i People, Planet, Profit ii iii People, Planet, Profit How to embrace sustainability for innovation and business growth Peter Fisk iv Publisher’s note Every possible effort has been made to ensure that the information contained in this book is accurate at the time of going to press, and the publishers and author cannot accept responsibility for any errors or omissions, however caused No responsibility for loss or damage occasioned to any person acting, or refraining from action, as a result of the material in this publication can be accepted by the editor, the publisher or the author First published in Great Britain and the United States in 2010 by Kogan Page Limited Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permission in writing of the publishers, or in the case of reprographic reproduction in accordance with the terms and licences issued by the CLA Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned addresses: 525 South 4th Street, #241 120 Pentonville Road London N1 9JN Philadelphia PA 19147 United Kingdom USA www.koganpage.com 4737/23 Ansari Road Daryaganj New Delhi 110002 India © Peter Fisk, 2010 The right of Peter Fisk to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988 ‘LEED’ and related logo is a trademark owned by the U.S Green Building Council and is used by permission FSC logo © 1996 Forest Stewardship Council A.C The FAIRTRADE Mark reproduced with kind permission of the Fairtrade Foundation This book was produced using sustainable materials and printed on 100% recycled paper with no environmentally damaging chemicals used for bleaching 978 7494 5411 ISBN E-ISBN 978 7494 5863 British Library Cataloguing-in-Publication Data A CIP record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Fisk, Peter (Peter Robert) People, planet, profit : how to embrace sustainability for innovation and business growth / Peter Fisk p cm Includes index ISBN 978-0-7494-5411-1 ISBN 978-0-7494-5863-8 1. Social responsibility of business 2. Industrial management Environmental aspects 3. Corporations Growth 4. Social responsibility of business Case studies 5. Industrial management Environmental aspects Case studies 6. Corporations Growth Case studies. I Title HD60.F535 2010 658.4’083 dc22 2009048339 Typeset by Saxon Graphics Ltd, Derby Printed and bound in Great Britain by MPG Books Ltd, Bodmin, Cornwall v For Anna and Clara vi vii Contents Introduction: People and Planet and Profit The People, Planet, Profit Manifesto Part 1: Rethinking business 10 13 My world: Kris, the Indian computer engineer My world: Claire the South African banker My world: Grant, the American entrepreneur 14 15 16 Purpose beyond profits Making people’s lives better Defining an inspiring purpose Turning promises into reality Google and Microsoft: finding purpose in a digital world People, planet, profit: the reality of purpose 17 19 21 24 26 30 Strategies for growth Finding markets with sustainable growth Creating differentiation by doing good New business models for a new business world Apple and Nokia: being cool in a caring world People, planet, profit: the reality of strategy 36 39 42 43 45 49 Inspiring leadership Leaders of the new business world Leaders as the catalysts of change What it means personally 56 58 61 62 viii Contents Patagonia and Timberland: reaching new heights People, planet, profit: the reality of leadership Part 2: Reconnecting business 64 67 71 My world: Sugito, the Japanese salesman My world: Ash, the young Singapore journalist My world: Summerly, the London art gallery owner 72 73 74 Conscience consumers Enabling people to be good The new consumer agenda Segmenting the conscience consumers Coca-Cola and Danone: seeing