Gil Friend

Ecology is a love story. A play scripted between the sunlight’s tender dappling on the forest floor, the elegant drapery of the vines that climb a cliff-face, the tickle of the squirrels and birds holding society in the treetops, and the sultry sway of the purple kelp the otters cannot resist. The touch of life on life, met in the tension between unshaking trust and heartbreaking vulnerability is a kiss of light and love and heat, and earth. It is fierce and sweet, and rages with the same passion it births a wild rose.

The VERGE conference last month was a heady mix of both inspiration and rapidly accelerating best practice at the intersection of energy, buildings transportation and IT.

You can find complete coverage (and videos) at greenbiz.com. Here are some of the things that stood out for me -- not just because they're interesting (though they are), but because they also hold important strategic challenges for business -- perhaps your business.

Collaborative consumption is the leading meme taking on the ecological imperative but generally daunting business challenge that I've long talked of as "More value. Less stuff.":
- If, all things behind equal, more throughput means more impact; and
- if, all things being equal, more throughput means more profit; and
- if most businesses think their purpose is to maximize profit (It's not, but that's a story for another time); then
- how can a business make more money selling less stuff?

How? Some businesses are reinventing their value propositions around value delivered, not stuff delivered, while other businesses lose share in the face of that competition. Consider: the world's major hotel chains built global networks on the order of half a million beds in 50-70 years. The collaborative consumption networks of couchsurfing, AirBnB and their ilk built a network of 1.5 million beds in less than seven years.

"Unused value = Waste," according to Lisa Gansky, author of The Mesh and host of meshing.it. LooseCubes & Honest Buildings arbitrage that unused capacity. Since we only use our cars (our second largest asset) eight percent of the time, they're perfect for sharing. Robin Chase of BuzzCar noted that the average ZipCar is used by 30-50 people; 40% go on to sell their own car or not buy another; all drive 80% less. Great news for ZipCar, WhipCar, BuzzCar, CityCarShare, GetAround, et al. Possibly not such good news for Detroit et al.

The interesting question of course: what are the potential risks and upsides for your business?

Energy was the thread running through everything at VERGE. ("Energy is eternal delight." Wm. Blake) Amory Lovins, ever the phrasemaker, made sure we understood that the future of energy is "Netted Islandable Microgrids." (the EnerNet? the InterGrid?) Drawing from his newest book, Reinventing Fire, he observed that we can triple the energy productivity of US buildings at a 33% internal rate of return, and double industrial productivity at a 21% IRR. His recommendation: "If you can't solve a problem, make it bigger." The secret: "Big savings can be cheaper than small savings, through integrative design." But does your CFO know that? [I still encounter companies that should know better referring to susty investments as costs, and cap costs as investments...]

Amory noted four key elements to energy futures: Policy. Design. Strategy. Technology. "Focus on outcomes, not motives," he advised. "And don't wait for Congress." To which I'll add this: while many people are frustrated by the energy policy logjam in Washington, others are investing now in the new energy economy, since it doesn't all depend on policy.

Jon Koomey of Stanford University predicted that we'll not only see more & better mobile computing, sensors, controls -- with customized data collection -- but we'll see more cool gear running on ambient energy flows. A lot of this is about changing people, according to Dave Pogue of CBRE. I'm not so sure. My mentor Bucky Fuller, used to advise "Don't try to change people; reform the environment." One of the most effective ways to do that, in my experience, is with well designed feedback, and Pogue seems to concur, noting, for example that separately metered buildings 21% more efficient than single meter buildings. In fact, according to IBM "building whisperer" & VP Industry Solutions Dave Bartlett, there's 40% savings to be gained by listening to buildings "holistically."

Many of these opportunities hinge on Real Time access to Open Data linked through Smart Grids. (Remember "Netted Islandable Microgrids?" That's what we're talking about.) "Decentralized or centralized? Steve Case pondered. "Distributed!" he responded. "Build speed and scale from excess capacity and common platforms." (An echo of Gansky's "Unused value = Waste.")

Tim O'Reilly, who observed that data science job growth is "going vertical," posed an equally important question, but left it unanswered: "How to ensure that the emerging global brain does good, is moral?" As my physics professors used to say, that exercise is left to you to work out.

Jennifer Pahlka's brilliant approach at Code for America is to see government as a platform; CFA recruits development teams that compete to work with participating cities on projects that "can benefit from web-based solutions." Brilliant, I say, because what is government, after all, if not us, all of us, working together to address our common concerns.

