Insightful Points from an Inspired Protagonist

Tonight Brandeis hosted a lecture and Q&A session with Jeffrey Hollender, the founder and Chief Inspired Protagonist of Seventh Generation, which a leader in sustainable business.  Perhaps you’ve seen their dish soap, cleaners, paper towels, or other products at the store.  I didn’t originally intend to write about the event, but it was so great that I felt I needed to share it with all of our readers.  Here are the major points he made on the changes we need for a sustainable economy, in bullet form for easy reading:

• Changes in ownership structure – issue stock to employees, even if they don’t want it.
• Corporate bylaws – change responsibility to shareholders to responsibility to all stakeholders, including labor and the environment.
• Corporate charters – in order to receive permission to operate as a business, you must meet certain standards (e.g. issue a corporate responsibility report).
• Full cost accounting – include all externalities in the prices of goods so that the better goods cost less.
• Doing good – currently, our idea of doing good is doing less bad (e.g. 100% recycled, non-chlorine bleached paper towels).  Tonight’s event is an example of doing good.  In becoming the first company to use sustainably harvested palm oil, they’re doing good.
• Quality over quantity – we just plain consume too much stuff, need to consume less.
• Education – teach the systemic thinking, the connections between things, from the very youngest ages.
• Capital availability – small businesses are starved of money, even though they create the most jobs.  Also see the point on sustainable growth.
• Working less – people don’t have enough time to participate in their democracies.  You’re not necessarily more productive working 60 hours a work, so employees that work less should still be able to compete.
• Family businesses – they more often do the right thing.  Johnson & Johnson were the first to give employees paid vacation.
• Long-term thinking – businesses have a very hard time thinking long-term.  Immediately when things go bad, they lay people off, even though it’s expensive.
• Day trading – these types of investors offer nothing to companies.  We need extremely high capital gains taxes to discourage these types of behavior.  Long-term investing should have no capital gains tax.
• Mortgage deductions – these tax incentives benefit the people who need it least, like people who own two homes.
• Charitable giving – the poorer you are, the more you give away as a percentage of your income.
• Salary limitations – place limits on how many times more the highest-paid employee can make in relation to the lowest-paid employee.  If you pay someone over $500,000 a year, you shouldn’t be able to deduct it as a business expense.
• Seventh Generation – the name comes from the Iroquois principle that in every deliberation, we need to consider its impact on the next seven generations.
• Failure – Seventh Generation employees work too much, are too stressed out, but a month ago he finished a book about working less and hope to make changes.  They chose palm oil instinctively over petroleum, but really it turned out to be worse.
• Habit – humans generally replicate the same patterns over and over.  At Seventh Generation, they make an effort to be more conscious about their actions.
• Sustainable growth – complicated, because capital often isn’t available for those who want sustainable growth.  One bank in the Netherlands believes 20% is destructive and their companies who grow more slowly have done better in the financial crisis.  He’s still somewhat obsessed with growth because he gets more influence and shows more proof his model works.
• Political advocacy – you can’t necessarily publicly endorse a political candidate as the company that provides someone’s toilet paper.  You need to lay the proper groundwork for communicating with your customers before you do that.
• Charity – thinking about the circulation of money is important.  Oftentimes when money is given away, it’s gone forever.  Social entrepreneurship benefits immensely from the support behind it today, with micro-lending, awareness, etc.
• Starting Seventh Generation – when they started small their products were twice as expensive and half as good.  It was a bad fomula.
• Target – the store has helped Seventh Generation become their best-selling dish liquid because they priced Seventh Generation’s product at parity with Palmolive, Dawn, etc.

Thanks to the Brandeis Sustainability Initiative and Net Impact for helping bring Jeffrey to campus!

On a side note, a big announcement is coming for campus sustainability.  Janna Cohen-Rosenthal, our campus sustainability coordinator, was grinning as she told me about next Wednesday’s event (Shapiro Science Center, 5:30pm).  She looked like she could hardly contain the secret, so it must be big!