12.12.2013

Another non-environmental wonder

A spate of recent coverage highlighting systemic discrimination against women in business (Silicon Valley, pregnant women everywhere, financial services) can only be enhanced by this gem - it's hard to imagine a new male CEO taking over one of the world's largest industrial businesses being described in this way (via NY Times):

"'Mary was picked for her talent, not her gender,' Mr. Akerson [current CEO, GM] said in a conference call with reporters. But on a personal note, he said, promoting Ms. Barra to become chief executive was an emotional moment for him. 'It was almost like watching your daughter graduate from college,' he said."


12.11.2013

Another non-environmental wonder

In the spirit of what PR firm Bell Pottinger does best - as agency of record for a long list of luminous clients including Alma al-Assad, Rebekah Brooks, the Egyptian government and BAE Systems - allow me to misquote Chairman Tim Bell (via interview in the Guardian)

"[At Bell Pottinger] We tell...lies. We work for people who want to tell their side of the story."


12.09.2013

Gem of the day

Two cases of classic business dysfunction, illustrating the scale of the challenge surrounding data for decision-making (via the comments page of the Guardian, who knew life beyond trolls existed there?)
  • Glossy reports are great for coffee tables - not as a theory of change. "At AT&T we sat down with the company’s main futures group to discuss how they were working to ensure that AT&T kept on top of important unfolding trends and used them to its advantage...We then interviewed the AT&T Vice President who was in charge of the futures group as well as other responsibilities... He looked at us rather blankly, considered for a moment what we had said, and then said words to the effect, 'oh you mean the people who do all those long reports! I can’t actually say I have time to read them because I’m spending all my time trying to figure out how we can make a profit on all the copper wiring we have strung across the country and are now taking down.'" 
  • Designing tomorrow's solutions to fit into today's structures = backwards strategy. "[At Royal Dutch Shell] we sat in the New York offices of the company and had another fascinating discussion with a key executive in charge of futures analysis. He showed us an organizational chart that was absolutely stunning. The chart depicted the Shell group as being made up of 240 or so separate companies representing an incredible array of functions. It was obvious that while it was possible to create the superbly detailed organizational chart, it was impossible for anyone to understand and synthesize the activities of that many discreet actors and create a coherent strategy that incorporated their behaviors." 

12.05.2013

Gem of the day

An inspirational view of "how HR helps the bottom line" from the MD of Centrica Energy:

"Our £1.6bn acquisition of Venture Production last year was a hostile takeover, but we treated it as a merger, so it was crucial to quickly engage and retain a large number of people who had previously thought of us as the enemy. The HR approach from reward to internal communications helped us to change that perception. We’ve retained all our key people and created a top 3 oil and gas business in the North Sea."

Charming.

12.03.2013

Gem of the day

More jargon from the vortex that is the "sharing economy" (via BSR):

"Companies like Airbnb, Lyft, and Kickstarter are using technology and community networks to create new business models and unlock value. Gorbis...kicked off the conference by giving a name to this sea change: 'socialstructing'. As networks become a more powerful force in our economy, socialstructing is how organizations and individuals are 'creating value by aggregating micro-contributions by large networks using social tools and technologies.'"

Translation: businesses are learning that the way people traditionally have gotten by pre-capitalist globalisation - through trusted social connections, within communities - might have something to do with how value is created.

12.02.2013

Another non-environmental wonder

More insight into the wonder that is Walmart's role in America's downward spiral of chronic unemployment, wages too low to stay out of poverty on, and a broken social safety net (via Businessweek):

"In the U.S., Wal-Mart’s lower-income customers are struggling amid persistent unemployment and higher payroll taxes. Many seem to have fled to dollar stores in search of even lower everyday prices."

A growing segment of customers that can't afford Walmart's products, and more than half of Walmart workers making less than $25,000 a year, ultimately costing taxpayers more.

The solution - higher wages - and its knock-on benefits to the wider American economy, is so obvious that even Ashton Kutcher can do the math.


11.20.2013

Another non-environmental wonder

Outstanding example of mitigated language downplaying a serious problem - $670 million spent on consumer financial education every year vs. $17 billion spent by the industry to market financial products (via Businessweek):

"That means the majority of information consumers receive about financial products comes from a company trying to sell them something—which can make it quite a challenge for consumers to find unbiased information," CFPB Director Richard Cordray said.

11.19.2013

Gem of the day

Status update on the International Energy Agency (via Kurt Cobb):

"If the agency were a single person, what it has released over the last year as official pronouncements would likely have a psychiatrist reaching for the DSM-IV (Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition)."

11.13.2013

Gem of the day

Like all executives in industries tightly tied to the government, BAE Systems US CEO Linda Hudson has an uncanny ability to sidestep awkward revolving door conversations (via the WSJ):

"The lifelong Democrat [Hudson] has said she will leave BAE early next year and has been mentioned as a possible candidate to succeed Ashton Carter as deputy U.S. defense secretary when he steps down in December. The problem is she plans to remain on the board of BAE’s U.S. business for another year, ruling out a job with the company’s key customer. 'The timing is not right,' said Hudson."

Luckily there's nothing standing in the way of her alternative plan to consult on all things defense in the meantime:

"Once she retires, Ms. Hudson said she intends to set up a leadership and strategy consulting firm, take additional U.S. corporate board seats."


11.11.2013

Something that's actually good

Revisiting John Thackara's great rejoinder to the insurance industry on why trust is not an algorithm:

"My biggest concern with Big Data is the prospect that they will give managers and policy makers a sense of being in control when such confidence is not justified...[Big Data] capture information about transactions in the formal economy where they are most easily monitored. This focus obscures most of the world’s economic activity, which is informal."