AMEE's Gavin Stark took the platform approach as well. His question: "How might we footprint everything on earth?" His approach: a common reference platform for energy and carbon data. This, I think, is where the action will increasing be, as companies like AMEE, Open Data Registry [disclosure: I chair the board] and others transcend the limits of massive data warehouses and onerous standards processes for the more powerful and agile worked of open, interoperable, real time data. (About which I'll have more to say at another time.)

In sum, Don Reed of PWC had it about right: "What's needed for sustainability success: systems mindsets, innovation processes, business model breakthroughs."

If feedback loops are the basic unit in Universe, how can the variety of ways those loops can be arranged and juxtaposed give rise to the infinite forms of varied vitality and emergence?

[Originally blogged 2/15/11, but w/o a title. Nice to stumble across some other juicy posts from that month...]

No, I don't mean the "sensitive guy" thing. I mean, "How vulnerable is your company to the risks associated with your sustainability strategy?" -- or, more to the point, that strategy's gaps, shallowness or lack of integration with your business.

Consider this list -- which is either on your CFO's mind, orshouldbe:

How much are you wasting on materials, energy, labor, occupancy, management and opportunity that wind up as non-product -- the stuff you produce that you ship to a smokestack, sewer line, landfill or hazardous waste site, instead of to a customer? InterfaceFlor found nearly half-a-billion dollars in extra profitby asking that question. How does your Product-To-NonProduct Ratio compare with your competitors'? Don't know? You should.

What's your financial risk in a possible future in which there's aprice on carbon? (As with all risk analysis, you have to consider the potential scale of the risk as well as its likelihood.) Riskmetric's (now part ofMSCI) Carbon Beta calculates that monetized risk, divides it by EBITDA, and compares that ratio between companies in a sector, and between sectors. The gap can be 10:1 or more. Would you consider that "material"?

What's your financial risk in a possible future in which there's a price on water, biodiversity, and other "nature's services"(as well as carbon)? Puma's Ecological P&L was the first to attempt this analysis, and estimated a potential impact equivalent to nearly 50% of net income. How exposed would your company be?

What's your most important asset? Most of you are smart enough to say "people" -- but where are people on your financial statements? R. Paul Herman of HIP Investor Inc has discovered a handful of companies in India -- from infosystems to oil & gas -- that account for human capital as an asset, not a liability, and calculate Return on Human Capital. Yet no company in the US or Europe reports this metric. Will you be the first -- and gain the acclaim?

How much of your business depends on public subsidies? Yes, I know that one man's subsidy is another's social investment, and I'm not arguing that all subsidies should go away (though I would say that public subsidies to the fossil fuel and nuclear industries have long outlived their societal benefit) -- but what if they did? What impact could that have on your business? How much are you investing in eliminating your dependence on subsidies vs lobbying to preserve or expand them?

The list could go on -- license to operate, brand/reputation risk, resilience, just to name a few. (And I'll address those another time) But it's probably sufficient to get your juices flowing -- to recognize that there is significant business value on the table here, that can either make you a lot of money, or cost you a lot of money.

Don't you owe it to your management, your shareholders and yourself to consider the bottom line impacts of these all-too-plausible possibilities?

Some of the links I've offered above can help you understand these issues, and perhaps help you begin to address them. None can give you the comprehensive, integrated, rigorous, business-based approach you needfor dealing with them.

We can. That's what we do.

How?

• Full Cycle Sustainability engagements that help you design, implement and measure profitable sustainability strategies.
• Executive Coaching that helps you elevate and accelerate your personal & corporate sustainability commitments. 
• On-demand eLearning that gets your entire organization engaged, aligned and effective.

(This post originally appeared in Natural Logic's monthly newsletter. For a free subscription, click here and enter your email and preferences in the form. (Our privacy policy: no one gets your data. Period.)

Here's what I don't understand about Gleick-gate.

(See Romm on Revkin on Gleick on Crossing the Line as Civilization Implodes, and Revkin response, and DeSmogBlog's dissection the of Heartland Climate Strategy that they say shows it's no fake )

Was his "unethical" act that he pretended to be a specific person with an established relationship with Heartland? (Which I'll concede was both duplicitious to Heartland and exploitative of that person.) Or that he pretended to be "not Peter Gleick"? (Which I'm having a hard time distinguishing from a journalist going undercover, or 60 Minutes sending a hidden camera into a doctor's office or auto repair shop to capture and expose fraud.)

Perhaps someone can explain?

It depends whom you ask, of course.

The invaluable Joe Romm, writing on the indispensible ClimateProgress.org, tells us that Confusing Climate Study Actually Makes Strong Case Against Tar Sands -- If We Want To Avoid Catastrophic Global Warming | ThinkProgress

According to Time magazine, “Pipeline Politics: Are the Oil Sands ‘Game Over’ for the Climate? One Study Says No”:

The good news from the Nature Climate Change paper is that, should environmentalists lose their battle, the consequences might not be quite as bad as they’ve made it out to be.

