Fall 2015

Can the profit motive save environmentalism?

– Rick Fedrizzi

“The environmental movement is deeply, fundamentally virtuous, but our tactics have become obsolete,” writes the founding chairman of the U.S. Green Building Council. “Enterprise is environmentalism’s only hope.”

My hometown of Syracuse is not far from Seneca Falls, the birthplace of the women’s rights movement. I remember learning about it as a kid — being taught about Wesleyan Chapel, Elizabeth Cady Stanton, and the 1848 Women’s Rights Convention. It was hard to imagine a time in this country when women had no rights, couldn’t vote, and were seen as property. But in 1848, folks got together in a little town by a lake in upstate New York and began a movement that, over the course of many decades, would change America and the world.

Since boyhood, I’ve revered the great social movements of the nineteenth and twentieth centuries. I was in third grade when Martin Luther King, Jr., gave his “I Have a Dream” speech, and I remember a year later when President Lyndon Johnson signed the Civil Rights Act into law. I was in high school when the Stonewall protests brought the LGBT movement to the national stage, and I had just graduated from business school when some of those same activists marched on Washington in the midst of the AIDS crisis of the 1980s.

To others, this might all make me sound old. To me, it makes these incredible social movements feel recent.

I think about them when I contemplate the future of environmentalism. On the one hand, our movement to build a sustainable world is very different from the other movements for freedom and equality in American history. Environmental degradation is a cause of social inequality, but environmental injustice is a subtler form of discrimination. The enemies aren’t (usually) misogynists, racists, or homophobes. The enemy is everywhere and nowhere; it’s the infrastructure of modern, industrial life.

Obvious differences aside, however, environmentalism does have a tremendous amount to learn from social movements past and present, and one critical lesson in particular: Being right isn’t enough.

The brave souls who have fought for social justice know that their first chance at victory is never their last. But the environmental movement does not have that comfort.

The women’s rights, civil rights, labor rights, and gay rights movements all were — and are — on the side of the angels. From our vantage point, it seems obvious that these social movements prevailed. We look back at our history and see obvious injustices that made these movements right and necessary. But social movements don’t win because they’re on the right side of history; they win because they’re effective. Nonviolent protest, union organizing, political, judicial, and economic activism — these were the brilliantly effective strategies that the great social movements devised and deployed to prevail in the face of powerful, cruel, and oftentimes violent opposition.

Today, environmentalists struggle to understand how society can so callously and knowingly poison the air and the water. We can’t grasp why sustainability has been an occasional afterthought instead of a universal core value. We can’t explain why congressional action on climate change has stalled indefinitely. There’s no real question that environmental sustainability should be embraced throughout society; it has history, morality, science, public opinion, and even the Pope on its side.

So what’s missing?

The environmental movement is deeply, fundamentally virtuous, but our tactics have become obsolete. The elements of a young social movement — an inspirational idea, a call for change, a sense of moral urgency — are no longer enough to carry the movement forward.

When the women’s rights movement was agitating for suffrage, its supporters battled in the knowledge that even if they fell short, their daughters and sons would pick up the struggle for them. When the brave activists of the civil rights movement marched together, they walked with a sure sense that, as Dr. King would say, the “arc of the moral universe” was bending, however slowly, “toward justice.” Today, the visionaries of the LGBT rights movement are fighting for equal protection and recognition under the law. They’ve won historic, heroic battles, most recently in the Supreme Court, and there are more battles to come. But even if they fail one day, one week, or one year, there will always be another day, another week, and another year to continue the campaign for true equality.

The environmental movement is deeply, fundamentally virtuous, but our tactics have become obsolete. Being right simply isn’t enough.

The brave souls who have fought for social justice know that their first chance at victory is never their last. But the environmental movement does not have that comfort. Instead, we are almost out of time. This is not to say that the environmental movement is in any way more urgent than these other historic movements for justice and inequality. It’s only to say that, in this case, our window is rapidly closing.

As you read this sentence, the ice caps are melting, the seas are rising, the world is warming, and pollution is mounting. Soon, the catastrophic effects of climate change will be irreversible. Our children and our successors in the environmental movement won’t be able to pick up where we left off. Instead, they’ll be forced to deal with the horrible consequences of our failure.

