Cuppa Joe? Many of us love our morning coffee (“the Joe”), but we should think more about growers at the source…

Ah, that morning coffee — so delicious for many of us.  The products of the “coffee belt,” encircling the globe just north and south of the Equator, are made from a valuable commodity — the coffee bean. Harvesting those is a US$100 billion annual commodity, writer Jodyn Cormier tells us on the Care2 web platform, second only to the value of the oil market.  And yet…she writes that the average coffee farmer gets $1,000 per season for his/her work.

That, Cormier concludes, makes coffee an industry that is inherently unbalanced and unfair.  And then the writer focuses on Vega Coffee (Nicaragua), a “subscription-based” coffee company that helps farmers pick, process, package, and ship quality beans direct to customers.  The customer gets the coffee within 5 days of roasting, “direct from farmers’ hands to theirs.”

The company’s founder explains how this differs from many parts of the traditional value chain in reaching developed nation coffee consumers:  The family farmer typically sells beans to a cooperative, which sells to another or larger cooperative, and then it’s to an exporter, then to a roaster (the importer), then to a coffee distributor, and on to a roaster wanting Nicaraguan coffee…and then through middlemen to retail outlets…to customer.

The Vega firm has a roastery in Nicaragua, and local farmers are involved in the roasting process, packaging the goods for export to the USA (every two weeks).  Farmer-to-roastery-to shipment to US customer.  And women are encouraged to get involved in the usually male-dominated cultivation activities.

And what about climate change?  The views from the coffee belt in Nicaragua are shared in the top story (below) as well as many other fascinating views.  Conclusion:  Vega believes people (read: we coffee consumers) should not have to trade quality for sustainability.  And they are showing how it can be done.

Author Jordyn Cormier is a Boston-based freelance writer and “avid outdoors woman.” The Care2 web platform is known for its “member petitions” resources, such as saving the rainforest and protesting President Trump’s offshore oil drilling agenda.

Should You Have to Choose Between Good Coffee and Sustainability?
(Monday – April 17, 2017)
Source: Care 2 – Coffee as a commodity is worth $100 billion worldwide—second only to oil. And yet, the average coffee farmer makes a paltry $1000 per season (which is about $3/day), and that’s without taking into consideration drought or disease…

Hiring? Most Likely The Newbies Will Be Millennials — Is Your Workplace Ready — Is Your Company a Sustainability Standout?

The Millennial Generation — that’s men and women born in the years 1982 to 2004 (according to researchers Neil Howe and William Strauss).  This generation’s members are ages 17 to 35, and now said to be outnumbering the previously dominant cohort of the Baby Boomers in the workplace (BBers were born 1946-1964, some 77 million in all).

Consumer product marketers of course want to know what the Millennials value, what they are interested in, what information they need, what motivates to shop and buy.  And just as important and maybe more:  employers want to know more about the Millennials as they recruit them and bring them into their corporate culture. And keep them there!
One of the more long-lasting, familiar brands in Corporate America is Rubbermaid Commercial Products (RCP).  The company commissioned a report by Lightspeed to determine the attitude of Millennials and the relationship of corporate and brand values and corporate sustainability to them, in terms of recruitment — and workforce retention.

The resulting report:  Recycling in the Workplace: A Millennial View.  One important conclusion of the study:  To attract and maintain new employees, companies will be required to surpass the status quo and get serious about putting sustainability strategies into action. 90% of the generation, the authors concluded, identified sustainability as a crucial consideration when making career moves.

Sustainable Brands published highlights of the study — see our Top Story for more details.

And — if you have recruited members of the Millennial Generation, point them towards the Governance & Accountability Institute education courses to help them get up to speed quickly on sustainability, corporate responsibility, sustainable investing and related topics.  There’s more information on these offerings here:  http://www.ga-institute.com/training.html

Top Stories This Week…

New Study Cites Sustainability as Top Priority for Millennial Workforce
(Tuesday – April 11, 2017)
Source: Sustainable Brands – According to a new study by research body Lightspeed on behalf of Rubbermaid Commercial Products (RCP), a brand’s commitment to sustainability — or lack thereof — is an important concern for millennials and one which will…

And there is much more information of value in the Wikipedia definitions of Millennials and other generations (Gen X, Gen Y, BBers, and more):
https://en.wikipedia.org/wiki/Millennials

Corporate Responsibility – Sustainability – Citizenship: Is It In Jeopardy in the Trump-ian Years? Don’t Think So!

by Hank Boerner – Chair & Chief Strategist – G&A Institute
April 17, 2017

The mid-1960s….the time of the wonderful beginnings of the modern era of Corporate Social Responsibility. Corporate Citizenship.  And then large corporations began backing off their prior commitments as new administrations came to power in Washington.