Except that isn’t what the study finds. Indeed, the final paragraph states

If North American and international policymakers wish to limit global warming to less than 2 °C they will clearly need to put in place measures that ensure a rapid transition of global energy systems to non-greenhouse-gas-emitting sources, while avoiding commitments to new infrastructure supporting dependence on fossil fuels.

In short, if you care about the 2C (3.6F) target, building something like the tar sands pipeline is a really bad idea.

By the way, if you care about a 3C (5.4F) target, building something like the tar sands pipeline is also a really bad idea —

I offered this comment on Joe's site:

If we posit that Time is trying to do a good job of serious journalism, what needs to happen to increase the odds of them not getting a story like this so wrong?

Oh, and then there's this:

To have a 66% chance of limiting warming to less than the 2 °C limit put forth in the 2009 Copenhagen Accord, one carbon– climate modelling study estimated that total future global carbon emissions should be limited to less than 5.9×1017 g C (ref. 9). If this amount were to be distributed equally among the current global population, the resulting allowable per capita cumulative carbon footprint would be 85 tonnes of carbon. The eventual construction of the Keystone XL pipeline would signify a North American commitment to using the Alberta oil-sand reserve, which carries with it a corresponding carbon footprint. For comparison, by fully using only the proven reserves of the Alberta oil sands, the current populations of the United States and Canada would achieve a per capita cumulative carbon footprint of 64 tonnes of carbon.

There’s something odd about the notion of “sustainability leadership.” Perhaps it’s that “sustainability” underwhelms. As Michael Braungart reminds us, “Sustainability is boring. How would you characterise your relationship with your spouse? As sustainable? If this is the bigger goal – sustainability – then I feel really sorry because it doesn’t celebrate human creativity and human nature.”

Leadership toward less bad, slower decline and holding steady is somehow not compelling. Dr King didn’t have a dream that things hopefully won’t get too much worse.

But let’s put that aside, assume we all know what we mean when we say sustainability (here’s what I mean), and focus on leadership itself – which may seem more obvious and familiar, but is actually less so.

Ask most people about leadership, and they’ll say, “setting a direction, and getting (or inspiring) people to follow.” Yes, but it isn’t that simple. There are several critical components of effective leadership that step beyond the obvious, ordinary, and easy. That depend on the actions leaders take – most fundamentally in how they speak.

• Leaders see a world that does not yet exist, that most people perhaps can’t even see – or can see but not believe their own senses, or believe in their ability to bring it into being. Leaders commit to bring that world into being – into general being. Leaders declare that the world they see is possible, and they commit to fulfilling that possibility.[1]
• Leaders communicate in ways that, yes, shift other people’s perceptions and inspire their actions, but that also evoke other people’s commitment – their shared commitment – and that encourage them in turn to communicate in ways that build coherence and coordination around that shared commitment.

• This depends on “competences for listening to the concerns of communities, and for developing…interpretations about the situations in which communities of people find themselves…that can serve as effective platforms for people to propose how to act in new ways.”[2]
• Leaders engender the trust that enables people to coordinate their actions in fulfillment of those shared commitments. This can be done through command-and-control, or, more powerfully, by creating, or enabling the emergence of, coherent teams – and what Ernest Lowe called “autonomy in a coherent whole.”
• “Creating a coherent team takes time, engagement, and reflection. Producing trust occurs as people participating in a network of commitments, acting in language, come to see each other as reliable performers, and learn to align and connect their interests with each others’ interests and with those of the project.”[3]
• Leaders are courageous – not just in the sense of bravely facing risk, but also in the sense of full of heart (from the Old French corage, for “heart, innermost feelings,” from the Latin cor, heart). The best leaders move from love.

Which brings us back to “sustainability.” A true sustainability leader, standing in courage, engendering trust, evoking commitment, calls to us from a new world, a world that is thriving, nurturing for all, a world in which, as Bill McDonough puts it, we “love all the children, of all species, for all time.” A world of prosperity, not just in the sense of economic well-being, but in which we move, together, pro spera – toward our hopes, toward flourishing.

Robert Dunham summarizes it well[4]:
- Leaders take care of concerns, and build the capabilities of others to take care of their concerns.
- Leaders build power for themselves and others.
- Leaders make offers.
- Leaders speak and move with a presence, a voice, and identity to have their offers heard and accepted.
- Leaders build new narratives of and commitments for the future with others.

A true leader doesn’t produce followers. A true leader creates more leaders.

