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Responsible investing for newbies -- share your ideas

I’ve been invited to do a short presentation to an investing club on “sustainable stuff and investing.” My plan is to define socially responsible investing, then to move on to Corporate Sustainability Reporting and to demonstrate it by reviewing reports for one or two of the companies they already invest in.

A while ago, the Brigadiers discussed corporate sustainability and I had my first and very frustrating foray into trying to find the reports for Seventh Generation. (Update - as predicted, I haven’t tried it since then.) We identified a host of websites and resources that I found overwhelming to navigate.

I’m asking my fellow Brigadiers and all our readers: If you had 15-20 minutes to share the two best, most accessible resources, what would you pick? URLs, comics, and memorable phrases — I’m open to anything!

• September 25, 2009 by Janne K. Flisrand
• 5 comments

• tags: corporate responsibility CSR investing

Can you tell the difference between sustainable lumber and clear cut lumber?

(numstead, via Flickr)

I didn’t think so.

A coalition of international environmental groups established the “Forest Stewardship Council” (FSC) in 1993 to help you tell the difference. Even though they’re criticized as not tough enough, the FSC’s third-party certification system has become the gold standard for sustainable forest products.

Following the old adage, “if you can’t beat them, join them,” the American Forest & Paper Association created its own certification system for labeling sustainably managed forests, requiring all members to ‘self-certify’ that they comply with their “Sustainable Forestry Initiative” (SFI) requirements. (SFI became an independent non-profit in 2007.) Buoyed by the support of behemoth members such as Weyerhaeuser the SFI has grown rapidly, with SFI operations now covering approximately 90% of the industrial forestland in the US.

Michael Brune, executive director of the Rainforest Action Network described the SFI efforts as “a new green coat of paint over the same tired practices” and environmental groups have lined up to fight the SFI certification program producing a sobering photo gallery of SFI Certified Logging.

The battle is heating up. The U.S. Green Building Council is now poised to recognize SFI certification in their LEED Rating System. Earlier this month, ForestEthics filed administrative complaints with the Federal Trade Commission and the IRS claiming that SFI’s “phony ‘green’ certification label misleads consumers and cheats taxpayers.” A certification system birthed by the industry it purports to regulate seems a bit like the fox guarding the henhouse.

• September 24, 2009 by Jim Nicolow
• 5 comments

• tags: sustainable forestry initiative

Outdated mental models thwart sustainability -- details at 6

Last week, Andrew Revkin noted the recently released MIT Sloan Management Review/Boston Consulting Group report on the pace and substance of corporate sustainability adoption. I wasn’t particularly surprised at the results nor did it ring any greenwash bells. It’s good but sobering news:

• 92% of 2,000 respondents said they are addressing sustainability in some way, but…

• More than 70% said their company has not developed a clear business case for sustainability.

• Latin American companies see environmental destruction as a major driver but American companies see government regulation as that driver.

• There is a chasm between intent and action (60% of respondents have no plan overall to address sustainability).

• Most respondents expressed limited concern about their gaps in technical and operational capabilities needed to address sustainability.

• “Experts” in sustainability were much more likely to see the value creation/ business case for sustainability than executives less familiar with sustainability principles.

And now, from my own non-statistically significant informal observations:

1. People always fudge on surveys because we want to appear better or more noble than we really are. The truth lies in action. Sustainable progress in product development, manufacturing and supply chain alignment can be at odds with the public posture and lobbying efforts of a corporation which brings into play the sustainable product vs. the not-so-sustainable Board or company evaluation.

2. The report indicates that an outdated mental model was one of the most significant barriers to sustainability plans and action. I have spent 20 years listening to rhetoric about “the environment” as anathema to strategic business objectives. What’s really at fault?