11.08.2013

Another non-environmental wonder

In case you didn't already have enough proof that inequality in the USA has reached epic proportions (via the SSA):

32% of working Americans made less than $15,000 in 2012. Translation: a third of Americans earned less than the official poverty line.

11.06.2013

Something that's actually good

Memo from Bill McKibben to the rest of the world (echoed by WorldChanging founder Alex Steffen):


11.05.2013

Gem of the day

It's hard not to focus on the irony in the Norway Sovereign Wealth Fund's forthcoming decision to divest from coal assets - a $760 billion fund bankrolled by Norway's massive oil wealth, lauded for a radical move to decarbonise its investments.

Then again, for a fund that owns an average of 2.5% of every European listed company, a move is a move. In that case here's the next logical step - divest from three of the fund's top ten holdings, which are...in oil companies.

10.28.2013

Bonus gem

In a classic move by the company, Coke gives "offsetting" a new strategic meaning (via NY Times):

"The Coca-Cola Company plans to erect 150 kiosks in 20 countries that will offer water, electricity and Internet connections; they may also sell Coke and other products."

Explanation by CEO Muhtar Kent:

"Why are we doing all of this? Because when there’s healthy communities, we have a healthy, sustainable business."

Translation: In case there's any doubt about the intention of this new business model, Coke's motivation is majority defensive. By having women in developing countries sell Coke products alongside health advice, clean water and Internet access, the business can make up for the obesity and other negative health impacts of its sodas. Now that's innovation.


Gem of the day

Tesco has a unique range of product available at everyday low prices (#googlefail):

10.23.2013

Gem of the day

In the wake of a massive outburst of negativity towards British Gas from government, customers, media - pretty much everyone, and deservedly so - what could be a better gem than a self-serving case study from four years ago by an agency looking after the company's brand?

"British Gas was finding customer retention increasingly difficult...Carat insight showed that 88% of British Gas’ brand perceptions were driven by customer experiences rather than communications...In 2009 British Gas set out to become the first ever sponsor of British Swimming and turn around the perception of their brand."

So here's a valuable insight into the head-in-the-sand mentality of BG and its peers in the energy sector - rather than addressing the core problem with the service provided to customers, they decide to focus on brand perception. Now there's a short-lived investment.

10.15.2013

Gem of the day

Yet another fact that proves how devastating the state of health is in the US (and why McDonald's, Coke and others need to be doing more than giving consumers a "choice" and encouraging them to burn off the calories, a legacy of obesity and malnutrition they're about to repeat in emerging markets. This insight via Nestle research, ironically):

  • Nearly 25% of 19–24-month-old babies in the US consume no vegetables or fruit 
  • French fries are the most common vegetable consumed by infants aged 15–18 months
Case in point.

10.14.2013

Gem of the day

Irony in a nutshell: Major company in an industry ripe for disruption (banking) releases a report announcing another industry ripe for disruption (energy).

Given the state of its shares, Citibank would do well to listen to its own crucial piece of insight about the pace of change: "This is not a 'tomorrow' story."

10.09.2013

Gem of the day

Jigar Shah on the water-energy nexus in India - a stark choice between power and hydration (via Gigaom):

"In India, like in the United States, the power sector is the single largest user of water – more than agriculture. Presuming that India could solve its problems and build more coal, they would run out of fresh water even faster...Water is literally killing India."

10.04.2013

Another non-environmental wonder

Another inspired quest-for-growth quote from a public company (via Forbes):

"Looking at the map of the US, there’s still lots of white space for us. We can fill many new markets."

10.01.2013

Another non-environmental wonder

More credence for the "no-one is in the driver's seat" theory of why banks are so dysfunctional - and even better, from another actual banker (via the Guardian):

"We rely upon self-declaration, upon what is presented to us by a bank's internal management. But often they don't know what's going on, because banks today are so vast and hugely complex. I don't think I have ever been deliberately lied to – though obviously I might not know about it. The real threat is not a bank's management hiding things from us: it's the management not knowing themselves what the risks are, either because nobody realises it or because some people are keeping it from their bosses."

9.30.2013

Another non-environmental wonder

Cinnabon, the American - where else? - company that manufactures the ultimate processed dessert clocking in at over 800 calories per unit, just doesn't get it. As proof here's CEO Kat Cole, who unbelievably calls herself a "connected-creative-conscious-capitalist", on why Cinnabon has done literally nothing to address the ridiculous implications of its product (via Businessweek)

"If we say the Classic Cinnamon roll is a smidge smaller, they are going to be like, 'That’s still hundreds and hundreds of calories, and it’s still huge, and it’s still dripping with margarine and frosting.'"