# # #

[1] Charles Spinosa, Fernando Flores, and Hubert L. Dreyfus, Disclosing New Worlds: Entrepreneurship, Democratic Action, and the Cultivation of Solidarity.
[2] Chauncey Bell, My Problem with Design
[3] Gregory A. Hovvelll, Hal Macomber, Lauri Koskelas and John Draper, Leadership And Project Management: Time For A Shift From Fayol To Flores
[4] Robert Dunham, What is a Leader?

(This article was previously published at SustainableBrands.com)

Last month I offered my picks for the Top Sustainability Stories of 2011. Here are my predictions for the Top Sustainability Stories of 2012. (It's a rugged mix of bad news and good.)

Climate heats up and hides out
The sheer pressure of the hard-to-escape evidence -- more record-breaking temperatures, more disastrous weather events, big supply chain disruptions, ever-rising insurance payments -- will drive more businesses to take global warming seriously as a business risk, even as The Economist and others blast the journalistic malpractice that leaves "climate" out of the weather disaster stories, and President Obama takes cover in an "all of the above" energy strategy.

US falls behind in solar
China, Germany, Brazil -- and California -- continue to invest policy and capital in the new economy, while Washington remains lost in ideological shock and awe (as House republicans tell the Pentagon "you have to waste taxpayers money and make the troops less safe so we can continue to ignore both the science and the economics of climate change"). But there are surprises too: "red state" Iowa has decided that exporting $6b/year to buy fossil fuel from unfriendly nations might not be the most "conservative" plan, and is investing government money to reduce that balance of payments deficit!

EPA battle royal
The right's war on the EPA (and on regulation in general) will continue, and in fact heat up as campaign fodder. Little noticed: 191 house votes attacking the EPA in 2011. Expect this battle to continue into 2013 (depending on how the elections turn out).

But there's good news too.

Green Chemistry & Biomimicry
These big ideas are taking deeper root, bring sustainability where it most matters -- into the design process, which determines environmental impacts for years or decades to come. Just a few examples: University of California Berkeley has established a major, interdisciplinary green chemistry program, the Biomimcry Institute, re-branded as Biomimicry 3.8, is building its business leverage, and companies from Steelcase to Method are bringing this next generation of design science to market.

Radical Transparency and "Open Data"
This may be below the radar for many of you, but it's big. Markets want -- need -- transparency; the simply don't work well without open flows of information. Customers want transparency -- whether a parent wanting to know what's in the baby food to a global corporation wanting to be able to stand behind its products. Geeks love transparency -- just look at the growth of the open source software industry. And sustainability requires transparency -- and open, accessible, interoperable data -- with initiatives as diverse as Nike's GreenXchange patent sharing platform to GoodGuide's product rating tool and startup Open Data Registry's innovation in supply chain information infrastructure. (Disclosure: I'm on the ODR board)

Widening green gap
Watch for big, bold moves from major brands, as more companies move sustainability from peripheral "nice to have" and corporation social "responsibility" to mission-critical business driver and corporate social imperative. And big, subtle moves too; as Adam Lowry, co-CEO of Method, put it recently: "People don't want to buy green. They want to buy better. But green is a part of better." Watch for big failures, too, from companies that won't or can't adapt; "Businesses that don't take sustainability seriously," as Ray Anderson often observed, "won't be a problem, because they won't be around."

Getting the prices right
For as long as I've been in the sustainability game (40 years this summer, long before anyone coined the term), the challenge of "getting the prices right" -- of eliminating the market-distorting impacts of "externalities" and subsidized environmental damage -- has seemed a pivotal element of sustainability strategy. Succeed and we have a chance; fail, and we're consigned to the fate of Sisyphus, endlessly pushing the boulder uphill, only to have it roll back down, again and again.

The good news: while this was once an esoteric subject, I now hear it on the "top three issues" list at many, perhaps most, of the discussions, meetings and conferences I attend. There's still a long road and hard slog ahead, but the issue is on the table, the data is getting clearing, the innovations are starting to surface, and we will see much more on this critical topic in the years to come. (Join me at VERGE, where I'll be leading a session on getting the prices right, and watch for my forthcoming book of the same name.)

I'll stop there, with these two questions:
- What do you think will be the top sustainability stories of 2012?
- What will you make the top sustainability stories of 2012?

Because, as Scoop Nisker is fond of reminding us, "If you don't like the news, go out and make some of your own!"

This is the time of year when people assemble their top 10 lists for 2011 -- movies, restaurants, etc, -- and top sustainability stories and trends. Here are mine -- not ranked, not complete, quite subjective, and hopefully rich food for thought for you. (Next time: my predictions for 2012!)

