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A Brief History of Commerce

p = 1:1050

1/ 1,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

The probability that life rose out of the early earthhad the same probability that a tornado couldSpin through a junk yard and assemble a 747 jet.

565 GigatonsAmount of additional carbon we can release into the atmosphere by midcentury and still hope to stay below two degrees.

2 CelsiusLonger droughts and more intense heat waves - Big disruptions to the world’s food supply.

Sea levels could rise several feetFlood many coastal communities in the U.S. Large migrations of people – Bangladesh, India & Vietnam.

So far, we've raised the average temperature of the planet just under 0.8 degrees Celsius, and that has caused far more damage than most scientists expected.

2,795 GigatonsAmount we’re on track to release.

GCI: 3 Major Components• Responsibility• Sufficient Information• Past/ Future Purchase Behavior

Demand Is Growing

Given a choice between green and non-green products of similar quality, consumers choose green by a large margin.

Especially true among Millenials.

Millennials are twice as likely as Boomers to own a hybrid car and seven times as likely to own an electric car.

The “Size of Prize” is SURVIVAL. Short term P&L focus is dangerous and myopic.

Consumer demand is growing significantly.

Brand and product differentiation.

Sustainability alone is not enough to justify higher prices. New products must also solve problems in better ways to justify higher pricing.

Important to build consumer confidence.

Top-down leadership and culture change is critical.

Making Sustainability an Important Point of Difference.

Traditional Marketing Product Life Cycle

Sustainability Marketing Product Life Cycle

Socio-Ecological Impact Matrix A qualitative (vs. quantitative) method Identifies: 1. Types of negative environmental

impacts a product may create 2. When the negative impacts occur

Life-Cycle AssessmentCompleted in order to: 1. Evaluate between several options of

meeting consumer needs I2. So that the option which minimizes

the eco-footprint is selected.

Socio-Ecological Impact Matrix

Technology that delivers efficiencies in resource use. Minimizing the Carbon Footprint from Logistics and Distribution; North Face Backyard Hoodie

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Type 1Product Improvement

Type 2Product Redesign

Type 3Function Innovation

Type 4System Innovation

Type I innovation:

line-extension.

Represents a

possible step

toward a

sustainable product

line.

Type II innovation:

Re-design of the

basic product.

Type III innovation: Function Innovation. Total paradigmshift in how aneed is met.

Type IV innovation Changes the entire system of consumer product use and manufacturing.

Car sharingAs the ‘norm’.

Time (years)

Greenwashing has taken its toll on consumer confidence.

Consumers are now demanding more transparency.

Sustainability reporting not only demonstrates transparency but, in our view, is the basis of organizational learning, demonstrates our values, and both reflects and drives outstanding economic, environmental and social performance. Ford Motor Company, Sustainability Report 2013/14

For businesses, reporting on social and environmental impact has become an imperative. Stakeholders of all types demand information beyond governance practices and financial accountability. And companies are recognizing the inherent value in engaging with those stakeholders on sustainability and social responsibility — from elevating reputation, to anticipating resource scarcity and talent needs, to moving beyond risk mitigation to drive innovation. The Governance & Accountability Institute finds that as of 2015, 75% of S&P 500 companies are producing an annual sustainability or corporate responsibility report, up from just under 20% in 2011. Now, leading companiesare going beyond static reporting cycles to steadily communicate what impact they are having on the world. Paul Polman, CEO, Unilever

C-Level Managers in major corporations are adding this position within an increasing number of companies.

Sustainability at BMW.

• 7 million tons of weight

• Twice the size of Texas

• Up to 9 feet deep

• 6:1 plastic to plankton

ratio.

• It is the largest plastic

dump on earth

• 80 % is plastic

• Scripps 5 to 10% of the

fish contain small pieces

of plastic.

Bio-Plastics.• Coca-Cola already has produced 25-billion units sold in 40 countries.• Saved 525,000 barrels of oil.

Making Packaging Leaner• Packaging size getting smaller• Packaging getting lighter • Fewer materials used in packaging

Recycled packaging• Where a brand’s packaging material has been sourced from• What materials have been used for packaging• Whether the packaging can be recycled.