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How Chocolate Can Save the World


4:50 PM Tuesday September 28, 2010
by Serita Cox | Comments (13)

Mars and Hershey are giving away the farm. Mars, the
Email
company behind M&Ms and Milky Way, has cracked
chocolate's DNA code and instead of immediately filing a Tweet This

truckload of patents to protect its intellectual property, the Post to Facebook


company is sharing it with the world. Its genome map of the
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cacao tree will be available on the Web for free to anyone —
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including its biggest competitor, Hershey. Oddly, Hershey is
doing the same thing with its own map of a different variety of
the tree. These two giants, who collectively account for more
than $13 billion in annual chocolate sales, have funded dueling
consortiums to break the tree's genetic code and are
explicitly prohibiting patents. Why? Because they want to enhance their natural capital — the
natural resources a company depends on.

Our Bridgespan team sat down with environmental experts like WWF's deep-thinking Jason Clay
last year as part of a broader effort to explore the natural-capital concept and how developing RECENTLY FROM THE CONVERSATION

natural capital can be a win-win for companies and the environment. When companies integrate How to Overcome Communication Fears SEP 30
consideration of natural resources into strategic planning, they can improve their cost positions, On the Differences Between Innovation and Cooking
reduce risk, capitalize on increasingly strict environmental regulations, improve new product Chili SEP 30
development and tap new value streams. And they benefit the environment at the same time. New BP CEO's Tough Communication Tasks Ahead
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Like Mars and Hershey, many companies are looking beyond the traditional view of natural
Those Job-Hopping Baby-Boomers SEP 29
resources as simply manufacturing inputs to be managed as proprietary property. They are
Why Sales and Marketing Are at Odds — or Even
beginning to see that the ongoing value of these resources to their business and, indeed, their
War SEP 29
competitive advantage lies not in controlling a finite set of them in the near term, but in indefinitely
preserving and enhancing all of the natural resource the firm uses, and the ecosystems that they're
part of. The cacao tree, it turns out, is quite fragile. It is highly susceptible to pests and disease,
and sensitive to growing conditions. Mars has determined that only 20% of its supplier's crops
produce 80% of the high-quality beans used for chocolate. That leads to a lot of wasted time,
effort, and money. By sharing the genome with everyone — university researchers, government
scientists, even its competitors — Mars is encouraging more strategic breeding and innovation that
will help ensure a sustainable future for cocoa, for the 6.5 million people running small-scale farms,
and for the company itself.

When big business can align its focus on the bottom line with its need to ensure the
sustainability of ecosystems, the world wins. Daimler, for example, used to rely largely on
plastic fillers for its Mercedes-Benz headrests but began adding coconut fiber in its place. Recently,
the company partnered with the South American environmental organization, POEMA to help
coconut farmers improve their farm management by promoting sustainable mixed-use agriculture.
The farmers' production of coconut fiber has increased four-fold. With less risk of input shortages,
Daimler has now stopped using plastic fillers entirely, realizing five percent savings in the process.
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1 of 5 03-10-2010 23:08
How Chocolate Can Save the World - Serita Cox - The Conversation - ... http://blogs.hbr.org/cs/2010/09/how_chocolate_can_save_the_world.html

Are these just one-off examples, or is there a world where growing bottom lines and sustainable
ecosystems can coexist — and even reinforce each other? What examples can you share from STAY CONNECTED TO HBR

your own organization or field in where such win-wins exist?

Serita Cox is a manager with The Bridgespan Group in San Francisco.


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what a fantastic, rich post.

there's so much i can riff on - let me offer just a couple of perhaps inconsequential thoughts.

this is a sharp example of just how different i think 21st century advantage already is 20th. consider, for a
moment, just how different a route to profitability open-sourcing your key input is, instead of aiming to keep
your suppliers "captive". it's positive-sum, not zero-sum, collaborative, not adversarial, and optimistic, not
pessimistic.

this is a textbook example what i've termed "thick value": profits that reflect socially useful activity (as opposed
to building patent hoards, which, of course, are the living expression of socially useless, or perhaps even
harmful activities).

and it's a great example of smarter growth: growth that reflects, as you point out, the authentic prosperity of
people, communities, and society - not just (increasingly tuned out, myopic) "shareholders".

so thanks for sharing this with us!!

