Joel Makower - Chairman and Executive Editor at GreenBiz Group
Joel Makower is chairman and executive editor of GreenBiz Group Inc., producer of GreenBiz.com, and lead author of the annual State of Green Business report. A veteran journalist with more than 40 years' experience, he also hosts GreenBiz's annual GreenBiz Forums, the global event series VERGE, and other events. Joel is author of more than a dozen books, including his latest, The New Grand Strategy: Restoring America's Prosperity, Security, and Sustainability in the 21st Century (St. Martin's Press).
Joel Joins Sustainable Nation to Discuss:
The evolution of GreenBiz and becoming a top resource for sustainability professionals
Current state and momentum around the circular economy
The ESG investing movement pushing corporate sustainability forward
Excitement around carbon capture, carbon storage and working towards carbon positive
Advice and recommendations for sustainability leaders
What are you seeing out there in regards to the circular economy? Do you envision us ever getting to a true circular economy? I know one of your annual events is Circularity. Maybe you can tell us a little bit about the discussions that have been going on at that conference and your thoughts in general on what you're seeing in the circular economy movement.
I've been in this field for a long time and I've seen a lot of frameworks, ideas, concepts and other things come to the fore. Most of them fade back into the proverbial woodwork. Circular economy is different. It's the first of these frameworks that I've ever seen that really requires a company to engage its entire value chain, as opposed to something like energy efficiency, renewable energy or waste reduction and things that may involve some partners, but you can largely do that by yourself. This is something where you have to rethink how materials are designed, where the materials come from, where it's made, how it's made, how it's sold into the marketplace and the relationship with the customer because it may no longer be a buy and sell relationship, it may be something else.
We have to consider what the ongoing post-market relationship is, because instead of just a few years of a service contract there may be a 10 or even 20 year subscription kind of relationship in some cases. We have to consider how you get stuff back and what happens to it. How do you extract the materials? Can you repair and refurbish it? Is it produced into something new and what is the market for that? How does the money change hands? It is really complicated. I've never seen anything come to the fore this quickly and attract the nature of excitement and companies. Just look at the companies Loop has with Proctor and Gamble, Nestle, PepsiCo, Unilever, Mars, Clorox, Coca-Cola and a bunch of smaller brands. They have evolved UPS in the program and a resource management company.
It's a big system and it's admittedly just getting going in various locations including Pennsylvania, New Jersey and an area in France. It's just really happened this summer, so it's going to be a while before we really have a sense of this, probably at least the end of the year. But it's a really interesting experiment and it's one of many. It's just really extraordinary what's going on out there. So, we launched a conference this year called Circularity. There really hadn't been a comprehensive, multi-day circular economy event in North America. There'd been a few smaller ones, but none that really brought together the entire value chain from the polymer companies like Dow, DuPont, BASF and others all the way through the brands and the collection and recovery companies.
We didn't know how many people to expect. It was a launch events, so we kind of stuck our finger in the air and said, "Well, 500 people would be great." We had to shut down registration at 850 because the fire marshal basically told us we had to. Aside from the numbers, it was really quite a mood there because you had all these people from some of the world's biggest brands loking around the room and saying, "Wow, I had no idea that there were so many of us." That was a special moment and we think that we're onto something, so we'll be doing this annually. The next one's in May in Atlanta next year.
Loop requires a change from the consumer. Consumers have to play a role in this. Do you think consumers are ready to change the way that they purchase and they consume to help work towards a circular economy?
Well, it's an open question and a good one. I started this part of my career with the consumer facing piece, and back in 1989 there was the first study of consumers in the US about their interest and willingness about making greener choices in the marketplace by an organization called the Michael Peters Group. It had some very large percentage, 78% or 92%, of people who said that they would gladly make the green choice and some very high percentage of those would pay a small premium for the privilege of doing so. Of course, if we look at our grocery carts and everything else, they haven't changed all that much.
They do these surveys all the time now and the numbers aren't all that different. So, there's this big disconnect between what consumers say they want to do and what they actually do. For it to succeed, green has to equal better. Better can be defined in lots of different ways - cheaper to buy, cheaper to operate, higher quality, better for my family, better for my community, better for my image, recyclable, locally sourced and any number of things. I's going to depend on whether you're talking about cosmetics, a computer or a car, but so many of these products have not been better. They have been harder to find, more expensive or didn't work as well from brands you didn't recognize.
I think that's the big question. How much are consumers willing to try new things? Will it be seen as better? Will it be more convenient? Will it be more affordable? Will it be higher quality? Will it be something that makes them feel good? People change all the time and how we do things, but it has to be better. That's the real thing. People say they want a change, but when it comes down to actually making those changes, not so much. So that's the open question. Will Loop be better? Will a subscription model for something that we used to buy for clothing be better? It will be for people who could afford it and for some higher end fashion, but it won't be for the people who shop at, let's say, Old Navy, because those things are just too inexpensive to put it into a circular model.
So, we're going to see a lot of different things, a thousand flowers blooming, and some of them are going to take and some of them are going to wither and die. I think that's where we're at and, and the ultimate answer your question is it depends on the product, the offering, how well it's available and all kinds of other things. It's going to vary depending on product category to product category. We may see some big changes in some and some huge resistance in others.
GreenBiz has also done a great job talking about how the investment community is getting engaged in sustainability and is helping to push the sustainability movement forward. For many years, the discussion was that investing in sustainability and battling climate change was going to be too hard on the economy and it was going to be too costly. It was going to slow growth. Now we're hearing the complete opposite. We're hearing that if we don't address climate change, it's going to have catastrophic impacts on our economy. The exciting thing is a lot of this is coming from the investment community. Talk to us about this change in dynamic that you're seeing and how this is really moving things forward.
