Shiny Green Button

Since it was announced back in 2005, I’ve been following GE’s ecomagination strategy with interest. It was the first bold, mainstream declaration that a sustainability strategy could be a business driver that caught my attention. Wrapped up in GE’s recent pummeling in the stock market and criticism in the media, I recall reading (though I can’t find the article now) how the ecomagination strategy was underperforming, that Immelt had overextended himself, etc. So it was a nice surprise to read about GE’s report, out today, summarizing its performance against its ecomagination goals. By all measures, the strategy has been a success so far, outpacing projected revenue (it hit $14 billion in 2007) as well as GHG emission reductions. So GE has reset its goals, upping its revenue goals by $5 billion to $25 billion by 2010. Nice.

But what I really thought was cool was this tidbit, highlighted in the Environmental News story:

According to GE’s ecomagination website, if seven percent of the land area of Arizona were covered with GE’s GEPV-200-M solar modules, it could generate an amount of energy equal the average daily electricity demand of the entire U.S. If a typical 75,000-square-foot “Big Box” retail store in the the U.S. mid-Pacific region covered its roof with GE’s GEPV-200-M modules, it could generate more than 6.1 million kWh of electricity each year.

A couple of years ago, I heard William McDonough (eco-architect, author of Cradle to Cradle) speak and he made a similar claim–that by installing solar panels along the highways in the Southwest (where right of way has already been established) we could essentially generate all the electricity our country needs.

Anyway, how much could this cost to pull off? $10 billion? $50 billion? $100 billion? Compared to what we’re spending on other things (Iraq and oil subsidies leap immediately to mind), it’s drop in the bucket. Plus, it’s not like this would be an expense–it’s an investment in our national energy independence, likely thousands of jobs, the accelerated advance of related technologies (such as plug-in vehicles). If this is remotely possible, it’s a no-brainer. What the heck are we waiting for? Sign me up.

I found this graph on Environmental Protection News illustrating how the public views the leadership (or lack thereof) of certain types of institutions on environmental issues. It speaks for itself. Unsurprisingly, the U.S. government and corporations have enormous gaps to fill. (And individuals and volunteer organizations are perceived in the best light.) But here's the kicker–people say the feds are actually doing more than companies. That's astounding to me, given the current administration and its record over the past 7+ years. Particularly in light of what many companies are doing–or are saying they're doing–to protect the environment. It's illustrative of the huge communication challenges companies are facing to credibly tell their green stories. People are suspicious, cynical and resentful–maybe more so than with the government because the fundamental assumption is that while government is about and for the people, companies are about and for profit. Unless companies can objectively and consistently change the narrative to demonstrate that environmental leadership reflects enlightened self-interest, it's going to take more than happy stories and reams of data to change such ingrained perceptions.

It's getting harder and harder to hate the Red Sox. Earlier this week, their 24-year-old pitcher John Lester–who battled back to the big leagues after being diagnosed with lymphoma in 2006–threw a no-hitter. And today the team announced that it's installing solar panels at Fenway Park, which opened in 1912 and is the oldest stadium in the American League (Wrigley Field in Chicago is the oldest in MLB). The energy produced by the solar panels will save about 1/3 of the energy used each year to heat water at Fenway. The solar panels are part of a larger program that includes extensive recycling, installing LED bulbs, using less fertilizer and switching to bio-diesel mowers.

Since I grew up in the New York/New Jersey area, I'm steeped in the Yankee-Red Sox rivalry. For generations, the Yankees famously had the upper hand. But since the Sox came back from being down 3-0 to the Yanks in the 2004 playoffs and went on to win the World Series (finally breaking the curse of the Bambino), the Red Sox have been the model franchise. As the team bumbles its way through the early part of this season, the Yankees are building a new stadium that will open next year, replacing the historic Yankee Stadium with a facility with all the modern amenities (and revenue opportunities). But I've been unable to find any information about whether the new stadium will include features to reduce its environmental footprint. In this case, I'm going to assume no news is bad news.

If the Red Sox can bring a nearly 100-year old baseball stadium into the 21st century, why can't the Yankees design their new stadium to be sustainable? What a missed opportunity from the franchise that bills itself as the most successful in all of sports. It could have set a revolutionary example for other new stadiums, much like the Orioles' Camden Yards did for ballpark design in the 90s. It could have lowered its operating costs and future-proofed the stadium against rising energy prices. It could have raised awareness of sustainability issues with the millions of people who attend & watch Yankees games each year. And it could have enhanced the value of its brand by tapping into the growing expectation among mainstream people for companies (and make no mistake, the Yankees are a mega-corporation worth well over a $1 billion) to take the lead in helping mitigate and prevent environmental damage.

So, I have to give the Red Sox my grudging respect. And it's almost enough to make me like them. Almost.

I had hoped to post about this earlier, but on Monday the WSJ had an interesting story about whether consumers reward companies that invest in social responsibility. Using coffee and t-shirts, the paper staged a few tests to gauge the premium people are willing to pay for products that profess to be produced in an ethical way. The tests revealed that consumers are willing to pay a slight premium for socially responsible products (at least, they say they are), but–and this is the more valuable insight–they’ll punish a product to a much higher degree (by buying it only at a big discount) if it’s been produced at the expense of the environment or labor rights.