5 people liked this.

Thank you so much Umair for the positive feedback, much appreciated. "Thick value" profits, in my
belief, are what companies should strive for and that these are not charitable acts, but rather further the
profitability and longevity of companies within their own ecosystems. Thanks, Serita MORE FROM THE CONVERSATION
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2 of 5 03-10-2010 23:08
How Chocolate Can Save the World - Serita Cox - The Conversation - ... http://blogs.hbr.org/cs/2010/09/how_chocolate_can_save_the_world.html

I think Umair got it, and Chris may have missed the point.

This article, and natural capital, is only about CSR in-so-much as it is a means of removing friction from the
system. When there is alignment between corporate objectives and social benefits then both can be achieved
in an efficient manner. By trying to influence (or compel) companies to act in socially responsible ways that
are not aligned with the corporate goals, friction is introduced. This is literally a tax on corporate performance.
When companies can find ways of achieving social/environmenal benefits that also further their corporate
performance, things might actually happen to the benefit of both.

Excellent article. I wish more thought went into how each and every company assesses "global" ROI. Best of
luck to the companies who find accretive ways to achieve corporate and social/environmental success,
capitalism should reward that.

4 people liked this.

Walt,
of course agree with the principles of the article
i just answer the first question by saying what i believe all these corporations are really thinking today,
as we speak (since i am part of the thinktanks too...)
shameful but true.

all these are really pretentious ways of brands saying "we care".
the real question is: out of every 100 decisions made, how many have similar impact? i guess too few - but
just about enough for filling in nice, illustrated, printed on 80% recylcled paper, CSR report.

2 people liked this.

Looking from a different angle, the approach would increase the supply of their raw materials. The companies
would there get high quality cocoa at a lower rate; this would improve their bottom line

1 person liked this.

Sharing the genomic sequences is the proper etiquette in genomic sciences and is under intense scientific
debate. I am sure companies who did the sequencing will not like to be labeled irresponsible in the eyes of
the scientific watchdogs.
I bought eco-friendly shoes and they rot in a year or two without me actually wearing them a couple of times. I
wonder how soon we need to change the Mercedes head rest and is there any early warning sign that it is
going to fall apart!

That maybe a pretentious ways of brands saying "we care". but it still could make a difference and I would like
to say that is really great of course for ecological standpoint. Great for the environment, irregardless if it has a
little benefit to human economic!!!

I would like to say this is great. It is from an ecological standpoint. I have to add that it does not state how it
affects humans. Great for the environment, but what is the benefit to human economic? I work for a modular
home corporation that has put all the "no waste" policies in place but they are totally degrading their workers
in benefits and wages. So the company is green but degrade the lifestyle of the human element by their wage
and benefit policy...dang will it ever be right? Profit is still the bottom line and harms the human element in this
with lower wages and benefits.....am I wrong? It's all about profit and it will be as long as corporations run the
planet.
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3 of 5 03-10-2010 23:08
How Chocolate Can Save the World - Serita Cox - The Conversation - ... http://blogs.hbr.org/cs/2010/09/how_chocolate_can_save_the_world.html

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This is one of those mixed-emotions situations. I am always delighted when businesses social are your greatest
responsibility is strengths and deepest values?
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Exactly right. If we can continue to find and highlight case examples where bottom lines benefit from
environmental sustainability, I think more companies broaden their horizons and perhaps more
importantly, more shareholders will broaden their expectations. The issue that I wrestle with however is
timing. If the financial benefit of aligning business operations with sustaining and enhancing natural
capital does not happen during the tenure of current management or next quarter's earnings, will it be
done?

Small steps lead to larger ones. Perhaps these gestures, pretentious or not, will eventually lead to a larger
impact. Cadbury certainly agrees and is now offers Fair Trade certified Dairy Milk to their market in Canada.
Fair trade benefits everyone from the farmer to the consumer and has a global impact.

Thank you, Michelle for sharing Cadbury's Fair Trade practices. Fair Trade, while still small in terms of
percentage of commodity trade, does have significant impact on both communities and ecosystems.

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