Sign Up Early for SB'24 San Diego and Save! Spring Rate Ends June 23rd.

Marketing and Comms
“Eco-Business” Explores Big Business's Motivation Behind Green

The lingo of sustainability didn’t offer a descriptive enough term for modern brands that integrate energy savings, waste reduction and innovative sourcing goals into the framework of the way they do business. So professors Peter Dauvergne and Jane Lister coined one: Eco-Business.

The lingo of sustainability didn’t offer a descriptive enough term for modern brands that integrate energy savings, waste reduction and innovative sourcing goals into the framework of the way they do business. So professors Peter Dauvergne and Jane Lister coined one: Eco-Business.

Their book on the subject, which hits stores March 15, looks back over 20 years of aspirational goals and commitments that major world brands have made toward sustainability — from promising to eliminate toxic chemicals or pledging zero waste to embracing clean energy.

But Eco-Business: Big-Brand Takeover of Sustainability (MIT Press) doesn’t just applaud or boo brands based on their environmental track record. Instead the book makes an argument for the business advantages that led brands to embrace sustainable practices.

Eco-BusinessMotivated by more than public relations, global companies like General Electric and Walmart set environmental goals in order to gain greater control over supply chains, achieve a competitive advantage and become even more profitable, Dauvergne and Lister found.

“We started to look at the brand companies, and we were surprised to learn of the accelerating rise of commitments around sustainability over the last five to 10 years,” Lister said. “We wondered why these companies like Coca-Cola and Walmart are now making these big promises of sustainability like zero waste and carbon neutrality and 100 percent local sourcing.”

Dauvergne and Lister — who teamed up two years ago to write Timber, about the drivers behind deforestation — wanted to know if brands could meet the goals they were setting, whether these commitments represented true change and why so many NGOs were partnering with them.

The book follows the history of brands establishing sustainability goals and partnerships, the politics of big-brand sustainability, the economic setting that led to a boom of corporate sustainability programs and the advantages those companies seek — including higher market share and better control over the supply chain.

“There is clear business value for the companies pursuing sustainability. The reason why we have seen such a rise and why it is going to continue is that there is opportunity to reduce risks, to lower costs, to access new markets, to build brand reputation — ultimately to sustain growth as a company,” Lister said.

Brands incorporate sustainable practices into their business model for various reasons, but the authors were surprised to find the level at which NGOs have partnered with them to reach their own goals.

From 1990, when the Environmental Defense Fund partnered with McDonald's to phase out the fast-food chain’s Styrofoam sandwich containers, more and more NGOs have joined hands with Fortune 500 companies to try to influence the decisions those brands make. While activists may criticize those partnerships, a company the size of Coca-Cola, for example, can make a global change quickly.

Even Greenpeace has worked with Coca-Cola on reducing greenhouse emissions. And for good reason, the book points out.

The soft-drink manufacturer buys more aluminum and sugar cane than any other brand on earth and is second in glass buying. “We could spend 50 years lobbying 75 national governments to change the regulatory framework for the way these commodities are grown and produced,” the authors quote Gerald Butts, president and CEO of the World Wildlife Fund Canada. “Or these folks at Coke could make a decision that they’re not going to purchase anything that isn’t grown or produced in a certain way — and the whole global supply chain changes overnight. And that in a nutshell is why we’re in a partnership.”

As brands such as Marks & Spencer show that corporate sustainability initiatives are about more than just public relations — saving the company $110 million in 2011 — the question of overall consumption challenges whether programs help to sustain the planet or just the company.

The authors ask a question: Driven to lower the costs of production in order to produce more, has a brand really achieved any benefit for the environment?

“Eco-Business is about the business value of sustainability but then we go on to say that this falls short of actual true sustainability in an ecological sense or in terms of global social equity,” Lister said. “Eco-business is about helping us to buy and sell more. It’s not about sustaining the planet. That’s where the challenge lies for brand companies.”

Some brands are making commitments that go beyond eco-business strategy to espouse broader sustainability outside of the company.

“There are opportunities for brand companies to step up and do more in this respect,” Lister said, “and you see some leadership here: Companies like Puma with their profit and loss statement around environmental impact; Patagonia with their campaign around buying less; Unilever with its efforts to try to decouple growth from consumptive impact.

“You see efforts of brand businesses to try to get at changing the fundamental business model, which is where I think hope lies.”

Peter Dauvergne is Professor of Political Science and Canada Research Chair in Global Environmental Politics at the University of British Columbia.

Jane Lister, a Senior Research Fellow at the Liu Institute for Global Issues, is a sustainability practitioner and the author of Corporate Social Responsibility and the State: International Approaches to Forest Co-Regulation.

Eco-Business: Big-Brand Takeover of Sustainability is available beginning March 15 at bookstores around the world and online at Amazon, MIT Press, Barnes and Noble and more.