Press Release
Some Stories Are Worth Telling:
The Legacy of the Michigan Source Reduction Initiative

Sometimes a great notion matters. Sometimes a great notion matters a huge amount. In this case, the great notion was the Michigan Source Reduction Initiative (MSRI). Few people remember MSRI, but its legacy lives on.

MSRI was the catalyst that launched The Dow Chemical Company into a collaborative approach in helping the world achieve sustainable development. It also ushered in a wave of new and unique company-NGO collaborations that helped accelerate progress and set new standards for these relationships. It is hard to imagine the great collaborations of more recent years (e.g., US Climate Action Partnership formed in 2006) happening without that catalyst of MSRI.

MSRI was a breakthrough effort designed and implemented collaboratively among Dow’s Michigan Operations, the Natural Resources Defense Council (NRDC), local environmental groups including Lone Tree Council and the Ecology Center of Ann Arbor and facilitated by the Meridian Institute. It was spawned by the trust developed from productive working relationships with leading environmentalists in the mid-1990s and motivated by a desire to find ways to identify opportunities for pollution prevention, rather than rely on end-of-the-pipe regulation, which often ended up in litigation before it was implemented. Terms of the collaboration were negotiated, including quantitative goals for reductions, how milestones would be established, how NGOs could participate within the plant, and how progress measured, publicly reported, and validated. An independent chemical engineering, pollution prevention expert, the late Bill Bilkovich, was vetted and approved by both sides and brought in to facilitate and brainstorm pollution prevention projects inside the plant and unit operation level alongside Dow engineers. Bill’s positive and inquisitive nature benefitted from the freedom Dow allowed to explore and engage with various innovative ideas and questions, and he quickly became trusted and respected by all.

The Results Were Remarkable

By the time the project was completed, Dow was on track to reduce production of a list of hazardous by-product materials by 37 percent, and to reduce the release of these materials to air and water by 43 percent, which would exceed its initial goals of 35 percent in each of these areas. In addition, Dow’s investment of $3 million to make those changes was estimated to result in savings of more than $5 million per year, and in some cases, to facilitate improvements in production capacity and product quality. The majority of the projects required a relatively small capital outlay, and were funded from small capital project budgets in each affected Dow business unit. It was eye-opening at the time that small amounts of capital could produce such huge results.

Lessons Learned

1. Relationships are key: MSRI was built on a foundational set of relationships that many Dow people (e.g., Jerry Martin, Rick Olson) had cultivated over a long period of time with people who both supported and opposed company actions over the years. This kind of initiative from individuals in industry formed an essential bridge for this collaboration – and is perhaps the first and most important lesson in multi-sector collaborations – individuals in industry need to take the initiative to build relationships and bridges.
2. Develop and agree to clear and transparent objectives and milestones: These objectives and milestones were reinforced by meetings that brought together senior Dow leaders, midlevel Dow manufacturing leaders, junior Dow plant engineers, and the environmental activists to review progress and determine priorities and next steps.
3. Find the right collaborators: The late Bill Bilkovich, an independent chemical engineer and pollution prevention expert, gained trust from everyone as he worked tirelessly to identify opportunities for improvement. In many collaborations, contributions from strong individuals make a real difference in the success of the collaboration.
4. Accountability and flexibility: While there was accountability built into the process, there was also flexibility that allowed us to make modifications when minor obstacles arose. Because we spent the time to hammer out clear and quantitative goals and objectives, the roadmap was clear. We were able to agree on adjustments, such as to timelines.
5. Third parties: The inclusion of a trusted and highly skilled mediator throughout the collaboration was critical. He provided an objective “ear” for all parties as well as facilitating the periodic meetings of the group and helping to problem-solve between meetings.
6. Focus on the facts first: The collaboration focused on data collection and making decisions together on commonly-agreed-upon datasets, not on assumptions, extrapolations, inferences, or irrelevant history.
7. Recognize the needs of the participating activist organizations: These organizations will require and need transparency in the process in order to maintain credibility with their constituencies throughout. This was a key hurdle for Dow, but a necessary step to progress and to cooperation from external stakeholder audiences.

Dow Benefitted in Several Ways from MSRI:

1. Dow directly benefitted from ongoing cost savings of millions of dollars per year.
2. MSRI encouraged continued work and successes under Dow’s 10-year 2005 EH&S Goals. In 1996, Dow had announced its first set of 10-year sustainability goals. The MSRI demonstrated tangible results and encouraged progress toward these ambitious goals. From 1996 to 2005, Dow achieved waste reductions of 1.6 billion pounds, water use reduction of 1.8 billion pounds, energy savings of 900 trillion BTUs, and reduced injuries by 84 percent. In this timeframe, Dow saved more than $5 billion on a $1 billion investment.
3. Dow learned that these kinds of long-range 10-year goals and collaboration needed to become an essential component of Dow corporate strategy. So Dow followed the first set of 10-year EH&S Goals) with another 10-year set. These 2015 Sustainability Goals continued to focus on EH&S targets and added an emphasis on breakthrough innovations to solve world challenges. Dow is now in its third set of 10-year goals, the 2025 Sustainability Goals, which build on the last two decades and now expand into Dow’s role helping to design blueprints for sustainability in areas as diverse as watershed management, energy and climate, resource efficiency, infrastructure and sustainable cities, quality education, and productive employment with economic growth.
4. Collaboration is key. This culture shift at Dow has paid huge dividends. One recent example is Dow’s collaboration with The Nature Conservancy on valuing ecosystem services in business decisions. Since 2011, this groundbreaking collaboration led to Dow’s 2025 Valuing Nature Goal, where Dow seeks to deliver $1 billion in value by 2025 through projects that are good for business and better for ecosystems.
5. The NGOs benefitted by learning how to work with industry to make actual changes and measurable impacts toward reaching their environmental objectives. The relationships that they built in MSRI were valuable in future work related to legislation, regulation, and other cooperative efforts.

Dedication

This blog is dedicated to the men and women who made this remarkable collaborations the breakthrough it clearly was. It took courage on everyone’s part. In particular, this blog is dedicated to the late Jerry Martin and Bill Bilkovich, and to the great visionary work of Rick Olson, Terry Miller, Tracey Easthope, Anne Hunt, Mary Sinclair, Diane Hebert and Jeff Feerer.

Authored by:

Neil Hawkins, Dow, David Buzzelli, retired-Dow, Linda Greer, Natural Resources Defense Council, and John Ehrmann, Meridian Institute.