The relationship of large corporations to the general society (i.e., the rest of us) has long been of interest to me. My career has been an exciting journey through up and down cycles of clear demonstration of corporate social responsibility, corporate citizenship, environmental responsibility, by large corporations…and at times, and at times, a clear lack thereof.

The news has mostly been very positive for the past two decades about CSR and sustainability — and corporate citizenship. Will this continue in the months and years ahead?

This of course is a question on the minds of some as the Trump Administration and the Congress continue to at least verbally assault the New Era of Enlightenment of the corporate sector.

Corporate-Society relations — this is something I closely monitor and am involved with daily in our Governance & Accountability Institute work, of course. And the progress made, or at times lack of progress, is a subject area that I have often commented on in my writings over the years since the 1960s.

* * * * * * *

Consider:  U.S.A. – Industrial Powerhouse of the Postwar Era

The publisher of Time magazine (Henry Luce) commented that the 20th was the “American Century,” in great measure thanks to the fantastic production of the United States corporate community.

The nature of the post-World War II economy was firmly set in place by the production prowess of the war years (1941-1945), when the United States of America was the “Arsenal of Democracy,” with fantastic output of weapons and war materiel by large companies. (Ford Motor stopped making cars and instead made B-24 bombers; General Motors turned out tanks, with innovative transmissions that became best-selling features on post-war autos, etc.)

The rapid military buildup helped to lift large U.S. manufacturers and their tens of thousands of workers out of the dark days of the Great Depression era and into renewed prosperity. A “military-industrial” complex thus arose that continued through the decades onward to today. The great American middle class was set firmly in place after the war and the world’s greatest consuming economy was created in catering to the needs and wants of the population.

Because American and British bombers had devastated the factories of Germany and in other European countries, and American bombers the manufacturing facilities of the Empire of Japan, the U.S.A. dominated postwar [world] trade, for many years accounting for fully half of global trade flows.

* * * * * * *

Civil Rights in Focus

Despite the broad and inspiring progress made in uplifting American families to middle class status, not all “boats rose” on the rising tide of progress.  The benefits of Corporate America were not evenly enjoyed.

The relationship of the corporate sector, and of the public sector, and the nation’s African-American population, was over the years problematic. There was discrimination in hiring, in training, in promotion, in access to goods and services; the African-American community steadily lagged behind white peer groups.

The sweeping Civil Rights Act of 1964, followed by The Voting Rights Act of 1965, set in place public sector commitments to change things, to open up opportunities in employment, in access to college education, to affordable home mortgages, and more.

Of course, not all American citizens welcomed the changes; particularly in the American South, there was pushback and protests and defiance of Federal anti-discrimination laws. (Including the landmark 1954 Brown vs. Board of Ed, which seemed to assure equal education for all citizens.)

* * * * * * *

The Rise of Civil Unrest in the 1960s

With rising civil unrest in the inner cities, filling with African-Americans in the Great Migration north, there were riots in 1963 and 1964 in Birmingham and Savannah; in Chicago and Philadelphia; with both whites and blacks involved, battling each other, and more often battling police.

In 1965, there were riots in Los Angeles (the “Watts” neighborhood), 4,000 people were arrested, 34 people were killed, hundreds were injured, and tens of millions of dollars of property damage resulted.

The year 1966 brought unrest to Chicago, Los Angeles, Cleveland (“Hough” neighborhood) — 43 disorders in the U.S. in all. More people died; the National Guard was mobilized; more protests were in store for the next year. And in Spring into Summer 1967, there were riots in Tampa, Cincinnati, Atlanta, Newark and Northern New Jersey, and Detroit.

The Report of The National Advisory Commission on Civil Disorders (issued March 8, 1968) noted: The summer of 1967 again brought racial disorders to American cities, and with them, shock, fear and bewilderment to the nation. The worst came during a 2-week period in July, first in Newark (N.J.) and then in Detroit.

Said the authors. this is our basic conclusion: Our nation is moving toward two societies, one black, one white — separate and unequal.

Reaction to the disorders has quickened the movement and deepened the division. Discrimination and segregation have long permeated much of American life; they now threaten the future of every American. (end quotes).

