Kevin Wilhelm

Apr 27, 2009 by Candace Lombardi

Sustainability may be all the rage but, as the song says, it’s not easy being green. Without widespread standards, companies are struggling with how to properly calculate and disclose their carbon footprint to the public. I interviewed Kevin Wilhelm, the chair of the Greater Seattle Chamber of Commerce Sustainability Committee and CEO of Sustainable Business Consulting. His book, “Return on Sustainability,” which got endorsements from environmentalists Robert F. Kennedy Jr. and Laurie David, takes a shot at deciphering the ins and outs of corporate sustainability given the current economic downturn. He spoke candidly about the recession, the next Y2K event, outsourcing, wasteful surprises most companies find, and why comparing carbon footprints can be like comparing apples to oranges.

Q: Are sustainability efforts taking a bad hit with this recession?
Wilhelm: Yes. It’s just like so many other initiatives big companies are doing, whether it’s IT infrastructure or energy upgrades. Traditionally, sustainability and green efforts are seen as additionals. Because the marketplace hasn’t gotten to where it’s fully required, it’s definitely been hurt by budget cuts. Some current clients have asked to hold work for 2009 because there’s no more budget. All that being said, I think everyone was in this panic over the economy. Now that the bottom is somewhat stabilized, I think the fear is gone and people realize sustainability is part of a long-term strategy. And even though they may have to slow down their efforts, they still have to go through with them. The Y2K prep is nothing compared to what’s coming this December, January, and February in terms of regulation.

Q: Explain what you mean in your book by “waste equals money.”
Wilhelm: Anything that you’re throwing out or not using to its full effect becomes waste. People’s time when they’re not producing is wasted time and wasted money. Materials are a big component. When a company throws out something, they’re not only throwing out scrap. They paid for that in the cost of whatever they bought. The most famous example is Ben & Jerry’s ice cream. Ben & Jerry’s was used to disposing of slop through traditional sanitation methods. They found they could take their waste from dairy production and sell it to pig farmers. Cascade Designs makes thermal things for backpackers that have this foam (in them). With their cuts there was always left-over foam and they were throwing it out. They turned it into camping pillows, and what was this expensive thing they paid to be hauled to a landfill was turned into a profit center.

Q: How does outsourcing come in to this? I’ve talked to people from major companies who wonder if competitors could be fudging carbon footprint numbers by eliminating their manufacturing from the U.S. and outsourcing it to China. While our local U.S. air may get cleaner as a result, that company is still contributing to pollution that’s going to affect us long-term.

Wilhelm: You’re right. It’s just like any time when anyone tries to externalize their costs. You look right now at any company polluting the air. Companies pay to recycle or take out garbage, to have wastewater treated, but air goes up and what happens to it? Nothing. We all pay the price. In terms of the carbon footprint, you’re dead-on. With companies right now–because they’re just now understanding what you have to measure–you may find you’re comparing apples to oranges sometimes. What you try to do with companies is get them to say what the boundaries of the company are for the footprint. They can say they’re only doing U.S. operations and exclude anything manufactured in China. In terms of what the standard is, companies can include operational control, economical control, or subsidiary control.

Look at all the products being made and shipped from China. Some of the factories are giant and make (products) for four or five brands at a time. You look and say 20 percent (of their production is going) toward our product, so 20 percent of their energy needs to be part of our carbon footprint. There are standards, but people can define it in different ways. Starbucks only looks at energy use and transportation. They don’t count their cups, and everyone walks out with at least one of those. But they’re very transparent about it. They say it’s complicated and they haven’t gotten to it yet. It’s new for a company and they usually say, “We want to do a carbon footprint for everything.” Then they realize, “Oh, I have to go to China to figure this out?” I biked an entire year to work, then I took one trip to China and wiped it all out.

Q: In your book you say that whether you believe in global warming is beside the point.
Wilhelm: It is. If you’re a businessman who doesn’t think climate change is manmade, well, the EPA (Environmental Protection Agency) has said it is and they’re coming out with climate regulations. The Kyoto Protocol is coming up and they’ll have a new treaty in Copenhagen. So whether you believe or not, you’re going to have to respond. The trend with consumers is huge and from a global perspective, climate change is like the Y2K event. The Y2K prep is nothing compared to what’s coming this December, January, and February in terms of regulation.

Q: You mention in your book how REI was shocked to find that 26 percent of its carbon emissions came from its Adventure Travel division, while it had assumed it would all be from shipping and distribution. Depending on the type of business, what’s the likeliest culprit between energy, travel, waste, paper, and freight?

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