State Green Business Report 2011

state of
green
business
2011
by Joel Makower and the editors of GreenBiz.com
FEBRUARY 2011
GreenBiz Group
www.GreenBiz.com
Contents STATE OF GREEN BUSINESS
2011
Introduction 3
Top SUSTAINABLE BUSINESS TRENDS OF 2011 3

Consumer Giants Awaken to Green 5
Companies Aim for ‘Zero’ 6
The Developing World Yanks the Supply Chain 8
Greener Transport Makes Its Move 10
Sustainable Food Becomes a Main Course 12
Metrics and Standards Become the Rule 14
Toxics Concerns Spur Greener Alternatives 16
Water Footprinting Makes a Splash 18
Companies Learn to Close the Loop 20
Bioplastics Become Material 21
The GreenBiz Index

Introduction 23
Summary Chart 24
Carbon Intensity 26
Carbon Transparency 28
Cleantech Investments 30
Clean-Energy Patents 32
Corporate Reporting 34
Employee Commuting 36
Employee Telecommuting 38
Energy Efficiency 40
Environmental Financial Impacts 42
E-Waste 44
Fleet Impacts 46
Green IT 48
Green Office Space 50
Green Power Use 52
Organic Agriculture 54
Packaging Intensity 56
Paper Use and Recycling 58
Toxic Emissions 60
Toxics in Manufacturing 62
Transparency 64
Credits / About GreenBiz Group 66
Infographics by Seth Fields
© 2011 GreenBiz Group Inc. (www.greenbiz.com). May be reproduced for non-commercial purposes only, provided credit is given to GreenBiz Group Inc. and includes this notice.
STATE OF GREEN BUSINESS
2011
Top Sustainable Business Trends of 2011
There’s a school of thought that says, in effect, it isn’t easy being green
even in a good economy. If that’s true, sustainable business activities
should pretty much have driven off a cliff during the Great Recession.
But the opposite seems to have happened. Indeed, a dramatic shift is
occurring in business: Companies are thinking bigger and longer term
about sustainability — a sea change from their otherwise notoriously
incremental, short-term mindset. And even during these challenging
economic times, many have doubled down on their sustainability
activities and commitments.
During 2010, we saw a steady march of progress, with These are growing pains, signs of a maturing business
some of the world’s biggest companies and brands put- function. We saw the same thing happen with informa-
ting a stake in the ground in the name of environmental tion technology professionals a quarter century ago.
(and sometimes social) sustainability. Some are com- Their work was initially seen as marginal, not core to
panies that hadn’t previously been visible in these ways. strategy. They sat off to the side, organizationally speak-
Others, it turned out, had been quietly taking action, ing, with their own fiefdoms and unique, often impen-
walking more than talking, only recently discovering that etrable, jargon. We heard from them only when there
modesty is no longer an asset in a world that increasingly were problems. Today, of course, we can chuckle at
demands transparency. Still others have only recently our naïveté, given our unconditional surrender to IT to
elevated sustainability to a level of importance, hiring run our lives at work, at home, and at play. Today, nearly
their first senior executives to oversee and coordinate everyone inside a company is an IT worker of sorts, as
sustainability commitments and goals. we upgrade, troubleshoot, and plug and play technology
of previously unimaginable sophistication. Dedicated IT
All of this in spite of — and, in some cases, because of —
professionals are viewed as key players, core to profits
the stumbling economy.
and productivity, typically answering to a chief informa-
As we noted last year, this recession was the first eco- tion officer.
nomic downturn where corporate environmental pro-
Sustainability seems to be on a similar path.
fessionals weren’t the first to be tossed overboard. They
largely kept their jobs, though some suffered budget Today, managing a company’s environmental footprint
freezes and slashes, and more than a few endured reor- is less and less limited to the environmental depart-
ganizations that consolidated them with other func- ment. Increasingly, it is the domain of procurement,
tions, or dispersed sustainability responsibilities within finance, facilities, fleets, legal, operations, real estate,
other operations or business units. supply chain, marketing, investor relations, even human
2011
resources. Growing numbers of us are recycling, Much of the greening of business remains an
telecommuting, rethinking business travel, untold secret largely ignored by the mainstream
turning off lights, rooting out waste, and gen- media and, in many cases, not widely discussed
even by companies. The former typically don’t
A great
erally being more conscious of the impacts of
the things we do at work. In some companies, view corporate environmental leadership as transformation
such activities are tied to managers’ and execu- news, or cynically believe company activities to is taking place.
tives’ performance evaluations and compensa- be superficial marketing ploys. The latter fear Will the public
tion. Increasingly, these efforts are directed by that by pointing out what they’re doing right, they