* * * * * * *

An important irritant: the increased involvement in the war between North and South Viet Nam — a conflict in which young men of privilege (attending Ivy League schools, for example) could skip military service while a high proportion of African-Americans would be drafted and shipped to the war zone.

* * * * * * *

Corporate Sector Response

After passage of civil rights legislation, companies doing business with the Federal government were required to meet certain requirements; state and local governments had to come in line with affirmative action (such as set-asides in hiring for members of minority communities).

As the rules-of-the-road of the Federal civil rights statutes were set in place, both government agencies and America’s largest employers began to change their strategies, practices and policies to match the law of the land. This was not always easy — and certainly was not met with universal acceptance in many quarters of our population.

As the corporate community adjusted, G.A. Lloyd, a respected director public affairs/ community affairs manager at Humble Oil and Refining Company became an active public speaker on the changes taking place.

He wrote a small booklet: The Human Side of History (published 1967 – 16 pages) to help to educate his corporate community colleagues in the business sector on the changes taking place. He delivered a delivered powerful speech at University of Houston and around the Southwest, in late-December 1967, a time when I had been appointed as the “citizenship officer” of my employer, American Airlines (so I was paying close attention).

The Great Progress Made in the Private Sector

Mr. Lloyd advised us that “…leadership socially-conscious companies business organizations” such as those encouraged in the day’s electric utility industry association) were striving to make a difference. (Was this the beginning of modern-day “corporate social responsibility”? Perhaps.)

The corporate functions involved included public relations, community affairs/ community relations and philanthropy.

His employer — Humble Oil Company – in November 1967 was reacting very positively to key government action: passage of the Federal Civil Rights Act and the Voting Rights Act

The chairman of the board of his company, M.A. Wright, in October 1967 said: “The business community’s involvement with social problems must take a new look. In the search for solutions, they must bring into play their leadership and analytical capabilities. They must devise new and better approaches to existing public programs. Businessmen have no practical choice but to insist social problems be given the same analytical treatment that business uses in solving its own problems. ”

There were three outstanding business attributes and resources to bring to bear, the common wisdom told us: the three E’s of education, employment, environment.

G.A. Lloyd was busily telling business and academic audiences, “poor youths” were being put to work in the NASA Manned Space Center in Houston, Texas; 187 youths were recruited, paid a wage and provided training (“learning skills” was important).

Note the accepted language of the day: They were “economically-deprived boys and girls” from families of “the hard core unemployed,” and the objective was to keep them from falling into poverty as they grew up. They learned to type, run duplicating machines, operate machinery, and learn about electronic equipment.

The community-based programs that they were recruited from included: Job Fair; Junior Student Trainee Program; Job Opportunities for Youth (“JOY”); Vocational Education Program; and Back to School Youth Opportunity Campaign. Buses picked the students up, brought them to work and back home.

By the year 1967, Lloyd informed us, some 348 U.S. insurance companies had agreed to invest $1 billion to upgrade U.S. “slums” (concentrated primarily in major U.S. cities).

And more good news:

U.S. Gypsum (building materials) bought or optioned tenement buildings in Harlem and a handful in Cleveland to rehabilitate.

Smith, Kline & French (the Philadelphia pharma) rehabbed buildings in its neighborhood and sold them to the local housing authority.

Hallmark Cards in its home city of Kansas City planned over the next 16 years (that would be to 1983) to invest more than $100 million in rehabbing a “run-down” 85-acre area.

Polaroid (then based Cambridge, Massachusetts) established a “job clearing house” and invited colleagues in from more than 700 Boston-region firms to hire “underprivileged Negros” sans high school diplomas to earn that diploma on company time and expense. Companies responding supplied interviewers at the clearinghouse.

Met Life in New York City was recruiting new employees through The Urban League and social service organizations and put them through a 13-week training course. This process includes a “culture fair test” (no details provided).

Pacific Bell & Telephone dispatched African-American and Spanish-speaking recruiters out to barber shops, pool halls, beauty parlors and “where ever people meet” to identify potential new employees. Those selected were given training to develop skills; 18 of the first 20 men and 21 of the first 22 women became full-time employees.

Jobs Now (operating in Chicago) helped street gang members and those with minor criminal offenses to get local employers to look at candidates that had been on the straight-and-narrow for at least six months. High school diplomas were waived.

