Today's Marketers in Responsible Marketing

Today’s marketers should concern about possible impacts of business and marketing on all stakeholders, not only customers but also employees, community, partners and the planet for particular as living entity. Based on these considerations, marketers should search for possible solutions that can help create more positive values and/or reduce negative values on these stakeholders.

There are many approaches for marketers to adopt the concept of responsibility and sustainability in their marketing strategies and tactics.

The case of TerraCycle and our project for OMEGA Global Initiative offers an approach of partnership with branded recycling solution or branded sustainable practice that can help create more values to customers and the planet for companies.

The case of Tissue Culture Beef is quite unique in teaching us about the sustainable idea coming from the product itself which is made in a sustainable process. That also leads to the idea of making products from more responsible and sustainable materials, that can be developed into various approaches. It can be Cradle to Cradle. It can be working with partners to have similar “Reimagine” projects of Patagonia to regenerate sources for materials.

A company can also work with third party to supervise how they reduce impacts on the environment through carbon footprint chronicle (Patagonia) or something like that such as Environment Profit and Loss (StellaMcCartney).

Some cases such as Patagonia, TerraCycle also teach us about orientating consumption among customers. Consumption needs the intention of companies because as Szarky of TerraCycle said about his business model “We can’t recycle our way out of waste” and finally, “big business was designed to "mirror" consumer habits and if consumers don't demand durable goods, businesses won't provide them”. Look at what Patagonia did in Worn Wear campaign in Black Friday and how they are encouraging their customers to “buy less but buy well”.

One more thing, as we usually think about marketers as those who tell lie. It is time to keep mind on greenwashing in all of marketing tactics. Business should be consistent between what they say and what they do, or else it may trigger business disaster such as the case of Fiji Water.

However, we can not say all business should follow similar approach following responsibility or sustainability. For each business in their context, there will be different approaches along with limited opportunities to adopt responsible and sustainable practices in their own business. Most of all, it is necessary to keep in mind that it is time for "responsible economy" and business along with marketers should be those to lead this period of time.

There is more than one way to turn waste into useful resource. Here are example of waste turned into construction materials. The good thing is that all of them are cool things.

Trump's Threat to the Environment

Under President Obama, America and many businesses have made huge strides toward addressing environmental issues. However, with the current President elect, Mr. Trump, there will be huge setbacks as revealed in his first 100-day action plan:

* FIFTH, I will lift the restrictions on the production of $50 trillion dollars' worth of job-producing American energy reserves, including shale, oil, natural gas and clean coal.

* SEVENTH, cancel billions in payments to U.N. climate change programs and use the money to fix America's water and environmental infrastructure

According to this blogpost from Business Insider, these are the 7 biggest threats Trump's presidency will have on the environment:

1. Backing out of Paris Agreement
2. Killing the Clean Power Plan
3. Eliminating the EPA (Department of Education and Environmental Protection Agency)
4. Appointing climate change deniers to lead EPA and Department of Energy
5. Cut all federal spending on clean energy
6. Avoid creating any regulations on methane
7. Open federal lands to oil and gas spilling

As you can see from these, the incentives set in place for companies to achieve a triple bottom line and be conscious of the negative externalities they produce is likely to diminish. 

Hopefully those 4 years of a Trump presidency won't create a big enough setback on the environment to the point where it's too late...

Are Zara's sustainable clothing line a part of greenwashing?

Fast fashion industry are a huge contributing factor to negative environmental issue. Apart from using organic cotton, Zara now uses 100 percent recycled cardboard and teaming up with designers, etc to turn recycled boxes into chic DIY projects with tutorials and lastly recycling old zara clothes.
However, that is just one collection, it does not account for all of zara clothes that uses organic clothing.  Critic are saying that this small collection is nothing in the grand scheme of things for a company that produces more than 900 million garments a year. If Zara is serious about producing sustainable clothes, i feel that most of its clothing line should use organic materials instead of just one collection. What do you think? How can a fast fashion brand like Zara and H&M be truly sustainable?

For our Class discussions today 1) About Terracycle 2) Recycling Revolution: Al Jazeera 2) Eliminating the idea of waste 3) Outsmarting the idea of waste (1:30:00) - Long

Tohokubu Clean Center

Last Friday we visited Tohokubu Clean Center, a solid waste treatment factory. A cute place among the mountains. Very clean and with a lot trees. If do not know what this building is really stands for, you will never guess that 700 tons of wastes in “yellow bags” are processed here daily. No disgusting smells and even no smoke from the chimney. Each detail seemed to be thought out. Turning garbage into electricity production is very clever idea. Even ash could be used to “build” the islands, increasing the constrained territory.

I know that the problem of waste treatment is actual for my country. For example, in Moscow and its suburbs only 17 % of waste are cycled. All other garbage is just stored on open space in Moscow region. There are several factories inside Moscow, but it's not enough. The technology is poor and therefore it's not environment -friendly and it's really annoying for Moscow citizens.

Tohokubu Clean center showed that there is a real example of solving such problems. Such factory aims at sustainable and clean waste treatment with changing wastes fuse into energy and harmonizing with surrounding environment. Combination of high technologies and great designing standards makes such project adaptive to every country. I sent the information about such factory to Moscow region government in my home town. Probably it'll be interesting for them. Since the relationship between Japan and Russia becomes warmer recently, one day the problem of waste treatment would be the theme of reciprocal cooperation between these two countries.