That’s why the environmental movement as we know it must come to an end. We have so much farther to go, and we need to get there fast. That’s why we must totally and completely redefine environmentalism around the idea that sustainability is profitable. We need a brand-new environmental movement to catapult us to the next level. We need a movement that harnesses the incredible power of the profit motive instead of struggling in vain to suppress it. Enterprise is environmentalism’s only hope.

Enterprise is environmentalism’s only hope.

Once upon a time, we saved the planet. At first, nobody knew there was a problem. An invisible gas emitted by everyday consumer goods was contaminating our atmosphere and threatening the future of life on Earth. Slowly but surely, the empirical evidence grew until it was undeniable: Something had to be done.

The United States government started with domestic regulation, but that wasn’t enough. This was a global problem that no single nation could solve. Soon, there was an international treaty that established an ambitious goal. The United States signed on, as did 196 other countries, including every single member of the United Nations.

This global compact worked. The damage caused by the harmful gas was slowed, then halted, and then reversed.

This might sound like an environmentalist’s utopian daydream, a fantasy of what the world should do in response to the threat of climate change. But this isn’t a work of fiction. It’s history — recent history.

The pollutant in question wasn’t carbon dioxide, it was chlorofluorocarbons, or CFCs, released by air conditioners, refrigerators, fire extinguishers, aerosol cans, and countless other consumer products. In 1974, the University of California’s Mario Molina and F. Sherwood Rowland identified the threat of CFCs in the upper atmosphere, where CFCs break apart into smaller pieces, including the element chlorine. Molina and Rowland discovered that this chlorine was devouring the ozone layer, which protects the Earth from deadly ultraviolet radiation. No ozone layer would mean no plants, no insects, no bacteria, no animals, no people — a planet that looks more like Mars than Earth. CFCs were depleting the ozone layer with astonishing speed, the researchers found; just one atom of chlorine from CFCs can wipe out 100,000 molecules of ozone.

By the late 1970s, the EPA issued a rule banning the use of CFCs in aerosol sprays. Unfortunately, this didn’t stop or even slow the production of CFCs, which continued to rise into the 1980s. Then, in 1985, the British Antarctic Survey made a frightening discovery: one-third of the ozone layer had vanished since 1972, and CFCs were the cause. The science was indisputable, and the danger undeniable.

Then, something amazing happened — something we haven’t seen happen since: the world acted.

In 1987, the world came together to sign the Montreal Protocol, which required the private sector to cut CFC production in half within ten years. When new evidence revealed that a more drastic solution was required, the protocol was updated to stop all CFC production in the developed world by 1996. Despite industry’s early protests that CFCs were a necessary and irreplaceable component of the consumer products they manufactured, businesses were able to find new substitutes and workarounds to get CFCs out of our atmosphere.

Long story short, it worked. According to the EPA, chlorine levels in the stratosphere reached their highest levels in the late 1990s, and they’ve been steadily declining ever since. The ozone layer is now on its way to a full recovery. The battle to ban CFCs was perhaps the most important environmental victory in world history.

Unfortunately, times have changed since then. Fast-forward 20 years to the recent fight between environmentalists and the business community over the Keystone XL pipeline. In 2008, energy company TransCanada decided to build off an existing Canadian oil pipeline called Keystone to connect Alberta’s oil sands to Nebraska, and ultimately to refineries on the Gulf Coast. A few months later, the environmental movement, led by many of its most prominent organizations and voices, mobilized an incredible, historic response that ratcheted up political pressure on the Obama administration and delayed any pro-Keystone action from President Obama — keeping the pipeline in limbo for the first six-and-a-half years of the Obama presidency. In early November 2015, President Obama announced his opposition to Keystone.

The fight over Keystone XL exemplifies a larger problem. As someone who cares passionately not just about the environmental movement but also about its success, the movement’s activism around Keystone XL seriously bothered me. Sure, it was a convenient focal point for a lot of frustrated energy and anger about our government’s failure to enact a meaningful response to the climate crisis, but the fight against climate change isn’t a fight against pipelines; it’s a fight against carbon emissions.

For environmentalists, the fight over Keystone XL was a distraction. Oil producers simply found other ways to get their product to market.