For his company, Humble Oil, applicants with low math and “chemical comprehension” (knowledge) were provided with lower entrance qualification testing and given training. (“They were educationally-deprived,” he noted. (In those days before self-service at gas stations the company was training minority men for jobs as service station driveway salesmen at the pump in Newark, New Jersey; Baltimore; and Los Angeles, working with local job development agencies.)

What did all of this mean for the people and communities involved?

  • They got a job – and a salary. And were trained.
    Dignity and self-respect was restored.
    They were able to buy an affordable home. With an affordable mortgage.
    There were less people on the welfare rolls.
    More minority youth were able to attend college. And become professionals.
    There was less potential for civil unrest – the riots of recent past years.
    Neighborhoods could be rehabilitated.
    It was good for business — especial for the private sector.  Major companies and small businesses would prosper.
    Entrepreneurial businesses gained a good foothold.
    These were optimum results at minimum cost, as some experts observed.

* * * * * * *

Hedley Donovan, Editor-in-Chief of Time magazine and one of the most influential of American journalists, observed that it was good business to apply the same creative radicalism used to create good, and sometimes great, products, into create “good” and “great cities.”

* * * * * * *

Importantly, a manager of public relations at giant DuPont (one of the dominant industrial firms of the era), advised that a major objective of American business should be “public service,” not just pursuit of profit. That is, public service through new or better products for the benefit of humankind…the objective is “just making money” was not sufficient, in his view.

Even in those faraway days there were many men (mostly men) who had stopped looking for work and too much unemployment concentrated in minority communities.  American corporations tried to do their part to change this situation.

This was all good news, of course, but there were changes in the wind.

* * * * * * *

As a long-time student of the Corporate-Society Dynamic, I have concerns that with the election results of November 2016, there might be backsliding in the efforts of Corporate America to be “better citizens,” and to continue to “do well by doing good” in terms of benefiting the American and global societies.

We shall see. The early signs are very encouraging. So far, this is not a revival of the actions of Richard Nixon presidency. Even though then-President Nixon encouraged adoption of the Federal Environmental Act and created the US EPA, his dog whistles to the business community helped to bring about an end to much of the above described good works of many major companies.

With the rise of right-leaning political leadership, the era of “Neutron Jack” Welch at General Electric would become the model for other CEOs. Slash and burn, chop away at R&D budgets, get rid of people, concentrate on profits and not people.  And please Wall Street. Not the many Main Streets of America.

Good news:  We have not yet seen a repeat of the rhetoric of Professor Milton Friedman as he so eloquently stated in The New York Times Magazine of September 13, 1970: The Social Responsibility of Business is to Increase its Profits. (You can read that essay here: http://www.colorado.edu/studentgroups/libertarians/issues/friedman-soc-resp-business.html)

In case you have not read the piece, the summation of the essay was: “…the doctrine of ‘social responsibility‘ taken seriously would extend the scope of the political mechanism to every human activity. It does not differ in philosophy from the most explicitly collectivist doctrine. It differs only by professing to believe that collectivist ends can be attained without collectivist means. That is why, in my book Capitalism and Freedom, I have called it a ‘fundamentally subversive doctrine’ in a free society, and have said that in such a society, ‘there is one and only one social responsibility of business–to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.’ ”

We have come a long, long way from those positions as stated by a respected academician of his time. This is so very long ago in today’s corporate rhetoric on corporate citizenship.

What will the future hold? We’re closely watching the Trump Administration and the Congress to hear the dog whistles and see the signals perhaps being quietly sent to the business and investing communities.

With all the progress being made by “universal owners” (the all-important independent fiduciaries of our time), and wide-awake NGOs and other key stakeholders, I don’t think we’ll have a Nixon-ian and Ronald Reagan type of backsliding. Not just yet. That’s the good news.

Your thoughts?

Accountability Demonstrated by This Bank Board? Wells Fargo Directors Clawback $75 Million from 2 Former Execs

April 10, 2017

by Hank Boerner – Chair & Chief Strategist – G&A Institute

We often hear about bank industry un-accountability; is this the beginning of a turn toward greater accountability?  Time and actions taken will tell us…over time.

The Board of Directors of Wells Fargo has clawed back $75 million in compensation from two former executives — the CEO and the head of retail banking.  That’s a drop in the bucket to some governance experts and consumer protection advocates, but it’s a good sign that corporate accountability is being demonstrated by at least one bank board.

Former Chair/CEO John Stumpf gave up $41 million in comp when he resigned last October; he now is ordered to pay back an additional $28 million.

Former head of retailing Carrie Tolstedt gave up $19 million in comp, and now will lose $47 million in stock options.

