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August 2013 - Terra Infirma


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29 August 2013

Skin in the Game

rouletteI sat nervously in the anteroom, waiting for a colleague who had set up this presentation to a meeting of senior managers on one of the big chemicals sites on Teesside. I was there to sell the concept of industrial symbiosis to them - one company's waste becoming another's raw material - as I'd secured funding to run an IS project in the Tees Valley. This was the first environmental project that I had ever conceived and got running myself, it was a big one, I was very excited about it and the nerves were starting to show.

My colleague, who had decades of experience in the industry and a fantastic network, had been coaching me on what to say and what not to say, inadvertently ramping up the pressure. But he wasn't there.

So I went in alone. I did my pitch. At the end I asked "So who wants to get involved?"

Silence.

Eventually the chair cleared his throat. "You've given us plenty of food for thought. We'd be very interested in the results of your study."

"It's not a study!" I protested "I need your companies to take part."

More silence. I played my final card. "I'll leave this box at the back of the room, please put your card in it if you want to join in."

When I collected the box the next day it was empty.

My colleague, who had simply forgotten about the meeting, got some feedback from the managers. He said I'd done a good job, that I had piqued their interest, but "they're very busy people."

A couple of months later we launched the project. We got a high profile keynote speaker, some good industrialists giving case studies, but crucially, we then switched to a workshop format and got people generating ideas of how their business could get involved. There was a palpable buzz in the room and we got dozens of companies signed up. Amongst them was one of the senior managers from that first, fruitless presentation - he became the project's biggest industrial champion and helped drive it to great success.

That was my first lesson in gaining commitment. If you simply explain what you want to do and ask people if they approve, you'll get murmurs of assent, but no real buy-in. As soon as you get people actively involved in developing the project they feel they have 'skin in the game' - a little part of the of project becomes theirs - they will share in any success and share in any failure.

It's the same with, say, a corporation's sustainability strategy. If present a strategy you have prepared in a vacuum to the board and ask for approval, all you will get is people trying to dilute the actions to minimise their exposure. If you get the board involved in pinning down the basics at the start of the process, you will get a much more enthusiastic response. They will have skin in the game.

 

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27 August 2013

Making Connections for Sustainability

sustainability green business networkSustainability will never be delivered by people working in isolation. From a practical point of view, you've never transform your supply chain, never mind implement something adventurous like industrial symbiosis, without knowing who's out there doing what.

But from learning point of view, restricting your experiences within your organisation or even within your sector will give a very blinkered view of what is possible - the best you can expect is a bit of drearily dull 'best practice'. Most green events don't help - the Powerpoint-Q&A format saps all energy out of a subject and the networking during coffee is simply random, making small talk and watching the more predatory consultants cruising past like sharks (I know someone from a big consumer goods brand who refuses to wear his name badge at conferences so he doesn't get hassled so much).

There are quite different - ie much better - ways of going about networking properly. My own Corporate Sustainability Mastermind Group (CoSM) is based around structured discussions between a small number of top sustainability executives. The intensity of the exchanges brings out some really great insights, learning points and the occasional epiphany. One high street brand told me they wouldn't join because there weren't any other retailers on board - I said that was the whole point!

On a bigger scale, I'm delighted to be opening The Big Eco Show in October with the theme of Conversation, Connection, Collaboration. The even has been structured around round table discussions lead by facilitators - a format I pinched from the now sadly defunct Low Carbon Best Practice Exchange as it is one of the best ways I've come across to get people talking in a meaningful way in an event like this (we decided OpenSpace was a step too far).

No man (or woman) is an island - the sustainability practitioner does need to get out there and keep interacting and keep learning - but choose the forum carefully as many are simply not worth the time and effort.

 

 

 

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23 August 2013

More ethics, fracking, Caroline Lucas MP and the EDL...

Caroline LucasHere's a conversation between me and Mrs K yesterday:

MrsK: What did you think of [Green MP] Caroline Lucas getting arrested at the Balcombe fracking protest?

Me: Difficult one - while I largely agree with her about fracking, law makers aren't supposed to be law breakers.

MrsK: Oh, I think it's great that someone is standing up for what they believe in.

Me: Like the EDL protesting about immigration?

MrsK: Oh, don't be annoying, you know what I mean.

