SC Johnson

Will American consumers ever go “green”?

April 5, 2011

It’s been another action-packed day at FORTUNE’s Brainstorm Green conference on business and the environment. Lively conversation about the future of coal (it’s not going away), sustainable seafood (about which more another day), geoengineering and marketing to the green consumer.

The “green consumer” panel featured SC Johnson’s CEO H. Fisk Johnson, Steve Wenc of UL Environment and marketing guru Suzanne Shelton. It was moderated by my friend and colleague Joel Makower, the founder and editor-in-chief of GreenBiz. They all agreed that much of corporate America has moved ahead of its customers when it comes to embracing green products.

Wait, it gets worse: Joel and Suzanne argued that consumers fool themselves about their green behavior. They buy a CFL bulb or green cleaning product or perhaps a Prius and then decide they’ve done their part for the planet. They tell pollsters that they consider sustainability factors in their purchasing decisions and describe themselves as “conscious consumers” but the reality is quite different. They’re greenwashing their own behavior, Joel noted.

Is this bottle necessary?

Fisk told a story that illustrates this sometimes-depressing reality. [click to continue…]

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How to “green” a plastic bag

January 31, 2011

You’ve heard of “carbon offsets”?

Get ready for “garbage offsets.”

In an effort to make its Ziploc plastic bags as environmentally friendly as possible, consumer-products company SC Johnson has joined forces with RecycleBank to keep more than 100 million pounds of waste out of landfills during the next two years. [click to continue…]

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Glimpsing the future at Net Impact 2010

October 30, 2010

My favorite conference is Net Impact’s annual gathering, mostly because of the crowd—this weekend, about 2,500 people, most of them MBA students, undergrads and young professionals, gathered at University of Michigan’s Ross School of Business in Ann Arbor. These fare the smart, passionate and committed business leaders of tomorrow. I’m proud to be on the board of Net Impact, a nonprofit that helps its members harness the power of business for the greater good.

So much programming is crammed into the two-day event that it can’t be captured in a single blogpost or experienced by anyone, because dozens of sessions on different topics unfold simultaneously. But here are a few highlights:

What’s the future of recycling? It’s an unhappy fact that recycling rates haven’t moved up much since Earth Day. Yes, the original Earth Day, back in 1990. But innovative companies like TerraCycle, RecycleBank and Waste Management–yes, Waste Management, through a subsidiary called Greenopolis–are experimenting with clever and promising new ways to move the needle, by rewarding consumers for recycling.

I first wrote about RecycleBank in 2007. [See Turning trash into cash at Fortune.com] The company measures homeowners’ curbside recycling, and then rewards those who recycle with points that can be redeemed for stuff at more than 1,500 companies. “The idea of consumer behavior change is at the heart of our business,” said Ian Yolles, the chief marketing officer at RecycleBank, who previously worked at Nike and The Body Shop. The company is growing–it now operates in more than 300 communities in 26 states — and its investors include Coca-Cola,  venture capitalists Kleiner Perkins and Generation Investment Management (the fund led by Al Gore and ex-Goldman partner David Blood). RecycleBank generates most its revenues by saving municipalities money (lower tipping fees, higher revenue streams from recycling) and taking a share of the savings. [click to continue…]

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An “iPod” for the global poor

October 10, 2010

While we Americans  plug an ever-increasing number of gadgets into the wall, about 1.5 billion people in the world, most in sub Saharan Africa and south Asia, live without access to electricity, according to the International Energy Agency. It will take years, perhaps decades, to get electricity to all of them, so in the meantime a small London-based NGO called Lifeline Energy with big ambitions is rolling out new products called the Lifeplayer and Prime Radio.

Both operate off the grid. Powered by solar energy and/or a hand crank, the Lifeplayer is a multi-band radio, an MP3 player and a cell-phone charger that can be used to deliver information and education to the rural poor, farmers, teachers, government workers. Prime Radio is a simpler and less expensive radio, which is equipped with an LED flashlight as well. Both have powerful speakers and are designed for group listening.