This after a 6-month investigation ordered by a handful of independent board members and conducted by the Shearman & Sterling law firm. The bank has paid $185 million to date in regulatory fines.

Some 2 million (!) fraudulent accounts were opened in customer names to inflate sales claims (the retail banking operations were overseen by Tolstedt).  More than 5,000 employees have been fired, accused of participation in the scheme, which went on for more than a decade.

Wells Fargo is one of the “Big Four” commercial banks of the USA.  The familiar red stage coach hustling across the western prairies is the symbol of the venerable institution, founded in May 1852. But today’s bank is the result of the merger of the old Wells Fargo & Company with Norwest Bank back in 1998.

Strumpf joined Northwestern National Bank (banking arm of Norwest Corporation) in 1982 and had risen in Norwest operations / then the combined company over the years, becoming CEO in June 2007 and adding the board chair title in January 2010.

So — he was not a “newbie” perhaps not always familiar with the culture of the merged bank operations. His action seriously tarnished the reputation and brand value of the “stagecoach bank” founded so long ago by Messrs Wells and Fargo.

With this action, the Wells Fargo board of directors takes an important step in addressing the cultural woes of the merged bank.

As The Washington Post writer observed, this is an attempt to demonstrate that banks can hold themselves accountable (and so avoid regulatory action for mis-behaviors).

The new CEO?  That’s Timothy Sloan, who was the former COO and therefore the supervisor of retail bank head Tolsteadt!  The board members have all been re-nominated for re-election this year.  Let’s see how “accountable” shareholders think the board has been when they vote their proxies.

Culture — it’s all about culture!  Culture — good or bad – is the ultimate determinant of outcomes!

 

The SDGS – Are You Tuned In, Aligning Your Company’s Strategies, Operations, Performance, Actions? 2030 Is Just Around the Corner!

Gaining momentum in the global corporate sector, among sovereign governments and institutional investors — the 17 UN Sustainable Development Goals (“SDGs”).  After reaching agreement in September 2015, the countries of the world adopted goals to end poverty, protect our planet and ensure prosperity for a greater number of the world’s population through a universal agenda for action (with 169 specific targets under the wonderfully-aspirational broad goals).

The nation-states of the United Nations are now busily adopting the SDGs to address their issues, some broad and experienced by many nations, others more specific in impact on the country.  The goals include climate change-related issues; the growing scarcity of natural resources; adoption of absence of, new technologies;  continuing growth of cities at the expense of rural areas; water, water, water; reducing poverty; empowering women…and more.  The SDGs are in force out to year 2030 with many milestones between then and now.

There are 17 major categories of goals and 169 specific targets within these, for attention by all sectors of society out to year 2030.  Are you on board?  Your company or organization?

Matthew Yeomans (founder of Sustainly, and author of the annual Social Media Sustainability Index), writes for Sustainable Brands on the opportunity for organization leaders to align their efforts with the SDGs to work with governments, NGOs, and other companies to address the challenges through a commonly-understood framework for engagement and action on the issues (inherent in the 17 goals).

Aligning the company with the SDGs could help companies in key areas:  for marketers, or corporate communicators, the actions taken could be embedded in a campaign for customers (consumer, business, public sector).  The corporate storytelling could bring data and metrics to life and help guide customers to the company’s core sustainability reporting that might otherwise be overlooked or disregarded (perhaps thinking, is this reporting just PR?).  The SDG focus could help to underscore a company’s serious commitment, authenticity and transparency regarding actions on the SDGs.

Author Yeomans provides brief examples with Wal-Mart Stores (addressing poverty, women empowerment), Pearson’s (quality education for all) and Stella Artois (clean water).  Highlights are in the Sustainable Brands post and there’s a link to more information at Sustainly.

The G&A Institute team has been focused on the SDGs and helping our corporate clients to better understand and “adopt” material goals and the targets and key performance indicators under the broad goal, those that can be more “naturally” aligned with the adopted corporate mission and overall strategy and implementation of the corporate sustainability journey.

For example, Goal 6 is to “ensure availability and sustainable management of water and sanitation for all.”  How to do that?  We help corporate managers understand the “natural” alignments available to them within the goals/targets, and explore ways to “adopt” the goal and make it an integral part of the company’s sustainability journey.  What are the KPI’s that will matter? What are the “water issues” of importance to the company and its stakeholders?  What can the company do to address water availability, water use in products, waste water, protection of public water supplies, making water supply more secure in the communities in which it operates?  And more….