TerraCycle: Recycling won't solve the waste dilemma, but consumers can

CEO of TerraCycle’s suggest consumers to think about their shopping habits with aim to promote durabke and used products in closed look systems. According to hi 5% of the global packaging was recycled and 25% was dump in to oceans and 70% was burned.

Consumers understand sustainability based on low carbon economy and companies that focus on environmental and societal issues and have are becoming leaders in the market. The process of these companies is as follow:

In addition to this article, another article highlights that in case if consumers face with challenges in the waste industry, it is the responsibility of industry and professionals to teach consumers about practices and environmental and economical values. Due to these reasons some companies starting educational programs for consumers.

Based on these articles, it seems that Patagonia and Terry Cycle have similar goal and they can be competitors to each other.

“Adding Value through Branded Recycling Solutions” – a business model of TerraCycle that OMEGA Global Initiative can adopt

The article was written by Tom Szaky – CEO of TerraCycle.

TerraCycle can provide a branded recycling solution, while most of other companies are struggling for recycling by themselves. Tom Szaky suggested that by integrating this branded recycling solution into the value chain, a company can effectively create more values for itself and even for customers. With a branded solution, the company can communicate their brand more effectively than just doing by themselves.

For instance, that fact that Henkel partnered with TerraCycle in offering a recycling solution for anaerobic adhesive packaging did help Henkel itself communicate to its customers about its brand DNA of supporting responsible practices. Moreover, “Offering a custom, branded recycling solution adds value for current and potential customers by communicating that solving for its difficult-to-recycle anaerobic adhesive containers is part of who they are.”

Tom Szaky also advised that “When companies attempt to integrate sustainable enterprise into their branding strategy, transparency is essential.”

Such way of working with the partners of TerraCycle can be a good example for OMEGA Global Initiative. Because in fact, OGI is offering a sustainable system of water source preservation that other companies who are concerning about sustainability are also struggling for new solutions for recycling their water source. 

Adding Value through Branded Recycling Solutions

Did Trump pursue a responsible marketing strategy for his presidential election?

He may have a strong marketing plan based on the number of popular votes and electoral votes given to him. Or we may say that because his election run had encouraged a considerable number of White working class going to vote, he was successful in influencing his target “customers”. However, is it a responsible marketing strategy?

Looking into how he persuaded his “LRTC”, what he did were that he turned his back on most of the policies of previous presidency, broke the credibility of media in residents, evoked the hatred of a considerable part of American on their own political system. Furthermore, his populist, protectionist approach in his policies, certainly, will have negative influence on other countries. For instance, his viewpoints and policies related to UN climate change programs will have considerable bad impact on the planet, American environment for most. Becoming US president, along with his racist, xenophobic attitudes, he seemingly represents for some negative values which are rising now not only in America, but also around the world, giving them more evidences to believe in the rightness of such approaches, at least in this period. Apparently, Trump with his election run, has contributed much into dividing the society deeply, Republican party itself already showed some signs of separation. He had created a mess, and now when he has become president, how can he improve the situation with most of his policies changed incredibly during his presidential election, or just following the framework of Democrat Party in combining with his protectionist approach and his "unique" personality?

Comparing and contrasting Clinton and Trump http://www.politifact.com/truth-o-meter/article/2016/nov/01/comparing-and-contrasting-clinton-trump-johnson-an/

Trum and Clinton on the economy http://graphics.wsj.com/elections/2016/donald-trump-hillary-clinton-on-the-economy/

 

Changing Consumer Habits for Environmental Change

Saw this Terracycle article regarding environmental change: http://www.edie.net/news/5/We-can-t-recycle-our-way-out-of-the-waste-crisis--says-TerraCycle-founder/

Terracycle argues that the main source of environmental issues is consumerism. Therefore, we have to change the way we consume to avoid having businesses trying to meet our demands which end up exacerbating environmental problems.

This poses a huge challenge for educating consumers for "better" buying choices and also having them participate in closed-loop systems like what Terracycle aims for. I don't know if it would be more effective for consumers to be "forced" to participate in said closed-loop systems or for a very strong incentive program that allows consumers to be willing to make the "extra effort" to think beyond their immediate needs. It seems the majority of campaigns are not so effective where even many of us in class are not willing to give up our current habits for the sake of convenience.

What will it take for consumers to change their poor buying habits and effectively participate in environmental change?

Presidential election

The main intrigue of this week was president election in USA. It was question number one for all countries in the world. It looks like that such election in USA is even more important then all domestics problems. 

Both candidates Donald Trump and Hilary Clinton were untypical for candidate of the president of such huge country as USA. Trump winning was unpredictable for everyone. But Professor Sugai told us that Trump had very strong marketing plan. Very clear and direct messages for the specific categories made it  possible. This case proved democratic principles in USA. When the possibility to capture the majority of minds dominates the rationality.

 For my opinion the election's result is the same as Brexit. Countries with strong economy are trying to isolate from globalization process in oder to safe their magnitude and influence. Different kind of units as Soviet Union and European Union appeared to be ineffective. The history will show us the results in a while.   