Recently, I met with Kristine Pearson, the co-founder and CEO of Lifeline Energy, to talk about the group’s work, and especially its efforts to find support from  global corporations.

Lifeline is working with specialty coffee growers and an Wisconsin-based importer named Peter Kettler to get the radios to coffee farmers in Rwanda, who get timely market information as well as programming about agricultural practices. It recently worked out a similar arrangement with the SC Johnson Co. to provide radios to pyrethrum farmers, also in Rwanda. SC Johnson has been working with U.S. AID to help farmers improve their methods of collecting, drying and shipping pyrethrum, a natural insecticide used in such SC Johnson products as Raid.

The idea is to get the radios into the villages, and then give women and children an opportunity to use them, Pearson told me. “Culturally, radio has been a man’s preserve,” she said. Now, she says, “there are literally millions of children in Africa getting a high quality basic education from radio…I think of the Lifeplayer as an iPod for development.”

An American who spent three months traveling in Africa back in 1986, Pearson moved to South Africa soon after; today she lives in Cape Town, Johannesburg and London. “I’m an African American,” she jokes. She started Lifeline Energy (formerly known as the Freeplay Foundation) in 1999. Since then, Lifeline has distributed more than 215,000 radios since then, reaching anywhere from 20 to 250 listeners per radio. The group is currently distributing Lifeline radios in Haiti.

Lifeline has made friends in Hollywood, notably Tom Hanks, who was the prime funder behind the research and development of the Lifeplayer and Lifelights, which are LED flashlights powered by solar energy or wind-up technology. Hanks  has worked with the group since 2003, talking about its products on television, auctioning them on eBay and appearing in a YouTube video. The NGO has also received donations from foundations, Rotary clubs, the World Bank and individuals.

Even so, its current budget is less than $2 million a year,  Pearson told me. The Prime radio costs about $38 out of the factory, before shipping, and the Lifeplayer costs about $80. They are given to recipients, not sold, but in exchange people have to commit to maintaining and managing the radio and participating in follow up surveys. “There are lots of strings attached,” Pearson said. “They’re just not financial.”

The challenge for Lifeline Energy is getting to scale. Donations are will always be scarce. Business-oriented projects like the ones with SC Johnson and the coffee growers, where the companies gain by getting radios out to farmers in their supply chain, stand a better chance of getting the radios into the hands of a lot more people who can use them.

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Ten “green” brands, and the rest of the story

June 9, 2010

You probably would not think of corporate giants Clorox and Colgate-Palmolive as “green” companies. But they own two of  top 10 “green” brands, at least in the eyes of consumers, according to new global survey of consumer perceptions by WPP, the giant marketing and communications firm.

Burts-BeesTopping the list of U.S. brands is Burt’s Bees, which is a unit of Clorox–a fact that isn’t exactly trumpeted on Burt Bee’s extensive website. Instead, the company tells the story of how Roxanne Quinby started the company in rural Maine by making candles out of Burt Shavitz’s beeswax, after which they fell in love and moved into an abandoned schoolhouse to make more. Her folksy little essay concludes: “The honey and candles are gone, the kids are grown, our friend sold the schoolhouse and now it’s a tattoo parlor, and Burt bought a classic motorcycle with his earnings, but otherwise everything’s pretty much the same here at Burt’s Bees.” Well, yes, everything’s pretty much the same except that Burt and Roxanne split, she sold to 80% of the company to a private equity firm, which then sold it to Clorox, best known for its bleach, for $913 million in 2007.

tom's of maineTom’s of Maine is No. 3 on the list. (Maine is obviously a green state, in the eyes of consumers.) Its marketing, too, features homey images from the company’s early years and talks about “putting the good of community and planet first.” Its toothpastes, mouthwashes, soaps and deodorants are all natural (no aluminum in the deodorant) and use environmentally-friendly packaging. Meriting only the briefest mention is the fact that the family-owned firm was sold in 2006 to Colgate-Palmolive, which makes Ajax and Speed Stick, a deodorants whose active ingredient is aluminum ziconoium tetrachlorhydex. (So is aluminum in deodorant a good or bad thing? Who knows?) Tom’s co-founders Tom and Kate Chappell, meanwhile, have moved on to a new company called Rambler’s Way which makes “superfine, sustainable, American worsted wool apparel.” [click to continue…]

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America’s 10 greenest brands?