9.24.2013

Another non-environmental wonder

John Lanchester shines a light on the incredible extent to which banks have failed in the UK - not only as institutions, perhaps banking's higher purpose, but even as companies. His key points on why the push for cultural change - made the talk of the town by Antony Jenkins at Barclays - won't work:

  • "Our banks are so big and so complicated that it isn’t clear their cultures are amenable to change in the way we need. Joris Luyendijk, a Dutch journalist who has been running a two-year project interviewing bank staff, reached the same conclusion. His experience was that banks are fragmented and atomised places, and that in many parts of them employees regarded themselves as working not so much for the bank as against it."
  • "Let’s for a moment propose a counterfactual, in which one of the big banks was headed not by a banker but...a professional ethicist, greatly admired by his peers, who writes books about the need for banking to be a moral enterprise...The bank was HSBC, and the person in charge as CEO and then as chairman of the board was Stephen Green, who is an ordained minister in the Church of England...As for how that worked out, well, it was on his watch that Mexican drug-dealers made special boxes to deliver drug cartel money over the deposit counter."
  • "There’s no reason to think that an emphasis on ethical banking, from the head of the company down to the troops, is likely to have any effect. These banks are huge and hugely complex institutions, whose separate components are fragilely and fleetingly linked. That is the reality of ‘universal banking’"

9.23.2013

Gem of the day

Tesco's new CR strategy, designed as a rather-late-than-never response to its many detractors, names health as one of three big focus areas.

So the chain's choice of photo to illustrate this commitment in its latest report is ironic, if appropriate:


9.18.2013

Gem of the day

In the increasingly public melee over corruption in BP's claims process for Gulf of Mexico recovery funds, here's the one question that shouldn't be asked:

"Is this fair to BP?"

Even worse is the answer provided by the author, who is also Executive Director of the Texas Civil Justice League:

"BP's good faith effort to make whole the individuals and businesses harmed by the spill has morphed into a travesty of justice that threatens not only the financial future of a major U.S. employer and energy producer, but the integrity of the judicial process itself."

Then again, that wondrously distorted point of view is no surprise coming from the TCJL, which counts Koch Industries and the Texas Oil & Gas Association among its board members.


9.10.2013

Something that's actually good

Energy expert Kurt Cobb sums up the bottom line on fossil fuels:

"Advancements in technology designed to extract more oil, natural gas, coal and uranium from the ground are in a race with geological constraints."

9.09.2013

Gem of the day

Finally: Walmart is making a concerted effort to address some of the major social and economic criticisms the company has faced for decades.

Except this is not about making long overdue commitments - it's The Real Walmart campaign. Featuring a PR firewall of Q&A and supportive quotes from "real customers". Little else could sum up the reality of rampant inequality and declining mobility in the US that Walmart represents better than this customer quote:

"On two deployments in Iraq I served with a lot of guys who didn't know if they had a job waiting for them. Walmart held my job for me."

8.14.2013

Gem of the day

Businessweek continues its run of excellent pieces on BP's shift from highly visible humility post-Gulf of Mexico to aggressive litigation and denial, pointing out how the company is becoming one giant law firm.

The best example is delivered through an interview with CEO Bob Dudley, who pulls no punches with lines like this one about alleged corruption in the claims process:

"We’re a big investor in the United States, and we’ve challenged this really strongly. It’s just not right."

Anyone looking for more insight into Dudley's remarkable attitude might find grist for the mill later in the interview, when he attempts to answer the following:

[Interviewer]: "Why do people hate oil companies?"
[Dudley]: "People in oil and gas are sort of perplexed by this...I absolutely, passionately, and thoroughly enjoy oil and gas."


8.05.2013

Gem of the day

KPMG's highly scientific graph proves once and for all sustainability can deliver ROI - oh right:


Something that's actually good

Simon Zadek on the irony of systemic risk in financial markets, in a nutshell:

"Short termism delivers some specific, systemic biases in the pricing of risk. Zero carbon pricing in valuation is the exemplary case. practiced by the vast majority of investors (including many of those belonging to climate-sensitive investor coalitions). Such pricing in effect is betting on a four to six degree world, an approach that at scale is nothing less than shorting civilization itself."

7.30.2013

Another non-environmental wonder

Understanding the scale of Serco, the private government contractor running prisons, hospitals, and even nuclear facilities across the UK, is no small challenge. Here's two clues to help convey just how giant it is (via the Guardian):

  •  "Without Serco, Britain would struggle to go to war" says the Daily Telegraph
  • A prime example of the level of information Serco is willing to release publicly about its operations in the UK, bringing new meaning to the term "opaque": "We operate in a range of markets and geographies, which means we are well placed to bring a wide range of experiences and knowledge to help customers with the challenges that they face."
But nothing tops the explanation of CEO Chris Hyman as to why the company is so invisible:

"We are delighted when the public knows who we are, but really, we need to be known by the people who make decisions."

7.25.2013

Another non-environmental wonder

John Oliver (standing in for Jon Stewart on The Daily Show) on the absurdly repetitive efforts of Jay Carney, the White House Press Secretary, to avoid calling the situation in Egypt a "coup" (his only talking point: "I'm going to be blunt here, it's a highly complicated situation."):

"I don't know if Jay Carney is doing a bad job, or just has a really bad job."

7.22.2013

Something that's actually good

Since the media seems to have missed it entirely, here's welcome proof that at least one person in the convoluted land of intergovernmental policy is taking on the challenge of playing provocateur to the food industry. Thanks Director General of the WHO, Dr. Margaret Chan (via UN):

"Instead of diseases vanishing as living conditions improve, socioeconomic progress is actually creating the conditions that favour the rise of non-communicable diseases...It is not just Big Tobacco anymore. Public health must also contend with Big Food, Big Soda, and Big Alcohol."

7.17.2013

Gem of the day

BP's strange campaign to combat alleged fraud in the payouts from its $20 billion Deepwater Horizon recovery fund, ironic in more ways than one, took another twist yesterday. In a move that the WSJ correctly identified as a marked - and inevitable - shift from the company's PR-led apologetic tone in the aftermath of the Gulf spill, BP is aggressively reaching out to the mass public for help by setting up an anonymous fraud "hotline".