The relative impact of stopping the Keystone XL pipeline is only a drop in the bucket. As the New York Times reported in November 2014, carbon emissions connected to Keystone “would amount to less than 1 percent of United States greenhouse gas emissions, and an infinitesimal slice of the global total.”

More to the point, with the Keystone XL pipeline in limbo, oil producers looked for other ways to get their product to market. And they found a good one: trains. According to the Reuters news agency, “oil-train traffic has surged at least 42-fold since 2009.” While the Obama administration was buying time studying Keystone, rail transportation capacity for oil increased by more than half of the Keystone pipeline’s expected capacity. In fact, rail companies were so successful meeting the transport needs of oil producers that one expert told Slate, “The pipeline guys have got to be scared.” By defeating the Keystone XL extension, did environmentalists slow, stop, or reverse carbon emissions? The answer, resoundingly, is no.

It’s hard to consider these two stories — the historic effort to marshal global action to save the ozone layer, and the unending fight a couple of decades later over the construction of a single pipeline — and not see that something fundamental has changed.

The environmental movement has grown in size, power, and influence since the 1970s, and today it has more members, more funding, and many talented and dedicated lobbyists on Capitol Hill. In fact, the protests over Keystone XL show just how much the environmental movement’s capacity for activism has increased over the years. And needless to say, the movement’s overall goal — building a more sustainable world — has never been more urgent.

The hard truth is that the environmental movement is failing. Yes, there have been important victories: tighter vehicle efficiency standards, greater investments in renewable energy nationally, and renewable portfolio standards and cap-and-trade systems at the state and regional levels. But the big battles are being lost decisively.

The hard truth is that the environmental movement is failing.

The Kyoto Protocol is one famous example. The agreement — formulated in Kyoto, Japan, and agreed to in principle by the United States in 1997 — capped greenhouse gas emissions for developed nations. But the U.S. is one of only a handful of countries never to ratify the treaty. Why? Because the U.S. Senate was convinced that it was choosing between the environment and economic growth. And it wasn’t even a close call. According to Benjamin Kline in his history of the environmental movement, First Along the River, even before the draft of Kyoto had been settled, the Senate voted “that the United States should not be a signatory to any protocol that did not include binding targets and timetables for developing as well as industrialized nations or ‘would result in serious harm to the economy of the United States.’”

Just over a decade later, in December 2009, the nations of the world met again in Copenhagen. Again, despite promises, optimism, and plenty of good intentions, negotiations foundered. How did it all go wrong? It’s no mystery: once again, the idea that environmental goals stood in the way of growth was an insurmountable obstacle in the negotiations. In 2012, Roger Pielke summed it up nicely in Foreign Policy magazine: “If there is one ideological commitment that unites nations and people around the world in the early twenty-first century, it is that GDP growth is non-negotiable.”

In 2014, we glimpsed a ray of hope when President Obama announced a major climate deal with China. This historic agreement was the first time China has committed to capping carbon, and because our two countries are responsible for nearly half of all greenhouse gas emissions, it has the potential to create a significant impact for years to come. But it also provided a glum reminder of how the environmental movement has failed of late. Shortly after the China climate deal was made public by the president, it was denounced by congressional Republicans.

Domestically, the environmental movement has continued to suffer major blows on Capitol Hill. Look no further than the failure of cap-and-trade. In 2009, the House voted 219–212 to advance a bill known as Waxman-Markey that would have set ambitious renewable energy targets and created a new regime of emissions caps and tradable permits. The ideas in that bill had some bipartisan support, and even resembled amendments to the Clean Air Act signed by President George H. W. Bush in 1990. But after Waxman-Markey passed the House by a razor-thin margin, the Senate quietly killed it — no vote, not even a filibuster.

There are two ways to look at these enormous, recent failures of the environmental movement to marshal the kind of effective policy response to climate change that we saw during the CFC crisis in the 1980s. The first way is one I hear a lot about in the environmental movement: We lost the fight because we didn’t work hard enough, fight fiercely enough, march far enough, or protest loudly enough. But there’s another way to look at it — a more accurate and, I believe, more productive way: We lost the fight because we allowed ‘business’ and ‘growth’ to become our opponents.