September 28, 2009

What are the “greenest” brands in the U.S.? Until we can define “green,” there’s no meaningful way to answer that question. Of course, that doesn’t stop people from having, and expressing, opinions.

Last summer, a group of agencies owned by the giant marketing and communications company WPP – the PR firm Cohn & Wolfe, branding experts Landor Associates and pollster-consultants Penn, Schoen & Berland Associates (PSB) – joined with Esty Environmental Partners, a consulting firm run by Yale prof and author Dan Esty, to survey about 5,000 consumers around the world about green products, companies and brands. This Friday,  the agencies will host a lunch in New York where I’ll moderate a panel (see below) to talk about the survey, called Green Brands, Global Insights.

The survey produced all sorts of interesting results—would you believe that 38 percent of consumers in Brazil are willing to spent 30 percent or more for green products?—but what jumped out at me was the list of the U.S.’s greenest brands. Here goes.gw_logo

images-11. Clorox Green Works

2. Burt’s Bees

3. Tom’s of Maine

4. SC Johnson

5. Toyota

6. P&G

7. Wal-Martimages

8. Ikea

9. Disney

10.  Dove

To which I can only say: I would never, ever have predicted that list. [click to continue…]

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The evolution of laundry detergent

May 19, 2009

“People are very entrenched in the way they do their laundry,” says Adam Lowry, the co-founder and chief “greenskeeper” at Method. And that’s a problem, as we’ll explain in a moment.

Method is an eight-year-old company that makes “environmentally-friendly cleaning products that are safe for every home and every body.” Started in a San Francisco bachelor pad by Lowry—a former climate scientist!—and his friend Eric Ryan, privately-held Method now has more than $100 million in annual revenues, about 100 employees and a good deal of buzz for its style as well as its green products. Although Method was the first company certified as a Cradle to Cradle company in the U.S., it’s probably better known for its packaging aesthetic than for its commitment to sustainability.

methodimages

“If your brand position is, hey, we’re the green alternative to the toxic stuff, and everyone else offers green products, you’re no longer differentiated,” Lowry says. “It’s also not very interesting.”

“We’re trying to create broad appeal, way beyond the green consumer, for products that have ‘green’ as one of their qualities,” he says. “There have been far to many green things that have been designed to be green, and they suck.”

Lowry spoke today at the Greener By Design conference in San Francisco, hosted by my friend Joel Makower and run by Greener World Media. (I’m a senior writer at Greenbiz.com, a GWM media property.) He’s an interesting guy—34, with a chemical engineering degree from Stanford, who worked for the Carnegie Institution before starting Method.

Method is at the forefront of changes sweeping the home cleaning business. (No pun intended.) Premium brands like Method, Seventh Generation and Restore are growing. The big players in the industry, meanwhile, are introducing green brands, like Clorox’s Greenworks and SC Johnson’s Nature’s Source. All tend to talk about themselves as plant-based, biodegradable, natural, non-toxic, chlorine-free and the like. I confess, I can’t even begin to sort out the competing green claims.

Method, though, was the first cleaning company to introduce a triple-concentrated laundry detergent back in 2004. That was a simple and very good idea—it reduced packaging, appealed to retailers because it saved shelf space and shipping costs and was easier for consumers to shlep home. At first consumers balked—they weren’t sure they were getting enough detergent for their money—but with a big push from Unilever, which introduced a product called Small & Mighty All, and an even bigger push from Wal-Mart, the idea caught on. Now most laundry detergents are compacted.

“We thrive by making the market change and getting our competitors to follow our innovations,” Lowry says. “You now can’t buy at Wal-Mart or Target a non-concentrated laundry detergent.”