a different side of life People, planet, profit: the reality of consumers 75 78 81 82 85 89 Sustainable innovation Social and environmental drivers of innovation Innovating every aspect of business The creative potential of social entrepreneurs Amazon and eBay: redefining markets through innovation People, planet, profit: the reality of innovation 91 94 97 99 102 104 Engaging consumers Engaging people through enlightened dialogue Building networks to more together The ‘good’ consumer experience Marks & Spencer and Wal-Mart: retail revolutionaries People, planet, profit: the reality of engagement 109 111 113 116 118 122 Part 3: Releasing business 127 My world: Biki, the Barcelona mother My world: Stuart, the London advertising exec My world: Nicky, the Hong Kong banker 128 129 130 Sustainable operations Working better together Good sourcing, transporting and producing The power of sustainable energy and technologies Adidas and Nike: no finish line People, planet, profit: the reality of operations 131 132 134 137 138 141 Contents ix Delivering performance Certification, labels and sustainable impacts Linking sustainability to business results Managing business performance and reputation News Corporation and Time Warner: beyond print People, planet, profit: the reality of performance 145 147 153 156 158 163 Transforming business Making sustainable change happen Articulating the case for change Managing the implementation Ikea and Interface: good living People, planet, profit: the reality of transformation 166 168 170 171 174 178 10 Emerging futures Leading in the new business world Sustainable innovation and lifestyles Business as a force for positive change 182 184 187 194 Part4: Resources 197 The People, Planet, Profit A to Z The People, Planet, Profit blueprint The People, Planet, Profit directory The People, Planet, Profit programme 198 204 204 210 Authors and contributors 212 Index 218 216 People, planet, profit Colin le Duc, Generation Investment Management Colin is the senior portfolio manager for the Generation IM climate solutions strategy Prior to co-founding Generation, Colin was research director at Sustainable Asset Management in Zurich, Switzerland At SAM, he ran the analyst team conducting sustainability research on large-capitalization companies globally with the aim of selecting companies for the Dow Jones Sustainability Indexes and SAM’s actively managed sustainable investment funds He has also worked for Arthur D Little in London as a strategy consultant Nigel Morris, Aegis Nigel is CEO of Isobar, the digital marketing division of Aegis For almost five years he has been leading the growth, integration and overall strategy of Isobar, which has evolved into the world’s largest digital advertising network in 38 countries In 2005 he was voted one of Advertising Age’s Top 10 Global Marketers to Watch, and in 2006 he was listed at number four in Revolution magazine’s Power 50 Nigel is also a frequent speaker at events such as the World Economic Forum and Cannes advertising festival David Nussbaum, WWF David Nussbaum joined WWF in the UK as chief executive in May 2007 He is also a non-executive director of the quoted private equity fund, Low Carbon Accelerator, and of the leading fair-trade finance company, Shared Interest Until 2006, he was the (non-executive) chair of Traidcraft, the leading UK fair-trade company He is also a member of the Council of the RSA David Singleton, Arup David is chairman of Arup’s Global Infrastructure Business He joined Arup in 1973 and is currently a member of the group board and chairman of the Arup Partnerships He guides the delivery of sustainable solutions valued by clients, communities