Uniqlo's clothing recycling program

I went to Uniqlo this week and found this on my receipt:

Due to my limited Japanese, I guess the meaning of the small paragraph is that, Uniqlo will like to deliver its recycled clothing to refugees,  and if you have any unneeded Uniqlo clothing, please recycle it through the box in its store. It would help Uniqlo fulfill its responsibility.

According to Uniqlo website, it has been doing this recycling program since 2017, and in total have donated 16.32 million pieces to people in need.

I guess this is at least a good way to demo Uniqlo's extended producer responsibility, to retrieve its 'waste' back and reuse it. However, this is still not close-loop. I wonder what would happen after the clothing is worn and refugees throw it away. There is really still a long way to go for real responsibility realization.

http://www.uniqlo.com/en/csr/refugees/recycle/

Tissue Culture Beef

Tissue Culture Beef

High technologies are very interesting for me. I'm sure that it helps us in many industries such as automobile and medicine. It really makes our life easier. But what do you think about such technologies in food.

I read Ketzel Levine about Lab-grown meat.

This article is from 2008 so we can see that this theme interested people since a long period. And not only one company working in this direction. 

http://www.npr.org/templates/story/story.php?storyId=90235492

Under progress it'll be possible to grow just meat stakes. Man-made meet will be grow in the laboratory not on the farm. It'll be meat without bones and fat, therefore healthier and diet. Such idea is interesting for vegetarians and animal -friendly people. It's a way to create something new and useful. I think it will be great thing but in some 50 years. Right timing is a very important indicator.

In our century, we prefer hand made things and fresh products from environment friendly farm. In era of high technology people is ready to pay for goods which are natural and have soul. The same thing with meat. Natural way created fresh meat is still delicious because of the fat, bones, muscles and smell. It's traditional wild way to get food. Of course, real man is not hunting on mammoths any more but there is something really attractive to eat grilled steak on bone!

Living Green: Loving Halloween but hating the waste

People celebrate Halloween, but they get haunted by the waste they produce and this has to change. Tesla suggest ways to change this, from changes the types of products sold in terms of packaging etc. However, people need to change their behavior as well. In Tokyo, even the seat of a toilet was found (the washlet technology) in the waste. There are many cities that get haunted by the waste the spirits of Halloween create. Are they evil spirits? Trash or treat! http://mainichi.jp/english/articles/20161031/p2a/00m/0na/015000c

Voluntary EPR vs. Mandatory EPR

Found this article that shows the debate of companies wanting voluntary EPR vs. mandatory EPR. Currently in California, there are talks about creating a mandatory EPR system on packaging. This stems from recycle officials running out of ideas to incentivize manufacturers to do EPR in a way that achieves their goals. However, on the manufacturer side, many believe EPR is not financially sustainable and are pushing against it.

It seems to me that EPR would only be really effective if it is mandatory. However, I wonder if this would force companies out of business, especially SMEs who lack the resources. The long term benefits of EPR are obvious, but it doesn't seem to be taking off quite well at least in this case.

What do you guys think?

http://www.environmentalleader.com/2016/09/15/calrecycle-pushes-extended-producer-responsibility-to-reduce-packaging-waste/

Larfage Africa seeks Adoption of sustainable waste management initiative

It is really great to see that Africa is also taking action on this front. It's been said that Africa will be unable to continue or emulate the industrial activities of the developed countries because of the negative contribution these active have had on society. The only way Africa will grow is if they focus on activities that will lessen the negative impact on society, they have the potential on being leaders in this path of greening initiatives.


http://guardian.ng/business-services/lafarge-seeks-manufacturers-adoption-of-sustainable-waste-mgt-initiative/

Some reasons why we need to move to EPS

The article gave two main arguments to support Extended Producer Responsibility, or the reasons why we should shift the responsibility of recycling from government to producers.

Firstly, national recycling just helps recycle 10% of goods. This is because not all kinds of waste can be recycled within limited financial budgets. While aluminum, metals, many forms of paper can be recycled 100%, others such as plastic and glass almost can’t be recycled (the cost and resources required to recycle those materials versus the cost and availability of virgin materials).

Secondly, price of recycled plastic has decreased incredibly, leading to a drop in national recycling of these materials.

In general, under these economic issues related to recycling, current recycling approach shows to be ineffective. As an alternative, recycling should be taken out from commodity goods and be put under the control of original producers.

 

According to Walls (2006), among various types of EPS, individual take-back approach and combined fee/subsidiary approaches are preferred. Between individual and collective take-back approaches, individual approach is supposed to be better in encouraging Design for Environment (DfE) and companies can generate the economy of scale.

 
Is it time to rethink recycling? http://ensia.com/features/is-it-time-to-rethink-recycling/
Walls, M. (2006) Extended Producer Responsibility, OECD

 

There is no perfectly responsible fashion brand or responsibility notion itself is relative. Stella McCartney has made considerable efforts towards more responsible fashion goods but still suffer from the bad deeds of other brands like Adidas and Nike.! Should the brand be blamed for such collaborations? 

http://ecosalon.com/behind-the-label-is-stella-mccartney-a-sustainable-brand/

 

Stella McCartney sustainable claims

So after reading the patagonia case, i am more aware what a "truly" responsible company means. As for stella mccartney i was reading about some articles about how most people do not know that she does not use real leather and fur in her products. Therefore counterfeit imitations of her products are made with real leather. Regardless, of how "sustainable" her brand is, she chose to link her brand with her high profile partnership with adidas.

