how to change the world - wind of change at major corporations
TRANSCRIPT
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How to Change the World – Wind of
Change at Major Corporations
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“There are three ways to change the world: change China, change California, or change Walmart.”
William McDonough, architect, designer,
and sustainability expert
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Too good to be true
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Largest retailer in the world
Known for ruthless exploitation of natural resources, squeezing suppliers, and crushing communities
Public Enemy No. 1 for a generation of activists and reformers
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Wind of Change Announced plans in 2006 to
rebuild the company with 3 major goals:
~ To use 100% renewable energy
~ To achieve zero waste ~ To sell only products that
benefit the environment across the global supply chain
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Only one phrase to describe this ambition:
匪 夷 所 思(Unbelievable)
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Goal No. 1
100% Renewable energy
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In 2013, renewable
energy already
provides 21 % of Walmart’s
global electricity
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Goal No. 2 Serious about waste….“Our goal is to create zero waste. We’re working toward a day when
there will be no landfills containing our throwaways.
In 2011, our Walmart U.S. operations prevented more than 80% of store waste from going to landfills.”
Walmart Global Sustainability Report, 2012
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Zero-waste-to-
landfill
Recycle, Repurpose ,
Reuse
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Goal No. 3
All products to be sustainably produced – by far the most ambitious goal
Can it be ever achieved?
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One example – fishery products
Over the past half century, demand for seafood has increased five-fold.
An estimated 75% of the world’s fisheries are at or beyond sustainable limits.
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Sustainable Fishing
Since 2007, Walmart requires all seafood suppliers to become third-party certified as sustainable using Marine Stewardship Council (MSC), Best Aquaculture Practices (BAP) or equivalent standards.
As of Jan 2012, 76% of fishery products sold at Walmart were sustainably harvested.
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Still a long way to go, but it’s
already impacting on all its suppliers worldwide, including those in China.
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Nike
Made its fortune
through celebrity marketing, supplier exploitation, and total disregard for the environmentBut things are changing, and
changing fast….
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Nike wants to sell shoes, a lot of shoes…
But it also asks: What should go into the shoe? How to minimize its impact on the
environment? What materials should be used? How to manufacture the shoe so that it
can be easily disassembled and recycled?
What happens when the shoe’s useful life ends?
How to regain the discarded shoes from the customers?
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Nike’s Considered Design
A systematic effort to minimize environmental impact by reducing waste throughout the design and development process, using environmentally preferred materials and eliminating toxics.
The long-term goal is to design products that are fully closed loop: using the fewest possible materials and designed for easy disassembly, while allowing them to be recycled into new product or safely returned to nature at the end of their life.
Shoes
will not be the
same again
.
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Nike’s vision Design for recycling Consumers bring their products back
to us to be recycled into new products Waste that cannot be eliminated is
recycled Product is less reliant on oil and
water We all step lighter, faster into a
future low-carbon sustainable economy
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Nike’s new design approach Considered Design
Pegasus – Nike’s best-selling running shoe – is a product of Considered Design: 13% lighter with an 83% recyclable sole.
Applied to all shoes 2011 To all apparel 2015 To everything 2020
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Nike has become a master of remarketing
It is always asking: Can we reuse, recycle, repurpose, or remanufacture this input or output?
Classic example: Nike Grind
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Now watch where they
go
These discarded shoes used to end up
in landfills
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All from recycled shoes
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How many shoes does it take to make a Nike Grind surface?
Outdoor basketball court: 2,500 pairs Outdoor tennis court: 2,500 pairs Playground: 3,500 – 10,000 pairs Indoor basketball court: 3,500 pairs Soccer pitch: 50,000 - 75,000 pairs Running track: 75,000 pairs
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Walt Disney
Apart from theme parks, Disney is the world’s largest character franchiser – Mickey Mouse, Donald Duck, Winnie the Pooh, etc.
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In 2009 it acquired one of its competitors, Marvel Comics (owner of Spiderman, etc), for US$4 billion to strengthen its position in the character franchise market.
This figure shows how big the business and the stake are for Disney.
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Who is Disney No.1 customer?
Children, of course!
But what’s wrong children nowadays?
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A 2004 UNICEF report revealed that 30% of US children were overweight and 14% were obese. And the trends were most worrying.
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1966
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Although Disney did not feel that they had contributed to this phenomenon, some of their franchisees certainly did, including of course McDonald’s.
This is the youngest person
ever to have weight loss
surgery
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Disney was determined to transform the eating habits of children to halt the obesity trend.
In 2006, Disney introduced nutritious food guidelines
Requiring all its franchisees to use kid-focused products that meet specific limits on calories, fat, saturated fat and sugar.
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Imagination Farms was launched to create an extensive food portfolio which today offers nutritious options in key meal categories including fresh produce, bread, pasta, dairy and baked goods.
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Imagination Farms Mission
Increase the consumption of fresh fruits & vegetables among children
GoalBecome the number one trusted brand
for healthful food choices for kids
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For Disney, all these are not part of CSR as such.
They are trying to educate and nurture a new generation of children with healthy lifestyle and eating habits.
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Thinking outside the bottle
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Coco-Cola started operation in India in
1950. But in 1977, they exited after a new law partially nationalized
the company.
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They returned in 1993 and had been struggling to find a foothold.
The Indians like their product but resent their global corporate dominance.
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Greatest challenge:
Developing the business in the rural areas where there are
few job opportunities, little or no electricity,
a huge population that has embraced wireless technology
How do you sell soft
drinks when there are hardly any
refrigerators?