The company's official statement on Tuesday promoted the hotline as a resource "for people who want to do the right thing". So in that case here's someone who should probably call in: former CEO Tony Hayward. After all, when stepping down in July 2010 he assessed his role in the Deepwater Horizon disaster in exactly the following terms: "I became a villain for doing the right thing".

If he does speak up about the proportion of alleged fraud in the fund, BP had better hope Hayward's recommendation isn't based on his early approach to talking about the environmental impact of Deepwater Horizon:

"I think the environmental impact of this disaster is likely to be very, very modest...Gulf of Mexico is a big ocean."

7.05.2013

Gem of the day

Oil majors like BP might be in denial about oil running out, but they sure are quick to notice when money is running out - especially money linked to legal obligations from a spill.

In editorial adverts last month BP issued concerns over potentially illegitimate claims being paid out from its dedicated $20 billion Gulf of Mexico reparation fund. Verbatim:

"Trial lawyers and some politicians are attempting to capitalise on this misinterpretation by encouraging the submission of thousands of claims for inflated losses, or losses that do not even exist...Whatever you think about BP, we can all agree that it's wrong for anyone to take money they don't deserve."

It sure is. Which makes BP's own history of poorly managed anti-corruption policies so much more ironic, from over 365 breaches of conduct in its Russian TNK venture, to years of bribery exposed in its shipping division.

And it's not worth getting started on BP's own role in promoting things that "do not even exist" - artificial reserves, anyone?

6.28.2013

Gem of the day

What does it say about Interbrand's 50 Best Global Green Brands 2013 that four out of the top five are car manufacturers? Not surprisingly, Interbrand has specifically highlighted that question. Even less of a surprise is that their answer is misses the point.

Congratulating auto companies for "keeping the long term in focus" is rightfully said for Toyota, a business guided by a vision to achieve sustainable mobility. For other manufacturers, the real test of whether they deserve to be on any list like this one will be their approach in emerging markets where the sales are, not in slow-moving efforts to transform or adapt some product and service offerings in Europe and North America. If those companies are truly balancing long and short term goals, it will be by influencing the mobility system in countries like China - now the biggest car market in the world - not least by helping governments avoid the car-dependency culture that has trapped the USA in a cycle of obesity, air pollution, suburban malaise and punishing oil prices. Rethinking what America might do with the estimated three parking spaces per person of empty concrete space is still in very early stages.

It goes without saying that the core of the Interbrand ranking, a score based on performance and "perception", is in and of itself a non-starter. One of several "perception" elements, for example, is "authenticity", which Interbrand describes as "the perceived credibility of the brand's environmental claims". Since authenticity can only be based on real action over the long term, "perceived credibility" is hardly a useful way of measuring it. Consider how often BP ranked in the top 10 most accountable companies in the world throughout the 2000s, only to reveal the extent of its inauthentic approach to environmental management in April 2010's Deepwater Horizon disaster.

Rankings like this one are amusing, but they don't tell us much about the core challenges ahead for the auto industry and beyond.

6.26.2013

Another non-environmental wonder

Epic Pentagon Papers whisteblower Daniel Ellsberg nails how secrecy, and operating in a culture organised around the "haves" and "have nots" of classified information, turns people into "morons" (via the New Yorker):

"'You will deal with a person who doesn't have those clearances only from the point of view of what you want him to believe and what impression you want him to go away with, since you’ll have to lie carefully to him about what you know...[So] the danger is, you’ll become something like a moron. You’ll become incapable of learning from most people in the world, no matter how much experience they have in their particular areas that may be much greater than yours.'"

6.24.2013

Gem of the day

Via Nestle Waters Twitter debate, a classic case of corporate sustainability jargon raising the question, why bother even asking? Or more to the point, why should anyone in their right mind give the "reports not reporting" approach a single second of time?



6.13.2013

Another non-environmental wonder

Case-in-point why Hillary Clinton didn't win the 2008 election against Obama, illustrated by one of the multiple slogans rolled out across the misguided campaign (via Jon Lovett):

"Strength + experience/change = 1"


6.12.2013

Something that's actually good

Larry Huston of P&G fame explains why for most incumbents the concept of "transformation" fails to catalyse change (via London Business School):

"I think transformation is a dirty word. If you go and say to a company, 'I'm going to go transform you', they'll say, it's going to be impossible and we'll never finish. In the case of Connect + Develop we were careful not to position it as transformation – even though now it is. We said, we have a strong, powerful, global organisation, we've built outstanding capability all over the world, we have world class people, what we're going to do is take this already strong capability and turbocharge it. And so the core idea is based upon how do we turbocharge? And then, what are the accepted beliefs that people have about this kind of thing? How do we create its credentials?"

6.11.2013

Something that's actually good

John Thackara on the mindset challenge of big data for multinationals (via Change Observer):

"A lack of data does not mean a lack of value and potential. Billions of people with low cash incomes meet their daily life needs outside the money economy — for example, through traditional networks of reciprocity and gifts...The problem with Big Data is not that numbers are bad — it’s that we’ve made them an end-in-themselves in ways that lead us to misallocate time, attention, and resources. Big Data can work well in support for online resource-sharing — AirBNB, Uber, eBay and their like — but they’re of modest efficacy to the informal economy where, to repeat, a big majority of the worlds’s citizens subsist."

What could be a more timely observation, as the giants that created the big data revolution come under scrutiny for their role in mass surveillance of Americans?