According to a March article in the observer, workers at Bangladeshi factories for Adidas are "beaten, verbally abused, underpaid, and overworked" which made me rethink about how she should handle her supply chain channels and partnerships with brand. No matter how "sustainable, and responsible" a brand claims to be, being linked with a company like that would ruin the image of her brand being sustainable. There are many quotes which make me question her claim as being sustainable as well. However, Stella McCartney is to be applauded for her personal commitment to animal rights issues and being a vegetarian brand

Stella McCartney and Chelsea Handler Team Up For Breast Cancer Awareness

One would expect that Stella McCartney is mostly or only focused on reducing harm to the environment. It is quite interesting to see that her focus is so vast and is willing to look at making women beautiful that are faced with life threatening diseases.

Having learnt about Patagonia and now Stella Mccartney it confirms that ones upbringing has a huge impact and influence in what interests they take on in life. This breast cancer initiative is closely linked to her because her mother suffered from breast cancer.

http://www.elleuk.com/fashion/news/a32358/stella-mccartney-and-chelsea-handler-breast-cancer-awareness/

STELLA MCCARTNEY ADMITS THAT EVEN SHE'S NOT 100% ECO-FRIENDLY

It is very hard to be sustainable, just being responsible is realism. Stella McCartney, a big name is fashion recognises it. Is it a confirmation that "sustainability" does not exist? Is it just a buzz word? Opinions are mixed. But what is interesting in that is that at least more and more people are thinking about changing the traditional way of doing things, looking for "better" ways. This is even a push to innovation, as we have to innovate to be able to get out of the conventional way of doing things. It is indeed then a value that is added, to everyone. Sustainability therefore is value-adding, not a burden. http://fashionista.com/2014/05/stella-mccartney-sustainability

Influencing the Next Generation of Sustainable Fashion

Three months ago, Stella McCartney's Youtube channel posted this "short film" advertising her latest addition to her sustainable fragrances, "POP":

The video embodies the some of the core values of Stella McCartney: feminine independence and individuality. Each of the four actresses show some type of unique self, all dancing freely and enjoying adventure. 

At first, I had no idea who these actresses were, but I later found that they were not mere fashion models, but also role models to the millenial generation. Each of these millenial actresses/musicians/artists are very similar to Stella herself in that they are activists of some sort (environmental, animal, or human) and also have famous lineage (most notably Lourdes Leon - Madonna's daughter). These young women are helping Stella McCartney create a paradigm shift that there is a place for sustainability in high fashion and luxurious lifestyles. 

Stella discusses the importance of using these millenial celebrity role model activists below:

All in all, this shows Stella McCartney's proven strong ability to communicate the value of her sustainable products, without sacrificing luxury's high end image, and influence the market through an emotional connection via effective use of her C-channels.

For more info on POP click here!

Stella McCartney's Models Wear Her Sustainable Fashion Ethos Close To Their Hearts

http://www.huffingtonpost.co.uk/entry/stella-mccartney-paris-fashion-week-sustainable_uk_57f36a2de4b056365584a8af

An interesting way to make a statement. I'm just wondering about its efficacy. As someone who has no problem wearing plain, solid colored t-shirts (and hoodies in the winter), fashion isn't exactly my thing. I never watch fashion shows, or pay attention to trends. I went out of my way to find this article, and would have never clicked it of my own volition (or visited the Huffington Post for that matter). So, I'm wondering, for the people who DO pay attention, what's your take? Is is effective? Or is it just another lukewarm marketing attempt?

Taken from the article:

"McCartney took advantage of the slogan tee trend to ensure it missed nobody’s attention that her collection was “animal free” with “no leather and no fur”.

"Models dressed in organic cotton muslin, eco-friendly suede and vegan leather danced down the runway at the Opéra Garnier on Monday 3 October.

""Every single day, myself and my entire team are challenging ourselves and the industry: what we can do better? So here we are, and this is the start of our journey, and as you can see, we are not perfect but something is better than nothing.

"“I’m hoping to share and encourage the industry to join in, and evaluate its environmental footprint for our future.”"

Stella McCartney and Chelsea Handler Team Up For Breast Cancer Awareness

Do you happen to know Chelsea Handler, a famous American female comedian and talk show host? She has been active in promoting equality, and now Stella McCartney is cooperating with her to promote the awareness for breast cancer - news released just 7 days ago. This is another example of Stella McCartney's responsible actions in promoting women's self-awareness.


In the pic below, you may see Chelsea Handler wearing the newly-launched new pink Stella lace lingerie series. As Stella explains, breast cancer is the second most common cancer in women, and her Stella lace series serve as a reminder for women to take care of their health and have regular body check. Of course, she never sacrifices the sexy and elegant elements in her design. The series focuses on both functionality and appearance.

This is not the first year that Stella launched the breast cancer campaign. In the last 2 years, Kate Moss and Kara Delevingne were featured in this campaign. 

