How to Change the World – Wind of

Change at Major Corporations

“There are three ways to change the world: change China, change California, or change Walmart.”

William McDonough, architect, designer,

and sustainability expert

Too good to be true

Largest retailer in the world

Known for ruthless exploitation of natural resources, squeezing suppliers, and crushing communities

Public Enemy No. 1 for a generation of activists and reformers

Wind of Change Announced plans in 2006 to

rebuild the company with 3 major goals:

~ To use 100% renewable energy

~ To achieve zero waste ~ To sell only products that

benefit the environment across the global supply chain

Only one phrase to describe this ambition:

匪 夷 所 思(Unbelievable)

Goal No. 1

100% Renewable energy

In 2013, renewable

energy already

provides 21 % of Walmart’s

global electricity

Goal No. 2 Serious about waste….“Our goal is to create zero waste. We’re working toward a day when

there will be no landfills containing our throwaways.

In 2011, our Walmart U.S. operations prevented more than 80% of store waste from going to landfills.”

Walmart Global Sustainability Report, 2012

Zero-waste-to-

landfill

Recycle, Repurpose ,

Reuse

Goal No. 3

All products to be sustainably produced – by far the most ambitious goal

Can it be ever achieved?

One example – fishery products

Over the past half century, demand for seafood has increased five-fold.

An estimated 75% of the world’s fisheries are at or beyond sustainable limits.

Sustainable Fishing

Since 2007, Walmart requires all seafood suppliers to become third-party certified as sustainable using Marine Stewardship Council (MSC), Best Aquaculture Practices (BAP) or equivalent standards.

As of Jan 2012, 76% of fishery products sold at Walmart were sustainably harvested.

Still a long way to go, but it’s

already impacting on all its suppliers worldwide, including those in China.

Nike

Made its fortune

through celebrity marketing, supplier exploitation, and total disregard for the environmentBut things are changing, and

changing fast….

Nike wants to sell shoes, a lot of shoes…

But it also asks: What should go into the shoe? How to minimize its impact on the

environment? What materials should be used? How to manufacture the shoe so that it

can be easily disassembled and recycled?

What happens when the shoe’s useful life ends?

How to regain the discarded shoes from the customers?

Nike’s Considered Design

A systematic effort to minimize environmental impact by reducing waste throughout the design and development process, using environmentally preferred materials and eliminating toxics.

The long-term goal is to design products that are fully closed loop: using the fewest possible materials and designed for easy disassembly, while allowing them to be recycled into new product or safely returned to nature at the end of their life.

Shoes

will not be the

same again

.

Nike’s vision Design for recycling Consumers bring their products back

to us to be recycled into new products Waste that cannot be eliminated is

recycled Product is less reliant on oil and

water We all step lighter, faster into a

future low-carbon sustainable economy

Nike’s new design approach Considered Design

Pegasus – Nike’s best-selling running shoe – is a product of Considered Design: 13% lighter with an 83% recyclable sole.

Applied to all shoes 2011 To all apparel 2015 To everything 2020

Nike has become a master of remarketing

It is always asking: Can we reuse, recycle, repurpose, or remanufacture this input or output?

Classic example: Nike Grind

Now watch where they

go

These discarded shoes used to end up

in landfills

All from recycled shoes

How many shoes does it take to make a Nike Grind surface?

Outdoor basketball court: 2,500 pairs Outdoor tennis court: 2,500 pairs Playground: 3,500 – 10,000 pairs Indoor basketball court: 3,500 pairs Soccer pitch: 50,000 - 75,000 pairs Running track: 75,000 pairs

Walt Disney

Apart from theme parks, Disney is the world’s largest character franchiser – Mickey Mouse, Donald Duck, Winnie the Pooh, etc.

In 2009 it acquired one of its competitors, Marvel Comics (owner of Spiderman, etc), for US$4 billion to strengthen its position in the character franchise market.

This figure shows how big the business and the stake are for Disney.

Who is Disney No.1 customer?

Children, of course!

But what’s wrong children nowadays?

A 2004 UNICEF report revealed that 30% of US children were overweight and 14% were obese. And the trends were most worrying.

1966

Although Disney did not feel that they had contributed to this phenomenon, some of their franchisees certainly did, including of course McDonald’s.

This is the youngest person

ever to have weight loss

surgery

Disney was determined to transform the eating habits of children to halt the obesity trend.

In 2006, Disney introduced nutritious food guidelines

Requiring all its franchisees to use kid-focused products that meet specific limits on calories, fat, saturated fat and sugar.

Imagination Farms was launched to create an extensive food portfolio which today offers nutritious options in key meal categories including fresh produce, bread, pasta, dairy and baked goods.

Imagination Farms Mission

Increase the consumption of fresh fruits & vegetables among children

GoalBecome the number one trusted brand

for healthful food choices for kids

For Disney, all these are not part of CSR as such.

They are trying to educate and nurture a new generation of children with healthy lifestyle and eating habits.

Thinking outside the bottle

Coco-Cola started operation in India in

1950. But in 1977, they exited after a new law partially nationalized

the company.

They returned in 1993 and had been struggling to find a foothold.

The Indians like their product but resent their global corporate dominance.

Greatest challenge:

Developing the business in the rural areas where there are

few job opportunities, little or no electricity,

a huge population that has embraced wireless technology

How do you sell soft

drinks when there are hardly any

refrigerators?