What are the data sets and metrics that will help the company to adopt operations to the goal(s) and later make the storytelling about all of its progress a more compelling tale? What are the important stakeholder relations to begin, or to enhance if a relationship exists?  What are the natural alignments within the industry or sector that can form a collective approach (perhaps through trade association) to address critical issues?  What is the ROI for the company?  How to determine these and then measure progress (or lack of)?  And finally, how to build the progress into the various reporting schemes, including the company’s GRI report?

If you need more information on these aspects of the SDGs for adoption by your company, please let the G&A team know.  We’d love to set up a call to discuss SDGs with you!

Click here to read more about G&A service related to SDG Alignment.

An important resource for you:  The Post-2015 Development Agenda:  Goals, Targets and Indicators

Top Story

Why You Should Align Your Brand’s Sustainability Efforts with the SDGs
(Thursday – March 30, 2017)
Source: Sustainable Brands – The United Nations’ Sustainable Development Goals (aka Global Goals) are viewed by most in the sustainability community as the biggest opportunity yet for the world to shape a new and better way of doing business while shaping a…

Cradle-to-Cradle Case History: Shaw Industries

Guest Commentary by Jennifer Moore – at the Conference Board

Content originally prepared for Certification in Corporate Responsibility & Sustainability Strategies – on-line courseware by G&A Institute **

The early 21st century ushered in a new wave of heightened concern about resource scarcity and climate change. Consequently, consumers have been more concerned about the sustainability of the products they purchase and the effects they are having on the environment.

Businesses have also taken on the challenge of incorporating sustainability strategies into their business models. Many more companies are now integrating sustainability practices through product stewardship and their R&D activities.

These companies are focusing on life cycle assessments of their products and are aiming to achieve Cradle-to-Cradle status. As defined by the Ellen MacArthur Foundation, the Cradle-to- Cradle school of thought is an important branch within the circular economy concept.

Cradle-to-Cradle focuses on products that have a positive impact and reduce the negative impacts on commerce through production efficiency (see footnote 1).

Cradle-to-Cradle and circular economy goes beyond the “reduce, reuse, recycle” campaign of the late Twentieth Century to focus more on the design and production of products, rather than on consumption by the consumer.

The authoritative work, “Cradle to Cradle: Remaking the Way We Make Things”,  authored by Michael Braungart and William McDonough called for a new era of production, wherein, companies should be focusing more on “doing more good,” rather than “doing less bad.”

The goal and focus should be on the end of the product’s lifecycle, and whether it will either be safely re-entered into the environment — or be recycled back into production.

Cradle-to-Cradle aims to achieve three things: (1) eliminate the concept of waste, (2) power with renewable energy, and (3) respect human and natural systems. (2)

This concept argues that resource consumption and economic growth should not be isolated from each other. In fact, they often go hand-in-hand. (3)

The private sector is not siloed; it has been highly influenced by the public sector and discussion forums. Many non-governmental organizations (NGOs), driven by public demand, have advocated for the advancement of a circular economy. The World Economic Forum, Oxfam International and the United Nations in particular have been vocal about transitioning to a circular economy.

Also, the emphasis of the Sustainable Development Goals (SDGs) released in 2016 by the United Nations is on developing a more circular economy and seeking to implement sustainable development across the UN member states. (4)

While the SDGs are driven by politics and protecting human rights, the goals cannot be achieved without businesses and were developed with input from the private sector. There is business value for companies to align their strategy with the SDGs. (5)

Many companies have recognized the benefits of aligning their goals with the SGDs and the relationship between resource consumption and economic growth.

Consumers are now expecting companies to provide products that are eco-friendly and reduce resource waste. According to a survey conducted by Nielsen in 2014, “55 percent of on-line consumers indicated they were willing to pay more for products and services provided by companies that are committed to positive social and environmental impact, an increase from 50% in 2010 and 45% in 2011.” (6)

The Business Community’s Embrace of Cradle-to-Cradle

Businesses across all industries are now developing their product stewardship products to meet these consumer demands. Companies cite “customer demand for solutions that address global sustainability challenges, such as climate change and resource scarcity” as primary drivers of sustainable product initiatives. (7)

For example, 3M is striving for 40 per cent of their new products to be sustainable and Kimberly-Clark is developing solutions for used diapers. One exemplary model of sustainable product stewardship is Shaw Industries’ dedication to Cradle-to-Cradle.