As a part of the campaign, a percent of the profit will be donated to the Breast Cancer Research Foundation in the US and Linda McCartney Center to support the early detection programs and treatments for breast center.  (actually, Linda McCartney, Stella's mother, died of breast cancer, which triggered Stella's motivation to start this great cause). 

check out more details in the following links:
http://www.elleuk.com/fashion/news/a32358/stella-mccartney-and-chelsea-handler-breast-cancer-awareness/
http://eprretailnews.com/2016/10/25/stella-mccartney-launches-new-pink-lace-lingerie-set-and-breast-cancer-awareness-campaign-featuring-chelsea-handler-5265353633/

Stella McCartney’s First Release of Environmental Profit and Loss Account (EP&L)

After 3 years since its engagement in EP&L since 2013, Stella McCartney has just published its first report on its official website.

The report will help the luxury fashion brand adopt further steps on reducing its environmental impacts.

According to EP&L, its overall environmental impacts have increased since 2013 but if we look to the impact per kg of materials, it has considerably decreased. Apparently, with a strategy of expanding the product lines along with its existence in the world markets, the total impact will increasingly higher and higher. This could be one of the issues that Stella McCartney should put into consideration.

 

As a result of EP&L, its most impact on environment came from its supply chain, which explained for 90% of the total impact, particularly, raw material production and processing. This will pose a big challenge to the company because it has to share the suppliers with other fashion companies.

From there, Stella McCartney has planned to reform how it will use alternative kinds of materials, mostly through “using recycled and bio-based materials”. For example, for cashmere, they have planned to opt out using virgin cashmere but instead regenerated cashmere.

From the EP&L, Stella McCartney seems to stop tracing its environmental impact from raw material productions to its stores, warehouse and offices, but not going further into after-buy steps. This can be next consideration for the luxury fashion brand if they head toward sustainable purposes rather than just stopping at being a responsible company.

 

Reference

http://www.ecouterre.com/stella-mccartney-releases-first-environmental-profit-loss-account/

http://www.stellamccartney.com/experience/jp/press-room/stella-mccartney-announces-first-global-environmental-profit-and-loss-account-for-2015/

Stella McCartney’s 2015 Environmental Profit and Loss Account http://cdn3.yoox.biz/cloud/stellawp/uploads/2016/09/SMC-EPL-Final-Report-2015.pdf

The World's Most Sustainable Companies 2016

I have already mentioned in the class about list of top sustainable companies in the world in Forbes website and it was mentioned by Patagonias' representative that sustainable companies doesn't exist yet.

The rating that is given in Forbes website are from RobecoSAM which does Corporate Sustainability Assessment (CSA) annually with aim to check companies sustainability practices. Every year they send the questionnaire with 80-120 industry- specific questions which focus on economic, environmental and social factors to 3400 listed companies. The company has long structure for this which can be checked in this document: http://www.sustainability-indices.com/images/corporate-sustainability-assessment-methodology-guidebook.pdf

The company analyze the questionnaire and compare the result between the industries. Furthermore, it uses formulas for calculating the total sustainability. Through this they identify the top sustainable companies which effect positively in company's reputation. However, to what extend all this information and data is accurate and do they really check the effects of production and activities of the company to the environment (besides receiving companies answers). The company mentions what they consider during the analyses, however not all the information is so practical.

All this information again prove that none of the companies reached sustainable level.

More thoughts on bottled water: Evian's claim 'Zero net carbon by 2020'

When reading the Fiji Water case, I instantly thought of Evian. As a more global brand, how does it address the similar environmental issue? I took a look at the website and have some interesting findings. 

Evian has an objective to reach Zero Net Carbon in 2020. It claims to be Danone's first brand to reach zero net carbon.

Under this scheme, it has two major strategies:

1) reduce carbon footprint

2) restore water-linked ecosystem to offset its carbon emission

 Besides, it also conducts bottle recycling, community engagement, water preservation, etc.

How similar are these actions to Fiji Water! Certainly, Evian is claiming in a more mild way: "we own everything to Nature, which is why we are protecting it'. 

Although it is not as dramatic as 'every drop is green', what do you think? Is it green washing, or responsible action? 

Sustainability Mindset

This books seems to be very interesting and actually sounds in many ways to the value plan. It is the called the sustainability Mindset however it is nonprofit organization management orientated. The overall matrix is to help create strategy to help on financial viability. Here is the link,  http://www.nonprofitsustainability.org/

Shortcomings of a Triple Bottom Line Mentality

The big talk of businesses' goal to achieve sustainability revolves around the idea of the triple bottom line. The triple bottom line is an accounting principle that takes beyond the idea of just mere profit. It also include the ideas of measuring the impact on the planet and people. Thus, a business that is able to manage all three aspects well, is considered a sustainable company. It's especially useful for (social) investors to understand businesses' social impact and value.

Although useful, there is a problem with this triple bottom line mentality - it's not actually sustainable. The triple bottom line is, as mentioned above, an accounting principle that gives businesses an incentive to cut down on C02 emissions, amongst other forms of pollution, and produce some sort of value to society (e.g. women empowering jobs). However, such an attitude should not be considered sustainable. Slapping on "sustainable" to business just because they can manage the triple bottom line is greenwashing. If they were to be more transparent, they'd be able to call themselves "responsible" at best. Business need to better strive for true sustainability by measurements based on the Circle Economy concept.

Although the triple bottom line represent huge strides toward a sustainable economy, it only goes halfway and should instead be labeled as "responsible." It is only by setting the goal towards creating a Circle Economy, and achieving that goal, that a company could then call itself a "sustainable business."