   • Most companies are not true learning organizations capable of suspending the belief they know everything and actually listening to others;

   • Exquisitely effective anti-environmental frames and messaging;

   • Obscure “nature is sacred” arguments by many NGOs and public agencies which fail to make the business case for business value creation;

   • A flat-earth orientation to the world which defies physics, natural systems and is grossly ignorant of our perilous and delicate reliance on Earth systems;

   • Obscene expectations for short-term returns by investors, which lead to dubious business decisions;

   • A lack of a direct feedback loops: We can delay, hide or export all the impacts of an inefficient and injurious business model and still get up each morning and drive our SUVs without batting an eye; and

   • A tendency for corporate spokespersons to spew rhetoric about how awful government is and how “environmentalists” are disconnected from core business values.

The derriere we save may be our own as we wend your way through the sustainability matrix. Saving that derriere should be a core strategy for businesses everywhere because it’s not just about earth physics but the volatility of resource prices, civil war occasioned by climate change and a cranky and environmentally aware younger generation that may not want to work for you or buy your products… if you fall down on the job.

• September 21, 2009 by Heidi Siegelbaum
• 0 comments

• tags: CSR sustainability

A business guide to preventing greenwash

“Understanding and Preventing Greenwash: A Business Guide (opens PDF)” was just published by BSR and Futerra Sustainability Communications. The report finds that trust in business is at record lows with only 13 percent trusting advertising. (I’m frankly surprised they could find a survey pool where even 13 percent say they trust advertising.)

Highlighting continued growth in demand for environmentally responsible products (nearly 40% of the American market now chooses green products over other options), the report finds that greenwash is bad for business and cites ways customers, regulatory bodies, NGO’s, and the media are beginning to stop greenwash.

The authors urge that businesses understand the US Federal Trade Commission’s “Guides for the Use of Environmental Marketing Claims” and take precautionary measures to avoid being accused of Greenwash—the FTC has begun to step in, recently charging Kmart with making “false and unsubstantiated claims that their paper products are ‘biodegradable.’“—and provides example practices for reducing the risk of greenwash, including Lifecycle Analyses and NGO partnerships.

Maybe greenwash is a gateway drug, and mainstream companies will now begin to move beyond greening their PR message to greening their actions.

• August 17, 2009 by Jim Nicolow
• 0 comments

• tags: environmental marketing claims FTC greenwash greenwashing index Kmart

Answering your questions: Bottled water vs. soda?

Thanks to Toni from Winston-Salem NC for writing in to ask why environmental tips focus on reducing the use of bottled water, but don’t tend to address soda.

Being a bottled water lover for 1+ years now, I am trying to figure out why soda bottles are not a concern as well? I would rather see a bunch of people drinking fresh water than sugary soft drinks any day, but that is just me…so why water bottles only?

Although indeed convenient, bottled water has all these things going against it:

1. Cost between $1.50 and $4.80/gallon versus tap water’s $.002/gallon
2. The fuel and energy costs for making the plastic and bottling the water would fill 1/4 of the bottle with petroleum oil
3. Frequently draws down (or depletes) your municipality’s drinking water supply; they take the water you are already paying for, rebottle it, then resell it to you at 1,000 times the cost (can we say rip-off?). This leaves less water for agriculture, fish, recreation and yes, tap water
4. Bottling companies are increasingly trying to privatize water rather than leaving it in the hands of local populations
5. Plastic bottles are a cocktail of toxic chemicals
6. 85% of plastic bottles are ditched as garbage and never recycled

You should visit the Responsible Purchasing Network where you can find data to your heart’s desire on bottled water. Just recently the GAO issued a report as well, 09-610, which concludes that EPA standards for drinking water contaminants are stricter than the standards covering bottled water.

I don’t know much about soda bottling but do know it also involves significant inputs of local water and has caused much consternation. Do yourself a favor and get a stainless steel bottle and fill it up with yummy Winston-Salem water rather than supporting an inherently corrupt, illogical and non-consumer friendly proposition.

• August 12, 2009 by Heidi Siegelbaum
• 8 comments

• tags: bottled water water use

Horizon Organic to consumers: sewage sludge is good for you!

