Greener Isn't Green. Brown Isn't An Option


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The presentation was given at the 2009 CHaINA Supply Chain Management conference in Shanghai on November 4, 2009.

Entitled Green Isn't Greener. Brown Isn't An Option, this presentation focuses on the economic motivations that will drive sustainability, steps that some firms are making, and what happens to firms who fail to embrace sustainability

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Greener Isn't Green. Brown Isn't An Option

  1. 1. Clean Up or Close Up Going Green Isn’t Greener Staying Brown Isn’t an Option
  2. 2. The World Wakes Up to Costs of Carbon (Dioxide) 150 USD Oil <ul><li>Diesel and gas inflation brought calls for change that drowning polar bears could not </li></ul><ul><li>Pressure on governments to regulation and subsidize solutions </li></ul><ul><li>Pressure on industry to change - to reduce waste and increase efficiency </li></ul><ul><li>Pressure on consumers to change habits – public transport, bicycles, and even walking! </li></ul>Treehuggers and yuppies unite! Global Warming <ul><li>Al Gore (and his drowning polar bears) catalyze global awareness </li></ul><ul><li>Inconvenient Truth and 11 th hour become award winning movies </li></ul><ul><li>Citizens begin learning about “carbon footprint”/ Schools begin teaching environmentalism </li></ul><ul><li>TV Shows on CNN & Discovery highlight human impact on the environment while CNBC covers investment opportunities </li></ul><ul><li>Children tell their parents to save the word </li></ul>Cleantech Investment <ul><li>Investment in clean technology </li></ul><ul><ul><li>Renewable energy (wind and solar) and alternative fuel enter consumer investor portfolio </li></ul></ul><ul><ul><li>Vernacular/ technology are enter mainstream conversations on television </li></ul></ul><ul><ul><li>Cleantech investment books become best sellers </li></ul></ul><ul><ul><li>Economics of and focus on cleantech firms improves with each dollar rise in oil </li></ul></ul>
  3. 3. Events that are Changing China Labor Scandal <ul><li>Immediate Impact </li></ul><ul><li>Domestic and International press coverage </li></ul><ul><li>45,000 investigators sent to Shanxi </li></ul><ul><li>Public acknowledgement of system failure and call for change by party </li></ul>Product Recalls <ul><li>International witch hunt and tit-for-tat </li></ul><ul><li>Economic impact to Chinese manufacturers </li></ul><ul><li>Questions at home about products surface </li></ul>Immediate Impact <ul><li>Immediate Impact </li></ul><ul><li>Environmental awareness took a quantum leap </li></ul><ul><ul><li>Domestic / International press coverage </li></ul></ul><ul><ul><li>National support and sympathy for affected </li></ul></ul>Taihu Lake 5.12 Earthquake <ul><li>Immediate Impact </li></ul><ul><li>24/ 7 news coverage – with citizen journalists first to report (twitter) </li></ul><ul><li>Intense corporate pressure to donate and manage messaging carefully </li></ul><ul><li>First time many firms experienced the “mass” media </li></ul><ul><li>24/7 Full press coverage on TV, newspaper, blogs, &twitter </li></ul><ul><li>Public awareness of problems with food industry, and call for changes </li></ul><ul><li>Ongoing investigative reporting into other areas / other companies </li></ul>Immediate Impact Milk Scandal
  4. 4. Solar Panels Hybrid Cars Wind Mills LEED Certifications Double-side Printing Organics Carbon Offsets Green Jobs China will lead from a need for clean air, water, and food… Framing Sustainability Populations & Labor Consumer Safety Urban Planning Urbanization Food & Agriculture Landfills & eWaste Over-packaging Healthcare Managed Resources Traffic and Transport Healthcare
  5. 5. Making the Case <ul><li>The Door was open for change… </li></ul><ul><ul><li>Consumers were becoming citizens </li></ul></ul><ul><ul><li>Citizens were become activists </li></ul></ul><ul><ul><li>Governments were responding </li></ul></ul>The Business Case For Sustainability was made
  6. 6. Clean Technology Economics Built Environment Manufacturing Resources Civil Society Social Services <ul><li>Land Use </li></ul><ul><li>Renewable Materials </li></ul><ul><li>Food & Agriculture </li></ul><ul><li>Forests and Parks </li></ul><ul><li>Bodies of Water </li></ul><ul><li>Labor Pools </li></ul><ul><li>Waste Management </li></ul><ul><li>Air Quality </li></ul><ul><li>Life Cycle Analysis </li></ul><ul><li>Closed Loop mfg. </li></ul><ul><li>Product Design </li></ul><ul><li>Packaging/ Waste </li></ul><ul><li>Logistics/ Transport </li></ul><ul><li>Ethical Supply Chain </li></ul><ul><li>Quality Control & Assurance </li></ul><ul><li>Recycling & eWaste </li></ul><ul><li>Financial Markets </li></ul><ul><li>Green Economies </li></ul><ul><li>MFG Vs Services </li></ul><ul><li>Urbanization </li></ul><ul><li>Rural/ Urban Gap </li></ul><ul><li>Consumer