6.06.2013

Another non-environmental wonder

How Walmart has lost its way (oh let us count the ways), according to retail man Doug Stephens (via Businessweek):

“This is the lesson Costco teaches. You don’t have to be Nordstrom selling $1,200 suits in order to pay people a living wage. That is what Walmart has lost sight of. A lot of people working at Walmart go home and live below the poverty line. You expect that person to come in and develop a rapport with customers who may be spending more than that person is making in a week? You expect them to be civil and happy about that?”

6.04.2013

Gem of the day

In a potentially radical about-face, Apple has hired former EPA head Lisa Jackson to push environmental progress at the company. Great news for cleaner products with a cleaner foundation - renewables, zero waste.

But Jackson's true challenge may be moving beyond the built-in glass ceiling of her title - VP for Environmental Initiatives - to reframe sustainability as a powerful driver of innovation for the company (as Hannah Jones has done at Nike). An initial guess suggests that is unlikely to happen.

5.16.2013

Gem of the day

Case in point why The Nature Conservancy, like most corporate-funded, partnership-dependent NGOs, just doesn't get:

a) The biggest impact of their work on business, especially companies where conservation isn't most material (hint: it's reputational, the halo effect of being seen to work with a global conservation organisation)

b) The changing role of business in the world, especially in relation to government (hint: "megatrends" are called "mega" for a reason, so it's not an "either/or" of government vs. business need to take action)

But I'll let TNC President Mark Tercek speak for himself:


"You’re asking, what’s Coke going to do about its product, or how can they be an even nobler citizen? I don’t know the answer. And it’s not exactly TNC’s job. If Coke’s product is a bad product, I think the government has to say so. That’s my personal answer. I don’t think you can ask a business to not be a business."

Luckily for Tercek there are people out there who know the answer: stop targeting minorities and kids with marketing, price drinks so smaller sizes are best value (full list here), or, even better, just sell less Coke.

5.13.2013

Another non-environmental wonder

Generic insight of the day, courtesy of Deloitte (via Bloomberg):

"India is offering a great opportunity for companies to be part of the volume growth...There is continued interest and there will more international players coming into India."

5.02.2013

Gem of the day

The 2013 Sustainability Leaders survey is out from Globescan & SustainAbility, and the results aren't surprising. Unless, that is, you happen to think that Coca Cola looks painfully out of place in the top 10 next to the likes of Unilever, Natura and Nike.

First thing's first: Coke is doing a lot on water, setting huge goals like net zero water consumption in its operations that the company hardly has any idea how to achieve. But in a year where we saw the obesity epidemic finally rising to panic button levels, Coke's sports-as-medicine strategy that places the burden 100% on people to "consume responsibly" is starting to make the soft drinks industry look like the new tobacco (Franck Riboud was already saying this at Danone 7 years ago, and the company refocused its business on healthy products as a result).

Companies that deserve to be on a leadership list are those that are not only accepting responsibility for, but truly leading an effort to transform their most material impacts into net benefits for everyone. Unilever on personal resource efficiency and sanitation at scale, Natura on biodiversity and Nike on innovation driven by sustainable materials fit that description - or at least have set the kinds of long-term goals that commit them 100% to getting there.

Until Coke's board gets real about the obesity crisis and the central role of its products in fueling it - and that includes stopping its ridiculous 1990s-esque attempts to stymie any and all regulation, read it and weep - they don't belong in such company.


4.26.2013

Gem of the day

An example of how not to sum up where we are with the sustainable business agenda, especially when making the case for leadership (via HBR):

"Warren Buffett, Robert Rubin, and Howard Schultz have been outspoken about the role of business in American society, and companies from Walmart to Chevron have engaged in socially responsible activities."

4.15.2013

Another non-environmental wonder

The aftermath of CEO Ron Johnson's hasty exit from retailer JC Penney has proved a busy space for commentary on just how wrong he got it.

Apple board member Bill Campbell echoed a critical insight into why business transformation can fail with his take on the situation (via Businessweek):

“You have to keep your current business going while you experiment with a new one. [Ron] didn’t do that. He just put a bullet hole in his current business."

Even better, an interview with Johnson offers a priceless look at his misguided attitude towards the change process, in his own words (via FastCompany):

"All my ideas just sort of come. I don’t know to explain it. It’s all intuitive I think...I wanted to do something that had scale. I don’t just want to run a business, I want to do what I did at Apple--I want the chance to transform something. So I picked JC Penney. I didn’t come here to improve Penney, I’m here to transform Penney."


4.10.2013

Gem of the day

Infamous Whole Foods CEO John  Mackey is on a roll with his "Conscious Capitalism" call to action - business should lead by embedding a "higher sense of purpose" in value creation. So it's beyond ironic that his answer to an area where upscale Whole Foods has yet to fulfill that kind of leadership - increasing access to healthy food in the US, land of "food deserts" - is to...create a nonprofit (via Forbes):

Forbes: "One of the primary issues with Whole Foods is that the stores are largely located in well-to-do areas. How does Whole Foods intend to make healthy food available to all?"

Mackey: "We do take seriously our responsibility, and growing ability, to educate people about healthy eating and giving them greater access...We will start to bring healthy food options to people in several other cities, starting with a new store in mid-town Detroit that will open in May. We are even looking to create a new non-profit to help make this a reality."


4.04.2013

Gem of the day

Former BP chief Tony Hayward's take on the operating environment for oil companies in Kurdistan, where he's quietly excelling as CEO of Genel Energy as the memories of Deepwater Horizon fade away (via BBC):

"If you like, it's conventional Middle Eastern oil and gas exploration - pretty straightforward, and pretty low-cost."

