Facebook, IKEA, Nike say business big and small should embrace low carbon innovation
- 24 September 2013
NEW YORK: Today a panel featuring a compelling mix of exciting start-ups and the world’s most successful listed consumer companies, discussed the rapidly growing sphere of low carbon innovation, suggesting ways big and small businesses alike can embrace it.
Low carbon leaders
David Pogue, Global Director of Sustainability, CBRE opened the panel, which took place at CBRE's NY headquarters during Climate Week NYC 2013, by pointing out progress made in the last decade, specifically in the real estate sector where back in 2000 the first EPA energy star was issued for an office building—today 200,000 buildings participate. At last year's summit, CBRE launched a four-year, US$1 million commitment to fund sustainability R&D in commercial real estate worldwide. This week CBRE was recognized for its climate change transparency with its inclusion in CDP's S&P 500 Climate Disclosure Leadership Index.
Dan Perez, Founder and CEO of Marblar, then announced Simon Barker as the winner of EarthHack, a crowdsourcing contest launched with The Climate Group earlier in the year with the support of IKEA and Philips. Simon co-created Radfan, a low-power fan which redistributes heat from radiators. Explaining how Radfan is saving its 2,000 customers money and energy, Simon also shared that the company is looking for ‘people in charge of a lot of houses’ such as social housing providers in the UK, to both expand businesses and help people.
Setting the tone for the subsequent panel, Chris Librie, Senior Director of Sustainability Programs, Hewlett-Packard, started: “It is clear to us that development without innovation is not sustainable. HP has developed new server technology, which we are currently using to run HP.com from, which uses the equivalent energy of just 12 60 watt lightbulbs. It is a fundamental quantum change.”
Steve Howard, Chief Sustainability Officer, IKEA, also highlighted the operational efficiency of greening business when he asked: “Is flat-packing a sofa innovation? If you can quadruple the amount of sofas shipped it probably is.” Then talking about IKEA's sustainability strategy he said innovation challenges any existing gaps, adding: “If we don’t do that in our businesses, then we are all screwed.”
Hannah Jones, VP of Sustainable Business and Innovation for Nike said the ‘epiphany’ came for Nike in the early 1990s, when the company needed to innovate without effecting business in order to remove harmful sulfur hexaflouride gas from its shoe air bags. Ten years of R&D later, Nike replaced the gas with nitrogen, forcing it to innovate in ways which also improved product performance. She said: “We have reduced our carbon footprint by 18% from a decade ago and are now aiming for 20%. Every innovator loves a challenge.” Hannah also said business culture is ‘critical’ to sustainable innovation, which can be a problem in larger companies: “Innovators have to be given permission to fail 100 times. That doesn’t work in mainstream commercial business. Innovation sits in the shadows between the silos—sustainability forces you to look at the shadows and turn them into amazing opportunities.”
Adding to Hannah's comments, Bill Weihl, Sustainability Guru at Facebook, said as well as taking risks, innovators must also be rewarded. He highlighted how Facebook is ‘vertically integrated’ which frees people to think about innovation across the organization, stating: "We embarked on a disruptive approach to our system: to stop leasing data centers and commodity servers and design them ourselves, to reduce costs and energy consumed. Big innovators like Google have done the same. We didn’t hire lots of people, we worked with partners like HP, and two and half years ago, open-sourced it to build a collaborative ecosystem for a new class of design and data centers, so we can leverage all the smart people, so everyone can benefit—and it helps business."
Answering a question about mobilizing change, Hannah Jones suggested: “You have to push ego out of the way. We know we are winning when someone take our ideas to scale. One of the big things we debate at Nike is sustainability verus performance. We will never compromise performance and sustainability. It has to be a win-win. And it is a win when athletes win gold in our shoes. Sustainability is a win for market, for the company, for teams... That way other trade-offs become easier to navigate.”
In the next panel, which focused on partnerships around low carbon innovation, offering the corporate perspective, Kyung Ah Park, Managing Director & Head of Environmental Markets Group, Goldman Sachs said the bank has reached US$30 billion in capital investment for clean energy, and that despite volatility have also decided to commit another US$40 billion over the coming decade. Harry Verhaar, Senior Director of Strategic Sustainability Initiatives at Philips said that while big corporates are doing more in sustainability, it is “easier to ask forgiveness afterwards than permission before” when it comes to initiating partnerships on innovative projects. Yesterday at the Opening Ceremony, Harry annnounced a Philips and Ecofys report on the economic and social benefits of energy efficieny, and mentioned that in the first half 2013, 25% of Philips' turnover was LED-based.
Eben Bayer, CEO, Ecovative and winner of the Dutch Postcode Lottery's Green Challenge prize in 2008 for his sustainable Styrofoam replacement. Greensulate™, mentioned that his start-up has partnered with institutions you "wouldn’t think are innovative" but that are "more than ready to embrace and scale innovative technology quickly". Andrew Shapiro, Founder, Broadscale reiterated the importance of powerful partnerships, when he said: “a critical component of Elon Musk’s success with Tesla was Daimler, Panasonic and Toyota, who all invested as well as formed strategic partnerships." Eben Bayer echoed this, concluding that successful collaboration is about “finding the thing to bring to the table in exchange for the big companies to bring it to scale.”
As our Director of Corporate Relationships, Ben Ferrari, mentioned earlier in the panel, post-EarthHack The Climate Group will continue to work with our partners on driving low carbon innovation across business, however big or small.
By Clare Saxon