Yeah, the conversation has flipped in a certain way from "What is business doing to impact the climate?" To "How is the climate going to impact business?" That's a very different conversation from corporate responsibility to risk, plain and simple. Risk can come in a lot of different forms from, from reputational and financial risk to right to operate risk. If you are a heavy water user in a water stressed area, you may not be welcome there, for example. There's business continuity risks, the ability to have reliable supply chains.
All of this gets factored in by climate change and so this has become a factor for investors because they are naturally concerned about risk. That's where they live. There's a framework introduced in Europe a couple of years ago with the lovely acronym, TCFD. It stands for the Task Force on Climate Related Financial Disclosure. Basically, it's a framework on how companies can report to investors the impacts to them, to their company, their operations, their supply chains, their customers and their employees in a climate constrained world looking out any number of years at different levels of degrees of global warming. Investors are interested in that and taking a look at that. In Europe and in Asia, that's becoming required to be listed on some stock exchanges.
It's not being required so much here in the United States, but as is often the case here in the US, regulations are coming more from the market than from the government. So, if you look at the big institutional investors, the BlackRocks, the Vanguards, the State Streets, the CalPERS and other big pension funds organizations, they are now leaning into what's called ESG environmental, social and governance metrics. These have been around for a long time, basically metrics of how companies track their impacts. But these have been around and not that interesting to mainstream investors, but suddenly it is. So, now these things which had been sitting off in the margins are now sitting in the middle of Wall Street, which is sort of changing the game.
One of the other things we launched this year in addition to our Circularity Conference, is something within our GreenBiz conference that we hold every February in Phoenix, called the the Green Fin Summit, looking at green finance issues. This is an event within an event with about a hundred people, invitation only getting the ecosystem in the room to discuss some big challenges. In this case, the big challenge is how do we align the information that companies are reporting with the information that investors need to make risk-based asset allocation decisions?
That turns out to be not so simple, because for all the companies that are reporting, it's not the necessarily the accessible comparable information that investors need to look at a company and determine how well they are poised to survive and thrive in a climate constrained world. So, this is just getting going, but it's a really fascinating area. The question is, following the money, will that really drive change at a much faster scale, scope and speed? And I think it can.
What is one piece of advice you would give other sustainability professionals that might help them in their careers?
Learn about things beyond sustainability. In some ways, sustainability is too important to be left to sustainability professionals. So, learn finance, learn marketing, learn supply chain, learn, procurement and learn HR. Learn any number of other disciplines and bring your sustainability instincts and knowledge to that. That's how change happens. The sustainability department in way too many companies is a little bit of a ghetto where it's around compliance, it's around doing well by doing good, but it's not seen as strategic to companies. So, the more you can learn about other things and embed that into sustainability work or embed sustainability into that other work, I think the bigger impact you can have.
What are you most excited about right now in the world of sustainability?
Well, everything. But I think we've been talking about some of it - the circular economy, the green finance piece of it, the carbon draw down. Those are three big ones. I think some of these are the newest emerging and potentially most impactful things going on out there.
What is one book you would recommend sustainability professionals read?
That's an unfair question because I've written a bunch of books on sustainability. The question is do I talk about Cradle to Cradle or some of the other iconic books out there, or do I talk about The New Grand Strategy? This is a book I coauthored a couple of years ago that talks about an economic plan for America, born at the Pentagon, that embeds sustainability as a national strategic imperative. It's a different version of what some now call the Green New Deal, but it's a really bipartisan and it's not a Washington program. It's really bottom up since we're not looking to Washington for leadership in the United States, it's really going to happen at the city and state level. I still think that that's a really interesting topic of how do we look at the economy and look at sustainability and figure out how sustainability can leverage economic opportunities at all parts of the economic scale.
What are some of your favorite resources or tools it really help you in your work?
I just love being out there and talking to companies and real people doing real things. GreenBiz and other resources are great. I read Bloomberg, I read the Guardian, mainstream media is starting to cover this more and more and I always am fascinated by that to see how they do it. The answer often is not very well. But there's no substitute for getting out there and doing informational interviews, meeting people for lunch, going to conferences, networking events and just learning what people are doing and how they're grappling, how they're succeeding, what's not going well, what they wish they could be doing more of. I think that's fascinating and the best way to learn.
Every company, depending on its size, sector, geography, competitive landscape, culture of innovation and a number of other factors, does this differently and needs to do it differently. So, it's not something where there's a six part program or a 12-step or any other program that you can check into, although there are some best practices. You learn from other people. That's what I find most effective. There is a really high percentage of people in this field who are just great people with the spirit of generosity, spirit of caring, who obviously care about the planet and they're doing God's work. They tend to be a just really enjoyable people to hang out with.
Where can people go to learn more by you and the work of GreenBiz?
Well you can go to greenbiz.com. You can also check out my personal site and makower.com to see some of the other things that I've been up to. GreenBiz is a great resource we have five weekly newsletters, a different one each workday. Mine comes out every Monday, called Green Buzz which looks at the profession of sustainability and what's going on in that. There's also one on energy, one on the circular economy, one on this verge in technology and one on transportation and mobility issues. They're all different written by different people. They're all pretty good and it's all free. You can find all that on GreenBiz. There's also a number of other webcasts, webinars and other resources that we have. And of course, if you can make it to one of our three big events every year, we'd love to see everybody there.