In that case what passes for "conventional" in the Middle East must mean something quite different from in other parts of the world, if we believe this Kurdish observer (via Independent):

"We Kurds have one of the most complicated political situations in the world."

Or even better:

"I call it ‘Corruptistan’," said one woman.

4.02.2013

Gem of the day

Coca Cola's new "Chairs" ad (see raging critique in HuffPo) is the company's latest take on placing responsibility for health and wellbeing squarely on the consumer - where it's easiest to say it belongs. Why "Chairs"? Of course Publicis, creators of the ad, can handily explain:

"The goal was to open the discussion with the society about the sedentary lifestyle problem. Some studies show that people spend more than half of their lives seated and that was the inspiration for the idea. Since the insight is human and universal the campaign can be used in future in other countries, depending on Coke Worldwide's decision."

With half of Americans already obese and numbers rising, surely a "sedentary lifestyle" is only chipping away at a much larger systematic issue - but given Coke's focus on marketing around this issue rather than taking real action, that's probably asking too much.

3.20.2013

Gem of the day

Al Gore uses his ShareAction speech to give us something to be optimistic about in the uphill battle to making capital markets sustainable:

"Here's what we've got on our side: the way markets are operating today is functionally insane."

3.19.2013

Another non-environmental wonder

How much can you pack into a generalized statement about "Africa"? In the world of business, a lot (via BusinessWeek, of course):

“Africa is an idea, not a market," sayeth veteran IBM shareholder Richard Soultanian.

Not to be outdone, IBM's head of South African operations has this to say:

"On his desk was a newspaper article chronicling the aftermath of an August police massacre of 34 platinum miners after an illegal strike turned violent. 'My actions cannot be dictated by what is going on in the country or the marketplace,' he says."

Now that's a smart way to look at doing business in emerging markets. Get thee to the real experts before it's too late - they just might be able to help you appreciate this reality instead:

"If the local socio-political system is characterized by a lack of transparency, profound structural inequalities, deeply engrained types of social discrimination, widespread arbitrariness, omnipresent corruption or pervasive structural violence, then your actions will normally reinforce those features, even if unintentionally."

Right.

3.12.2013

Gem of the day

When someone writes an article titled "Can Even Hated Industries Redeem Themselves with Social Media?" you know what you're getting: very expensive "crisis communications" consultancy, free from any sense of irony.

Still, inevitably it's worth reading these pieces if only for outstanding gems like this one:

"Utilities have a powerful story that simply isn’t being told. They are the engine that makes every aspect of modern life possible. They are the first responders on the front lines when Mother Nature wreaks her havoc...These are the narratives that will establish tangible consumer connections and put a human face on that flick of the switch."

Then again, what more would you expect in this particular case from the man who did PR for Guantanamo, Deepwater Horizon and the Catholic Church?

3.04.2013

Bonus gem

More extraordinary statements from an extraordinary industry (financial services). Here's a very special one from a "financial services expert" at PA Consulting Group (via FT, where else?):

"The great core strength of banks is their ability to take an intelligent view of the value of an asset and its associated risk."

So that core purpose must have just slipped bankers' minds in what made 2012 a record year for massive risk fall-outs at the world's biggest banks:
Then again, maybe JP Morgan leader Jamie Dyman was acknowledging the bitter truth when he said this during his semi-apology to Congress:

“We’re doing what a bank is supposed to do."

Gem of the day

Sometimes a single quote can sum up everything you need to know to take the temperature of the sustainability conversation in the investment community (and yes, it does exist): the challenge, the opportunity, and the problem with that entire equation.

So thanks to JP Morgan's Head of Environmental Affairs for doing just that in a conference panel with the non sequitur title "The Power of Wall Street in Promoting Sustainable Development":

"Wall Street can only make a difference on this stuff if we figure out a way to make money on it."

2.28.2013

Gem of the day

The concept of digging one of our most precious resources - oil - out of the ground and burning it for fuel hardly makes much sense, so as the world's oil majors cling desperately to the century-old business model you'd expect bumps along the way.

Even better is the double embarrassment Shell has faced over the past 24 hours:

  • Being forced to shut down Arctic operations for 2013 after spending billions of dollars, with no results to show
  • Acknowledging solar is where the money's at, a business Shell quietly exited 4 years ago
All of which only makes the company's "Let's Go" stakeholder campaign even more ironic.

2.26.2013

Another non-environmental wonder

Craig Charney, colleague of Leland Miller (infamous China Beige Book fame), on why everything we think we know about China is wrong:

“You know the old joke about advertising? 'Half of all advertising is wasted. I just don’t know which half.' The same thing is true of Chinese statistics. Half of them are wrong. The problem is that we don’t know which half."

Genius.

2.25.2013

Gem of the day

George Packer takes a masterful look at what the evolution of American business since the 1970s means for the country's social contract, using the example of Apple vs. Walmart (via the New Yorker):

"The middle class has shrunk; tax rates (especially on upper brackets) have plunged; inequality has exploded; the safety net (especially for the poor) has weakened; the old power structure has given way to a more diverse and broad-based upper class based on education...and business culture has become entrepreneurial, fast, risk-taking, and harsh. The trade-off: more freedom, less security."

"Together, Apple and Walmart represent the intense separation of American life into blue and red, rich and poor, overpriced and undersold, hyperconnected and left behind."

2.22.2013

Gem of the day

Sometimes you just can't make this stuff up. Can anyone spot the problem with the design of BASF's stated "Purpose" - ideally one of the most important pages on their website, let alone the entire driver of their business?

