits on Conservation International’s board and donates to the group.

Such cozy arrangements are increasingly common as big companies work side-by-side with big NGOs (non-government organizations). Clorox secured the endorsement of the Sierra Club – and the use of its logo — for a line of eco-friendly cleaning products, called GreenWorks that the company introduced late last year. Neither will disclose how much cash is involved.

You can read the rest here.

Who’s watching the watchdogs?

Public interest groups need more scrutiny. So a forthcoming book called Green Inc: An Environmental Insider Reveals How a Good Cause Has Gone Bad (Lyons Press) by a journalist and activist named Christine MacDonald piqued my interest. MacDonald argues that big green environmental groups – specifically Conservation International (where she worked briefly), The Nature Conservancy and the World Wildlife Fund — have become too cozy with corporate America.

The big conservation groups are “deforming themselves,” engaging in “questionable practices” and cultivating “unsavory corporate ties,” she writes. They are conflicted because they take corporate money. They are too quick to provide cover for bad actors:

Groups that once dedicated themselves solely to saving pandas and parklands today compete for the favors of mining operations that remove entire mountaintops, logging and paper companies that clear-cut old growth forests, and homebuilders who contribute to urban sprawl. They rely on funds from cruise ship companies, despite the industry’s record for polluting the oceans. Among the most generous donors are the biggest environmental scofflaws of all: energy companies.

It’s an explosive charge—but MacDonald fails to prove it. The book is spotty, uneven and ultimately disappointing, for the most part lacking the specifics that would show how conservation groups either enabled or covered up bad corporate behavior. But Green Inc. does raise provocative questions about the business models of some of America’s most important green groups.

MacDonald’s basic point—that conservation groups work closely with polluters—is both true and unremarkable. No one would expect the pastor of a church to close its doors to sinners; why, then, should we ask environmental groups to refuse to work with oil companies, mining companies, home builders or giant retailers like Wal-Mart. (McDonald, as it happens, also uses religious language to make her case, writing at one point that CI and others are “guilty of making deals with the devils of deforestation, habitat destruction, and global warming.”) Hey, people rob banks because that’s where the money is. Environmentalists need to get their hands dirty and deal with polluters.

It’s important to understand the role that CI, TNC and WWF play in the NGO ecosystem. They are collaborators, not activist groups. Other green NGOs are activists, and many are both essential and effective—the Rainforest Action Network, Greenpeace, Forest Ethics and Earthworks, to name just a few. But after they raise a ruckus, big companies frequently turn to groups like CI, TNC and WWF for guidance and help in making those pesky activists go away. (You can almost think of the Rainforest Action Network as the business development arm of CI.) Other NGOs like the Environmental Defense Fund and the Natural Resources Defense Council juggle both roles—they are sometime allies, sometime critics of corporate behavior. They’ll sue a company one day, then make nice the next. Hey, the world’s a complicated place.

The key question is, what impact do the collaborative groups have after they engage? I’ve spent a lot of time looking at work done by Conservation International (with Wal-Mart, Starbucks, McDonald’s and Marriott), less with World Wildlife Fund (mostly with Coca-Cola) and none with The Nature Conservancy. My strong belief—informed by reporting—is that they do a lot more good than harm. CI helped guide Wal-Mart through its ambitious and impressive sustainability drive. (By coincidence, I was on a reporting trip today with people from both Wal-Mart and CI who are working together to clean up a big, polluting industry. More to come…) WWF is doing superb work around water and supply chain with Coke, and Jason Clay, who works there (and who I wrote a column about last month), is an important thinker around the question of how to make agriculture more sustainable

Having said that—MacDonald tells a couple of stories that I’d like to know more about. She writes about CI’s work with Bunge in Brazil, saying that CI has allied itself with the company and against local groups protesting deforestation for soy. She accuses an alliance of companies, NGOs and governments called the Business and Biodiversity Offset Program of helping a mining consortium develop valuable forests in Madagascar. LI’d like to know more—so anyone who has insight into these projects, please email me.

I’ve also come away from this book wondering whether CI, WWF and TNC pull their punches because they don’t want to offend corporate donors. I think these groups and others need to be more transparent about their funding sources, particularly since they ask the public for money. They say they don’t depend on corporate donations or fees. (CI’s Glenn Prickett tells me that less than 10% of their funds come from corporate contributions.) But that accounting does not include donations from corporate executives acting as individuals or family foundations. MacDonald writes that CI got $21 million from the Walton Family Foundation (founding family of Wal-Mart) in 2005, representing nearly a quarter of its revenues that year. I wonder about CI’s partnership with Fiji Water, especially since one of the company’s owner sits on the CI board. (Shouldn’t a conservation group discourage consumption of bottled water?) MacDonald also writes that TNC received “hundreds of thousands of dollars in Shell donations” before giving the company a leadership award. If true, that’s yucky.

Here’s a thought: Whenever an NGO produces a press release praising a company, or announcing a partnership, or giving an award, maybe it should disclose how much money it has been paid by the company for consulting and how much money executives, company founders and their foundations have donated.

You might argue that it would be simpler for these groups to refuse all corporate money. I disagree. They provide valuable advice and expertise to companies; there’s no reason that individual or foundation donors should foot the bill when CI helps Starbucks develop a program for rewarding coffee growers who embrace sustainable practices or WWF helps the sugar industry develop more sustainable growing practices.

But more transparency would help. To that end, I will ask CI how much money it has taken in from Fiji Water and WWF how much it has gotten from Coke. (In the interests of transparency, you should know that CI is a programming partner of Fortune’s Brainstorm: Green, a conference on business and the environment that I chair; my wife works for Greenpeace; occasionally I am paid for giving speeches and moderating panels but if the client is a public company, I give the money away; and my daughter’s a summer intern at Edelman, a PR firm with a big sustainability practice. I try to set all that aside when I write.)

Your thoughts?