The Shaw Industry Model

Shaw Industries is the largest producer of carpet tile in North America. While carpet tiles can have a lifespan of 10-to-25 years, commercial owners and tenants often update their facilities more frequently than that to reflect contemporary trends, resulting in a high-waste industry.

Historically, when the time came for flooring to be removed from businesses, schools, retailers, hospitals and other properties – whether for wear-and-tear or aesthetics, it was sent to landfills.

Recognizing the opportunity to create a better solution for customers and to create a product that would help advance toward a more circular economy, Shaw developed EcoWorx-backed carpet tile, which it introduced in 2008 and continues to optimize for sustainability performance.

The world’s first Cradle-to-Cradle Certified carpet tile — EcoWorx — was designed for reuse. To create a carpet tile that could be infinitely recycled with no loss of quality meant removing PVC, phthalates and other chemicals. As a result of its meticulous design process, Shaw understands what’s in its EcoWorx products and, therefore, what’s going into the next generation of its products.

Today, with 16 years and more than 3 billion square feet of EcoWorx installed, Shaw continues to optimize the product’s performance in alignment with Cradle-to-Cradle criteria – material health, material reutilization, energy, water and social responsibility.

Most recently, Shaw worked with one of its suppliers to remove an ingredient from its latex that was added to the list of banned chemicals within version 3 of the Cradle-to-Cradle Certified Products Program Standard.

Further, the company employs sustainable manufacturing practices – making efficient use of materials and natural resources, using alternative and renewable energy sources when possible, and designing and operating its facilities and manufacturing processes in accordance with widely recognized sustainability and safety standards.

It completes the sustainable manufacturing process by delivering its products using the most efficient mode of transportation feasible while meeting customer deadlines.

Shaw has committed itself to embracing Cradle-to-Cradle practices and has lead the way in carpet reclamation in the flooring industry. Today, 65 percent of its products – commercial and residential – are Cradle-to-Cradle Certified, with a goal of designing 100% to Cradle-to-Cradle principles by 2030.

Not only is Shaw committed to upcycling within its own operations, it also looks for opportunities in other industries.

For example, the company converts plastic drink bottles into residential carpet through a joint venture with DAK Americas: The Clear Path Recycling Center in Fayetteville, NC produces 100 million pounds of clear flake each year, recycling approximately three billion plastic drink bottles annually.

Furthermore, in 2016 alone, Shaw supplied more than 200 million pounds of post-industrial waste to other businesses for a variety of recycled content needs. For instance, the wood flour – waste fiber from hardwood flooring operations – is used by a major producer of composite decking and the minimal waste from its resilient manufacturing facility is used to make garden hoses.

The Future for Cradle-to-Cradle in Industry

Today, sustainable leadership companies, like Shaw, can strive to achieve cradle-to-cradle production through the certified program by the Cradle-to-Cradle Products Innovation Institute.

The Institute examines certifiable products in five (5) quality categories – (1) material health, (2) material reutilization, (3) renewable energy and carbon management, (4) water stewardship, and (5) social fairness. (Footnote 8)

Sustainability managers must partner with their design and strategy teams to develop sustainable solutions to the products and services their company offers. Not only are these products essential ecologically and socially, they are also drivers of revenue growth.

If managers are concerned about getting [internal] corporate buy-in to fund ESG R&D, they are able to present the business case of how other companies — especially like Shaw Industries with the illustrations here in this case study — have seen Cradle-to-Cradle’s positive impact on their revenue. (9)

According to The Conference Board, “revenues from sustainable products and services grew at six times the rate of overall company revenues.”

In order to address Earth’s ecological crisis, companies must lead the way by ensuring they are designing eco-friendly products and services that respects the finite resources available on the planet. Sustainability managers can look to Shaw as one company that is leading by example.

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Jennifer Moore is Manager, Executive Programs, Sustainability & EHS at the Conference Board. She engages with senior executives from Fortune 250 companies to understand their needs and help solve their business issues. She oversees and executes all aspects of 15 roundtables per year.

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**  Information about the G&A Institute on-line course:

http://learning.ga-institute.com/courses/course-v1:GovernanceandAccountabilityInstitute+CCRSS+2016/about

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Footnotes:

(1) Ellen MacArthur Foundation. Cradle to Cradle in a Circular Economy – Products and Systems. Retrieved March 5, 2017. https://www.ellenmacarthurfoundation.org/circular-economy/schools-of-thought/cradle2cradle

(2)  Ellen MacArthur Foundation. Cradle to Cradle in a Circular Economy – Products and Systems. Retrieved March 5, 2017. https://www.ellenmacarthurfoundation.org/circular-economy/schools-of-thought/cradle2cradle

(3) Strahel, W. (2015). The Performance Economy. Palgrave MacMillan: 2006

(4) United Nations. United Nations Economic and Social Council. Millennium Development Goals and post-2015. Development Agenda. Retrieved March 5, 2017. http://www.un.org/en/ecosoc/about/mdg.shtml.