2.20.2013

Gem of the day

British American Tobacco's so-called "sustainability vision" offers a lesson on how to make a statement without saying anything at all:

"Our vision of a sustainable tobacco business is one that manages the impact of its operations and products responsibly today and prepares for a future in which it continues to create value for shareholders as well as being in the best interest of other stakeholders."

2.12.2013

Gem of the day

Finally: academic evidence to support the bold analogy Danone CEO Franck Riboud made 7 years ago, as his company changed to a strategic health focus, about obesity as "the new tobacco".

A new study shows relying on the biggest food and drink companies to "self-regulate" salt, fat and sugar content in food won't work. Most importantly, the report points out this is a battle that needs to be won - and quickly - to make sure these companies don't repeat the same mistakes in emerging markets, where the focus is on aggressive growth over the next decade:

"Saturation of markets in high-income countries has caused the industries to rapidly penetrate emerging global markets, as the tobacco industry has done. Almost all growth in the foreseeable future in profits and sales of these unhealthy commodities will be in low-income and middle-income countries [where consumption is currently low]."

2.11.2013

Gem of the day

Edelman's point of view on what's required for a "sustainable business future":

"For successful corporate citizenship and a sustainable business future, companies need to focus on conducting and communicating their efforts in a way that garners trust and generates positive reputations among key stakeholders."

Influencing stakeholder views - progressive.

2.08.2013

Gem of the day

Netflix CEO Reed Hasting's amazing presentation on "Culture" nails what company values truly are:

"Many companies have nice-sounding value statements displayed in the lobby, such as: 'Integrity. Communication. Respect. Excellence...The actual company values, as opposed to the nice-sounding values, are shown by who gets rewarded, promoted or let go."

2.07.2013

Gem of the day

As the world's largest food company, you'd assume Nestle has a good vantage point for understanding the impact of climate change on the energy, water and nutrition challenges we face. And yet, here's Chairman Peter Brabeck doing just the opposite (via GSB):

"I've been coming up here [World Economic Forum] for 15 years and nobody was talking about water. They were talking about CO2, they were talking about climate change; that we're going to roast and burn. We're talking about running out of oil, well it happens that we have 120 years of proven oil reserves, we have 240 years of proven gas reserves, we have 550 years of proven coal reserves, we have thousands of years of proven Uranium reserves and we are running out of water today."
There's only 3 possible explanations:

1. He doesn't get the link between climate change and oil, gas and coal (scary)
2. He's so busy talking up Nestle's water focus (a big reputational issue) that he got his story totally wrong.
3. He assumes because oil has a value in the market, investment will be made into alternatives as supply runs out (never mind the timescales demanded by climate)

It's all even more ironic given that he goes on to make a big deal out of understanding the big picture:

"If you become more and more and more specialised in a world that is more and more interconnected, you are losing your impact and your credibility to find solutions."

You can say that again, Mr. Brabeck.

2.06.2013

Another non-environmental wonder

Nobel Prize winner Andre Geim gets a less than warm reception at Davos (via FT):

"'What are you doing here?' The software billionaire choked in astonishment when I told him I was a physicist. The reaction was informative: it was as if he had encountered a seasonal labourer at our meeting place, the World Economic Forum in Davos."

So why did Geim bother showing up? Oh right:

"The distinguished crowd at Davos last month discussed the poor health of the global economy...The only thing they shared was a belief that a quick fix was available...The advantage of ivory towers is that they allow a view beyond immediate problems. Where one sees banking crisis, debt crisis, currency crisis or some other crises, academics may see even more worrying developments. We are in the midst of a technology crisis. Disruptive technologies now appear less frequently than steady economic growth requires."

2.05.2013

Gem of the day

Scott Anthony gives business a cold, hard dose of reality (via Forbes):

"Most efforts at transformation fail miserably. This unnerving and frustrating reality should not be a surprise--after years of pervasive 'continuous improvement' programs, executives are reaping what they have sown. Their organizations, from executives down through the rank and file, have been motivated and compensated to focus on incremental improvement, measured quarterly and annually, along competitive performance parameters established years earlier."

And even better as a zinger:

"Cultural change does not occur through PowerPoint."
 

2.04.2013

Gem of the day

The "sustainable brands" conversation has accelerated over the past few years. One critical point from a set of takeaways at London's Sustainable Brands conference this year sums up the serious problem at the core of the concept:

"We should use The Power of 'And' — there is no need to trade off materialism and concern for environmental and social issues."

That's an assumption, not a fact - and one that puts a dangerously low glass ceiling on answers to the sustainable business model question.
 

1.31.2013

Gem of the day

BrandLogic's 2012 "SustainabilityIQ Matrix", sold as a new way of looking at sustainability leadership in business, suffers from a few fatal flaws:
  • Comparing apples to oranges - Different sectors have wildly different sustainability impacts, so benchmarking BP, Allianz and Walmart all within the same framework doesn't tell a very useful story.
  • Defining sustainability as "ESG" - Environmental, social and governance factors made for a useful reporting foundation when companies were just starting to get their heads around these issues about a decade ago. For real leaders like Danone, where the company's entire business model (except for Waters) has shifted to a strategic focus on health, ESG is totally marginal.
Case in point are the results, which place the oil majors - BP, Shell, Chevron, ExxonMobil - and even regulatory disaster Bank of America, firmly in the "Challengers" category. To give a better sense of just how wrong that is, here's BrandLogic's definition of "Challengers" and what that means for companies in that category:

"Companies whose real ESG performance is above average and substantially ahead of their perceived performance may have opportunities to secure unrealized ROI from investments in communications and brand positioning."