The story is interesting in its own right, but it gets more intriguing when you consider it in light of this other bit of research that I recently came across. Back in December, Forrester released a study indicating that 12% of U.S. consumers are willing to pay more for green technology products–the so-called "bright greens." Of leading technology brands, Apple counts the most bright greens among its customers (17%) while HP is near the bottom, with 7%. But if you compare the green performance of the companies relative to each other, HP is clearly the leader. It touts the energy efficiency and recyclability of its products, while Apple has been criticized as a laggard in addressing the environmental impact of its products.

But Apple enjoys the greater premium in the marketplace. In general, it seems, people are not punishing Apple for its poor record on sustainability. And while HP is the largest manufacturer of PCs, it’s gotten there largely on the strength of its revitalized design, marketing and aggressive pricing. Not so much on its advances in providing greener laptops, desktops and printers.

What this suggests, I think, is that for mainstream products "green" has greater impact at the more tactical, message-based level rather than at the level of brand. That is, consumers are not loyal to one brand over another on the basis of how green it is–but they may be more inclined to be swayed by green issues at the point of purchase.

Of course, t-shirts and coffee don’t necessarily equate to bigger ticket items like mp3 players or computers, but I think these two studies suggest that, right now, green is more influential in one-off buying decisions rather than building affinity with a brand. Green isn’t yet integrated into our lifestyles, so for most of us it’s a factor, but not necessarily an overriding one.

Last week, I was surprised to read in the WSJ about how Portland is hosting Mazda’s destruction of  4,700 new cars, worth about $100 million, that were victim to a freighter listing in the Pacific a couple of years ago. While the cars weren’t obviously damaged in the accident–they were secured in the ship’s hold–Mazda didn’t want to risk releasing thousands of potentially defective vehicles into the marketplace. I live in Portland and hadn’t heard about this, but it sounds like a huge and complex operation involving lots of precautions against leaking fluids, hazardous waste and theft of valuable components and raw materials.

In any event, it struck me as an interesting test case of how more manufacturers might be held accountable for recycling and/or destroying their products when they’re ready for the landfill or scrap heap. From what I understand, there are already take-back regulations in Europe for technology products, such as computers. A few states in the United States–California, Maine and Maryland–also have e-waste laws (as of 2006) that require manufacturers, such as HP or Dell, to accept some financial responsibility for disposing of their products.

What if that sort of model were applied to other industries on a nationwide scale? Beyond autos, it could affect large appliances, such as refrigerators and washers and air conditioners, and other products with big environmental footprints, such as carpeting. Although it’s extremely unlikely that industries would willingly accept such take-back responsibilities, this sort of regulation could spur greater investment and innovation in making products more easily recyclable. While IT products still have a long way to go, there have been advances in phasing out toxics, using more recycled materials, cutting weight and so on. I’m not aware of similar efforts in other industries. While mainstream appliance manufacturers or auto companies claim they’re making their products more energy or fuel efficient, for instance, I don’t recall ever seeing one promote the recyclability of their products. Climate change is the hot issue, but as we move in fits and starts towards a more sustainable economy, it’ll be interesting to see if manufacturer take-back becomes a broader issue–and, if so, its impact on product development and brand positioning, not to mention pricing models/fees.

Seth Godin hits the nail on the head (as he frequently does) with this post about the coming backlash over green marketing. His point is that until we’re able to quantify the impact of our consumerist choices–and keep track them in a meaningful and even public way–most claims are at best irrelevant fluff and, at worst, counterproductive. The numbers, Seth says, are the necessary weight behind the green stories marketers need to tell. Without numbers, we’re just spinning fairy tales. I can’t say it any better than Seth, so I’ll just end now and urge you to check out his post.

This rant by Bill McKibben in Plenty magazine about the profligate waste of mail order catalogs hit a nerve with me. When I put out my recycling this week, it contained at least 11 catalogs: Eddie Bauer, LL Bean (2), Sierra Trading Post (2), A Step Ahead, J. Jill, Orvis, Levenger, Pottery Barn and Crate and Barrel. This was not an atypical week–we regularly get 8-12 catalogs every 7 days. We used to get what seemed like dozens of credit card applications, but catalogs now dominate. In this age of online shopping, it’s a mystery to me why I’m receiving greater volumes of catalogs now than ever before.

Beyond the horrendous waste that McKibben documents, these catalogs are affecting how I think about certain brands– particularly those that, at least ostensibly, have some connection to the outdoors and, presumably, the environment. While LL Bean and Orvis and Eddie Bauer aren’t authentically environmentally-focused companies, their products and positioning are heavily oriented toward people having a good time outside (while looking good, of course). The trouble is, there’s an obvious disconnect between what they’re promising and what their actions demonstrate, a disconnect that’s getting bigger with each catalog I receive. It’s off-putting, unseemly and wasteful. And I’m going to register with 41pounds.org or some similar service to put an end to it–as well as avoid purchasing anything from those companies.