(5)  Yosie, T. Is There Business Value in the UN Sustainable Development Goals? Retrieved March 5, 2017. http://tcbblogs.org/givingthoughts/2017/02/07/is-there-business-value-in-the-un-sustainable-development-goals/#sthash.L0MLUAN7.xHIHNvHZ.dpbs

(6) Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 17.

(7) Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 8.

(8)  C2C Product Certification Overview – Get Certified – Cradle to Cradle Products Innovation Institute. Retrieved March 5, 2017. http://www.c2ccertified.org/get-certified/product-certification

(9)  Singer, T. Driving Revenue Growth Through Sustainable Products and Services. New York: The Conference Board, 2015. p. 6.

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In the Dark Days of White House / EPA Action on Climate Change, Here are 7 Encouraging Trends for You from Amy Augustine at Ceres

Horrible headlines now coming out on the developments at the White House regarding climate change, global warming, and related issues as campaign rhetoric is fitted, however clumsily or mean-spirited, to public governance to attempt to match ill-advised campaign promises.

The reality is that there are a number of very encouraging developments, trends that hold great promise for those of us who are not climate change deniers and think that global warming is a hoax coming from China to disadvantage American companies!

The Ceres staff members have long been engaging with, monitoring and advising (the rest of us) on critical issues in the areas of Corporate Sustainability – Responsibility – Citizenship – Environmental Management — and of course, the paths to more sustainable investing.

Amy Augustine, the senior director of corporate programs at Ceres, shares with us in our Top Story the seven trends she sees continuing to drive corporate sustainability in 2017.  Our view is that this could be a “hinge year” for the United States in terms of focus on climate change, global warming, societal issues, environmental management and host of related issues therein.  (As in. “the hinge of history” with things going this way or that, the before and after.)

Amy observes:  “Bold leadership, as well as individual collective action from influential companies and investors, is critical to ensure continued progress in achieving the ambitions of the historic Paris Climate Agreement and the United Nations Sustainable Development Goals (SDGs).”

The seven trends are encouraging: (1) U.S. corporate sector support for U.S. clean energy policy is accelerating;  (2) investor expectations continue to rise that public companies will disclose information on more climate change risks and opportunities. (Remember, the US SEC in 2010 reminded boards of companies that they have the responsibility to oversee risk, and that climate change is clearly a risk.  But that was yesterday, under the former Administration…today is the era of climate denial in the White House.)

Trend 4 is the focus on Water Risk — large-cap companies operating in water-stressed areas are not waiting for government action to conserve  protect water sources.  Amy Augustine cites the efforts of such responsible enterprises as General Mills, Gap and Pepsico engaging with policymakers in California to urge on stronger water management measures.

What about Trend 3 – and 5, 6 and 7?  The details are waiting for you in the Top Story (link below). Amy’s concluding comment is…”No doubt, company actions on all of these (7 trends fronts) will continue to evolve and hopefully accelerate; such leadership is more essential than ever.”

At G&A Institute, we’re doing our part to report on both sides of the hinge — the great things that have been accomplished in the “good days” of the past decade, and the threatening things that are proposed or (positions) adopted in these not-so-good-days at US EPA, the White House or in the Congress.  Do check out the second in the newsletter, our comments in G&A’s Sustainability-Update Blog on the latest moves by the President and EPA Administrator to attempt to roll back the rich legacy of the prior administration.  (You can sign up to receive updates as these are posted.)  Let us have your thoughts as well!

And, we invite you to download “Trends Converging,” the book prepared in 2016 by G&A Chair Hank Boerner, which sets out important information about where are as the climate change deniers/destroyers go to work in Washington DC to undo the progress made.  Click here to download the digital copy.

Top Story

7 Trends That Will Drive Corporate Sustainability in 2017
(Wednesday – March 22, 2017)
Source: Triple Pundit – As we confront a new political climate that is inspiring both uncertainty and rising citizen action, I am more convinced than ever that business must play a critical role in achieving a sustainable, equitable and clean-energy…