Already plagued for falling prices and other woes, the organic food industry is now confronting 800-pound gorilla Dean Food’s decision to create a new line of “natural” yogurts and milks through its subsidiary, Horizon Foods. For anyone vaguely familiar with advertising claims, “natural” and “healthy” are big sellers, regardless of the fact that the terms are barely regulated in the food market and are largely meaningless.

The threat — which is considerable — is that this move will encourage a shift of organic dollars, the benefits of organic farming and a pretty tight USDA regulatory system toward a Wild West free for all: the ambiguous abyss called “natural.”

The feds (aka the USDA and FDA) have respectfully declined to define “natural” except for a very narrow class of products. And so Dean Foods will fill that void with their own: natural Dean products will be those “produced without added hormones, artificial sweeteners, artificial colors, flavors, preservatives or high fructose corn syrup.” Well, that’s reassuring.

Claims for natural meat and poultry only are defined and regulated by the USDA: for meat and poultry to be labeled “natural” it must be minimally processed (a process which does not fundamentally alter the raw product). The label must explain the use of the term natural (such as ‘no added colorings or artificial ingredients’ or ‘minimally processed’). But this is where clarity disappears.

Dean’s new “natural” yogurts and milk can — and will — come from dairy cows that have eaten pesticide laden feed such as corn and soy, antibiotics, pig and chicken byproducts, and sewage sludge. The only bad boy from the list of conventional animal feed that Dean has prohibited is hormones. So what’s a little sewage sludge and pesticide residue going to do to your kid anyhow?

Debates rage on whether organic food is more nutritionally complete or “better” for the consumer. Opinions vary considerably but even the EPA itself admits that children are particularly susceptible to pesticides for many reasons:

• children’s internal organs are still developing and maturing
• due to their lower body weight, children have increased exposure to anything in substances they eat or drink
• pesticides block nutrient absorption

The Score:

1) The International Dairy Foods Association and Grocery Manufacturers Association don’t want a definition of natural (just read their letter to USDA’s Food Safety and Inspection Service from March 2, 2007).

2) Consumers responding to the recent Shelton Group Survey trust natural over organic (note to organic marketers: Get working!).

3) The FDA will not engage in rule making on “natural” advertising claims due to “resource limitations and other agency priorities.”

4) The new Horizon products are aimed at toddlers and children (who are particularly at risk for pesticide exposure).

5) Oh, and the American Academy of Allergy, Asthma & Immunology concedes that milk is the number 1 cause of food allergies in children.

So, all you confused consumers out there, remember this: ATTENTION ALL SHOPPERS: Natural = pesticides.

• July 22, 2009 by Heidi Siegelbaum
• 5 comments

• tags: Dean Foods Horizon Organics natural organic

Is Wal-Mart making my eco-dream come true?

UPDATE 7/15/09 2:53pm — Sam Eaton previews Wal-Mart’s announcement on Marketplace today.

Anyone who has followed the Greenwash Brigade knows that my personal eco-dream is a single Sustainability Index that is easy for all consumers to understand, and that applies to everything from Acme Iron Bird Seed to a Trident Missile.

I think it would enable consumers who care - but who don’t care enough to research products on the Skin Deep Database before heading to the mall - to make better decisions on every purchase. And that they would, if it were valid and clearly placed on every product.

Daniel Goleman agrees with me. It seems WalMart agrees with me, too - and they’re making it happen.

My job is to write about greenwash, but until the index (and the messy, messy details underlaying it) are public, it’s impossible to say whether it is or it isn’t. The big W has been making significant steps for a while, so maybe they’ll do it right. The further I read, the more hope I have, because they seem to have the right players at the table - including my hometown big box brand Target and a host of life-cycle-analysis experts.

On the other hand, I have to agree with Gunther: “Who chose Wal-Mart to be America’s regulator?” I’m not sure I’d even trust Seventh Generation, a brand that has played a leading role in the corporate sustainability movement and in providing product information to consumers for two decades, to take this on! And Wal-Mart still has a long way to go to gain my trust.