Green China?
Not quite (actually, not by a long shot), but China maintains strong investment in renewable energy and clean tech, even as US energy & climate policy remain mired in, well politics. Not much talked about: China's Circular Economy Law. Its significance depends of course on how seriously it's enacted -- which so far appears to be "not much" -- but as Hunter Lovins points out,

Hypocrisy is the first step to real change. I've talked to Chinese well aware of it, and while not enforced, it is a force in their thinking. I think as China wrestles with the inherent impossibilities of its situation they'll return to it in future days.

Occupy
So much ink has been spilled about Occupy that I'm not going to add much here, except to say that no one (including business leaders, not just political leaders), should underestimate:
- the growing revulsion at the destructive role of money in democracy;
- the emerging culture of open, transparent and engaged... (consider the role of social media in the Arab Spring, and its emerging role in the culture of business);
- the disruptive impact this may yet have on everything.

Obama under-rated & over-rated
The president, like Rodney Dangerfield, "can't get no respect." He both deserves more credit than he gets for many unheralded environmental policy moves (including points for mercury regulation and renewable energy investment) but continues to disappoint on climate and energy policy overall. (I knew, when I decided to vote for him, that this man would inevitably disappoint me -- they all do -- but I didn't expect all the ways he would do it. No doubt he feels he has to choose his battles. But I'd like to see a few real battles, thank you very much.

Competing on sustainability
This is one of the most heartening signs. As companies learn the strategic benefits -- and business imperatives -- of sustainability, and overcome the now boring navel-gazing about the mysteriously elusive business case for sustainability, sustainability becomes a growing contributor to business value, and even a competitive differentiator. Who's got the greener shoes -- Nike, Puma or Adidas? I love that it's not a slam dunk obvious question.

Sustainability is a team sport
Equally important is the growing recognition that collaboration is as important as competition. Multi-company and multi-stakehloder associations (The Sustainability Consortium, Sustainable Apparel Coalition, Outdoor Industry Association, to name just a few, in just one industry) have come together in the recognition that there are some changes that not even big companies can make alone. That can only be done collaboratively -- perhaps most dramatically through the GreenXchange a multi-company alliance formed "to accelerate and scale sustainability-innovation through sharing intellectual property assets." (Watch for much more about "open" next year.)

Ecological Accounting
Speaking of Puma, the domain of Ecological Accounting (or as I like to call it, reality-based accounting) took a huge step forward this year when Puma (with PWC and TruCost) produced an environmental balance sheet and P+L, suggesting what their financial would look like if "nature's services" mattered. (They always have mattered, of course-- even if we haven't known how to value them.) The bottom line, so to speak: the ecological liability was material -- more than 45% of Puma's net earnings -- and Puma's parent company PPR plans to extend the analysis across the rest of its companies this year. (Note to CXOs: This is not just a PR or even a CSR exercise; it's an opportunity -- as are properly done Carbon Footprints and Life Cycle Assessments -- to identify risk and value that your current financial management tools are literally unable to perceive.)

Rise of the CSO
As the Weinreb Group observed in CSO Back Story: How Chief Sustainability Officers Reached the C-Suite,

"the person in charge of corporate sustainability and corporate social responsibility has evoloved, from a largely director level position, to vice president to chief, over the last decade. as the sustainability function crept up the corporate ladder, so has the caliber of the person leading it. Thus we have the title “Chief Sustainability Officer,” which implies the senior-most sustainability leader in the senior-most possible position."

Big bets
Another measure of sustainability's growing business maturity: companies are make bigger business bets on sustainability. The iconic examples of Interface, GE and WalMart (while the latter two still debatable) are joined by SAP, which says it will incorporate "sustainability" in all its products (which it asserts runs 60% of the global economy) within five years.

Renewables Trump Nuclear
Nuclear energy was big news in 2011, and not only because of the many layered Fukshima disaster (technical failure + terrible disaster planning + profound mendacity + political cowardice). In addition, this massively subsidized industry continues to lose orders, market share and price advantage to renewables. Plus, thermal energy generation will become increasingly problematic as temperatures rise; as one example, France has had to power down its reactors because it was unable to cool them.

Decline of stuff and the rise of collaborative consumption
It's too early to write the obituary for our addiction to stuff, but at least it's moving into the category of "everyone knows..." if still in the the category of "no one knows what to do." Some of the drivers:
- the economic downtown, to be sure;
- a growing emotional hunger, in the "developed" world, for things more meaningful than things (and perhaps, in the "developing" world, for a different development path than the one the West has followed);
- a continued trend to dematerialization and servicizing (since, as Dave Gustershaw of Interface puts it, "all things being equal, each kilogram of stuff moved another kilometer means more impact")
- the disruptive influence of the interwebs in enabling collaborative consumption (viz The Mesh, AirBnB, GetAround etc.) which will transfom industries as surely as digital has transformed music, video, retail and so much more.