and end users of Arup’s infrastructure services In addition to his other global responsibilities, David also holds the group board portfolio for corporate sustainability Dilys Williams, London College of Fashion Dilys is the director for sustainable fashion at LCF She has worked in the fashion industry as a womenswear designer with the likes of Katharine Resources 217 Hamnett and Stella McCartney for almost 20 years She is the course director for MA Fashion and the Environment and sits on the steering panels of a number of organizations including Made By, Fashioning an Ethical Industry and the RITE Group Thanks The author would like to thank each contributor for their fabulous insights Additionally, thanks to the many others who made this book possible: editor Jon Finch and Helen Savill at Kogan Page, literary agent Simon Benham at MayerBenham, Reinier Evers at Trendwatching, the research team at Green Sky Thinking, Carl Sharples at Co-operative Financial Services, Mark Thomas at PA Consulting Group, and the team of sustainability experts at Clownfish – including Laurence MacSween, Katie Chapman, Becky Willan, Carolin Schramm and Hannah Lane – for all their great support More details, links and downloads are available at www.PeopleandPlanetandProfit.com 218 Index NB: page numbers in italics indicates a figure or table Adidas 138, 139–40, 141 Grün 140, 141 Aegis 35, 53, 90, 165, 216 ‘affluenza’ 76 Africa 7, 80 Al Jabar, Sultan 183 ‘albedo flip’ 187–88 algae 138 Amazon 97, 102–03 business model 102 Kindle 103, 104 Ambani, Mukesh 97–98 Anderson, Ray 124, 175–76 Apple 45–47, 48 Arup 32–33, 54, 68, 107, 123–24, 164–65, 181, 216–17 supply chain 143 Arvind Eye Care System 45 Ashoka 100, 104, 205 asset utilization 155 authenticity 198 Bahrain World Trade Center 194 ‘Balanced Scorecard’ 153 inputs 154 outputs 154 throughputs 154 Bangladesh 44 Barker, David 88 Beauty Engineered Forever 193 Belize Sugar Cane Farmers’ Association 143 Ben & Jerry’s 111 Bill and Linda Gates Foundation Trust 29 biochar 138 biodegradable 198 biodiesel 198 biodiversity 188–89, 198 biofuels 138, 198 biomass 138 Bishopston Clothing 108 Blood, David 33 Blue Sky 83 ‘blue sky’ thinking BMW 191 Hydrogen series 191 Body Shop 18, 32 bottom of the pyramid 198 brand definition 23 ‘brand gestures’ 117 brand owners 26 brands 3, 23, 114, 117, 123 benefits 23 Index 219 corporate 23 Branson, Sir Richard 19, 21, 58, 134, 138 Brazil 77 Bressani, Ricardo 88 Brin, Sergey 26, 27, 98 Buffett, Warren 98, 134 Burt’s Bees 107 Bush, George 61 business as force for good/positive change 18–19, 24, 194–95 enabling people to be good 78–81 making lives better 20–21 rethinking 22 transforming 166–81 Business for Social Responsibility 205 business models 43–45 Amazon 102 sustainable 46 business purpose 22–23 components 24 business strategy 3, 22, 37 components 39 personal values and 35 sustainability and 38, 39, 40 Cafédirect 34 carbon cards 192 carbon credit 198 carbon dioxide 198, 199 carbon emissions 3, 4, 20, 43, 199 measuring 146 carbon footprint 199, 201, 205 carbon neutral 199 carbon offset 199 carbon trading 51 Carbon Trust, the 148, 205 cargo bikes 192 cellulose 18 Centre for Sustainable Design 205 certification 147–53 change agents 168–70 change management 62, 167–81, 172 attitudes 175 behaviour 175 case for change 170–71 implementation 171–74 leadership 168 sustainable 168–70 vision 167 Chappell, Tom 23 China 7, 54, 77 ‘choice editing’ 112 ‘choice influencing’ 112 Chouinard, Yvon 64 ‘churn’, challenge of 49 Citizenré REnU 192–93 Clarke, Ben clean-burning 200 climate change 7, 31, 51, 106, 144, 200 Climate Group 205 climate neutral 141, 200 Clinton Foundation 29 Clorox 107 ‘closed loop’ system business 136 Clownfish 179 Coca-Cola Company 26, 37, 53, 85–87, 88, 134 sustainability review 159 Workplace Rights Policy 87 Coca-Cola Recycling LLC (CCR) 87 combined energy 138 communities see consumers, social networks 220 Index competitive advantage see also differentiation conscience consumers 75–90 see also ‘LOHAS’, markets consumer opinion 76 level of conscience 85 motivations of 78–81, 79 national rankings 77 new consumer agenda 81–82 segmenting 82–84 consumer research 80–91 consumers 110–26 benefits for 111 commercial animals 142 connectors 116 eco-bunnies 142 ‘Evergreens’ 122 ‘good experience’ 116–18 marketing and 125 mavens 115–16 motivations 78–79 networks 113–16 ‘Nevergreens’ 122 types 115 consumerism 53, 76 Coocafe 108 Co-operative Bank, the 25, 42 Co-operative Insurance 42 Eco-Insurance 42–43 corporate reputation 146–47, 158 corporate social responsibility (CSR) 4, 200 CSR Europe 205 da Vinci, Leonardo 57 Danone 87–88, 93 ‘Way Ahead’ programme 88 Daub & Bauble 191 Decaux, Jean-Charles 97 deforestation 5, South America 20 de Preza, Merling 124 di Caprio, Leonardo 160 differentiation 42–43 digital media 125–26 Disneyland 117 Doerr, John 97 Dontang, eco-city 54 Dow Jones Sustainability Index 205 Drucker, Peter 127 early adopters 111 eBay 102, 103–04 e-waste 28 eco-friendly 200 eco-labelling 200 ecological footprint 200 ecological footprint analysis 200 economic blueprint 206 Edison, Thomas 57 Einstein, Albert 189 ‘elaborating’ 99 electric cars 138 energizer pyramids 79 energy efficiency 200 energy from waste 201 Energy Star 148 environmental blueprint 208 Environmental Leader 209 Esty, Dan 52–53, 68, 89–90, 106–07, 124–25, 214–15 Ethical Consumer 209 Ethical Corporation 209 Ethical Fashion Corporation 209 ethical sourcing 132 Ethical Trading Initiative 209 European Environmental Agency 209 Evers, Reiner 190–91 Facebook 113 Index 221 Fair Development Fund 34 Fair Labour Association (FLA) 138, 139 fair trade 143, 180–81, 201 Fairtrade (Foundation) 33–34, 90, 107–08, 124, 144, 149, 201, 209, 216 fashion 125 Ferguson, Iain 143–44 First Direct 117 Fisk, Peter 212–13 Fleming, Alexander 58 Fohboh 113 ‘food miles’ 42, 201 food security 201 footprint 201 Forest Stewardship Council 149, 209 Forum for the Future 209 fossil fuels 201 Foster, Lord Norman 183 France 77 Freidman, Jeffery 88 Friedman, Thomas 76 Friends of the Earth 121, 209 FTSE Good Index 209 Future Exploration Network 209 future radar 41 gap analysis 204 Gates, Bill 26, 29, 93, 97, 100 GE (General Electric) 37, 58, 62, 98, 169 Earth Rewards credit card 192 ‘Ecomagination’ 57, 58 Geldof, Bob 58 Generation Investment Management (IM) 33, 51–52, 68–69, 216 genetically modified (GM) foods 201 genetically modified organism (GMO) 201 Genius Works 8, 24, 40, 79, 96, 213 Ghandi, Mahatma 13 Gillies, Richard 121, 141, 180, 214 Gladwell, Malcolm 115–16 Global Action Plan 209 Global Footprint Network 209 Global Reporting Initiative (GRI) 153, 156, 158, 209 global warming 201–02 Goodall, Chris 137 Ten Technologies to Save the Planet 137–38 Google 26–28, 97, 98 staff welfare 27, 29 sustainability strategy 27–28 Google Earth 27 Gore, Al 33, 58, 68, 194–95 Gossypium 108 Gowland, Santiago 30–31, 49, 51, 70, 179–80, 215 Grameen Bank 43, 44, 93, 130 Grameen Danone Foods 93 green 202 tips 63–64 Green, Stephen 69 Green Sky Thinking 84, 85 Green Tick 151 ‘Green to Gold’ strategy 53, 68 Green & Black’s 43 Greenbiz 209 ‘Greendex,’ The 77 greenhouse effect 202 ‘greenhouse gases’ 199, 202 GreenOrder 112 CRED 112 Greenpeace 46–47, 121 ‘Green My Apple’ campaign 46–47 ‘greenwash’ 110, 126, 202 222 Index GRI (Global Reporting Initiative) 134 Grove, Andy 168 growth 3, 6, 8, 