Sustainable and responsible

The case study for this week looks interesting in terms of what some companies can do. What was interesting when doing the assignment was the seven sins. Now I can see that so many companies are committing the seems and I feel like saying "they will be rewarded a hundredfold". That even makes me think like "how does it profit a man to gain the work world but lose his soul?" 。of course they will not stop tomorrow, but st let we need to help them open their eyes and see what they are doing.

Create integrate sustainability strategy

This article published on the 18 of October attempts to set out guidelines on creating a sustainability matrix by focusing on a sustainability strategy.

http://www.triplepundit.com/2016/10/create-integrate-sustainability-strategy/

Sustainable Growth

Having read through the Fiji Water case, the term sustainable growth was thrown around quite a bit. To the keen observer, this is an obvious oxymoron, growth in inherently unsustainable. To put it simply, you cannot grow infinitely with finite resources. The very idea of growth is self-defeating and self-limiting. Fiji Water's devotion to this idea of sustainable growth shows how greenwashed the company truly is (aside from justifying its existence). So how do we grow, but be sustainable? The answer is simple: We don't.

If a company truly wants to be sustainable, it first has to move away from this idea of growth. So long as growth is the objective of a business, it will be forever unsustainable. Fortunately, alternative metrics exist, at least when it comes to macroeconomics, however implementing them would unfortunately require a major shift in cultural attitudes.

It is unfortunate to say the least, however, I believe that as marketers, it will be our jobs to reimagine  the idea of business itself in the future. As Yvon Chouinard taught us in the last case, profit is possible, even without growth, and if we want to be sustainable, then scaling back on this idea of growth is where we must start.

Please take time to review the latest Podcast from McKinsey on the value of The Circular Economy.

Weakness of recent sustainability metrics & How to fix

Before coming to a recent discussion about sustainability metrics, I would like to introduce a paper of Cohen (2014) summarizing the growth of sustainability management, three groups of sustainability metrics related to environment, society and governance (577 total indicators in ESG sustainability metrics), and some challenges in this field.

Mentioning about challenges, beside of lack of consensus in the metrics being used by different associations such as Global Reporting Initiative (GRI) or Sustainability Accounting Standards Board (SASB), the paper does not mention about the weakness of most of these metrics like Chen (2016) pointed out in “Why sustainability metrics fail to measure achievement, and how to fix them.”

In this article, the researchers argue that there are many indicators that can prove the efficiency in an activity done by a company but can hide the effectiveness. For example, a company can show to be efficient in reducing water consumption per unit output but in fact it does increase the total water consumption, which can be hidden in the indicator.

Therefore, the AVERAGE INTENSITY of the resource used can be put under tricks to make the EFFICIENCY of the resource used higher.

There are typically three situations a company can utilize to create such tricks.

1.       Partial outsourcing (or in-sourcing): “if a manufacturing step using water is moved to a third-party (outsourced) while the final production remains on site, average intensity will decrease.”

2.       Change in facility use: “When production is increased, average intensity will decrease because each unit of production will receive a smaller allocation of the fixed water use.”

3.       Change in product or service mix: Many activities in the production process can help produce many different products. If a mix of these activities can be arranged in a tricky way towards less resource-intensive activities, it can lead to a decrease in the average intensity.

According to Chen (2016), “Overall average intensity is a metric of limited usefulness, and serves as a very poor proxy for corporate efficiency.”. They also suggested the application of “a method based on flexible budgeting was jointly developed by Bacardi Limited and North Carolina State University and has been in practice by Bacardi for several years.”

“The method is able to effectively eliminate all of the distortional effects discussed in points 1 through 3 above, providing an accurate measure of a company’s overall performance for each sustainability parameter.”

They also provided a case study of the application of these metrics at http://onlinelibrary.wiley.com/doi/10.1002/tqem.21400/full

 Reference

Cohen, S. et al. (2014) The Growth of Sustainability Metrics [Pdf] Available at: http://spm.ei.columbia.edu/files/2015/06/SPM_Metrics_WhitePaper_1.pdf

Chen, Y.S.A. et al. (2016) Why sustainability metrics fail to measure achievement, and how to fix them. [Online] Available at: https://www.greenbiz.com/article/why-sustainability-metrics-fail-measure-achievement-and-how-fix-them

Difference between Sustainable and Responsible Marketing and Green-washing!

 As I have recently been reading extensively on sustainability, in general and on sustainable marketing in particular, I have encountered a lot of thing, that marketers might not want to associate themselves with! A good example of that would be greenwashing, pretending green when your (company) is not! This has let me to more questions than answers and trying to find out a nexus between Sustainable and Responsible Marketing and Greenwashing if there is any! Why do companies lie about the nature of their activities or simply why do marketers take a lead in that? Is it just being greed or green is cool and people like cool things? Is all this for a short-term profit? It was very frustrating that I have wasted a lot of my time reading and could not find convincing answers and ended up monologuing and convincing myself that not all companies have to be sustainable or green but all companies must be responsible. After few days, I resumed my research and luckily ended up reading on some companies that I know for real, raising the flag of sustainable mining, not responsible mining my the way! Yes sustainable mining if you have not read it appropriately! Yes again, sustainable depleting of mines, and sustainable polluting their surrounding ecosystem with whatever chemicals possibly available, just to name few, cyanide!
Honestly speaking the latter issue was an eye opening for me and has let me to something that I have never done before, praying that UN could extend the notion of R2P to include businesses! Please pray with me!

