Xerox is making the pursuit of sustainability a priority, and other companies are following. A few weeks ago I saw an article reporting that Xerox had created a staff position to track the green footprint or “green value chain” (similar to “lean value chain”*) for all their products. A quick news-search revealed that Xerox is working with other corporations such as EDS to track and reduce carbon emissions related to Xerox products (link), and has been named to Dow Jones Sustainability North America Index (press release). Read further for more on what is behind the change and how we can encourage it.
A growing number of corporations have been touting their “green” efforts over past few years, but it has been hard to see what a lot of them were actually doing. When such a trend starts out it is easy for companies to say a lot and do little in hopes of improving their image and market share. Eventually, however, as public awareness increases, they have to show real actions and results. It is encouraging to see companies taking concrete action towards sustainability, providing real cost savings to customers and environmental benefits that can be measured, and finding a market for new and improved services at least partly based on this approach.
Typically I expect corporations to keep their environmental initiatives and results secret, treating them as competitive advantage. From what I’ve seen, the only time this pattern changes is when the company perceives a marketing advantage in telling what they are doing, or, even better, sees profit in selling their new ideas for wider use. Xerox is one company that apparently has reached that understanding and taken concrete action, and it can be hoped that increasing numbers of other companies will follow quickly. Xerox has not only created and placed on-line a sustainability calculator (link) that will help figure out how much can be saved on printing and duplicating by use of various energy-saving measures, but also provides consulting to their customers to help them maximize the benefits of “thinking green” when it comes to the markets in which Xerox competes.
There are a number of aspects to this trend that are encouraging. The fact that companies see a marketing advantage in advertising their green-ness indicates that a significant portion of the population is aware of and cares about environmental issues. That companies recognize that they have to take real action and not just “make noise” about their green-ness suggests that they give the public credit for being able to tell the reality from the “hot air”, which is encouraging in itself. I believe we will see this trend continue.
Corporations have more potential to drive the world towards sustainability than governments. Considering that I learned in business school back in the late ’80’s that there were, even then, one hundred corporations with more economic power than all but the seven largest industrialized countries, the potential for a world movement towards sustainability driven by corporations is immense. Unlike country governments, corporations span the world, cross borders with ease, and have tremendous economic and political influence in the developing and undeveloped countries where country governments are poor and lack power (though sometimes corporate influence is obtained through questionable means such as bribing corrupt government officials).
Let’s work to put the profit in “green-ness”. Thus, corporations can achieve a more homogenous, global approach to world problems than governments who must make hard-to-negotiate treaties. The down side is that corporations will still be guided by profit. Environmental negatives such as strip mining and resource depletion will continue to drive profits, so we must do what we can to ensure the profit is in doing the right things. That means we must buy less and buy smart, make our stuff last longer, tell the corporations what we want, and generally work to be as environmentally responsible as possible.
Finding synergies between corporate and social goals is a key. In some cases corporations have funded local education in poor countries, for example, which is a key to a society decreasing its birthrate and thereby improving its economy. Hopefully we will see, and we can demand, more of this action by corporations in the future, even if it would be opposed by nationalist labor interests (unions, etc.) in the developed countries. If corporations see green-ness as bringing business advantages including decreased costs, higher profits, and bigger market shares, the potential for corporations to create rapid improvement in many environmental areas is great.
* “Lean value chain” (short description), or value chain management (wikipedia), is a business concept that has been around since 1985. It involves analyzing every possible step in the process of getting a product to the customer, and managing the cost and value added in each step in a holistic and coordinated way to improve the product, the process, and resulting profit. It is a major service product for a lot of consulting companies. The process of “green value chain” management is similar, but involves analyzing and optimizing environmental factors such as carbon footprint and waste characteristics for each step in the same process. (April 30-May 2, 2008 conference on the green value chain management)