78, 132, 147, 155, 188 see also profit health epidemics 31 Horrell, Jonathan 52, 164, 215 house prices 32 HSBC 69 hydrogen cars 189–90 IKEA 134, 174–75, 177 ‘Bag the plastic bag’ 177 Immelt, Jeff 57, 58, 62 ‘Ecomagination’ 57, 58 India 20, 45, 77 innovation 2, 91–108 drivers of 94–87 Intel 168 Interface Carpet 124, 176–77 Mission Zero 176 RAISE 177 reclaim programme 177 Intergovernmental Panel on Climate Change (IPCC) 209 investor confidence 156, 165 IPCC (International Panel on Climate Change) 167 IT obsolescence 30 Japan 77 Jobs, Steve 47 John Lewis 33, 43 Jones, Hannah 54–55, 67, 122, 141, 163–64, 178–79 Kahneman, Daniel 118 Kampar, Ingvar 174 Kellogg’s 135 Khan, Mehmet 26 Kleanthous, Anthony 214 Klein, Naomi 31 No Logo 123 Knight, Phil 67, 140 Kotter, John 171 Kozinets, Robert 115 Kraft 4, 52, 164, 215 Kyoto Protocol 28 Lamb, Harriet 33–34, 124, 144, 180–81, 216 landfill 202 Le Duc, Colin 33, 51–52, 216 leaders 59–61 catalysts of change 61–62 heads-down 61 heads-up 61 personal responsibility 62–64 leadership 3, 8–9, 56–70, 167, 168 Cs 60 inspiration 59–60 management and 58–59 mindset 57 ‘lean thinking’ 99 LEED (Leadership in Energy and Environmental Design) standards 132, 150 Lego 37 Liberation nut company 107 life cycle assessment (LCA) 202 Linked In 113 Lipton 106 ‘LOHAS’ (Lifestyles of Health and Sustainability) 82–84 London College of Fashion 34–35, 105, 217 Lovelock, James 187 The Vanishing Face of Gaia 187 Mackey, John 21 Index 223 Madscar (eco) City 183 Makower, Joel 84 malnutrition 31 management 58–59 Marine Stewardship Council 150 market mapping 41 markets, business 39–41, 94 bright greens 83–84 carbon 51 dark greens 83 green 51 light greens 84 mapping 95 new 40–41 pale greens 84 sustainable 41 Marks & Spencer (M&S) 34, 55, 69, 118–20, 121, 143, 181, 215 Eat Well range 142 ‘Look Behind the label’ 119, 121 ‘Plan A’ 55, 69, 119, 121, 141–42, 180 Supplier Exchange programme 120 Maslow, A 78 hierarchy of needs 78 McCormick, Dave 137 methane 202 Micorcredit Summit Campaign 44 microcredits 93 Microsoft 26, 28–30 energy management 29 sustainability strategy 29 MidAmerican Energy 98 ‘middle management’ 59 mission statement 19, 23 mobile phones 48 Morris, Nigel 35, 53–54, 90, 126, 165, 216 motivations, consumer 78–79 enablers 79 energizers 79 essentials 79 Murdoch, James 161 MySpace 113 National Consumer Council 209 National Geographic 209 Natural Capital Institute 209 natural gas 200 Nature Conservancy 209 NESTA 209 Nestlé 13 Net Impact 209 New Economics Foundation 209 News Corporation 161–62 Sky 161–63 Nieto, Verde Diana 213–14 Nike 37, 38, 54–55, 104–05, 122–23, 134, 138, 139, 140–41, 215 leadership 67–68 managing change 178–79 performance targets 163–64 ROI squared 163–64, 179 responsibility report 157 ‘The Power of We’ 47 transparency 163 Nissan Pivo 193 Nokia 45–46, 47–49 ‘The Power of We’ 47 Noon Solar 191 Novo Nordisk 43 nuclear power 190 Nussbaum, David 32, 69–70, 216 Obama, Barack 61 ocean energy 137 Of The Earth 193 offset 202 224 Index Oil 136 Oldbenburg, Ray 114 Open Architecture Network 210 organic 202–03 organic food 21, 202–03 ‘organizing idea’ 25 Oxfam 49, 80 ozone depletion 203 ozone layer 203 Pacific Gas & Electric 189 packaging 38 Page, Larry 26, 98 Parker, Mark 67, 105 partnering 132–33 Patagonia 64–65, 66 environmental values 64 The Cleanest Line 65 The Footprint Chronicles 65 People Planet Profit Manifesto 9–11 People, Planet, Profit Programme 210–12 People Tree 108 performance 145–65 ‘Balanced Scorecard’ 153 business results 153–56 certification 147–53 corporate reputation and 158 managing 156 Picasso, Pablo 197 population growth 3, 4, 92, 188 Porritt, Johnathon 106 poverty 5, 20, 31, 144 Prahalad, C