Apart from showing how annoying I can be on a day to day basis, this illustrates the main problem with talking about being 'ethical' - it depends on whose ethics you are talking about. While I'm not a natural placard waver, I, like MrsK, have respect for those who do so in the causes I believe in - pro-environment, anti-discrimination, pro-fairness etc, and disdain for those who take to the streets for issues I don't agree with like pro-hunting, anti-immigration, anti-same sex marriage etc.

But whose ethics are ethical? My stance on same sex marriage could be regarded as intolerant of those whose religious beliefs conflict with my beliefs. I see it as ethical, they see it as unethical.

This problem extends to 'ethical business' - by whose ethics do you adhere? There is a general presumption that this means pro-environment, decent working conditions both in the company and in the supply chain and a strong social purpose. But say a company decides to close its UK factory and open it in Bangladesh where wages are lower. Is that ethical? What the UK loses, Bangladesh gains. So is it ethically neutral? Discuss...

The only way out of such a conundrum is to define what your values are and then stand up for them. I would tend to avoid describing oneself in such dangerously subjective terms as 'ethical' in the broad brush way that some do. Let others decide that for you - they will anyway.

Photo: www.carolinelucas.com 

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21 August 2013

Do You Want Competition or Collaboration in your Supply Chain

race

I'm busy, busy, busy writing my second tome for DoSustainability - this one on Greening the Supply Chain. Even a short book like this requires a huge amount of research, so I've been perusing loads of published case studies and articles and interviewing some leading industrial sustainability practitioners to gather my raw material.

One emerging issue which I'm mulling on is to what degree do you encourage competition amongst suppliers for your business and to what degree do you work with suppliers to find win-win solutions? Some companies are quite brutal with their suppliers, taking a blunt "my way or the highway" line. Others feel mutual loyalty towards their suppliers having built up a trusting relationship over many years and don't want to ditch them on environmental grounds.

Let's look at some fundamental points:

  • You won't hit ambitious sustainability targets with the supply chain you have now - it will have to change;
  • That will inevitably mean losing suppliers who are locked into supplying unsustainable resources;
  • There are usually some current suppliers who could supply more sustainable resources, but currently don't for whatever reason;
  • There will always be a stream of new businesses eager to meet sustainable business needs.

In my opinion, if you are serious about sustainability then you must be prepared to lose suppliers and replace them with greener equivalents. You don't want a recalcitrant supplier to drag you down, or in the worse case, damage your reputation through their actions (or inactions). On the other hand, the ethical business will want to be completely fair and open about how they go about this, giving loyal suppliers ample chance to meet your future needs.

  • Make your sustainability objectives crystal clear;
  • Make the transition processes crystal clear - how, when and why you will assess suppliers and their products/service's sustainability performance;
  • Practice forward commitment procurement - announce what you will need in the future and by when;
  • Be open to entering a conversation with each existing supplier on how they can become part of the solution;
  • Be prepared (resources permitting) to invest in suppliers or a joint venture to develop solutions - if there is a clear case for doing so;
  • Be clear that 'do nothing' is not an option;
  • Be prepared to say "Thank you, it's been great, but it's over."

Be tough but fair, in other words.

 

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19 August 2013

Are You Creating Wealth or Creating Value?

Mark CarneyAt the risk of sounding like a Mark Carney fanboy (yep, second blog in a week), the brand shiny new Governor of the Bank of England told the BBC:

"I think finance can absolutely play a socially useful and an economically useful function but what it needs in order to do so, the focus has to be... on the real economy... And it's the loss of that focus, it's finance that becomes disconnected from the economy, from society, finance that only talks to itself and deals with each other, that becomes socially useless.

One of my other responsibilities is chairing the Financial Stability Board and a lot of what we’re doing there internationally is to strip out that type of behaviour."

This is all music to my ears as I believe too many people, particularly in the City, mistook 'wealth' for 'value' - and that's why the system imploded. We should all be striving to create value in business - particularly what Umair Haque of HBR calls 'thick value' - economic benefits which enhance society and the environment, as opposed to 'thin value' which creates wealth by depleting either or both.

Carney is right - every business must have a social purpose, creating value for others - preferably thick value - otherwise it is simply a leech on the rest of us.

 

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16 August 2013

Is fracking unethical?

no fracking wayI like to think of myself of one of the new breed of pragmatic environmentalists, who have freed themselves from the shackles of traditional big 'G' Green politics to deliver sustainability that works for everybody, not just the few 'who get it.' Central to this is the discipline of seeking an 'objective' view of any technology or issue before taking a position on it. I put objective in inverted commas as I fully acknowledge that any review comes with its own bias, but that does not mean objectivity is not a worthy goal.

