When it comes to environmental issues, there is a general consensus that human activity is adversely effecting our ability to survive on the planet.  One of the many areas in which we are seeing significant degradation is food production, namely fruits and vegetables.  Population growth and rising demand for staple crops like cotton and wheat are two often cited factors that push farmers into an unfortunate negative spiral.  Farmers use some very toxic chemicals to turbo-charge plant development and to ward off crop damaging weeds and insects.  Many of these chemicals are known to cause cancer and negatively affect the health of farmers, field hands, and people in the communities surrounding farmland.  These chemicals also destroy the health of the soil and prevent it from providing the nutrients and minerals crops need to grow.  So, farmers add more chemicals the next year further compromising the soil which encourages applying more chemicals and so on.

The spiral continues when you consider the agricultural products of  companies like Monsanto and Archer Daniels Midland Company (ADM).  They bioengineer weed and insect toxins into crop seeds and, in so doing, have sparked a maelstrom of controversy.  Opponents are concerned about these seeds, known as genetically modified organisms, or GMOs, because we do not have enough data on the total affect these new genetic strains have on an ecology.  An interesting debate, yes, but I’m more interested in the medium in which seeds, GMO or not, grow.  In this case, soil. (Note, plants can also grow in water or air.)

Earthworms in organic waste

Did you know that the poop of earthworms is an amazing natural fertilizer?!  Earthworms eat decaying organic matter and something magical happens as they digest the waste: it is converted into beneficial nutrients and minerals that help plants grow.  This is known as vermicomposting!  By harnessing the natural proclivity of earthworms, we can rejuvenate the natural health of farmland (CNN link) and increase crop yields in a more environmentally sustainable way.  More to come!

It is ridiculous that a corporation receives significant recognition for doing the simplest act.  Changing the lightbulbs is so junior varsity.  In this post, I’m calling out Intradeco Apparel for peacocking the fact that in March of this year they won an award for changing some lightbulbs.  Worse yet, they were given the award by a company called P.E. Energy that appears to be so insignificant they can’t maintain a web site (checked 10/04/2009).  Now, to their credit, they’ve taken more significant steps toward sustainability by obtaining organic certification for their manufacturing facility in El Salvador.  Unfortunately, they forgot to mention who certified them.  That’s kinda important.

Companies should be held to a higher standard when it comes to sustainability.  For starters, we should expect they’ve done the basics like change lightbulbs and recycle printer and copier paper.  They can start bragging when they generate a good chunk of their own electricity from alternative sources or assume responsibility for the sustainability of their entire supply chain.

One of my favorite examples of a company playing pro ball is Ford’s River Rouge plant.  Once a toxic waste dump, Ford rehabilitated their truck manufacturing facility into an impressive nature reserve.  A 454,000 sq. ft. rooftop garden?!  Even Nature is impressed: the birds have found the garden sufficiently suitable to raise their young.  There’s an award!

So, I submit the following for your consideration.  Which is a better award?

Intradeco's Energy Conservation Award

vs.

Ford's River Rouge Plant Award

P.S. If anyone knows someone from Intradeco Apparel, let them know I’m available to help them elevate their game.

Elements Four's WaterMill

Today, I’d like to talk about a very cool idea from a company called Element Four.  They have developed a product called the WaterMill, which sucks moisture out of the area and produces up to 12 liters of drinking water per day.

I really like this idea because I’ve seen something like it at work, IMBY…that’s “in my back yard.”  Well, not my yard, but in my girlfriend’s back yard.  In Arizona, the air conditioning units sit on the roof.  I noticed one day that there was an unusual wet spot on the patio (no jokes please).  When I investigated, I discovered that the A/C unit was indiscriminately spitting out the moisture it sucked from inside the house.  Hmmm, I thought.  Can’t something be down with that?  So, I put a 5 gallon water bottle under the unit’s hose and now capture enough water to help in yard work and washing the car.

I digress.  The WaterMill has built-in water purification technology like carbon filtration (think Britta) and UV light disinfecting to insure a clean and healthy drinking experience.  Element Four definitely gets the Period E sustainability rating for using cool technology as an innovative and environmentally friendly solution.