Even so, there’s lots of waste in the laundry biz. Most customers fill the cap on the bottle to the brim. More is better, they figure. Lowry says Method would like to find a way to get people to use only the detergent they need, and to deliver it with less packaging.

“We have a quandary.” Lowry says. “We make a lot of plastic bottles. I’d rather make a refill system.”

If consumers were willing to bring their empty containers back to the store and refill them, they could eliminate the packaging associated with each purchase and, presumably, save money. Restore is trying out a refill system for its products in cooperation with Whole Foods Markets in the Midwest. (Here’s a link to the Restore website that explains how it works.)

The problem is, it’s inconvenient. “If you don’t bring consumers along with you, the most wonderful innovation is useless,” Lowry says. Plus have you ever seen how much coffee is spilled on the floor in supermarkets where people grind the beans themselves? The aisles could get pretty sticky once people start dispensing laundry detergent.

Method is working on the next big idea in laundry detergent, Lowry tells me, but he won’t say much more than that. “It will bring fundamental change to the category,” he says. He will say that when he thinks about the future of laundry detergent – and it’s a good thing someone is – he sees an evolution from plastic bottles to a refill model to a subscription model to a service model.

“We want to get paid for cleaning people’s clothes, not for selling liquid. The business model has to change,” he said.

No, I don’t know what he’s talking about either, but one can envision a smart washing machine that would dispense exactly the right amount of detergent and no more, then clean your clothes, separate the rinse water from the detergent and the dirt, and then  recycle the water and detergent and do it all over again. A closed-loop system, if you will.

“When I think about Method in the future,” Lowry sats, “I want to be able to revolutionize every product category in which we compete.” Continuous improvement is the name of the game. Method is worth watching. And it’s clearly about a lot more than pretty bottles.

photo4

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SC Johnson: Coming clean

March 15, 2009

As a runner, I’m a fan of GU energy gels, including a flavor called “Tri-Berry.” The ingredients include many things…

MALTODEXTRIN (GLUCOSE POLYMERS), FILTERED WATER, FRUCTOSE, GU AMINO ACID BLEND (LEUCINE, VALINE, ISOLEUCINE, HISTIDINE), NATURAL AND ARTIFICIAL BERRY FLAVOR, POTASSIUM AND SODIUM CITRATE, GU ANTIOXIDANT BLEND (NATURAL VITAMIN E AND VITAMIN C), CALCIUM CARBONATE, FUMARIC ACID, SEA SALT, SODIUM BENZOATE, POTASSIUM SORBATE, GU HERBAL BLEND [CHAMOMILE, COLA NUT (HAS CAFFEINE), GINGER], CITRIC ACID, PECTIN

…but only a passing reference to berries. Tri-Berry, indeed.

What’s inside the stuff we buy? Even when it comes to food, it’s hard to know. (Fumaric acid? Cola nut?) As for other things—including the household products that we breathe and touch, like cleaners and air fresheners, the ingredients are usually a mystery.

SC Johnson Co., the $8-billion a year, privately held company that makes Windex, Glade, Shout, Off!, Pledge, Raid and Ziploc-branded product for the home, is going to change all that in a big way.

Last week, SCJ made a couple of announcements that are likely to shake up the home cleaning industry.

First, the company says it will disclose the ingredient in all of its home cleaning and air care products. This includes products with fragrances—which, up to now, have been closely held secrets because the fragrance industry had argued that it needs to protect confidential business information.

Second, SCJ says it has told its fragrance suppliers to stop using a controversial category of chemicals known as phthalates. Right now, SCJ cleaning and air freshener products include a phthalate called DEP.

Let’s take these one at a time, because each is interesting in its own way. (That’s also why this post is longer than usual…)

The disclosure issue, which has been roiling the household products industry, leapfrogs SCJ over its biggest mainstream competitors. (Seventh Generation, a smaller company that makes natural household products, has led the way on disclosure issues for years, driven by its pioneering CEO, Jeff Hollender.) While the home products industry has adopted a right-to-know initiative that calls for household product firms to list ingredients on either a label, or a website, or an 800 number, SCJ says it will make its information available in all of those ways. You can checkout the website at www.whatsinsidescjohnon.com.

