Professor Steve Powell
Re-Creating the Box
What could Wal-Mart, the world's largest retailer, and Seventh Generation, producer of environmentally safe household products, have in common? According to Wal-Mart Vice President Andy Ruben and Seventh Generation President Jeffrey Hollender, each company is committed to business sustainability. Both men spoke at the Tuck School's fourth annual student-run Business Sustainability Initiative conference held on February 24, 2006.
Nearly 250 people attending the conference listened to speakers and panelists relate success stories in social entrepreneurship, clean energy technology, and microfinancing, and ideas about other opportunities for, and challenges in, creating a more sustainable world. The conference message was clear: when it comes to sustainable business practices, don't just think outside the box—recreate it.
"Since its inception, the mission of the conference has been to bring together business leaders from a variety of fields to discuss the role that they can play in creating a more sustainable world," said Whit Rappole T'06, who, with Shruti Sehra T'06, organized the conference, titled Building Sustainability into Markets and Businesses. "We selected the theme for this year's conference to suggest that to enact durable change requires incorporating sustainability ideas in the structure of organizations and the design of markets." Tuck's Allwin Initiative for Corporate Citizenship co-sponsored the daylong event with the Thayer School of Engineering at Dartmouth and Vermont Law School. This year's event featured nearly two dozen panelists from nonprofit and for-profit organizations and two keynote speakers.
Keynote speaker Andy Ruben, vice president of corporate strategy/sustainability for Wal-Mart Stores, Inc., opened the conference by outlining Wal-Mart's goals to be energy efficient, produce zero waste, and support products that sustain resources and the environment. Quoting business guru Peter Drucker's remark that "every single pressing social and global issue of our time is a business opportunity," Ruben described Wal-Mart's push to reduce product packaging and broaden its line of organic cotton products. The company also is looking at ways to become energy self-sufficient, including use in its facilities of a heating system that incorporates used cooking oil. "By becoming more environmentally responsible and thus more efficient, the savings can be passed on to the consumer," he said. Ruben said other corporations likewise need to "look around and see what doesn't make sense"—such as pollution, over-fishing, and other unintended consequences of production—and create business opportunities that will provide solutions and add value. But, he added, companies will have to change their mindset before they can really change the world.
Ruben's comments were well received by the crowd in Cook Auditorium. Rappole's later remark that he was "impressed by the amount of work that Wal-Mart has already done and the breadth of their effort" reflected the audience's response during the Q&A following Ruben's presentation.
But the event's other keynote speaker, Jeffrey Hollender, who spoke later in the day, took issue with the giant corporation. "I'm surprised that you let Andy Ruben off so easily!" he told the audience. Hollender, founder, president, and corporate responsibility officer of Seventh Generation, Inc., said he will not supply the company's line of eco-friendly household products to the mega-corporation until it demonstrates a stronger commitment to social responsibility.
Hollender founded Seventh Generation 17 years ago on a promise to adhere to sustainable business practices, and he noted the firm's growing market, particularly in recent years, testifies to the value of responsible corporate behavior. He said more companies are discovering that socially and environmentally irresponsible behavior in pursuit of profits can be costly and damage their brand image, employee loyalty, and stock value. Corporations must rethink the principles and purpose of business and not allow themselves to be driven solely by the accumulation of wealth, Hollender said, adding that he believes it can happen. "I'm an optimist," he said.
So is David Green, founder of Project Impact. Green, one of three participants on the Challenges and Successes of Social Entrepreneurship panel, wanted to find a way to produce sustainable medical technology to help the poor in India. He collaborated with Aravind Eye Hospital to manufacture affordable sutures and intraocular lenses. Today, he produces the lenses for $1 and sells them for $4—the same lenses that sell elsewhere in the world for $300—and he makes it work through a tiered pricing system. Green noted that the high margins of most medical companies have kept them from being similarly socially transforming.
Dana Dakin uses microfinancing to support small entrepreneurial ventures in Ghana, West Africa. She is founder and president of WomensTrust, Inc., and was one of two panelists to answer the question, Can microfinance achieve financial and mission success? Dakin, who sold her car to provide initial funding for the program, charges 15 percent interest for short-term loans and takes clients who don't pay to small-claims court. But the money her enterprise makes is funneled directly to clients, ultimately empowering women through job creation. "It's all about investing in people. There is no other agenda," she said.
In planning the conference, student organizers Sehra and Rappole tried to provide a variety of perspectives on the panels "rather than just trying to preach to people. It is very important for us as future business leaders to understand the true trade-offs of the decisions we make," said Sehra. "Hopefully, through the conference, we are building more awareness about sustainable business and we will build a strong alumni base in related fields."
The organizers even incorporated the message of sustainability into other parts of the conference, including food preparation, door prizes, and giveaways. The luncheon consisted mostly of organic foods from local vendors, for example.
The record crowd in attendance represented more than a dozen schools, including Harvard, MIT, Yale, Cornell, Tufts, the University of Vermont, the University of Maryland, Antioch College, and Utrecht University in the Netherlands, as well as a range of businesses and nonprofits.
The fourth annual Business Sustainability Initiative conference took place on February 24, 2006. For more information on the conference, visit the Business Sustainability Initiative website.
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