Both HBS strategy professor Michael Porter and Rotman School of Management economics professor and urban theorist Richard Florida have described the importance of like-minded people clustering together and creating a dynamic and robust economy and social culture.  One such cluster that is developing in Chicago is around sustainable fashion.  The city is already home to green designers Lara Miller and Abigail Glaum-Lathbury as well as several unique sustainable lifestyle businesses including Uncommon Grounds, a local cafe adorned with an organic certified rooftop garden, and eco-minded event planner Shannon Downey of Pivotal Production.  In support of the fashion industry in general, the city is hosting Fashion Focus Week running October 22-25  and has joined with Macy’s in sponsoring six up-and-coming fashion designers mentored by renowned fashion maven Tommy Hilfiger at the Chicago Fashion Incubator.  Also, Chicago’s 375 retail boutiques will soon be joined by a LEED-certified retail property concept called the Green Exchange which, among other features, boasts an 8,000 SF organic sky garden.

Chicago. Sustainable Fashion Hub.

In trying to place Chicago on the Sustainable Value Curve, it dawned on me that as a non-commercial entity, Chicago is probably most similar to a non-profit organization.  And, through favorable policies in support of socially- and environmentally-minded businesses, the local government is well-past the Commerical Awareness Point.  Clearely, the city of Chicago is pursuing a Period F opportunity and, as such, has caused me to rethink how the period is defined.  I am now expanding the period to include municipalities and other governmental bodies that, through their forward-thinking policies, are promoting Sustainable Value and accelerating us towards the momentous point of Unified Achievement.

The LUSH imperative is to use only organic fruit and vegetables, essential oils, and safe-synthetic ingredients (i.e., non-toxic and non-bioaccumulative) in their “homemade cosmetics.”  The Dorset, England-based company started by husband and wife Mark and Mo Constantine sells a range of personal care products for your hair, face, and body as well as bathing products like soaps and shower gels.  My personal favorites are the Olive Oil Soap (discountinued), Hybrid Solid Shampoo (discountinued),  Jungle Conditioner, and Buffy Body Butter.

Now, I had read reviews by pregnant women who stated that for some reason their nausea and morning sickness seemed to magically fade away after using LUSH products in the shower.  Though happy that they felt better, I didn’t really consider the medicinal properties of these personal cleansing agents.  Well, that’s all changed.  Recently I got a bit careless in my poorman’s pedicure and clipped the skin near the nail.  Ouch.  I applied hydrogen peroxide, Neosporin, and a band-aid, but awoke the next day to a throbbing big toe.  Amazingly, after taking a shower, no more pain!  I’m not saying that a healthy shower was the remedy, but I’m left wondering about the coincidence.

LUSH's Charity Pot

LUSH is an amazingly concious and conscientious company that aggressively pursues the triple bottom line.  You purchase their products free of packaging to avoid contributing to landfills, they produce a product called Charity Pot whose entire retail price is donanted to one of 14 international charities, and they continually update their products based on social and environmental findings.  For instance, my favorite Olive Oil Soap was discontinued because LUSH discovered that the palm oil used to make the soap was a culprit in destroying orangutan habitats around the world.

I would say that LUSH is a company that hits the bulls-eye of the Social Awareness Point on the Sustainable Value Curve. And, after the development of their new soap base, leaks into the Period E opportunity profile.

I see Sunflower as the kind of innovative company creating a Period A opportunity on Sustainable Value Curve and placed close to the Social Awareness Point.

I think I have to be one of the few people last November who was actually excited about the economic meltdown!  The system we were using was too ingrained to transition by itself.  It needed a swift kick in its dangly parts to evolve.  Now that the shock has receded a bit, more people are starting to consider ideas of sustainability as a viable option for what’s next.