More important, SCJ will  list all of its ingredients—an unprecedented move. By contrast, the industry-wide plan makes an exception for a category called “Fragrances, dyes and preservatives,” again, because of the concern about business secrets.

Kelly Semrau, who is vice president for global public affairs at SCJ, told me last week that the company had come up with an ingenious solution to the fragrance industry’s resistance: Instead of listing ingredients specific to each product, the company will publish a comprehensive list of all of its fragrance ingredients so consumers know what could be potentially included in the products they buy.

A “palate approach,” she calls it: “We’re rather put all the ingredients up there, and begin a dialog with stakeholders, than have it be a black box.”

In a company press release, Erin Thompson Switalski of an environmental health group called Women’s Voices for the Earth is quoted as saying: “SC Johnson just raised the bar for the entire cleaning products industry.”

The phthalate decision will also increase pressure on competitors to follow suit.

Several advocacy groups–notably the Environmental Working Group—have been campaigning against phthalates with scary newspapers ads and websites like www.nottoopretty.org. that point fingers at brands like Arrid Extra Dry and Poison perfrume (“For baby, it could really be poison”) and Arrid Extra Dry.

The FDA and European regulators have approved the use of phthalates, the chemical industry says they are safe—and so, apparently, does SC Johnson. But Fisk Johnson, the company’s chairman and CEO, asked his scientists whether they could reformulate their products to eliminate phthalates.

“IF we can make our products just as good, and without the phthalates, why wouldn’t we do this?” Semrau told me. “That was the question that Fisk put on the table.”

There’s a risk, of course, of allowing scare campaigns to drive business decisions. (I’ve written about this problem when it comes to BPA and baby bottles. See Wal-Mart: The New FDA. ) Neither the media nor retailers nor ordinary consumers are trained to assess scientific research. But until we can rely on an aggressive and independent FDA and EPA to police the products we use—they have failed in the past to meet that standard–it makes sense for companies like SC Johnson to both be cautious and to stay ahead of consumer sentiment.

“We cannot walk away from science. Science should drive public policy,” Semrau says. “But when you are a consumer products manufacturer, you have to listen to consumers.”

Frances Beinecke, the president of the Natural Resources Defense Council, wrote on the NRDC blog: “What is promising to me is that SC Johnson has made this move voluntarily, after NRDC raised the issue of phthalates in air fresheners last year… The company’s response is a testament to the power of consumers to make a difference.”

I emailed Rich Liroff, the executive director of the Investor Environmental Health Network, who knows more about these issues than anyone I know, to ask him what he thought of the SCJ decision. He replied:

this represents a precautionary business judgment by SCJ that even though they believe that regulators’ judgments are on their side in terms of continued use of phthalates, the better competitive position to adopt is to side with their consumers lacking faith in regulators’ judgment and to make a focused effort with their supply chain to eliminate chemicals of concern. So rather than taking the position so many other companies have taken—“the regulators say our products and chemicals are safe” or “we are in compliance with all applicable rules and regulations”—SCJ is acknowledging that such positions are no longer adequate for consumer-facing manufacturers and retailers.

Two final thoughts. First, this issue isn’t going away. Just last week, Rich told me, a group called the Campaign for Safe Cosmetics released a report showing that that toiletry products for children contain formaldehyde. And The Walt Disney Co. released a healthy cleaning policy saying that it would take a “precautionary” approach to reducing its chemical use.

Finally, anyone who knows SC Johnson and Fisk Johnson won’t be surprised see them leading the way on an environmental issue. Back in the 1970s, SCJ took CFCs out of their products before they were banned. And at last year’s Brainstorm Green conference about business and the environment), Fisk spoke eloquently about how the company has been trying to avoid using coal-fired electricity in its manufacturing plants, turning instead to methane from a nearby landfill and wind power. I’m really pleased that Fisk will speaking again this year at Brainstorm Green.

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