Lab grown meat. Yay or nay?

Most of us are aware of the environmental impact of meat production and raising livestock. It is one of the biggest human activity that has a huge impact on the environment. Given the fact that the planet isnt getting any bigger whereas the global population and the global appetite keep growing, scientist and businesses have produced what you call a lab-created meat that will be "healthier" than conventional meat and more environmentally friendly. The idea is that cultured meat will be able to help alleviate the environmental and health challenges posed by the world's growing appetite for conventional meat. Well this is the general idea of a lab grown meat. I am curious to know what do you guys think of the idea of a lab grown meat? Will it posed a problem for current meat industries for example, putting them out of businesses and will there be additional health problems that is currently unidentified because it is still unexplored.

this is the article below
https://www.washingtonpost.com/national/health-science/lab-grown-meat-is-in-your-future-and-it-may-be-healthier-than-the-real-stuff/2016/05/02/aa893f34-e630-11e5-a6f3-21ccdbc5f74e_story.html

The Footprint Chronicles

I believe this is the first company that can potentially track the life of its product from raw material to delivery, this is definitely a success because it allows Patagonia to confidently state their level/s of sustainability. 

The greatest challenge for most companies is the raw material stage, I believe enough noise has been made about 'child labour, bad working conditions especially in factories, employee compensation to the point that most companies that are focused on sustainability have managed to 'some what' manage these challenges. 

The responsible sourcing of raw materials is still very much something that companies are struggling with, if you look at the current case of Apple inc where the gold used in their electronics is sourced from DR Congo and the conditions are appalling and this has caused a media frenzy.

Patagonia has definitely created value for the environment, customers and society.

My real-life example: Proctor & Gamble Taicang Plant

Speaking of sustainability, I'd like to introduce you the place I have worked: Proctor & Gamble Taicang Plant in China.
It is built in 2012 and looks like this from the outside, a modern plant with a big beautiful garden.

What is special about it? It is one of the most environmentally friendly plants in P&G:
1.100% wind power usage for production
2. reduced water usage by rain water collection system and waste water recycling
3. 0 manufacturing waste landfill
4. Administrative building obtains LEED Gold Certificate for green building, which is the first in P&G history

As a former insider of the plant project, I believe in P&G supply chain's efforts to be sustainable in the way it produces its products, but as I recall, the project encountered a lot of difficulties:

1. Cost: In order to realize all these green efforts, there was around 20% incremental capital investment, and around 10% incremental on-going production cost because of extra depreciation and wind power premium. Although the project was initially supported by Product Supply function during the funding and construction phase, after the factory was up and running, it was very heavily challenged by Finance function for its higher production cost.  - As the financial analyst at the time, I really had a difficult time to survive.

2. Product marketing: it was very difficult to market the Taicang-produced products by the concept of sustainability at the time. Chinese consumers were not ready - they are indifferent to the wind-power and environment concept, but very sensitive to price promotions. Therefore, the company bears more cost but cannot see return from incremental sales.


So, what do you think? Should companies expect returns from their green efforts, or should they do it purely for the environment's sake (which is unlikely....)?


To see more on Taicang plant, here is a link that introduces its environmentally friendly efforts:

http://www.mcdonoughpartners.com/projects/pg-taicang-100-wind-powered-beauty-plant/

Is Hong Kong A Sustainable Location For Entrepreneurs And Startups?

Hong Kong is well known as financial center and it is  board with the country which is the largest collection of manufacturing talent in the world. A lot of articles talk about entrepreneurship and business in Hong Kong. The following article"Is Hong Kong A Sustainable Location For Entrepreneurs And Startups? " brought my attention to look at startup businesses in Hong Kong.

It is mentioned in the article that for the last years, many startups enter Hong Kong with aim to create business; however not all of them stay there for a long time as the market is very competitive and only big companies are able to play. The prices for living and as well for startup businesses is very high. New startup businesses are not able to sustain their business and move to other countries with their information/business as it is much easier to sustain the business in other places compare to Hong Kong.

This issue was noticed by a lot business people and therefore a new system will be created to support startup businesses. This system called Hong Kong Startup Ecosystem.

The cost of the ecosystem is approximately US$2.8 to US$3.5 billion which is  lower than in Vancouver and Singapore (system is 4 time bigger than Hong Kong). Based on the analysis the following reasons attracted to create the ecosystem:
1. As an administrative of China, Hong Kong has its own government and legal system.
2. Startups businesses are rising dramatically.

The analysis shows pros and cons of the system. Also it shows which steps should the government and its business take with aim to keep the system sustainable. Following link for the ecosystem: https://www.techinasia.com/hong-kong-startup-ecosystem-report-2016

However, from one point to make the system work for a long time, the government should decrease prices for startups,shorter the process also make them aware about the sustainability of their businesses which will be useful both for Hong Kong and for the companies. From another point of view, the question will be: will all businesses follow sustainability steps and feel responsible for their businesses? For that the country should have a very strong with aim to keep the environment sustainable and have various types of business.

TOMS Shoes: Somebody should've done The Value Plan...