I was able to see on-the-ground implementations of  triple bottom line ideals last spring on the San Francisco CSR TREK I helped organize.  TREKs are themed excursions sponsored by Thunderbird’s Career Management Center (the CMC).  Through a competitive process, a small group of students is selected for an all-expense paid trip to visit companies, organizations, and institutions in a particular industry or based on a particular subjectmatter.  There are marketing TREKs to Seattle and Cincinnati, another for finance to New York, and one for international development to Washington, D.C.  For our TREK to the Bay Area, one of the companies we visited was Good Capital.  I mentioned GoodCap in my last post and wanted to give them another shout out because of an amazing conference they run which is going on this week.  SoCap09 “brings together a unique mix of the world’s top social innovators, investors, donors, entrepreneurs, and thought-leaders, today’s leading catalysts of change from across the globe.”

Though you can’t be there, be sure to follow the conference online via their blog or Twitter and learn more about social capital markets. The new economy is about using Other People’s Money in a much more conscious and conscientious way!

2009 CSR TREK to San Francisco. Visting Google and Google.org.

There are a many, many approaches to reach the end goal of financial, social, and environmental balance.  Each valid within their own right, each with their own opportunities.  The Value Curve reveals at least six Opportunity Periods in which we can all find a way to participate in making things better.

Opportunity Period A – This is the period for making the kinds of everyday changes that cumulatively make a difference.  Companies that develop and implement corporate social responsibility (CSR) policies (like Cargill and Nestle), introduce healthier and more conscious products into the marketplace (Aveda, Patagonia, Nau, Clorox’s Green Works natural cleaners), commercialize new solutions for reducing our destructive demands on the planet (Dow, Better Place, Raser Technologies), and companies helping other companies become more sustainable (InterfaceRAISE) are pursuing a similar type of  opportunity: incremental or reformative improvements.

Opportunity Period B – This period describes traditional non-profit organizations and their philanthropic missions.  Examples include Doctors Without Borders, foundations like that of the Rockefeller Brothers, former president Bill Clinton, and software billionaire Bill Gates, and government organizations like the Peace Corps.

Opportunity Period C – Some non-profits are working to educate the business world on new ways of doing business that benefit stakeholders not just shareholders.  Notable mentions include the Biomimicry Guild, who are acting as tour guides to how Nature can be used as a model for  solving all kinds of design challenges, and Business for Social Responsibility, who provide a safe, progressive forum for business leaders to develop sustainable business strategies and solutions.

Opportunity Period D – People who employ the resource management skills of business — money, marketing, management, etc. — to creatively solve pressing social and environmental challenges are organized in this period.  They are commonly called social entrepreneurs.  EnviroFit International, the Grameen Bank, and MBA Enterprise Corps are notable examples.  Larger companies like the Indian multinational Tata Motors through the introduction of the Nano automobile are also pursing Period D opportunities.

Opportunity Period E – Admittedly, this is my absolute favorite period! Companies in this period are heroically pursing commercialization of new technologies and ideas that are disruptive — in that they will fundamentally change the way we live our modern lives.  For these pioneers, sustainability is achieved by implementing radical solutions.  You will hear more from me about these kinds of companies, but I recommend you explore the work being done in genetic design by Synthetic Genomics, the controversial overunity energy platform called Orbo, and the mobile desalination facility being developed by Water Standard Company.

Opportunity Period F – The opportunities in this period are focused on accelerating philanthropic missions through socially responsible investing (SRI) — investors caring how their money is used to obtain financial returns.  Funding organizations include Ashoka, the Skoll Foundation, the Acumen Fund, and the Social Venture Network and (social) venture capital firms like San Francisco-based Good Capital.

My hope is that every reader is motivated by at least one of these periods to find opportunities to get involved in making the world a better place for us all.

Sustainable Value Curve

The Value Curve is a sexy piece of work!  In developing it, I discovered a lot of things (the subject of future posts).   The  important thing to understand at this point about the Value Curve  is that it helps determine the relative position of both for-profit businesses and non-profit organizations –  all which first fit the Profile — within the same continuum.