take notice?
someone in the C-suite. may unwittingly attract an unwelcome spotlight
Will political
on environmental challenges that remain unad-
All of this is especially noteworthy in light of
dressed or unsolved. So they remain mum, lest leaders position
today’s political environment — the open hos- themselves at
they be accused of “greenwashing.”
tility with which environmental protection is
the front of this
viewed by a swath of the political spectrum, And so it goes. A great transformation is taking
at least in the U.S. The general lack of political place. Will the public take notice? Will political
parade?
leadership and will — due in large part to a mis- leaders position themselves at the front of this
guided notion that we can’t afford to consider parade? Will growing the green economy ever
sustainability during tough economic times — is become a national cause?
a stark contrast with the far more enlightened,
Definitive answers are fleeting. But in the pages
proactive leadership of corporate chieftains.
that follow, we aim to help illuminate the state
A growing number view environmental think-
of the art, including what’s working — and what
ing — whether in the form of reducing waste,
promise remains unfulfilled.
improving efficiency, or eyeing new business
opportunities — as key to competitiveness, as To make sense of the year just passed, we
well as a means of clawing our way back to eco- combed the nearly 2,200 news reports, blog
nomic prosperity. When California voters had posts, opinion pieces, and podcasts pub-
the chance last November to set aside a tough lished during 2010 on GreenBiz.com and its
climate change law until better economic times, four channels — ClimateBiz, GreenerBuildings,
they voted overwhelmingly to stay the course, GreenerComputing and GreenerDesign — in
seeing instead the law’s potential to create jobs search of trends and themes about the year
while addressing a critical global challenge. ahead. Here are 10, in no particular order.
2011
1. Consumer Giants Awaken to Green
Large consumer packaged goods companies, committed to sourcing 100 percent of agricul-
the so-called CPGs, have long been reluctant tural raw materials sustainably by 2015, includ-
entrants into the green world. The makers of ing palm oil; change the hygiene habits of 1 billion
the leading brands of detergents, personal care people in developing countries to help reduce
products, processed foods, and other things diarrhea, the world’s second biggest cause of
found up and down supermarket aisles have
Few of these
infant mortality; make drinking water safer in
stayed largely on the sidelines, viewing green companies are
developing countries by extending sales of its
marketing as a risky, if not losing, proposition. doing much
Pureit home water purifier; and improve stan-
Suddenly, the world’s biggest brands seem to dards of living by working with nonprofit groups
green marketing.
be leading the way. Kraft, Procter & Gamble, SC to link 500,000 small-scale farmers and distrib-
But behind the
Johnson, and Unilever were among the CPGs utors to Unilever’s supply chain.
scenes they are
making green pronouncements during 2010.
What’s going on here? Have these behemoths making dramatic
P&G, the world’s largest CPG, took several major suddenly become treehuggers? Unlikely. Such
shifts.
steps, not the least of which was a “sustainabil- initiatives are logical extensions of efforts
ity vision” that set a series of long-term goals: already being undertaken, sometimes quietly, to
Use renewable energy for 100 percent of its fac- address stakeholder concerns, improve opera-
tories, use 100 percent renewable or recycled tional efficiencies, and hedge risks related to
materials for all products and packages, and petroleum use and greenhouse gas emissions.
send zero consumer or manufacturing waste to All of which provide opportunities to be seen as
landfills. The company also set interim 10-year a leadership company — not just by consumers,
goals, to be achieved by 2020. but by investors, job seekers, and employees.
That was just the beginning. During 2010, P&G Credit also must be given to Walmart, which has
also introduced to the U.S. its Future Friendly been pressing CPGs large and small to take such
campaign, an effort begun in Europe to raise measures — part of the retail giant’s own com-
awareness about greener products and prac- mitments related to waste reduction, renewable
tices; created a high-profile advisory panel of energy use, and making affordable green prod-
sustainability experts; launched a supplier ucts. Most of the leading CPGs also belong to the
scorecard; reformulated a bestselling sham- Sustainability Consortium, a research group
poo to reduce toxins; announced concen- set up by Walmart but now run independently.
trated versions of powder laundry detergents Among the consortium’s 70-odd members are
that significantly reduce packaging and energy Church & Dwight, Clorox, Colgate-Palmolive,
use; and introduced sugarcane packaging to General Mills, Kellogg’s, Kimberly-Clark, P&G, SC