Next time: My predictions for the sustainability top stories of 2012.

(Meanwhile, you might enjoy these additional top stories lists from Andrew Winston, GreenBiz, Sustainable Business Forum, Warren Karlenzig, Environmental Leader, and Technology Forecasters Inc.

I've long felt than one of the big differences (chasms) is between people who look at the world and see things, and people who look at the world and see pattern.

Here's a beautiful exploration of that idea.

"To Understand is to Perceive Patterns" on Vimeo

Marc Gunther seems to be relishing his role as green curmudgeon (or at least provocateur) over at GreenBiz.com. To judge by the comment stream, he hit a nerve with his recent "In Defense of the Plastic Bag."

Here's my response:

It may seem complicated, Marc, but perhaps it doesn't have to be -- if we ask the right questions. "Paper or plastic?" (or "this plastic or that plastic?") aren't the right questions. Nor is "Should we tax or ban all plastics because some end up as litter?"

No, I don't want to "impose my beliefs on others," but I do want everyone to bear the full costs of their decisions and actions. This challenge of getting the prices right is, I think, at the heart of most of our environmental problems.*

Probably the best way to address the plastic bag problem is extended producer responsibility (EPR) -- have the entities that produce what becomes "waste" be responsible for the costs of dealing with that waste -- rather than imposing those costs on ecosystems and other people. It's worked in many EU countries, as well as Canada and Japan. Natural Logic's white paper, Product Stewardship & Extended Producer Responsibility: Towards a Comprehensive Packaging Recycling Strategy for the US, lays out analysis and strategy for establishing EPR in the US. (The work was commissioned by Coca-Cola, and contributed to by a diverse group of stakeholder; the opinions is presents are Natural Logic's alone.)

* This is a topic which I've been thinking and writing about for a while. See, for example:
Memewatch: Getting the prices right
Get This: Overcoming the Key Barriers to Building a Sustainable Economy
CFOs, Sustainable finance, & Getting the Prices Right
The True Cost Economy: Ecologizing Capitalism
(and my book-in-progress, "Getting the Prices Right," in 2012)

In his latest blog post, veteran journalist Marc Gunther asks Have I fallen in love with Walmart? It's a long, thougthtful piece, responding to an even longer piece in Grist.

"I’ve written dozens of stories about the retail giant, Gunther writes. "...I’ve been critical at times...but most of my coverage of the company’s sustainability effort has been laundatory [sic]."

Now here comes Stacy Mitchell, a smart reporter, with a six-part series in Grist called Walmart’s Greenwash: Why the retail giant is still unsustainable. She assails Walmart for promoting suburban sprawl, making only token efforts to buy renewable energy and selling cheap throwaway stuff. She also faults mainstream environmental groups for focusing “on the small bits of good that Walmart could do—reduce PVC in packaging, for example—while ignoring the much larger consequences of its ever-expanding business model.” She also says that she has been “shocked by just how much of a public relations boost the media have given the company and how little public accountability they have demanded in return.”

Here's the comment I posted at Marc's site:

Thanks for this piece, Marc, and the thoughtful perspective. WalMart’s a mixed bag, to be sure (ain’t we all!), but it’s just way too easy to criticize, and damn hard to transform a large organization, and to get everything right. (Once again, who of any of us has?)

I completely agree with you re “The Sustainability Index” — WalMart’s “100% renewable energy/zero waste/only sustainable products” declaration has probably generated more sustainability awareness in businesses around the country than any single from regulators or NGOs. We’ve seen an immediate and profound impact on the flow of companies that come to us at Natural Logic, and the kind of assistance they’re looking for. WalMart deserves ample credit for moving the agenda at tens of thousands of companies.

But I strongly disagree with you about “Cheap Stuff.” As Dave Gustershaw of Interface is fond of pointing out, each additional kilogram of stuff moved an additional kilometer means (all things being equal) more environmental impact, so the challenge of “sustainable consumption” — and the related challenge of “how can companies make more money selling less stuff?” — are on a very short list of questions at the heart of the matter. (The others: getting the prices right, and escaping the trap of short-term-ism — but more on those another time.) I just don’t buy it when companies say “we’re just responding to consumer demand” and then spend billions to _shape_ that consumer demand.

By the way, why would buying solar “put the company at a competitive disadvantage” when it doesn’t do that for “Kohl’s, Whole Foods Markets, Starbucks and Staples”?

PS: WalMart isn’t us. The “us” who shop there (or don’t) do have substantial impact on what they do, and yes, markets do move business decisions, but it feels just a wee bit too simplistic, in these days of TARP x 11, to suggest that “we’re all one.”

