For years, companies have heard what not to do when it comes to making business practices more sustainable. But what steps can guide companies toward both ecologically responsible and financially profitable operations?
Businesses can and should turn to nature-inspired principles, which can transform their companies from resource depleters to resource reusers.
The materials parsimony rule guides a rethinking of input sourcing decisions and a dramatic simplification of the number and types of materials used in products. Importantly, materials parsimony should not be confused with the environmental management strategy of eco-efficiency. Eco-efficiency is about the quantity of materials being used in products. Materials parsimony is instead about the number of types of materials used, regardless of quantity.
Asking businesses to copy nature takes things a bit too far. Our production technologies are not yet sophisticated enough to emulate nature's manufacturing methods. But companies can nonetheless look to nature to understand the benefits of simplifying their materials palette. Many could dramatically reduce the number of materials employed, mimicking nature with a small number of materials doing the yeoman's work, and reserving a smaller set of materials for special isolated applications.
One look at our modern industrial landscape and it quickly becomes clear that materials parsimony has not been businesses' guiding principle. Our economy is filled with an ever-growing diversity of materials, from organic fibers to synthetic plastics. Industry's materials innovation has clearly been a boon to business and to many consumers; plastics alone have created whole new product markets from "rubber" duckies to artificial hearts. But this broad proliferation is not cost free. And sustainability concerns are now forcing companies to confront the downside of modern material proliferation.
Thus far, corporate pioneers who have begun simplifying their input materials have been motivated by risk management concerns. Driven by potential toxic liabilities and a growing corporate ethic of total product responsibility, a select number of companies have begun using tools to evaluate the health and environmental implications of their material sourcing choices. This is a good first step and is in accord with the biosphere: nature's palette is not just parsimonious but also largely non-toxic. But there's another reason for pursuing parsimony that most managers have yet to recognize: a parsimonious materials palette is a vital first step for cost-effective recycling.
It's much easier to create a new compound than to assess its human or environmental impacts. Evaluating toxicity requires costly and time-consuming testing. Manufacturers have avoided such testing and, to date, only a fraction of the synthetic chemicals available on the marketplace have undergone detailed human or environmental health risk assessments.(i) This dearth of information means we usually don't know for certain if a synthetic material is toxic or at what concentration any toxicity might pose a danger to humans and the environment, let alone how it reacts with other chemicals. Our lack of understanding has meant inevitable unwanted surprises.
For example, when Steve Jobs and Steve Wozniak released their first personal computer on April Fool's Day 1976, it looked as if a clean new industry was born. But not long after the birth of Apple, cracks began to appear in the industry's clean facade. In 1981, Silicon Valley resident Lorraine Ross gave birth to a daughter with a rare heart defect. By canvassing the neighborhood she found she was not alone. Miscarriages, cancers and birth disorders in parts of Silicon Valley proved to be three times higher than normal. The culprits were the underground chemical storage tanks that every high-tech campus in Silicon Valley used. Most had leaked, leaving Silicon Valley with the highest concentration of Superfund sites in the U.S. today.(2)
My first job as a professional environmental consultant was to track down pollutants and remediate the groundwater contamination in Silicon Valley. Despite the "clean room" impression, electronics production requires some toxic substances. What I soon discovered was that once these pollutants are released into the environment, cleaning them up is a practical impossibility. Trying to get toxic waste out of contaminated soil or water is like trying to put toothpaste back into a tube -- you can never shove it all back in. And because many chemicals are hazardous at very low concentrations, even a small amount can be a big problem. The cost of trying to remediate a contaminated site was huge. In one typical case, companies would spend over $10 million to figure out how extensive the problem was.
Making a Buck on Parsimony
All of this effort may make it seem like creating a non-toxic, parsimonious material palette is a costly endeavor, but the reality can be surprising. Supplier management and materials sourcing are often subject to the challenge of creeping complexity. In pursuit of top-line growth, companies continuously add "new and improved" innovations to existing products, as well as whole new products. Often these decisions are not managed as part of an overall strategy, but instead are taken on a case-by-case basis. The frequent result is a confusing proliferation of inputs and suppliers. Materials screening efforts often reveal stunningly complex trees of bifurcating supply relations.
This complexity can carry hidden costs. Large manufacturers often have hundreds, even thousands, of supply relationships -- and the costs quickly add up. Just tracking the exception items on an accounting sheet is expensive and time-consuming. Even worse is the fact that many of these relationships are often too small to result in an optimal pricing and sourcing marriage, generating additional unnecessary costs. Reducing materials sourcing needs for parsimony reasons thus can have collateral benefits. True Textiles, for example, initially projected that green screening would increase chemical sourcing costs. Instead, the company netted nearly $300,000 in savings per year.(3)
Beyond cost savings, some companies are finding materials parsimony efforts to be a source of value-adding innovation. At the 2006 CERES Conference in California, for example, where Nobel Peace Prize winner Al Gore and other eco-luminaries were featured, a different kind of door prize was being handed out: bottles of S.C. Johnson's Windex Blue glass cleaner. Johnson was showing off its first product reformulated using their patented Greenlist chemical screening process. In a twist on the marketer's old standby "NEW and IMPROVED!" the company's VP for Global Environment and Safety was touting Windex's new formula as better for the environment. More importantly, it cleaned better than its predecessor and cost less to produce.(4)
Identifying value-creating benefits like these from materials parsimony efforts is important. Reducing materials for sustainability reasons is the foundational step upon which subsequent steps are built. But this approach can also generate early "wins" in terms of cost savings or innovation that provide needed motivation and momentum to continue on to the next steps.
No company or product is an island. For most managers seeking to apply the rules of the biosphere, ensuring that they are part of a mutually beneficial ecosystem inside and outside their organization will be critical to success. But ultimately, applying rules from Mother Nature isn't a costly sacrifice -- it's an incredible business opportunity.
Reprinted by permission of Harvard Business Press. Adapted from Earth Inc.: Using Nature's Rules to Build Sustainable Profits. Copyright © 2010 Gregory Unruh; All Rights Reserved.
(i) Brickman, R., S. Jasanoff, T. Ilgen, Controlling chemicals: the politics of regulation in Europe and the United States, Cornell University Press, Ithaca 1985.
(2) Elizabeth Grossman, High Tech Trash: Digital Devices, Hidden Toxics, and Human Health, Island Press, 2006
(3) Op. cit. xiii
(4) Scott Johnson, VP Global Environment and Safety, S.C. Johnson, personal communication.
Gregory Unruh, author of “Earth Inc.,” is a thought leader dedicated to helping businesses innovate and profit sustainably. A doctor of international technology and environmental management, Dr. Unruh is professor of global business at Thunderbird School of Global Management and director of the Lincoln Center for Ethics in Global Management. He is a noted writer, speaker and teacher in the areas of business ethics, corporate social responsibility, corporate sustainability, energy and environment, environmental sustainability, technology and innovation management.