[originally posted on huffingtonpost here]
Another Earth Day is here (and gone). It’s probably trite to say, “Hey, every day is Earth Day, but I’ll give it a go. Yes, we need to worry about Earth stuff every day, but not just because the planet is in peril — which is a pretty good reason. Think of it this way: the Earth is often metaphorically compared to our home and, as a fairly recent homeowner, I can tell you that your home needs care and feeding much, much more than once a year (my small lawn of non-pesticide laden, eco-cared-for grass and natural weeds grows really fast). It’s a constant battle to keep a house running smoothly and providing for you and your family.
But let’s take a business perspective. Minding your costs, taking care of your assets, figuring out and fulfilling customer needs — all part of green value creation — are best done consistently and aggressively, not just in big flashy moments of marketing excitement. The days of “plant a tree” Earth Day celebrations being the only thing companies do are over. But many execs still see green as a checkbox exercise, not a corporate mandate and core strategy — do a few things such as retrofitting a facility or putting together a CSR report and move on.
But the environmental work we have ahead of us will be hard and ongoing. Luckily, it should get easier over time. Like the “flywheel” analogy from the bestseller Good to Great, you keep pushing away, and you start to get some real momentum.
All this relates to a question I’ve been struggling with lately: Does it matter if a company or its execs believe in climate change and other environmental imperatives? What got me started on this weeks ago was GM Vice Chairman Bob Lutz’ comment that “global warming is a crock of s***.” And at nearly every talk I give on green business, people at all levels in companies from CEOs down inform me that climate change is not real.
My approach in these moments has generally been to stay quiet or point out that it doesn’t really matter whether you believe it or not, as long as you buy that going green is good for business. If you’re still pursuing green value through, say, eco-efficiency or product innovation, then who cares what you believe. This is basically what Lutz went on to say after his more colorful remarks (“My thoughts on what has or hasn’t been the cause of climate change have nothing to do with the decisions I make to advance the cause of General Motors”). This general idea that you don’t really need the first half of the Green Wave (made up of natural forces/pressures and stakeholders), is a key point my co-author and I make in our book Green to Gold.
But I’m beginning to wonder.
Yes, in the short run, you can go down a profitable green path with the conviction that if enough of your stakeholders care, it’s good for business. But what about in the longer-run, as the excitement that’s swept the business world quiets down and we have to make this new green way of doing business work?
Innovation is hard. Creating new products and services and finding new markets for them is hard. Handling what may be a permanent rise in the cost of all commodities and thus the cost of doing business is extremely hard. Won’t all these pursuits go a lot easier if there’s a bit more on the line than “well, we just have to do this because our competitors are doing it and customers are asking for it”? Won’t employees drive harder if they and their bosses believe the underpinnings of why it’s good for business? When Shell CEO Jeroen van der Veer said recently that dealing with climate change “will be hard work and there is little time,” I believe his employees appreciated the blunt honesty and could set their nose to the flywheel/grindstone.
So does belief matter? I don’t have the answer, but I have my suspicions. The now oft-told green business success story of the Toyota Prius still speaks volumes — the company set out to make an environmental car. It wasn’t just an efficiency pursuit, but a real belief that the 21st century needed a form of transportation that reduced environmental burden. Going forward, GM may have trouble matching Toyota’s innovations if attitudes remain so different.
In the end, doesn’t it hurt morale, creativity, and productivity to hear your boss say one of the biggest drivers for action is a crock?
One Response
You raise a fundamental question for business leaders, and indeed for all those who believe in the power of the free market. Looking at business through the lens of a marketer, I can’t see how disbelief in climate change in the executive suite can have a favorable long-term outcome. Sure, you don’t have to believe in climate change to green your products and operations. You can simply make it another rational business decision to respond to stakeholder demand, like automakers do today by continuing to build gas-guzzling SUVs. But when you, as a business leader, hold no personal belief in climate change you have just signaled to your customers, employees and everyone else that your sustainability initiatives are nothing more than greenwashing. Is the world somewhat better off because GM is greening some of its vehicles, despite Lutz’s disbelief? I suppose so. Will GM be more profitable by becoming greener? Possibly. But I don’t believe even the invisible hand of the market is so amoral that it will reward GM for long, or for that matter, any other company that cares only for the gold in green.