The breakthrough….eKOCool and 5 by 20

eKOCool is a solar-powered mobile cooler for use in the villages where there is no electricity.

5 by 20 is Coca-Cola’s global commitment to nurture and empower 5 million women entrepreneurs by 2020.

Killing three birds in one stone

Creating employment as operator of a stand-alone business

Selling Coke Recharging

mobile phones and electric lanterns

The cooler can hold 48 300ml bottles. Beverages kept in the cooler overnight or 4 to 5 hours are chilled enough for consumption.

Coca-cola solar refrigerator in Indian villages

Accenture is one of the world’s largest consulting firm. Rank among Fortune Global 500.2012: revenue US$28.6 billion 275,000 employees worldwide

Greatest challenge: finding and

retaining talents

Young people

want more than a career

Talented employees look for meaning in their work and ways of contributing to society.

Accenture Development Partnerships - A Corporate Social Enterprise

The first of its kind Harness its best people to

offer their expertise to build, strengthen, or scale up NGOs and social enterprises in the developing countries

How it works

Accenture employees could choose to work in social projects in developing countries for 3 to 6 months at half pay.

On completion of the projects, they return to their original posts, having gained valuable exposure in fostering development in challenging and unfamiliar environment.

Making a Difference –Accenture Development Partnerships

Win-win-win

Half salary of staff involved

Half salary for project duration

Pay below-market consultancy fees

More capable and motivated staff

Exposure, training and opportunities to contribute

Access to top talents and expertise

Company

Contribution Gain

Staff

Clients (NGOs,

etc)

Accenture has become a role model in staff engagement and is winning the talent war

Many professional firms are following their example and devising similar programs

Interface Carpet – the Power of One

All of the previous examples are household names

Here is one which is not that well known as it is an industrial company

However, its impact and influence is by far the greatest

Interface Carpet - used to be a ‘business as usual’

Turned vinyl and other petroleum products into carpets

Total dependence on oil industry for inputs

Unsustainable from both business and environmental points of view

In 1994, a customer asked Chairman Ray Anderson a simple question:

“How environmental friendly is your company?”

Ray hasn’t a clue…

In preparing the response, he came across a book The Ecology of Commerce by Paul Hawken, which shocked him and helped him to realize that Interface has been a great polluter all along and was utterly unfriendly to the environment

Ray had two options…

Option 1 Tell the

customer that the company is not very environmental friendly but will do something about it

Option 2 Fundamentally

rethink and redesign the whole production method to make it totally environmental friendly

What would you do if you were Chairman Ray Anderson who was the founder and chairman of the Company but was already 60 years old?

He chose

option 2

Interface’s Mid-course Correction

Committed to pioneer the ‘next industrial revolution’ and ‘unhooked from the oil well’

Developed technologies to produce carpets with recyclable yarns from bio-based fibers made from corn starch

Pioneered carpet reclamation program – ‘We want your carpets’ – recycling own and rivals’ carpets

Towards a Sustainable Enterprise – The Interface Model

Mid-course Correction

by Ray Anderson1998

The Power of One Interface has since become

the world’s most environmental friendly enterprise

They were a lone pioneer when they embarked on their transformation

It was the Interface experience which helped convert Walmart to formulate their ambitious goals in 2006

Ray Anderson was an industrial engineer.

What do all these stories have in common

They are not conventional CSR efforts

They are not charitable acts They are addressing burning social

issues They leverage core business and

core competencies They turn social issues into business

opportunities

Why this sweeping change?

The Necessary Revolution

Capitalism has reached the stage that is threatening its own existence in terms of exploitation of the globe’s renewable resources

file:///C:/Users/Owner/Downloads

/The%20Necessary

%20Revolution.pdf

Business is the solution

Growing realization that ONLY businesses can, and have the resources, to tackle the world’s burning social issues…. not governments,

or NGOs or social enterprises

Michael Porter http://www.ted.com/talks/michael_porter_why_business_can_be_good_at_solving_social_problems.html

Rethinking the purpose of enterprise

From maximization of shareholder value to B corporation

B corporations are for-profit businesses which use the power of the market to create social and environmental benefits.

Social entrepreneurship has shown the way

Social entrepreneurs in different parts of the world have demonstrated that business can do good and well at the same time,

e.g. Grameen Bank (Nobel Prize winner

2006), Dialogue in the Dark Café Direct

Technology as a powerful enabler

We could design and make almost any products we need…. even for the bottom of the pyramid

A world-famous course offered at Stanford Design School:

Design for Extreme Affordability

Engineers as change agentsStrengths

Technologically literate

System-thinking capability

Financially well-off

Weaknesses

Lack of entrepreneurship

Lack of social sensitivity

Lack of passion

An unexpected role model….

Jenny BowenFounder,Half the SkyFoundation

Jenny’s insights for engineers Entrepreneurship – no track

record to speak of

Social sensitivity – an orphan touched her heart

Passion – determined, committed, unstoppable

What could you possibly do?

Engineers as Impact Volunteers ? Power of One ? Social Entrepreneurs ? Social Intrapreneurs ? Social Change Agents ? Policy Advocates ? Educators ? Social Investors ?

Even better…

Think and act as a team Leverage professional

platforms Leverage business and trade

organizations Become part of a global

movement (Engineers Without Borders, Engineering for Change, etc)

Thank you.