It sometimes seems that books flow into my bedside reading stack faster than they leave it. It's a good problem too have; there are so many good books on the subjects that concern us all. Here are a few of my current favorites - some that I've read, some that I'm reading, all of which are worth your attention.

Infinite Vision: How Aravind Became the World's Greatest Business Case for Compassion.
Pavithra K. Mehta & Suchitra Shenoy.
Aravind sprang from a surgeon's vision of ending curable blindness - without regard to people's ability to pay and without compromising their dignity. It's become the largest provider of eye care on the planet, with ten times the productivity of US eye surgeons, and patient results superior to British National Health Service. But this is not just a book full of heart; it's also an inspiring management case study of how to deliver the goods.

The Great Disruption: Why the Climate Crisis Will Bring On the End of Shopping and the Birth of a New World.
Paul Gilding.
If Infinite Vision is a great inspiration, The Great Disruption is quite a downer. Gilding, businessman and former head of GreenPeace International, is no optimist. He sees global crisis, both ecologic and economic, as unavoidable - but is ultimately hopeful for the human capacity for innovation and cooperation... once we've exhausted all other options.

Walk Out Walk On: A Learning Journey into Communities Daring to the Future Now.
Margaret Wheatley & Deborah Frieze.
Wheatley and Frieze find that capacity for innovation and cooperation at work today in local communities around the planet, and take the reader on a "learning journey" (evoking those that their Berkana Institute conducts) that brings these communities and their work together alive.

Reinventing Fire: Bold Business Solutions for the New Energy Era.
Amory Lovins and Rocky Mountain Institute.
Lovins and his colleagues at RMI present both a vision and a roadmap for getting the US off oil, coal and nuclear by 2050, at a profit, without a dime of government money, and with a Net Present Value of $5 trillion. I haven't checked the math, but I have seen the logic of RMI's time tested guiding principles - systems thinking; market oriented Solutions; end-use/least-cost approach; corporate transformation - deliver the goods again and again.

The Responsible Business: Reimagining Sustainability and Success.
Carol Sanford.
While Lovins and his team have been masters of integrative design in technological systems, Sanford has long been one of the leaders in integrative approaches to corporate strategy and transformation. As she observes, "The biggest challenge for a company that aspires to be a responsibility business is to stop working on parts and start recognizing and working on whole systems."

Sustainability by Design: A Subversive Strategy fot Transforming Our Consumer Culture.
John C. Ehrenfeld
Ehrenfeld, ex of MIT and currently head of the International Society for Industrial Ecology, argues that we're doing "sustainability" all wrong - using band-aids like ecoefficiency to reduce "unsustainability" - but not really building true sustainability - or, as Ehrenfeld prefers to put it, "the possibility that humans and other life will flourish on Earth forever."

Deciding when and whether to print just got a lot easier, thanks to the release today of a new infographic -- Pixel and Print Logic -- from Natural Logic, Domtar Paper and the Institute of Sustainable Communication.

We've all seen that little message at the bottom of emails -- saying, in effect, "you're a bad, thoughtless person if you even think about printing this email." It's not that simple of course. Paper can bring real environmental concerns -- deforestation, soil loss, water impacts, growing waste streams -- but so can use of digital technologies -- carbon emissions (from the energy to run servers, printers, PCs, smartphones, etc), conflict minerals, e-waste, etc. Each resource can be produced and managed in better and worse ways. And each has its place in an environmentally smart information strategy.

So what's a thoughtful, responsible information hound to do? You can't conduct a Life Cycle Assessment (LCA) every time you need to decide. But you can use this simple, light-hearted flow chart – inspired by the legendary What Beer Should I Drink flowchart (and based on Natural Logic's analysis of more than 70 LCAs for Hewlett-Packard) – to help you print responsibly.

I participated last week in Redefining Value: The New Metrics of Sustainable Business, a day long workshop produced by Sustainable Life Media and the Wharton School of Business. I moderated the first half of the day. Here are my opening remarks.

I'm Gil Friend, founder and CEO of Natural Logic Inc. We help companies design, implement & measure profitable sustainability strategies.

Throughout the last 20 years this has included a big focus on metrics. We built Business Metabolics -- probably the first sustainability dashboard -- in 1995, then evolved it into OpenEco.org with Sun Microsystem, and lately with a startup bringing radical transparency to supply chain metrics.

We've done this because metrics are about decision making, not just reporting. Because what companies measure matters, and drives decisions, behavior and results. This is no different than financial metrics; nobody thinks a balance sheet is just something the 10-K or annual report, but too often sustainability metrics are relegated to CSR reports, when they belong on management dashboards.