three of its brands. All of which followed the Johnson, and Unilever. Together, they represent
company’s 2009 commitment to sell $50 bil- more than $200 billion in annual sales.
lion in “sustainability-driven” products by 2012,
Few of these companies are doing much green
a goal the company says it is on target to meet.
marketing. Most remain on the sidelines, devot-
Unilever, one of P&G’s biggest competitors, fol- ing their marketing budgets to more traditional
lowed suit, launching a Sustainable Living Plan consumer value propositions. But behind the
focusing on the company’s supply chain — from scenes, they are making dramatic shifts — things
the farms that supply raw materials for its prod- unlikely to end up on product labels, advertise-
ucts to the emissions and waste generated by ments, in-store promotions, or any of the other
customer use of those products. The company tools of the marketing trade.
2011
2. Companies Aim for ‘Zero’
The notion of factories without Dumpsters isn’t ago, said that of the 400 million pounds of raw
new. Xerox, for one, began an internal initiative material it purchased in 2009, only 3.4 million
in the early 1990s known as the Waste-Free pounds went to landfill — less than 1 percent.
Factory. It hasn’t yet achieved that goal, but it
As these companies have learned, cutting waste
has driven the company to reach a 92 percent
can yield multiple savings. Dell, for example,
recycling rate for non-hazardous materials. One issue is
which last year edged close to its goal to cut 20
Along the way, other companies have put “zero million pounds of packaging, found that optimiz- that there is
waste” squarely in their sights. And a growing ing packaging had several benefits. For example, no generally
number have hit the mark. Some, like General it examined packaging for its Inspiron laptop accepted
Motors, which announced that more than half and determined that by reducing what goes definition of
of its 146 global manufacturing plants had inside the box and laying out items in the box
what “zero
achieved zero waste, have been at this for more differently, it could shave off a few millimeters
waste” means.
than a decade. Others are just getting started. — enough to fit nine additional boxes on a pallet,
Procter & Gamble, for example, announced its reducing transportation and storage costs. You
first zero-waste manufacturing plant in North don’t need a laptop to compute those savings.
America, part of a companywide zero-waste
It’s not all easy going. One issue is that there is
goal. Still others reached admirable milestones.
no generally accepted definition of what “zero
Sunny Delight said its Sherman, Texas, plant
waste” means. For example, some companies
became the company’s final site to get to zero
define zero waste to include incineration and
waste, while Kraft announced that nine facilities
other thermally driven technologies that many
had achieved that distinction.
nonprofits, public agencies, and waste manage-
As Kraft came to learn, with a little ingenuity ment professionals don’t consider to be worthy
almost anything can be kept from landfills. An of inclusion. On the other hand, the Zero Waste
Allentown, Pa., plant sends off 5 million pounds International Alliance states that “Businesses
of mustard seed hulls left over from making and communities that achieve over 90 percent
Grey Poupon for use as animal feed, instead diversion of waste from landfills and incinera-
of to the trash. Kraft’s Lowville and Campbell tors are considered to be successful in achiev-
plants in New York dump whey, left over from ing Zero Waste, or darn close.”
making Philadelphia cream cheese, into digest-
“Darn close” isn’t likely to cut it in the hyper-
ers to make biogas to generate heat, supplying
sensitive world of green, so this is an area sure
about 30 percent of the plants’ energy needs.
to attract accusations of “greenwashing.” That
A Tang factory in China realized that instead of
may be a good thing: It suggests companies are
sending sugar that didn’t fit its recipe back to a
engaged and striving to make zero-waste claims.
supplier, it could forward it to another Kraft plant
Competition and oversight will sort things out.
in China that makes Halls cough drops. Sweet!
Whatever the definition, there are more “zero
These companies join others that have reached
heroes” to come. Several big companies, among
zero-waste goals, from Caterpillar to Coca-Cola,
them P&G, Sony, and Walmart, have set ambi-
Diageo to Disney, brewers (MillerCoors) to ball
tious zero-waste goals, even if their timetables
clubs (the San Francisco Giants).
are a decade or more away. That doesn’t mean
A far greater number of companies are on their they aren’t starting now — indeed, they must,
way to “zero.” Carpet manufacturer Interface, in order to get from here to “zero.” All told, it’s a
which set a Mission Zero goal more than 15 years bandwagon that’s just getting rolling.
2011
Stalemated Laws and Corporate Thaws
Businesses continue to increase their investments in sustainability inversely to their confi-