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The breakthrough….eKOCool and 5 by 20
eKOCool is a solar-powered mobile cooler for use in the villages where there is no electricity.
5 by 20 is Coca-Cola’s global commitment to nurture and empower 5 million women entrepreneurs by 2020.
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Killing three birds in one stone
Creating employment as operator of a stand-alone business
Selling Coke Recharging
mobile phones and electric lanterns
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The cooler can hold 48 300ml bottles. Beverages kept in the cooler overnight or 4 to 5 hours are chilled enough for consumption.
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Coca-cola solar refrigerator in Indian villages
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Accenture is one of the world’s largest consulting firm. Rank among Fortune Global 500.2012: revenue US$28.6 billion 275,000 employees worldwide
Greatest challenge: finding and
retaining talents
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Young people
want more than a career
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Talented employees look for meaning in their work and ways of contributing to society.
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Accenture Development Partnerships - A Corporate Social Enterprise
The first of its kind Harness its best people to
offer their expertise to build, strengthen, or scale up NGOs and social enterprises in the developing countries
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How it works
Accenture employees could choose to work in social projects in developing countries for 3 to 6 months at half pay.
On completion of the projects, they return to their original posts, having gained valuable exposure in fostering development in challenging and unfamiliar environment.
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Making a Difference –Accenture Development Partnerships
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Win-win-win
Half salary of staff involved
Half salary for project duration
Pay below-market consultancy fees
More capable and motivated staff
Exposure, training and opportunities to contribute
Access to top talents and expertise
Company
Contribution Gain
Staff
Clients (NGOs,
etc)
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Accenture has become a role model in staff engagement and is winning the talent war
Many professional firms are following their example and devising similar programs
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Interface Carpet – the Power of One
All of the previous examples are household names
Here is one which is not that well known as it is an industrial company
However, its impact and influence is by far the greatest
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Interface Carpet - used to be a ‘business as usual’
Turned vinyl and other petroleum products into carpets
Total dependence on oil industry for inputs
Unsustainable from both business and environmental points of view
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In 1994, a customer asked Chairman Ray Anderson a simple question:
“How environmental friendly is your company?”
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Ray hasn’t a clue…
In preparing the response, he came across a book The Ecology of Commerce by Paul Hawken, which shocked him and helped him to realize that Interface has been a great polluter all along and was utterly unfriendly to the environment
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Ray had two options…
Option 1 Tell the
customer that the company is not very environmental friendly but will do something about it
Option 2 Fundamentally
rethink and redesign the whole production method to make it totally environmental friendly
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What would you do if you were Chairman Ray Anderson who was the founder and chairman of the Company but was already 60 years old?
He chose
option 2
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Interface’s Mid-course Correction
Committed to pioneer the ‘next industrial revolution’ and ‘unhooked from the oil well’
Developed technologies to produce carpets with recyclable yarns from bio-based fibers made from corn starch
Pioneered carpet reclamation program – ‘We want your carpets’ – recycling own and rivals’ carpets
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Towards a Sustainable Enterprise – The Interface Model
Mid-course Correction
by Ray Anderson1998
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The Power of One Interface has since become
the world’s most environmental friendly enterprise
They were a lone pioneer when they embarked on their transformation
It was the Interface experience which helped convert Walmart to formulate their ambitious goals in 2006
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Ray Anderson was an industrial engineer.
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What do all these stories have in common
They are not conventional CSR efforts
They are not charitable acts They are addressing burning social
issues They leverage core business and
core competencies They turn social issues into business
opportunities
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Why this sweeping change?
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The Necessary Revolution
Capitalism has reached the stage that is threatening its own existence in terms of exploitation of the globe’s renewable resources
file:///C:/Users/Owner/Downloads
/The%20Necessary
%20Revolution.pdf
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Business is the solution
Growing realization that ONLY businesses can, and have the resources, to tackle the world’s burning social issues…. not governments,
or NGOs or social enterprises
Michael Porter http://www.ted.com/talks/michael_porter_why_business_can_be_good_at_solving_social_problems.html
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Rethinking the purpose of enterprise
From maximization of shareholder value to B corporation
B corporations are for-profit businesses which use the power of the market to create social and environmental benefits.
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Social entrepreneurship has shown the way
Social entrepreneurs in different parts of the world have demonstrated that business can do good and well at the same time,
e.g. Grameen Bank (Nobel Prize winner
2006), Dialogue in the Dark Café Direct
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Technology as a powerful enabler
We could design and make almost any products we need…. even for the bottom of the pyramid
A world-famous course offered at Stanford Design School:
Design for Extreme Affordability
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Engineers as change agentsStrengths
Technologically literate
System-thinking capability
Financially well-off
Weaknesses
Lack of entrepreneurship
Lack of social sensitivity
Lack of passion
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An unexpected role model….
Jenny BowenFounder,Half the SkyFoundation
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Jenny’s insights for engineers Entrepreneurship – no track
record to speak of
Social sensitivity – an orphan touched her heart
Passion – determined, committed, unstoppable
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What could you possibly do?
Engineers as Impact Volunteers ? Power of One ? Social Entrepreneurs ? Social Intrapreneurs ? Social Change Agents ? Policy Advocates ? Educators ? Social Investors ?
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Even better…
Think and act as a team Leverage professional
platforms Leverage business and trade
organizations Become part of a global
movement (Engineers Without Borders, Engineering for Change, etc)
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Thank you.