Spending </li></ul><ul><li>Green Consumers </li></ul><ul><li>Urban Planning </li></ul><ul><li>Building Materials </li></ul><ul><li>Urban Transport </li></ul><ul><li>Greenspace </li></ul><ul><li>Energy/ Water efficiency </li></ul><ul><li>Build Retrofitting </li></ul><ul><li>Building Operation </li></ul><ul><li>Affordable Housing </li></ul><ul><li>Smartgrid </li></ul><ul><li>Biofuels </li></ul><ul><li>Transportation </li></ul><ul><li>Waste-to-energy </li></ul><ul><li>Water Filtration </li></ul><ul><li>Clean Coal </li></ul><ul><li>Renewable Energy </li></ul><ul><li>Carbon Offset/ Trading </li></ul><ul><li>Civic Engagement </li></ul><ul><li>Philanthropy </li></ul><ul><li>NGO Development & Capacity </li></ul><ul><li>Social Enterprises </li></ul><ul><li>Cultural Preservation </li></ul><ul><li>Consumer Safety </li></ul><ul><li>Community Program </li></ul><ul><li>Healthcare </li></ul><ul><li>Education </li></ul><ul><li>Poverty Alleviation </li></ul><ul><li>Elderly Care </li></ul><ul><li>Job Training </li></ul><ul><li>Rehabilitation & Counseling </li></ul><ul><li>Financial Services </li></ul>
  7. 7. Supply Chain Management Council Member Experiences Areas in need of Encouragement Switching to Aerodynamic Trucks Switching to More Efficient Modes Switching to Carriers w/ Green Initiative Areas That are Encouraging Reduction in Packaging Materials Selecting Recylcable Packaging Materials Switching to Reuseable Containers
  8. 8. Reasons for Change. Reasons Prohibiting Change Why Firms Are Not… Lack of Expertise. Lack of Incentives. Lack of Regulation??? Why Firms Are Going “Green” Strategic Interests Supplier Performance Customer Satisfaction
  9. 9. Leading the Pack The Big Bang: Wal-Mart <ul><li>October 2008 Announce Sustainability Revolution </li></ul><ul><ul><li>Comprehensive effort across supply chain and stores </li></ul></ul><ul><ul><li>Alternative Energy, Transportation, Packaging, Recycling </li></ul></ul><ul><li>Not spontaneous. It was planned for years. Wal-Mart is Serious </li></ul><ul><li>Others will be forced to follow </li></ul><ul><li>2008 Wal-Mart Home Entertainment Design Challenge </li></ul><ul><ul><li>Great design that attracts consumers. </li></ul></ul><ul><ul><li>Product innovation that reduces the environmental impact for its product category. </li></ul></ul><ul><ul><li>Packaging design that facilitates reuse and recycling, reduces waste, and reduces or eliminates the use of toxic materials. </li></ul></ul><ul><ul><li>HP Reduces packaging 97% </li></ul></ul>Breaking Barriers, Changing Habits, & Encouraging Change
  10. 10. Ways to React <ul><li>Some Firms will see new opportunity </li></ul><ul><ul><li>Interface Flooring </li></ul></ul><ul><ul><li>Haworth </li></ul></ul><ul><ul><li>Nike </li></ul></ul>Going the Long Way <ul><li>Some Firms will start with a single product </li></ul><ul><ul><li>BYD </li></ul></ul><ul><ul><li>HP </li></ul></ul><ul><ul><li>Esquel </li></ul></ul>Low Hanging Fruit <ul><li>Some Firms will be sustainable from day 1 </li></ul><ul><ul><li>Burt’s Bees </li></ul></ul><ul><ul><li>Bambu Home </li></ul></ul><ul><ul><li>Shokay </li></ul></ul>Starting from Scratch ? Others Will Wait
  11. 11. <ul><li>The business case for sustainability has been made </li></ul><ul><ul><li>Environmental and economical sustainability are not separate items </li></ul></ul><ul><li>Consumers Have Changed – and So Have Their Expectations </li></ul><ul><ul><li>Consumers are becoming citizens, and citizens are becoming active </li></ul></ul><ul><ul><li>Consumer pressure on industry will only grow stronger </li></ul></ul><ul><li>Global Supply Chains, Must Change… Will Change </li></ul><ul><ul><li>Environmental, labor, raw materials, water, and energy constraints have all changed </li></ul></ul><ul><li>Changes will begin with design and end with product take back </li></ul><ul><ul><li>Entire organization will be involved in the process </li></ul></ul><ul><li>Solutions Exist, Cost Savings Exist, and Options are Readily Available </li></ul><ul><ul><li>Technology gains are growing – energy, transportation, etc </li></ul></ul><ul><ul><li>Commoditization of parts, components, and technologies reduces cost of investment </li></ul></ul><ul><li>If you don’t make the changes willingly, you will be force to through competition, regulation, or consumer action. </li></ul>Takeaways
  12. 12. What’s Holding You Back? <ul><ul><li>Learn More : </li></ul></ul><ul><ul><li>All Roads Lead to China </li></ul></ul><ul><ul><li>Collective Responsibility </li></ul></ul><ul><ul><li>Cleaner Greener China </li></ul></ul><ul><ul><li>Follow my Tweet! </li></ul></ul><ul><ul><li>All Roads Lead to China @allroads </li></ul></ul><ul><ul><li>Collective Responsibility @chinaCSR </li></ul></ul><ul><ul><li>Cleaner Greener China @greenerchina </li></ul></ul><ul><ul><li>Contact Me! </li></ul></ul><ul><ul><li>Richard Brubaker [email_address] </li></ul></ul>