Corporate Buyouts, Sustainability in the DNA?
The article includes interviews with a number of green CEO’s: Seth Goldman from Honest Tea, Gary Hirshberg from Stonyfield Farm, Greg Steltenpohl from Odwalla, and Jeffrey Hollender from Seventh Generation. There are some choice quotes from Hollender: “choose your investors more carefully than your employees because they are a lot harder to get rid of”, and “if you have a business that is owned by investors whose primary goal is to make money, how good can the business ever be”. There has been a lot written about corporate social responsibility, including Hollender’s own very readable book “What Matters Most” and the more scholarly “The Market for Virtue” by David Vogel. Many believe in the concept, but Hollender has come to have his doubts.
To what extent is sustainability in the “DNA” of a given company? For many of the eco-companies that started small with a strong sustainability vision, like Honest Tea, Seventh Generation, Odwalla, etc. it seems it was deeply embedded. The risk is that this will diminish with a corporate buyout, large investment of venture capital, or even partnerships with major corporations. It will not necessarily happen, but it is a challenge. Tom Szaky of Terracycle wrote eloquently about the partnering issue here and the venture capital and buyout ones here. And Goldman, Hirshberg and others make their cases in the E Magazine article.
I was thinking about the sustainability in the DNA question with regard to OR companies. An OR consultant can find some work in sustainability (I have, and as he makes clear on his blog, so has John Poppelaars). And as I mentioned in a recent post, one can certainly work on sustainability challenges at companies like Waste Management and UPS, as well as at IBM and SAP. Just check out the twitter feeds of the latter two (click on them). On a smaller scale, I’ve written about Lumina (of Analytica fame) and their work in sustainability a couple of times. In each of these cases, impressive work is being done, but often the sustainability is in concert with other goals (efficiency, lowering costs). And that is great as long as it continues. This was the issue I felt listening to the UPS talk at the INFORMS Business Analytics conference last year. I wondered to what extent going green would still find favor when its costs were high. It depends on how deep the commitment is.