So. Fracking. Shale Gas. Here's a test...

The Greens are dead set against it, chaining themselves to gates at the first hint of a drilling rig. The UK's political right sees it as the new Jerusalem, freeing the country from rising energy prices and driving a potential economic boom. Across the pond, Barack Obama has neatly framed shale gas as a medium-carbon transition fuel to a low carbon economy. But there is so much crossfire of opinions, so much noise, it is nigh on impossible to get any 'objective' (that word again) facts on which to base a reasoned view.

We've seen a similar saga unfold over decades with nuclear energy. Nuclear has neither delivered what was promised by its cheerleaders (energy too cheap to meter) or the environmental/social devastation predicted by its detractors (coal is thought to have killed many, many more). The reality has been somewhere in the middle. My hunch is that shale gas will also prove to be neither as good as its proponents claim nor as bad as its detractors purport.

My personal view, until I am persuaded otherwise, is that renewables must be prioritised over shale. As well as the carbon impacts of any fossil fuel (and the likely rebound effect of coal prices dropping), I am very concerned as to why the US has exempted the industry from groundwater  protection legislation, and why the chemicals used are covered by commercial confidentiality. At the very least, renewables should always get a bigger state subsidy than shale, because they have lower externalities (costs borne by other people).

But there's a philosophical point here. Can an energy source be either 100% ethical or 100% unethical? The greens would say fracking was completely unethical because the gas will contribute to climate change, the libertarian right would say it is ethical as it will increase wealth. Neither tribe is likely to shift position, so we can either take sides or do some technocratic analysis.

The technocratic approach says everything has an impact, the question is how much. A wind turbine will kill (a few) birds and many people hate the sight of them. Fossil fuels like shale gas are the main driver of climate change, which will (probably) have severe impacts on a huge number of people, let alone substantial damage to the natural habitat. Therefore on balance I believe the ethical choice is to favour wind turbines - sorry, birds.

Decision-makers use the technocratic approach because at the end of the day they have to make a decision which they can justify. To use a slightly clunky footballing metaphor, they don't have the luxury of sitting on the sidelines waving scarves and screaming abuse at the other side - they're on the pitch playing the ball. Pragmatic environmentalists get changed into their kit and go and help the team that's shooting towards the right goal. Without players on the pitch, you'll never score.

Image www.frack-off.org

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14 August 2013

Mark Carney's not the only one giving 'forward guidance'...

Mark CarneyCanadian financial rockstar Mark Carney has taken up his post as Saviour Governor of the Bank of England and revealed his secret weapon (drum roll...) forward guidance. What this means in practice is that the BoE will set out the conditions for changing interest rates so investors can understand the risks better and make their investments more confidently. Simple, but apparently very effective.

And it turns out that he is not the only one using this technique. One of the biggest impediments of greening the supply chain is the old 'chicken and egg' situation. If there's no demand for a greener product or material, there's no supply. And if there's no supply, well you get it...

The Carneyesque solution is 'forward commitment procurement' - tell the market what you will want in the future, how much and by when. Then suppliers can gear up to supply that need, knowing that the demand will be there - and that demand for the conventional solution will fall. The European Postal Services did this for hydrogen-powered vans and HM Prison Service is doing it for 'zero-waste mattresses'.

Like all the best solutions, simple but clever.

Image: World Economic Forum

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12 August 2013

CSR Hits the Headlines (as per usual...)

newspaperWhat do on-line bullying, zero-hours contracts, on-line porn filtering, the tax affairs of Starbucks, lads mags' covers, the tax affairs of Google, Page 3 of the Sun, the tax affairs of Apple, the phone hacking scandal, working conditions in Chinese factories, the tax affairs of Amazon, the living wage, the horse burger scandal, the Rana Plaza garment factory fire, the fall in wage levels, electricity prices, pay day loans, bankers' bonuses, the pay of charity Chief Executives, the tax affairs of Vodafone, the impacts of shale gas on local communities, the tax affairs of the water utilities and Oprah Winfrey's Swiss shopping complaint all have in common?

  1. They’ve all hit the headlines in recent months;
  2. They're all corporate social responsibility issues;
  3. They're all issues at the core of the business, not some peripheral issue that can be easy solved by a CSR manager.

Why then is CSR still seen as a fluffy like-to-have rather than a core business priority?

