Natural Order
Green Makes Green
In the past decade, more companies have discovered that as they
become more environmentally friendly, they become more financially
attractive-a corporate makeover of sorts. As their numbers have
increased, so has the evidence supporting their claims. For example, a study by professors Michael Russo of the
University of Oregon and Paul Fouts of Golden State University
revealed firms with the highest return on assets went beyond
competitors in terms of pollution control and waste reduction.
Also, the environmentally sensitive financial analysts at the Dow
Jones Sustainability Group Index discovered stocks of companies
that account for their social, financial and environmental impact
outperform the stocks of companies that don't. That study was
supported by one by Innovest Strategic Value Advisors finding
companies with superior environmental performance generate superior
financial performance. And Vanderbilt University found that 80
percent of environmentally sound companies financially outperform
their higher-polluting counterparts. As these studies shore up Lovins' claims, natural capitalism
is pushing its way into the pantheon of strategic planning. Yet the
concept remains young (read: relatively unknown); therefore, most
entrepreneurs stumble onto it. What starts as a concern for the
environment and for government regulation evolves into sound
management strategy, as employees and franchisees of Brian
Scudamore's $10 million 1-800-GOT-JUNK? discovered. Content Continues Below
Each year, franchisees of the company pick up tons of junk,
primarily from homeowners who want to throw things out-after spring
cleaning, for example. They haul away old TVs, wood, appliances and
furniture. If Scudamore didn't care, they could just take the
junk to municipality transfer stations to get dumped. End of
story. So to protect the environment and earn more money,
1-800-GOT-JUNK? recycles cardboard, paper, concrete, sheet rock,
metal, tires, furniture, garden refuse, and the list goes on.
"Our target is to recycle a minimum of 40 percent of all
loads," Scudamore, 31, says. But there's even more to it
than that. "We've turned our recycling system into a profit-share
system," says Scudamore, noting that greed-once
environmentalism's perceived nemesis-can potentially be its
ally. "Our people get 20 percent of all the savings from what
they recycle. Instead of paying $120 to dump a load, they may pay
$70 as a result of recycling. It's win-win-win for the company,
the franchisee and the environment." | GREEN GIANT | | Effusive 28-year-old dotcommer
Josh Knauer laughs easily, especially about his prospects of
becoming a father. Not that the prospect is funny. There are issues
about diapers, sleep and time. It's not lost on him that come
the end of the year, he'll be balancing the demands of a new
family member with those of the company he founded in 1998,
GreenMarketplace.com, which is growing at 15 percent per month. By
the time his child is born, revenues from sales of 650 or so
environmentally friendly products such as organic cotton sweaters
and biodegradable laundry products should hit $3 million.
At least he'll have one less new-father anxiety:
GreenMarketplace is promoting a better environment for future
generations. Its products are made in ways that don't hurt the
environment, are free of hazardous chemicals, aren't tested on
animals, don't contain ingredients obtained in ways that harm
or kill animals and are made by companies that respect their
workers and pay fair wages. Knauer didn't set out to be an e-tailer. He started EnviroLink, a
clearinghouse of environmental information, resources and issues,
in 1991 because he couldn't find sources for environmental
research in college. That company quickly became the Net
environmental portal of choice. Over time, Knauer heard complaints
from the site's users about how hard it was to find
enviro-friendly products. Sensing opportunity, he started
GreenMarketplace. From that first day, Knauer rested the company's foundation
on a tripod: All corporate decisions must be beneficial
environmentally, socially and financially. It's a strategy that
has attracted attention in the dotcom world. Last year, when
GreenMarketplace wanted to buy competitor EthicalShopper.com and
relieve the space crunch in its 800-square-foot Pittsburgh
facility, the company's mission attracted the attention of
Sandra Bernardi, co-founder of Infoseek. She purchased a stake in
GreenMarketplace that enabled the company to go through with the
deal. Who said it isn't easy being green? |
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