In our attempts to spur action at Kyoto and Copenhagen, we were effectively setting ourselves up to go head-to-head with global business. In the fight for cap and trade, people assumed — or were persuaded by the environmental movement’s opponents — that we were going after their jobs. These are fights that environmentalists will lose every time.

Environmentalists picked the wrong opponent because too many of us have a worldview that no longer suits the times. The environmental movement’s enemy isn’t business, industrial activity, jobs, or economic growth; it’s environmental degradation and climate change. For too long, environmentalists have continued to buy into the idea that we need to defeat the former to defeat the latter.

This zero-sum worldview has finally reached its sell-by date. Both domestically and internationally, choosing between a sustainable future and a prosperous one doesn’t provide a useful framework to guide action or public policy. That old way of thinking has led us to the sad status quo in which we find ourselves today: a world without a healthy environment or a strong economy.

In other words, everybody is losing.

For a long time, industry was the opponent of environmentalists. And the tripartite tactic of agitation, legislation, and regulation was incredibly effective in putting points on the board. Today, the game has changed. Sustainability is profitable, and that means environmental organizations need a new plan of attack. Today, “greenthink” offers a different three-part strategy that is far more effective, disruptive, and transformative.

The first part of this new strategy is simple: connect the dots between sustainability and profitability. To put it a different way, the most successful environmental organizations today work with business to show them how much money they can save — and/or make — by transitioning to sustainable business practices.

One of the best examples of this tactic was perhaps the very first attempt at deploying it. The Environmental Defense Fund (EDF) was founded in 1967 with a mission right there in its name: to defend the environment. The organization has racked up some huge wins over the years, including its successful effort to push through the 1990 amendments to the Clean Air Act. That same year, EDF struck up a revolutionary partnership with McDonald’s, which became a test case for a new kind of environmental activism.

McDonald’s has served “billions and billions” of people around the world. In the process, it’s also created billions and billions of pounds of waste. Every Happy Meal, every order of supersized fries, and every extra-large soda comes in a familiar McDonald’s container emblazoned with the golden arches. For a long time, those containers were made out of polystyrene, a.k.a. Styrofoam, which is terrible for the environment and can stay in our landfills for centuries without breaking down. This is the stuff that was used to gently enclose your Big Mac in its clamshell container, until EDF sat down with McDonald’s and asked a simple question: Is this packaging efficient? It was an ingenious thing to focus on, because “efficient” meant two things simultaneously. For EDF it meant: Was the packaging environmentally efficient? While McDonald’s was open to pondering that question, the company was also interested in another one: Was its packaging economically efficient? EDF helped McDonald’s see something amazing: they were the same question. They also had the same answer: no.

The Environmental Defense Fund asked McDonald’s a simple question: Is this packaging efficient?

With EDF’s help, McDonald’s changed its packaging for the better — and for good. Instead of polystyrene shells, McDonald’s started serving burgers and sandwiches in paper-based wrapping, and started incorporating postconsumer recycled content into its paper products. All in all, over the next decade, McDonald’s “eliminated more than 300 million pounds of packaging, recycled 1 million tons of corrugated boxes, and reduced waste by 30 percent,” according to a 2010 press release. The best part is that this positive change didn’t cost McDonald’s a single penny — in fact, it saves them $6 million each year.

Since that breakthrough partnership with McDonald’s, EDF has developed other programs that connect the dots between profitability and sustainability. In 2008, for instance, the organization created the EDF Climate Corps, which matches teams of MBA students with large corporations to develop strategies that reduce waste, keep greenhouse gases out of the air, and — most important from the perspective of their private-sector partners — save millions of dollars.

Other organizations have followed EDF’s lead, and the best ones have taken it a step further. First, they demonstrate to private-sector partners how profitable sustainability can be. And second, they develop systems to make it easier for corporations and consumers to do the right thing for the planet.

The U.S. Green Building Council’s LEED rating system is a great example of making it easier for the private sector to adopt sustainable building practices and materials (full disclosure: I am the CEO and founding chairman of the U.S. Green Building Council). But one of the original nonprofits to deploy this second strategy was none other than the World Wildlife Fund (WWF). WWF was founded in 1961, making it one of the world’s oldest environmental organizations. But it was also among the first to recognize the need to constructively engage with and leverage the private sector to protect animals, people, and the planet.