For the moment, I’m glad someone is doing it (even if it is the biggest of the behemoths).

It will make a difference.

• July 15, 2009 by Janne K. Flisrand
• 5 comments

• tags: Seventh Generation sustainability index Wal-Mart

Talk about strange bedfellows: Dow Chemical & Greenpeace on cap and trade

We’ve had Dow Chemical in the Greenwash Brigade’s crosshairs in the past, so climate change skeptics chew on this: Greenpeace AND Dow Chemical are BOTH calling for action to combat global climate change. Greenpeace activists scaled Mount Rushmore on July 8th calling for President Obama to show leadership. That’s hardly surprising.

(Here’s a picture of the unfurled banner, via solveclimate.com:)

But the next day Rich Wells, the VP of Energy at Dow Chemical also encouraged congress to pass a cap and trade program to fight climate change, stating, “We believe the cost of inaction will far exceed the cost of comprehensive, far-ranging and expeditious action today.” Wells rightly expects that taking action can be good for the environment AND business.

Dow Chemical AND Greenpeace calling for action? It’s time to wake up, climate change skeptics. You’re as relevant as the Flat Earth Society.

• July 14, 2009 by Jim Nicolow
• 1 comments

• tags: cap and trade carbon emissions climate change dow flat earth society global warming greenpeace

The "G" in GM is for green?

The AP reports that General Motors has emerged from bankrupcy ready to “go green.” Literally. GM is apparently contemplating changing their logo background from blue to green (image via autoobserver.com). The cynical “greenwash brigader” in me wants to scream, “Greenwash!” Come on, this is the company who brought us such behemoths as the Hummer, the Escalade, and the Suburban.

The problem is, I have a dog in this hunt. I grew up in Michigan and have seen how the state has been ravaged by the American automobile industry’s loss of dominance. They should have seen peak oil coming, and either didn’t or chose to ignore it. But I WANT them to lead again. I hope that this bankruptcy provides the opportunity for them to truly reinvent themselves.

Larry Burns, GM’s VP for R&D, says that he sees a unique opportunity to “reinvent the automobile” and sees the future as a highly-efficient, electrically-driven automobile. Hopefully greenwash is a gateway drug, and GM will go beyond a green logo to become a green company. I wish them luck, and will be watching closely… cynicism held for the moment.

• July 13, 2009 by Jim Nicolow
• 6 comments

• tags: auto market General Motors GM greenwash

CFL faux pas from an ecological intelligence expert

I just enjoyed the first 45 minutes of a Minnesota Public Radio call-in show. Daniel Goleman is touting his book, “Ecological Intelligence: How Knowing the Hidden Impacts of What We Buy Can Change Everything,” and I was fantastically excited that he was talking about transparent, holistic ecological labeling for products. (In essence, he was touting the single-sustainability-label concept I suggested here.) He recommended a great-sounding tool, Good Guide. (I’m testing it now.)

About eight minutes before the end of the hour, it fell apart. A caller commented on all the mercury and transportation miles he was generating disposing of CFL bulbs — and Mr. Goleman congratulated him on his systems thinking, going on to note that we all need to think like that, and that the creators and promoters of CFLs neglected to do so.

I was flabbergasted. He’s promoting one of the most-debunked urban legends of anti-environmentalists — on “my” reliable radio station. Huff.

A quick web search on “mercury cfl” turns up a load of corrections - mostly about two years old. The Energy Star fact sheet (PDF) is clear, the EPA fact sheet (PDF) talks about other mercury sources in homes, too, The NPR story is the most nuanced. Then, there are a number of smart blog posts. Plus, there are new, lower-mercury bulbs now available.

Mr. Goleman, after the clear and nuanced understanding you presented during the show, I’m astounded that you didn’t immediately connect mercury from electricity production to total mercury emissions and correct the misinformation.

• July 7, 2009 by Janne K. Flisrand
• 5 comments

• tags: CFLs electricity mercury misinformation