Green Doesn't Have To Be More Expensive

A stereotype has become associated with "green" that, while it is probably better quality, it's also more expensive.  I'm not sure how that stereotype got started, but like all stereotypes it paints with a broad brush and is ineffective at explaining reality.  And certainly as times change this myth has not kept up with reality.

Let me give you just two examples at the consumer level to illustrate the point:

• Water.  In 2004 (the latest year I could readily find figures), every man, woman and child in the US spent, on average, $217 on bottled water.  The vast majority of the US water supply is perfectly healthy to drink and in those areas where it is not, a simple water filter would suffice.  The "green" thing to do is to drink tap water from reusable plastic containers and it would save the average family more than they can expect to get from the recently passed stimulus bill.
  
  
• Heating.  As I recently heard someone elequently explain on the radio, "every house needs a sweater and a wind breaker."  The sweater is insulation to keep the heat in / cold out and the wind breaker is an air-tight seal.  Most houses are not very well sealed.  But small changes can make a big impact.  For example, installing $10 weather strips on the bottoms of exterior doors will have a payback of less than a month during a New England winter, for example.
  
  

The same thing is true for businesses as for consumers, probably even more so since companies have the ability to enforce self discipline that individuals need to struggle for.  The absolute lowest hanging fruit are changes to processes that are more efficient.  At almost no cost, some process changes can have a big impact.  For example, when UPS made a process change to reduce (or almost eliminate) left hand turns, they saved over 3 million gallons of fuel per year and reduced the need for 1,000 delivery trucks. Or, one of my favorites, is when a green builder made a process change which she enforced on all her contractors which was that, "if you make a whole in the building, you are responsible for sealing it."  Anyone who's been around construction knows that there are many subcontractors working (plumbers, electricians, masons, etc.) each doing "their job."  This small change to process results in dramatically better sealed buildings.

How Companies Use Blogs

I stumbled across this post on Viridus News today that lists 10 corporate blogs worth reading and it briefly talks about how each of the companies uses the medium. Now I confess I have not read the entirety of each blog but I ran a quick experiment that I would like to share here.

I did a quick Google site search for each blog on the frequency of which the word "profit" or the word "sustainability" showed up. Below is a chart of the results.



It seems there are basically three groups. The first (BofA, LinkedIN, Ebay and GM) ignore sustainability. The second group is Google, Amazon, Whole Foods and Cisco that take a balanced approach. And then the last group (McDonald's and Wal-Mart) that focus the vast majority of their discussion on sustainability (and pretty much ignore profits). By the way I tried the same test with "environment" vs "profit" and got the same results.

I would argue that the perceived leaders in sustainability are the 2nd group (the balanced folks). And in some ways Wal-Mart and McDonald's may be overcompensating.

What do you think? Does this jive with your experience?

Why I am a Pessoptimist

Somehow there has come to be the notion that one's outlook on the world is a permanent fixture, unchangeable. In reality, everyone's (or at least most of our's) outlook is influenced by the conditions around us. And for me, generally speaking, I'm an optimist. I can usually find the white lining in the worst of situations. But I have to confess that I am a short term pessimist on the economy and even the clean tech / corporate sustainability industry, while still remaining a long term optimist.

The global credit crisis is having severe impact on clean tech, for example, in the last month:

1. OptiSolar lays off 190 (or half) of its employees.
2. Day4 Energy lays off 95 (or one-third) of its employees.
3. GreenFuel lays off 20 (or half) of its staff.

The list goes on and there is no reason to think this trend will right itself in a matter of months, perhaps even 3-4 years as Bill Gates has predicted. A lot of people will find themselves in tough situations.

So why am I still a long term optimist? Many folks are comparing this current economic crisis to the Great Depression, but I point out that we even recovered from that one! People are resilient and don't give up dreams and hope easily. And more specific to clean tech / sustainability, I believe this is a 30+ year trend. When I started working in this industry in 1990, it was clear even then that it would be a growth industry.

Today, we can expect fully $100 billion of the stimulus package to be targeting green industries and projects. Don't get me wrong, a lot of that money will be wasted (but it's one of the better areas to waste money if you insist on doing so). Sustainability has become a part of our vocabulary in business as well as with consumers. And as recently as a few months ago, the US Conference of Mayors forecast 4.2 million green collar jobs will be created over the next 30 years (10% of the total during that period). The reasons for growth are compelling because the industry is at the nexus of economic, defense and environmental challenges the solutions to which will truly create lasting value.

When Sustainability Conflicts With Business

What do you do when sustainability conflicts with business objectives? No, I'm not talking about the costs of green initiatives and how to fund them in a bad economic environment. I'm talking about a more fundamental conflict.

A good example is Wal-Mart and their personal sustainability projects ("PSP") officially launched last year. PSPs are individual sustainability projects Wal-Mart employees commit to and are wide ranging including things like exercise, diet, carpooling, community service and, of course, corporate sustainability. All of the projects are voluntary and some of them Wal-Mart compensates for (e.g. $1500 to quit smoking). The New York times wrote last year about some of the PSPs and their impact. So here's the dilemma. What do you do if your PSP is to eat less meat and quit smoking, yet you are the buyer/category manager for tobacco or meat? Your personal goal is to use less, but your job is to sell more. Marc Gunther wrote about this conflict on GreenBiz.

These are interesting conflicts and addressing them head on and appropriately is important. Join the discussion on Viridus to learn more about this issue.