On its website, WWF trumpets its belief that “the power of the global marketplace can and must be transformed into a force for conservation.” And the organization has created a number of incredible industry certification programs that have done just that. A great example is the Marine Stewardship Council (MSC), which WWF and Unilever cofounded in 1996 to certify sustainably caught seafood. Today, according to WWF, “nearly 15,000 seafood products with over $3 billion in annual sales bear the MSC label.” More recently, WWF worked with eight canned-tuna companies to cofound the International Seafood Sustainability Foundation (ISSF). ISSF now includes 26 private sector partners and covers 75 percent of the canned tuna industry, all working to improve environmental stewardship.

Similarly, the National Resources Defense Council (NRDC) has been exemplary in its willingness to pursue partnerships with the private sector, especially in thinking outside of the traditional target industries — most notably, working to bring sustainability to professional sports.

What started in 2003 as a partnership with one team, the NFL’s Philadelphia Eagles, and in 2005 grew to include a partnership with one whole professional league, Major League Baseball, has now become an incredible, widespread movement. As of today, the NRDC is partnered with every major sports league in North America, including the NBA, the NHL, and the NFL. Within each of these leagues, there are stories of incredible sustainability success. In a single year, basketball’s Miami Heat saved $1.6 million through green initiatives and better energy consumption (including a LEED-certified arena), and in the process gained $1 million in corporate sponsorship from companies interested in the team’s new green efforts. Likewise, between 2006 and 2011, baseball’s Seattle Mariners saved $1.5 million on utilities bills and have reduced greenhouse gas emissions by 21.2 million pounds a year.

Some of the most effective environmental organizations you could possibly imagine are businesses.

Environmental organizations like EDF, NRDC, WWF, and USGBC have pioneered the incredibly successful strategy of working with industry to make the connection between sustainability and profitability a real and meaningful one. It’s making better environmental outcomes cheaper and easier. This is how today’s environmental organizations must operate to meaningfully and measurably move the ball toward the goal line.

But the new environmentalism has to be bigger than the world of nonprofits — much bigger. Sure, environmental organizations need to partner with businesses, but some of the most effective environmental organizations you could possibly imagine are businesses.

In 2007, Eben Bayer and Gavin McIntyre were seniors at Rensselaer Polytechnic Institute in Troy, New York, when Bayer submitted a class project made out of mushrooms — a disk of sustainable “insulation” he had grown in a jar in his basement. Another teacher might have been upset about this homegrown homework, but Professor Burt Swersey wasn’t upset — he was excited. He told the New Yorker in 2013, “[Bayer] takes this thing out of his pocket, and it’s white, this amazing piece of insulation that had been grown, without hydrocarbons, with almost no energy used. The stuff could be made with almost any waste materials — rice husks, cotton wastes, stuff farmers throw away, stuff they have no market for — and it wouldn’t take away from anybody’s food supply, and it could be made anywhere from local materials, so you could cut down on transportation costs. And it would be completely biodegradable! What more could you want?”

With Professor Swersey’s help, Bayer and McIntyre started a company called Ecovative. After years of perfecting their craft, they discovered that their mushroom-based product can perform just as well — and cost about the same to produce — as petrochemical plastics like polystyrene. The difference is, Ecovative’s Mushroom Packaging is 100 percent compostable and sustainable. More than that, the company has turned a waste stream into something that has tremendous commercial value. And other companies and investors have taken notice.

Today, Ecovative is doing very big things, like raising millions of dollars in venture capital to perfect and expand its operations — and winning a number of awards along the way. In 2012, Ecovative entered into a partnership with Sealed Air, the Fortune 500 company best known as the makers of Bubble Wrap. The start-up’s customers have also included companies like Dell and Crate & Barrel.

Every time money changes hands is an opportunity to do something right for the planet.

Let’s be perfectly clear: Bayer and McIntyre are ardent environmentalists. I don’t know them personally, but I wouldn’t be surprised if, like many of us, they wear their organic food, hybrid vehicle, and recycling merit badges with pride. But as much as Ecovative’s founders are obsessed with sustainability, they don’t want to be the next Rachel Carson. As Bayer told the New Yorker, “We want to be the Dow or DuPont of this century.”