Back in 2011, I met the CEO of TOMS Shoes, Blake Mycoskie, at a school event. I recall thinking what a great social enterprise TOMS Shoes was, completely sold on their story and advertising campaign of "One for One" (buy one shoe, give one to a child in need). This campaign was the fuel to their big initial success, grabbing the hearts and minds of young people, like myself, who wanted to be part of something bigger than themselves. 

Here's a video about "One for One":

Fast forward a few years later, I realized that "One for One" was nothing more than a well-intentioned, yet misled sustainable marketing campaign. TOMS Shoes soon became under public scrutiny, when further research revealed that their donation of shoes to developing countries was in actuality causing local shoe makers to lose business (see below).

With a growing number of people realizing TOMS shortcomings in producing true social value, TOMS reacted to this through their "Beyond One for One" campaign. This included a breakdown of the number of jobs and amount of social value they produce to offset the externality of their "One for One" campaign.

(http://www.toms.com/beyond-one-for-one)

Although TOMS can be commended for their attempt to respond to the public scrutiny, it is still up for debate about whether or not they are producing more harm than good. It may also have been a little too late to change the negative views of their "One for One" campaign as seen by the many negative comments on the first YouTube video I presented.

As sustainable and responsible marketers, it is important for us to think critically and deeply as to what possible externalities businesses may unintentionally cause. The social value proposition must consider the effects on all direct and indirect stakeholders within the value system. Perhaps if TOMS Shoes properly performed "The Value Plan," they wouldn't have had to suffer the consequences from their current predicament. >__o ha..ha....

Pokémon don’t Go

Last class we touched the Marketing Idea of Pokémon Go. We discussed how responsible it is or should it be. This game is very popular all over the world. All of us heard that there were several car accidents including mortal one. 

But I will tell you another story how Pokemon GO playing could influence your life.

September 3rd 2016 the District Court of Yekaterinburg arrested Ruslan Sokolovsky, and put him to jail for two months. Ruslan is a 22-years old video-blogger who played Pokémon inside the church. Blogger accused of insulting the feelings of believers and inciting hatred. The grounds were published it on YouTube videos, one of which the young man was playing Pokemon Go in the famous the Temple-on-blood, while others critical of the Russian Orthodox Church. Here is the link for the news, It is in Russian but I already translated most part. http://www.bbc.com/russian/news-37265688

Of course we can discuss if the reaction is good enough, maybe it is too strict. But that is also the question to developers. Should be any restrictions for playing conditions and places to play.

Do the producers should concern about their customers more?  

Fashion companies - Greenwashing?

From Rana Plaza Collapse in 2013 in Bangladesh
To a recent cotton farmer project by CottonConnect funded by Primark
To the World Recycle Week of H&H.
These two fashion retailers were involved into the collapse. (Bangladesh fashion factory safety work severely behind schedule)
Much concern about greenwashing in fashion industry.

 

Many companies in fashion industry are getting profits from selling cheap fashion in developed markets by outsourcing in developing countries where they can easily go through the loose laws in labor practices and environment. The collapse of Rana Plaza happened in 2013 is a typical example to see that such exploitation has been going on. (Rana Plaza articles) 1,135 factory workers died in the Rana Plaza collapse. H&H and Primark are involved in the incident where they failed to keep track on their supply chain. Their factories or suppliers had not installed basic fire-safety measures before Rana Plaza and even two years after the incident. “13% of those suppliers have failed to take the basic step of removing locks from doors which could impede workers escaping a fire.” According to theguardian (Bangladesh fashion factory safety work severely behind schedule), the renovation of the site is still in very slow pace.

Meanwhile, these fashion companies have implemented some side project, event such World Recycle Week of H&H and Cotton Farmer Project by CottonConnect financially funded by Primark. According to theguardian (Am I a fool to expect more than corporate greenwashing?) (Primark tackles fast fashion critics with cotton farmer project in India), such event looks like a kind of greenwashing.

In case of Primark,  “The company argues that buying Fairtrade cotton or paying farmers more is not a suitable strategy for them – although a statement on its website refers to a plan to sell Fairtrade in the future “depending on market demand”.”

In case of H&H, “it would take 12 years for H&M to use up 1,000 tons of fashion waste.” and “if 1,000 tons is recycled, that roughly equates to the same amount of clothes a brand of this size pumps out into the world in 48 hours. Then there are the voucher schemes, which often fuel more purchasing.” Besides, “H&M’s Recycle Week clashes exactly with the grassroots Fashion Revolution campaign.” “Last April’s Fashion Revolution got huge traction on social media (124 million impressions of the hashtag alone).” “H&M will now use the same idea for World Recycle Week.”

The question is whether they have started looking at their supply chain seriously or they are just finding out ways to build their “reputation” to hide real problems behind?!

Reference:

Am I a fool to expect more than corporate greenwashing? <ttps://www.theguardian.com/commentisfree/2016/apr/03/rana-plaza-campaign-handm-recycling>

Bangladesh fashion factory safety work severely behind schedule
<https://www.theguardian.com/world/2016/jan/28/bangladesh-factory-safety-scheme-stalls>

Primark tackles fast fashion critics with cotton farmer project in India <https://www.theguardian.com/sustainable-business/2016/sep/30/primark-tackles-fast-fashion-critics-cotton-farmer-project-india-gujarat-cottonconnect>

Rana Plaza <https://www.theguardian.com/world/rana-plaza>