 

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9 August 2013

Is there an echo in here?

Here's the latest in the Green Business Confidential podcast series. It's called "Is there an echo in here!" and it's about the dangers of spending too much of your time in the 'green echo chamber'.
 
 

Audio MP3

Or, you can download it here and listen on your MP3 player:

GBC25 Is there an echo in here?

You can get the whole podcast series here or subscribe on iTunes.

 

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7 August 2013

The Fatberg is the Tip of the Iceberg

fatberg
Imagine spending three weeks sluicing away 15 tonnes of congealed fat, wet wipes and 'sanitary items' from a London sewer. A Herculean task if there ever was one - give me the Aegean stables full of sweet smelling horse manure any day.

Most right thinking people's reaction to the 'fatberg' story would be "Urgh!", but us circular economy freaks' initial response is "what a waste!" All that good bio-sourced hydrocarbon could be used as an eco-friendly fuel rather than soaking up more energy to shift and treat. And it seems that London Mayor Boris Johnson, despite his somewhat singular attitude to climate change science, is with us - he wants to use the cooking fat being dumped in London's sewers to power buses.

The circular economy requires a complete shift in mindset. If you have an acidic waste, say, then the conventional wisdom is you must treat it with an alkali to make it safe. By contrast, the circular economist thinks "What a waste of acid and alkali - what can I use the acid for?"

One of my favourite sayings is "waste is a verb, not a noun." As soon as you start making that mental shift, all sorts of possibilities start opening up. These are starting to make an impact on the economy. For example, one of my clients tells me that you cannot buy virgin glycerin in bulk anymore as the market is now dominated by glycerin sourced as a byproduct of biodiesel - a classic industrial symbiosis.

But the fatberg shows we still have a long way to go before we start harnessing all the wasted resources in our economy.

 

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5 August 2013

Zero Hours and CSR

digital clock

Another week, another corporate responsibility issue hits the headlines. This time its the number of workers (up to a million) that are on 'zero-hours' contracts where in any week they aren't guaranteed any work or pay until the very last moment. Many don't get holiday or sick pay. While this might be OK for somebody studying who is flexible timewise and just needs a bit of extra cash, it is no way to live for, say, somebody with parental responsibilities.

I have long been concerned about the deeper structure of the economy. Youth unemployment and a squeeze on the standard of living have been increasing since 2003/4 - so can't be blamed entirely on the 2007/8 crash or different Governments' responses to it. There is something more fundamentally wrong and I suspect the sort of thinking where 20,000 out of 23,000 Sports Direct employees are on zero hours contracts is a part of the problem.

The HBR blogger Umair Haque talks of thick value and thin value - the former is created by business which enhances society, the latter from those who leach value from society. It is clear to me that zero hours contracts lead to very thin value, causing much more damage to society than benefits. It is impossible to deliver thick value unless CSR is truly embedded into the core of an organisation's values - and that, folks, is what our mission must be.

 

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1 August 2013

Happy Birthday to Us, Happy Birthday to Us!

Terra Infirma is 6 years old!Yep, it was 7 years ago today that we metaphorically smashed a bottle of champagne (the smashing was metaphorical, not the bubbly) on the hull of the good ship Terra Infirma and set sail into unknown seas. And with the great financial hurricane of 07/08 hitting us soon after, we learnt our seamanship the hard way.

Dropping the half-baked nautical metaphor, and pushing modesty aside, here's some of the highlights over the last year:

  • Bringing on board some great new clients such as Viridor, News International, Innovia Films and the Natural Resources Research Council;
  • Continuing to work with established clients such as BAE Systems, Johnson Matthey and the NHS;
  • The publication of my ebook/short book "Green Jujitsu" and the development of the associated animation The Art of Green Jujitsu;
  • The continuation of our ever-popular Green Academy webinars, attracting attendees from around the world, and the first full year of the Corporate Sustainability Mastermind Group (CoSM);
  • And to crown it all, getting shortlisted as Green Consultancy of the Year 2013 at the prestigious Business Green Leaders awards.

Not bad in a year which also saw the birth of my third son, Charlie - who seems dedicated to eating us out of house and home.

Looking forward to the year ahead, I'm predicting a steady development of these themes rather than any radical new departures - although I've said that before! One thing I can announce is I am working on a greening the supply chain ebook which will out in the autumn.

So it just leaves me to say thanks to all our readers - especially those who comment on and share my posts here. Splice the mainbrace!

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