Ecovative’s goals are business goals. Their methods are business methods. In years past, environmental organizations might have tried simply to ban polystyrene or Styrofoam. Today, Ecovative is working instead to replace it with something far better, by competing in the marketplace with a truly sustainable product. And it’s winning accolades, fame, business, and profitability.

Ecovative is one of many companies across America and around the world that are pursuing environmentalism through entrepreneurism and achieving incredible results. Companies like Method, Seventh Generation, and Honest Company are taking natural cleaning products into big chain stores like Whole Foods and Target. TerraCycle has taken trash, such as chip bags and juice boxes, and turned it into trendy products like lunchboxes and backpacks that are sold in Walmart stores across the country. And that’s just to name a few. Patagonia’s CEO Yvon Chouinard put it well: “Every time we’ve made a decision that’s right for the planet, it’s made us more money.” To put it in a slightly different way, and in way that should tantalize would-be environmental entrepreneurs: every time money changes hands is an opportunity to do something right for the planet.

Sustainability is profitable, and profitability is sustainable.

Every year at Greenbuild — USGBC’s annual green building conference and expo — we give out several leadership awards. In 2012, we recognized a brilliant, charismatic, and all-around wonderful guy named Steve Saunders.

Steve, a businessman from Irving, Texas, got his start in HVAC systems — a great line of work when you live in blistering Texas, but not always an environmentally friendly enterprise. Over the past 15 years, however, Steve’s business has expanded to incorporate green rating systems and design principles, including LEED. Today, two of Steve’s companies — U.S.-EcoLogic and TexEnergy Solutions — are the biggest residential energy efficiency and green building consultancies in the world.

Most of Steve’s customers aren’t environmentalists, though. In fact, when Steve pitches his companies’ services to Texas home builders and developers, environmental concerns rarely come up. “I talk to people about how they can make money,” Steve says. “I don’t talk to them about how they can save the world. That’s their business.”

His business is a world-saving one. Steve’s companies have helped build and certify more than 43,000 ENERGY STAR homes and 24,000 green apartment units. That translates to more than 141 million square feet, or more than fifty-one Empire State Buildings’ worth of space. On top of that, U.S.-EcoLogic and TexEnergy Solutions are together responsible for 20 percent of all LEED-certified housing on Earth, making them the single largest LEED for Homes provider.

If you ask me, Steve is one of the most effective environmentalists anywhere in the world today. Yes, he lives in Texas. Yes, he runs a big business. Yes, he has a deep drawl, listens to country music, and makes a mean barbecue. But who wrote the rule that you can’t be a red-state environmentalist? Who said environmentalists can’t wear business suits?

For years, my message to the business community has been that sustainability is profitable. But the flip side is equally important for the future of the environmental movement and the future of the planet, and today’s environmental leaders and activists must hear that message just as clearly: Profitability is sustainable.

All I’m asking of my friends in the environmental movement is this: Don’t distrust the profit motive — leverage it.

I’m not asking die-hard environmentalists to compromise their most sacred values. I’m not asking them to be any less passionate or committed to the cause of saving the planet and improving the health and well-being of our communities and the people who live, work, play, and learn in them. I’m not suggesting that we wave a white flag to the industries that have spent decades decimating our land and poisoning our water.

All I’m asking of my friends in the environmental movement is this: Don’t distrust the profit motive — leverage it. Don’t fear the private sector — partner with it. Don’t ignore the marketplace — embrace it. And, more than anything else, don’t waste this opportunity.

Building a new environmental movement will require the very same values and skills that made the environmental movement of the past so successful in its time. The new environmental movement will require hard work, dedication, idealism, and passion. And yes, it will involve a good bit of righteous indignation.

We still need these things in droves. But one thing we must discard is our deep-seated and disastrous misconception that enterprise is always and inherently bad. The new environmental movement requires a new perspective. In environmentalism 2.0, business isn’t the enemy — it’s the means by which we can achieve our righteous ends.

* * *

Rick Fedrizzi is the cofounder of the U.S. Green Building Council. He also serves on numerous boards and advisory committees for diverse organizations, including Harvard University’s School of Public Health, the Clinton Global Initiative, and the World Green Building Council. Follow him on Twitter at @rickfedrizzi.

This excerpt is adapted from Rick’s new book, Greenthink.

Cover image courtesy of Shutterstock