This leads to some of the key questions we'll consider today: How do we measure what matters? How can we use "new metrics" to make us smarter? All of us, not just leaders, but everyone in the organization. J.M. Juran, one of the fathers of Total Quality Management observed (in 1948) that, "to be in a state of self-control, a person should be provided with knowledge about what he [sic]... is supposed to do, what he is actually doing, and what choices he has to improve results wherever necessary.... If any of these three conditions [is] not met," Juran noted, "a person cannot be held responsible." Unfortunately, in most organizations, one and sometimes all of these conditions is lacking. We fly blind and yet expect performance from people and organizations, even though it's clear from Juran's formulation that most of us are not in a "state of self-control... [and] cannot be held responsible." But if we're to have any chance of success in the battle against climate change, we have to be both self-controlled and held responsible.

Put another way, how can we give people a clear line of sight that connects actions, results and goals? People perform best with it; markets can't work without it.

Chauncey Bell and I observed, seven years ago, that "Business is on a collision course with a set of global shifts that almost no one has adequately prepared for. These inevitable surprises are coming fast. For those who are ready, these shifts will be platforms for change; for those who are not ready, they are traps."

So businesses need to be able to align their own needs, the needs of the planet and the needs of the market. The problem was, and is that "most companies are spending good money on accounting structures and traditional ways of observing the business that have you watching and measuring the wrong things, in the wrong time frames" -- and in ways that overlook material risk and material value.

"The wastes you’re watching, " Chauncey notes, "are not the wastes that will matter in the future. From force of habit you are spending good money accounting for obsolete waste, while overlooking other kinds of waste that are far more costly for you." (Careful. What he means by waste is not what you probably mean.)

This is challenge not just for sustainability leaders but it's especially pertinent for CFOs. With a few notable exceptions, CFOs are mostly new to the sustainability game. At most companies CFOs are peripheral to the sustainability conversation, but central to its -- and their own -- success!

So what can we do about it? How can we measure what matters and use those metrics in WAYS that matter. That's what we'll be discussing today -- to see what we can learn together, how we can build on this, and elevate the body of practice for all of us.

(Here's a summary of the day, with links to the presentations.) And a few of my past writings on the subject:

- Key Sustainability KPIs: the simple, the sobering, the significant

- Generative Feedback

Metrics for Wholeness (podcast)

- EcoMetrics: Integrating Direct and Indirect Environmental Costs into Management Information Systems (PDF: 1998)

I closed the day with these observations:

This has been an full and stimulating day. There are many things I could highlight from the day's presentations, but i'll just mention two that particularly stuck with me.

Paul Herman, CEO of HIPinvestor, asked "what's your most important asset?" This was a smart room, so everyone said "People." "Then where," Paul asked, "are people on your financial statements?" They're a cost and a liability. How can anyone manage a company with metrics that present such a distorted picture of what really matters? (Especially when the 100 best companies to work for have outperformed the S&P500 by 2-3x over the past 10 years?)

Dave Stangis, Vice President, CSR, Sustainability and Community Affairs of Campbell's Soup, brought it down to earth, with a simple, pragmatic approach that has resulted in common sense metrics like growing the percent of revenue delivered by "Better For You" foods. "A goal," Stangis reminded us, "is not a prediction of what you already know you will do." But that raises another challenge -- how to handle the essential role of failure.

It's essential, as we drive relentlessly toward success (and often tie metrics to tie to compensation), that we also allow room for failure. Modern business culture tends to punish failure, quickly and mercilessly. But wIthout failure, there is no success. Ed Land understood this; Land issued a memo to the staff at Polaroid in the early 50 saying that he would fire people who didn't fail enough -- because he understood that an innovation company couldn't succeed if people didn't feel free to try many ideas, and to fail often, while finding the best ones.

Don't we need key metrics to help guide behavior? Maybe. The book of Deuteronomy recounts the final teachings that Moses, just before his death, offered to the children of Israel. After leading them through the wilderness for 40 years, after delivering the principles, laws and social infrastructure on which to build a community, he summed it up very simply: "Do what is right and good."

Paul Herman asked Dave Stangis earlier -- and each of us -- "If you were CEO, what would you do?" I would ask everyone "Why are you working here? What do you most want to do with your job, and this company?" It's a version of the powerful question we ask all our clients: "What are you really here to do?"

Because it's not really all about metrics. As our old pal Al Einstein observed, "Not everything that matters can be measured; not everything that can be measured matters.” Metrics don't tell you what to do, any more than than a business case tells you what to do. They can tell you how well you're doing, but what to do comes from your heart. As does courage.