More brand positioning linked to "best in class" performance in underperforming energy and banking sectors - oh yes, that's what sustainability needs.

1.28.2013

Something that's actually good

Peter Uvin of Tufts University distils a set of 8 principles for companies operating in emerging markets, based on learnings from the work of development organisations; his colleague (and a former McKinsey partner), Dr. Bhaskar Chakravorti, responds to them from a business perspective (via Tufts MIB).

It's a great conversation that touches upon the operational, strategic and even psychological challenges of emerging markets.

Two key points from the first principle, 'All Action is Political':
  • "Managers on the ground have short time horizons: they know they are on the job for a short stint before they prove their ability to thrive under adversity and then move 'up' to more prestigious markets...rather than thinking holistically and longer-term about the broader impact of their commercial initiatives."
  • "If the local socio-political system is characterized by a lack of transparency, profound structural inequalities, deeply engrained types of social discrimination, widespread arbitrariness, omnipresent corruption or pervasive structural violence, then your actions will normally reinforce those features, even if unintentionally."

1.25.2013

Another non-environmental wonder

The words "Davos" and "groupthink" are rarely found far apart from one another. But given the state of economies around the world, this gem takes it to the next level (via BusinessWeek):

"There’s a crystallization of thought that the financial crisis is over,” says Scott Minerd, managing partner and chief investment officer of Guggenheim Partners, a Santa Monica (Calif.) firm with about $160 billion under management."

1.22.2013

Something that's actually good

Sam Palmisano, former President and CEO of IBM, summarises the critical challenge he faced taking the company in a new direction [product to service shift and adoption of Smarter Planet] at a time of strong financial performance (via Wharton School of Business):

"I really believed in the beginning that I had to keep the business going, [and] at the same time start the transformation of the business model. I didn't think the business model as it was at that point in time was going to sustain itself over the next 10 or 15 years...There were people, phenomenally successful in the PC era, who were wedded to a business model...[They thought] 'I'm making so much money in this business, do I really want to take the risk of transformation?'"

More proof that the short-termism of financial markets stunts innovation.

And speaking in a personal capacity, but one entirely relevant to that challenge, he nails the #1 reason most companies never get there:

"To get prepared for the future, you need to really put yourself in an uncomfortable space."

1.18.2013

Gem of the day

Paper industry group Two Sides, authors of key message "print and paper have a great environmental story to tell", have something to say about Google's new "go paperless" campaign:

"This new initiative is clearly another example of a self-interested organization using an environmentally focused marketing campaign to promote its services while ignoring its own impact upon the environment."

No comment.

1.16.2013

Gem of the day

Economist writer Schumpeter has a new column summarising two new reports on risk, and what their contents could mean for business in 2013. He couldn't be further from the point:

"The more you read, the more risks you see; eventually, you succumb to nervous exhaustion...[nevertheless] these reports not only provide warnings about dangers that can be avoided by better planning or clearer thinking. They also suggest opportunities."

The landscape of trends presented in these reports might not be news; rising inequality, unstable financial markets, climate change, resource scarcity, health crisis. But so far few companies have seriously changed the way they do business in response to any of those trends (Danone is a contender; Unilever, Kingfisher, GE, IBM and others aspire to). The past few years indicate the complexity and threat of these trends is only increasing; in the words of Frost & Sullivan, "bringing new competencies into play at half the life-cycle speed of the past decade." This all adds up to serious implications for business.

Companies face a world where the rules of the game are beginning to require more than delivering against short-term financial targets and producing a CR report. That means "better planning" and "considering opportunities" are not going to help any company find a strong, sustainable and long term direction for their business model in an operating environment that is fundamentally changing. 

Linda Sanford of IBM calls it "the golden age for transformation". It's also the start of a great disruption, and that won't be pleasant for any company silly enough to listen to Schumpeter.

1.14.2013

Something that's actually good

Even companies we might consider today's sustainability leaders - Unilever, GE, Kingfisher, IBM - still face a huge challenge to doing more: a market environment that demands short-term results.

That's why Unilever CEO Paul Polman's quest to push back on the limits of "quarterly capitalism" is so important.

But what about companies that are coming at the issue from a more mainstream point of view? Here's Amazon CEO Jeff Bezos on the benefits of a long term perspective (via HBR):

"If you're long term oriented, customer interests and shareholder interests are aligned. In the short term, that's not always correct.. if we needed to see meaningful financial results in two to three years, some of the most meaningful things we've done we would never have even started."

Now all Amazon needs to do is reconcile its status as the world's biggest online retailer with a sustainable business model. A long term mindset is the perfect place to start.

1.10.2013

Gem of the day

McKinsey, steadfast supporters of the status quo, offer three tips for "becoming more strategic" in a company. Tip #2 is "Become expert at identifying potential disruptors", which they describe as "the sorts of changes that make or break companies".

Ironically one hypothetical they give is for an oil company with UK assets to keep an eye on competitors and their investments - not, say, the price of carbon, the rise of non-traditional activist movements, growth of renewable energy markets, energy return on investment or, heaven forbid, decisionmakers' awareness of peak oil. Because in the world of business as usual, monitoring "less conventional" fluctuations in the average is what counts as mastering strategic threats.

Here's one tip they could have offered instead of all three:

"Become expert at translating global megatrends into threats or opportunities for your business - and then find the real thinkers who will help the company design a long-term strategic response to them."