The Value Curve relates time and Sustainable Value, aka triple bottom line goals, and then orients the business world and the non-profit community within that context.  The curve representing the Business World is depicted above the curve of the Non-Profit Community to show how much more Sustainable Value businesses can achieve in a shorter period of time because of the way they use their resources.  The reliance of non-profits on donations often limits them from successfully and consistently achieving their missions, which is why the Non-Profit curve connotes negative sustainability — although strong in social or environmental terms, non-profits are weak in financial terms.  True, there is an argument that many businesses are woefully deficient in their responsibility to society or the environment.  Thankfully, the Sustainable Strategy Profile acts as a first-stage filter to block such companies.

Several Opportunity Periods arise from certain key events.  For example, Period C is created when non-profits decide to work with for-profits in novel ways (the partnership between the World Wildlife Fund and the Coca-Cola Company comes to mind).  Around the Social Awareness Point, businesses start to “get it,” are “getting it,” or have “gotten it.”  Their status can be traced along the Business World curve over time (moving along the curve to the right).  Period D is the usual realm of social entrepreneurs, people who decide to apply business acumen to achieve a non-financial goal (a discussion for future posts, but consider the most celebrated example, the Grameen Bank).

The Commercial Awareness Point is a point of acceleration for a non-profit.  At this point, a non-profit learns to harness business in a beneficial way to insure the longevity of its mission (consider the investing activities of the Gates Foundation).  Over time, a virtuous cycle of collaboration between the business world and the non-profit community blurs the lines between commercial and philantrophic activity — a process I’ve labeled The Medici Effect after Frans Johansson’s 2004 book — and culminates at a point called Unified Achievement.  Unified Achievement is a term I use to describe how all human activity is performed in a way that honors the stewardship role human beings play on the Earth.

In future posts, I will talk about the really cool companies and ideas I’ve encountered and where they fit on the Sustainable Value Curve.  Comments are welcome at any time.

First, I should explain the Chinese characters in the middle of the model.  China matters.  I don’t think enough people in America have an appreciation for that and this post isn’t going to explain it.  But suffice it to say that the Chinese people cannot — should not — copy the Western model of consumption.  What passes for functional for 300 to 500 million people (the population of the US and a few of the more industrialized European countries and sometimes Japan) doesn’t scale up for 1.5 billion.  That fact is so accepted by the Chinese government that sustainability was written into the Chinese Communist Party’s constitution in 2007.  To acknowledge the noble intention of creating a minimum quality of life standard for all of us and  to recognize China’s profound effect on the future, I included the Chinese characters spelling Harmonious Society to remind everyone of the goal.

I chose as the three vertices the attributes I believe most characterize a sustainable business — a company with operations that are at least environmentally benign and a company that is emotionally intelligent to its leadership role in society.  Science is broadly defined as the set of tools (technology, techniques, and know-how) an organization employs for defining problems and creating solutions.  People reminds me who is at the heart of all commercial activity and how every component of and action in a value chain should be evaluated relative to the welfare and well-being of the people participating in it.  Business defines the system we use to motivate the efficient allocation and use of resources and to reward success.  The attributes combine in different ways to categorize and better understand most approaches to achieving triple bottom line success.

For example, when a company offers employee benefits such as Flex Time or on-sight daycare facilities or when it supports the community in which it operates, its actions lie between People and Business.  Some nonprofits like the Bill and Melinda Gates Foundation have missions directed to global health issues such as maternal, newborn, and child health and HIV/AIDS.  These organizations lie between People and Science.  Between Science and Business is Synthetic Genomics in La Jolla, CA, a company founded to commercialize genomic-driven technologies.  Then there are business models that combine all three attributes.  One such company is Houston, TX-based Water Standard Company.  Water Standard is building ships equipped with the latest desalination technology that serve as mobile platforms to bring drinking water to water-impoverished locations around the world.

This model is not meant to be a black-and-white profiling tool.  It should be used as a way of differentiating shades of gray.  Interpreting a company’s placement is just as much art as science.  Consider Synthetic Genomics mentioned earlier.  Although the reasons for the company’s founding seem to encompass only two attributes, Science and Business, the organisms they create are designed to overcome the energy and environmental challenges the world now faces — actions considerate of People.

In my next post, I’ll introduce the Sustainable Value Curve, a very sexy tool for determining how far along a company is in achieving sustainability.