The Next Industrial Revolution

by Carolyn Chase


"n 1750, if you would have said we are going to make every person hundreds of times more productive, no one would have believed you. And yet that is exactly what happened, and they called it the Industrial Revolution. Today we stand at the forefront of another industrial revolution, with even more at stake." So spoke noted author, businessman and environmentalist Paul Hawken last week in his keynote address to the 14th annual Industrial Environmental Association Conference & Exposition. His topic was corporate and indeed, cultural sustainability.

The theme of this year's conference was "Leaders of Environmental Responsibility." The IEA membership is made up of San Diego's largest manufacturers. Associate members include key engineering and legal firms. They like to refer to themselves as the "regulated community." Environmentalists identify them more basically as all the major polluters and their hangers-on. But there's also nothing we'd like to see more than environmental responsibility from this business sector, so I was enthusiastic about their selection for both the topic and keynote speaker this year.

An impressively large mix of the regulated and their regulators gathered to hear Hawken address corporate sustainability. An accomplished panel followed on the subject, with representatives of the multi-billion dollar, multi-national corporations Interface and Monsanto. Local analysis of sustainable development-oriented business strategies was covered by San Diego-based Environmental Business International.

Sustainable development has been a great combination of buzzwords throughout policy circles since the so-called "Earth Summit" held in Rio a few years back. But with the mushy concept of 'leaving sufficient resources for future generations,' many businesses considered it something for governments and community groups to wrestle with. What were the connections between increasing shareholder value and sustainability?

Businesses are beginning to figure it out. There were many common factors among the presentations with the overwhelming conclusions that the opportunities and risks for businesses are real and substantial.

First, the risks. Scientific evidence shows that all of our naturally productive living systems are in decline. The strategic, interconnecting issues to be watched are:
population growth and distribution; freshwater supplies; food security; energy use and climate change; loss of biodiversity; declines in ocean productivity.

Based upon trends in these areas the context for doing business will be fundamentally different than in the past. The issues of sustainability will drive huge economic and social discontinuities. Historically, businesses have flourished or disappeared based on their abilities to adapt to such discontinuities. There will be big losers and huge first-mover opportunities. Perhaps this is why you're seeing strategic alliances between some of the largest behemoths such as Monsanto, General Motors and British Petroleum, who have all taken proactive positions on the controversial issue of climate change.

Kate Fish, Director of Sustainability, Monsanto noted: "Monsanto, as many of your businesses, is completely dependent on living systems and stable weather patterns. Business is the creative element of society and the issues raised by questioning the sustainability of natural systems are not obstacles, but opportunities."

Some of the opportunities? The National Academy of Sciences measured our economy's productivity and determined we are only 2.5% efficient. That's about 98% WASTE. Turns out we're hugely productive, but not efficient. It's really absurd. The most efficient economies in the world, Germany and Japan are only 4% efficient.

Dupont, 3M, Monsanto and Interface, have moved beyond incremental waste reduction programs to pursue the radical and transforming concept of "zero waste." It's the ultimate way to close the loop. A key principle for sustainability is transforming currently linear processes into circular, regenerative processes. Yes folks, don't think in terms of merely reducing your waste - think in terms of designing your systems for no waste at all! It's elegant, really, once you can think in those terms. It represents a basic concept of nature: waste=food. This also aligns nicely with a corporate consideration: waste=reduced profits.

These companies are also discovering that when challenging their cultures to think in this different way, it goes both to the bottom line and the human heart.

Jim Hartzfeld, Interface Senior Vice-President, put it this way: "Our business has been about making money out of oil and dirt. We sell $1.3 billion dollars of carpeting and interior office products per year. We've saved $77 million by engaging in this process so far. Our founder Ray Anderson had a personal epiphany after reading Paul's book, Ecology of Commerce , that we were plunderers and essentially stealing from our grandkids - but also that there is something there that - if they could figure it out - they could kick butt in the marketplace.

"So we have begun the process to reimagine and reengineer literally everything we do. A lot of people seem to know intuitively that something's not right, but most do not understand the basic principles of natural systems and how individual actions add up. You need to find different ways to deliver what people want . The sustainability perspective does not narrow your creative space - it actually increases it by allowing you to think about things in surprising ways. Put the filters in the minds of your designers and not at the ends of your pipelines.

"It's not about 'doing without' - it's about better value. It's not about giving things up - it's about giving people what they want in ways that are sustainable - which we've discovered is about giving them more of what they want. They don't actually want more stuff. Nobody wakes up in the morning and says 'Hey - send me more PVC and nylon!' What they really want is an aesthetic, productive environment, and we've been shoving carpet down their throats.

"What's most missed about this seems to be the people element. The power is in getting people engaged - how it infects a different way of being. I can't tell you how much of a difference it's made at our company - not just the bottom line, but people wanting to have their work aligned with their values. We are a billion dollar textile company and I can't tell you how unusual it is - in this industry - with quite a history of oppression and conflict - to be rated highly by its employees. Getting connected presents a clear sense of purpose. Doing the right thing for our customers, our people and our planet is powerfully liberating. Interface will lead by example and validate by results leaving the world a better place than when we began."

Paul Hawken asked: "How can we become regenerative and restorative instead of extractive? Business and environmentalism must now be about opening up the possibilities for human kind....about expanding the possibility of what it is to be human. There's no them and us. There's no they there. It's everyone. It's all of us. Businesses, consumers, schools, churches. . . every kind of institution must examine what it does and how it works and begin to learn how to restore and regenerate living systems. The only way to enhance human beings is to begin to align all our efforts to restore living systems and provide value and meaning for people. We have a billion un- and underemployed people and youth who want something meaningful to do. But what does our system tell them? That the economy does not need them - and then they act that out - and there is your connection between sustainability, the economy and social issues. We need to provide meaningful work for people and we can only do that with an economy and a system that focuses on radical resource productivity - where you need more people, not less; use less resources, not more, and in sustainable, regenerative ways.

Whether government, businesses, citizens, scientists, or politicians - it's about who we are and putting what we are about into a larger framework of understanding. This can allow us to work together to support, regenerate and restore the living systems our economic and social systems all depend upon."

The IEA, Solar Turbines, the Natural History Museum and Monsanto are to be commended for taking a true leadership role in bringing these issues to the forefront in San Diego.