I stood indicted as a plunderer, a destroyer of the earth, a thief of my
grandchildrens’ future. And I thought, My God, someday what I do
here will be illegal. Someday they’ll send people like me to jail.
—Ray C. Anderson’s 1994 revelation
In 1973 Ray Anderson took his life savings and set about founding a company to produce the first free-lay carpet tiles in America. Today, his company, Interface, is the world’s largest producer of modular commercial floorcoverings. Interface has diversified and globalized its businesses, with annual sales of over a billion dollars in 110 countries and manufacturing facilities on four continents… but more important to Anderson is what the revelation has meant to him and his team. Today, Interface is more than 50 percent towards the vision of “Mission Zero,” the journey no one would have imagined for the company in the petroleum-intensive industry of carpet manufacturing.
Time magazine called Anderson a “Hero of the Environment.” U.S. News & World Report said he was “America’s Greenest CEO.” Fortune magazine has twice included Interface, in its annual list of the “100 Best Companies to Work For’ and now Ray Anderson’s has a new book detailing the journey, “Confessions of a Radical Industrialist”.
It’s with great pleasure that I welcome Ray Anderson to Smart Planet.
You refer to yourself as a radical industrialist. How do you achieve a radical position, through risk? Through creativity?
I earned the handle “Radical Industrialist” some time back in the late 1990s, when my company and I were beginning to chart our course up what we have called “Mount Sustainability”, and first began to talk about it with other businesses. The idea that we could take our petroleum-intensive carpet manufacturing business and re-imagine processes, products, and even the way we went to market was considered “radical” in the context of business as usual. The status quo can be a powerful opiate. Radical thinking takes you outside the business-as-usual mindset and frees you up, yes, to be creative, and even to risk failure – one must follow the other to truly be effective in creating change.
Ray, your company is half way to zero footprint. How did you achieve the first 50% and what’s the plan for the next 50%?
It’s a 15-year journey and you said it yourself – it is one no one would have imagined for my company – a company so petroleum intensive in how we made and sold our products that we could have at one point actually been considered an extension of the oil industry itself! The heart of my book is the Interface plan; there’s a chapter on each “face” that we’re climbing up that mountain. Here are the high points:
Between 1996 and 2008, we’ve cut net greenhouse gas emissions by 71% in absolute tons (the Kyoto Protocol, in contrast, called for 7% reductions by 2012, which many said was impossible). Yet over the same time frame, we’ve increased sales by 66% and doubled our earnings, expanding profit margins and propelling innovation. We reduced greenhouse gas intensity (relative to sales) by 82%, wastewater stream by 72%, landfill-bound scrap waste by 78%, total energy usage by 44%, smoke stacks by 33%, and effluent pipes by 71%. And since 2003, we have sold 83 million square yards of carpet with zero net global warming effect, “Cool Carpet” that is certified climate neutral.
Along the way we’ve developed technologies to reclaim and recycle carpet backing and face fiber, we’ve adopted Biomimicry as a design principle in both product development and process design, we’ve pioneered renewable energy using methane tapped from a landfill, and installed one of the first largest corporate solar arrays. We’ll spend the next leg of the journey – the journey to the top of Mount Sustainability – continuing the climb along those same faces of the mountain.
You had your revelation early. At a time where the national conscience may not have been as strongly in support. How did you get buy-in?
In the early years, we focused primarily on telling the story about QUEST — the Quality Utilizing Employee Suggestions and Teamwork — program that looked for and utilized in-house environmentally conscious ideas. QUEST was our first and is still our most financially lucrative initiative; it is a zero waste initiative that has netted us over $400 million in costs saved or avoided since 1996. Initially, we emphasized the cost savings that we got from QUEST with our investors, at financial conferences, at analyst conferences, and with our board. Then we began to gain some traction on other areas of initiative, such as renewable energy and recycling and so forth. And then we could show that those initiatives were highly profitable, too, and that’s hard to argue with.
Can industries make the transition while still maintaining profits?
Let me answer your question this way: At Interface, the business case for sustainability has manifested itself in four key ways:
1. Costs are down, not up, dispelling the myth that sustainability is expensive – that’s the first hurdle. Our first initiative, a zero-tolerance waste initiative, has netted us over $400 million in saved or avoided costs, more than paying for any capital or R&D costs associated with sustainability - everything.
2. Products are the best they’ve ever been. Sustainability is a well-spring of innovation, and our product designers have been particularly successful using biomimicry (the study of nature’s design principles) as a guide.
3. Our people are galvanized around our mission, owing to a sense of higher purpose and self-actualization that comes when you focus on something bigger than yourself. Academics and experts who have studied the cultural transformation at Interface say they’ve never seen the type of top-to-bottom and bottom-to-top alignment that sustainability has helped foster at Interface.
4. The goodwill of the marketplace is tremendous, winning business for Interface because customers want to be aligned with a company that is trying to do the right thing by our environment. No amount of marketing, no clever ad campaign at any cost could create the kind of customer loyalty that we have experienced. It makes sense, given that the whole journey began for us when our customers started asking, “What is Interface doing the for the environment?”
What are the hurdles to going green?
Over the years, Interface has had so many requests from other businesses who are trying to find their way up Mount Sustainability that we created a consulting arm of the company to help them. It’s called InterfaceRAISE. For most companies with whom InterfaceRAISE is engaged, the cultural transformation is often the first hurdle, and it gets back to your first question about creativity and risk-taking. If you can free up your people to be creative and take risks in the name of sustainability, the culture gradually shifts. Technology is another hurdle – when we first began this journey many of the technologies we needed to be successful simply didn’t exist. Today, we’re recycling not only carpet backing, but also the face fiber. Two critical advances in technology that allow us to keep our product in the “technical loop” and move us further from the well-head. But the cultural transformation that freed up our people to seek out those technologies was critical to making them happen. I often say that sustainability will happen one mind at a time, and I think that is our biggest hurdle – changing mindsets.
What surprised you?
I’ve been surprised at how the business case for sustainability has manifested itself. As I mentioned, it’s been a wellspring of innovation, a great differentiator in the marketplace and a profitable venture. What’s most compelling to me is that it is a more legitimate profit, one that doesn’t come at the expense of future generations.
What advice do you give to CEO’s looking to get started on this path?
Someone recently asked me for my twenty second, elevator pitch to a CEO on going green, and I said that while anything related to sustainability is worth more than a twenty second pitch, I’d start with idea that there’s a company (mine, Interface) has demonstrated that profitability and environmental responsibility aren’t mutually exclusive; that in fact, Interface has found a better way to a bigger and a more legitimate profit – a better way for the planet and for the shareholder.
What can we learn from your book?
I think “Confessions of a Radical Industrialist” is unique because it offers readers not only a “why to” on sustainability, but it is also the only “how to” book that I know of – the only book from a company that has actually done the work and changed the way we do business. As my friend Amory Lovins says, “If it exists, it must be possible.” It stands to reason, then, that if we can do it, anybody can do it. And if anybody can do it, everybody can do it.
To get a copy of Ray Anderson’s new book, Click Here
To see video’s of Ray Anderson on his YouTube Channel, Click Here