K 101, 198 product life cycle 42 profit 2, 3, 20, 38, 51, 155 Rainforest Alliance 151, 210 recycling 203 Reliance Life Sciences 97 reputation 26, 156 reuse 203 Riboud, Franck 93 risk 155 Rocky Mountain Institute 210 Roddick, Anita 18 Rose, Stuart 69, 119 Ryaniar 44 Sainsbury 34 Sapphire Energy 97 Scott, Lee 53, 55 Shell 134 GameChanger team 137 Singapore Airlines 116 Singleton, David 32, 33–34, 54, 68, 107, 123–24, 143, 164–65, 181, 216–17 Sky see News Corporation 162 Skype 44 Social Accountability International 210 social blueprint 207 social entrepreneurs 99–101 social entrepreneurship 92–93, 101 Social Entreprise Coalition 210 social networks 111, 113–16, 189 shared consciousness 115 ‘third place’ 114 solar energy 137, 189, 192–93, 194 Solar Sailor 193 Solstice on the Park 194 Starbucks 25, 111, 114, 134 stewardship 203 strategy see business strategy ‘streamlining’ 99 suppliers 24 supply chain 38, 120, 134, 135, 136, 143 Index 225 SustainAbility 210 sustainability 4, 203 business purpose and 23–24 business results and 153–56 life style choice 18 sustainable advantage 42–43, 44 sustainable development 203 Sustainable Development Commission 210 sustainable innovation 91–108 levels of 98–99 lifestyles and 187–94 phases 95–97 process 96 trends in 190–94 visions of 188–90 sustainable markets 37 adaptive 37 emergent 37 sustainable operations 131–44, 133 Swartz, Jeffrey 66 UN Environmental Programme 210 Unilever 30–31, 49–51, 70, 105–06, 123, 124, 215 Brand Imprint process 49, 106, 179–80 brands 31 sustainability programme 50 United States of America 77 waste 28 Tate & Lyle 108, 143 technological innovation 102, 188–90 Tesco 113–14, 135, 181 Tesla Motors 98, 192 Tichy, Professor Noel 169 Timberland 66–67, 135 environmental programme 67 Time Warner 160–61, 162 Tom’s of Maine 23 Tomorrow’s Company 210 toxic chemicals 47 Toyota 99, 106–07 Prius hybrid car 43 Transparency International 210 Treehugger 210 Trendwatching 191, 210 ‘triple bottom line’ 156, 203, 204 Wal-Mart 53, 55, 105, 118, 120–22, 135 waste stream 204 waste-treatment plant 204 water 7, 8, 31, 34, 53, 190 WhatOnEarthsGoingOn.com 29 Whole Foods Markets 21 Williams, Dilys 34–35, 105, 125, 217 wind energy 137 World Business Council for Sustainable Development 210 World Changing 210 World Economic Forum 210 Worldwide Fund for Nature (WWF) 32, 34, 69–70, 86, 210, 216 value, measuring 154–55 value chain 133 value creation 37–38 value drivers 155–56 value propositions 40 Velib cycling scheme 97 venture capitalism 97 video-conferencing 94 Virgin Galactic 18 Virgin Group 199 virtuous cycle 51 226 Index Xing 113 Yunus, Muhammad 7, 44–45, 93 zero emissions 204 Zipcars 45, 110 Zoom Ventures 100, 101 Zurcher, John 175 227 228 With over 42 years of publishing, more than 80 million people have succeeded in business with thanks to Kogan Page www.koganpage.com You are reading one of the thousands of books published by Kogan Page As Europe’s leading independent business book publishers Kogan Page has always sought to provide up-to-the-minute books that offer practical guidance at affordable prices 229 230 ...i People, Planet, Profit ii iii People, Planet, Profit How to embrace sustainability for innovation and business growth Peter Fisk iv Publisher’s note Every possible effort has been made to. .. force for positive change 182 184 187 194 Part4: Resources 197 The People, Planet, Profit A to Z The People, Planet, Profit blueprint The People, Planet, Profit directory The People, Planet, Profit. .. It goes to the heart of business To why you exist Where you focus, how you succeed To connect business and the world in new ways People and planet and profit Together, achieving more Business