dence in legislative and regulatory activities to support a green economy. This is an impres-
sive indicator of the health of the green economy, as companies invest in green initiatives
to decrease costs and gain competitive advantage rather than merely to comply with
regulations.
In 2008, we created the GreenBiz Intelligence Panel to take a monthly pulse of the green
business world. Twice a year, we ask the panel’s nearly 3,000 members for their views on key
economic indicators. Our January 2011 survey garnered 414 responses, with slightly more
than half from companies with revenues greater than $1 billion. The indicators remain positive
for the green economy, including environmental spending, employment, and product devel-
opment. Some key findings:
• Investments continue to rise. Eighty-nine percent said their 2011 environmental,

health, and safety spending will be equal to or greater than 2010 (44 percent and 45
percent respectively). Investment in green product development also continues: 84
percent said spending will be equal to or greater than in 2010.
• Hiring freezes have melted away. In early 2009, 27 percent of large companies
reported open requisitions but also had hiring freezes. By early 2010, freezes dropped to
15 percent and, in our most recent survey, plummeted to only 4 percent.
• Government’s role is in decline. In 2009, when we asked when they anticipated

greenhouse gas (GHG) emissions laws (such as cap and trade), we didn’t even offer
panel members a choice to indicate they didn’t think laws would be enacted. This was
largely because 60 percent expected legislation to be passed in 2010. By early 2010, 29
percent did not expect any federal legislation. That number has now risen to 39 percent.
• Regulation is less certain. For the past two years, between 87 percent and 90 percent
of panel members expected increased environmental regulations (outside of GHG emis-
sions laws). In a striking drop, only 73 percent now envision increased regulations.
Headcount
Headcount for forenvironmental
environmental
environmental
Headcount for and/orsustainability
and/or
and/or sustainability positions positions
sustainability
positions
atyour
at
Companies with revenues greater than $1 billion yourcompany
company
(companieswith
(companies withrevenues
revenuesgreater
greaterthan
than$1
$1billion)
billion)
31%
31%
28%
28%
27%
27%
23%
23%
22%
22%
17%
17%
15%
15%
11%
11%
8%
8%
4%
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Firms that haveopen

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Source: GreenBiz Intelligence Panel

2011
3. The Developing World Yanks the Supply Chain
Environmental issues in developing economies contain any of these four substances from the
have long been of concern to Western compa- DRC or adjacent countries. If so, companies
nies, but some issues are becoming more stra- must describe what measures are being taken
tegic, both to companies and countries. Geeky to trace the minerals’ origin. The law goes well
buzzwords like “rare earths” and “conflict miner- beyond electronics companies: It applies to any
als” are finding their way into mainstream media
Geeky
publicly traded U.S. firm that uses gold or tin in
and public discourse, and the sources of some buzzwords like
its products. It may be a challenge for public
of the most widely used agricultural commodi- “rare earths”
companies with deep supply chains to have
ties are being scrutinized. visibility into the practices of suppliers that sell
and “conflict
subcomponents and raw components that are
minerals” are
“Conflict minerals” is a term that came into
eventually integrated into parts sold to a final
widespread use during 2010. It refers to miner- finding their way
manufacturer or assembler.
als mined in conditions of armed conflict and into mainstream
human rights abuses, notably in the eastern Conflict minerals are just the beginning. The
media and public
provinces of the Democratic Republic of the issue of palm oil loomed large for food proces-
discourse.
Congo, or DRC, where warring factions have sors during 2010. The oil — used increasingly in
been embroiled in a decades-old civil war that the commercial food industry due to its lower
has caused 5 million deaths and displaced mil- cost and the high stability of the refined prod-
lions more. uct when used for frying — is seen as a cause of
substantial and often irreversible environmental
Conflict minerals include lesser-known sub-
damage, including deforestation, habitat loss of
stances — cassiterite, coltan, tantalum, tung-
critically endangered species such as the orang-
sten, and wolframite — along with more com-
utan and Sumatran tiger, and climate change.
mon ones like tin and gold, which are essential to
manufacturing a variety of consumer electron- Last year saw a move by big players toward
ics, including mobile phones, laptops, and MP3 sourcing sustainable palm oil. Coalitions of large
players. Purchasing conflict minerals, say activ- companies like Nestlé and Unilever worked with
ists, finances tribal fighting in the DRC. Armed activist and other groups to better define and
groups are present at many mines, often affili- certify palm oil harvested sustainably. General
ated with rebel groups or the Congolese National Mills committed to “sourcing palm oil in a
Army, both of which are said to use rape and vio- socially and environmentally responsible man-
lence to control the local population. ner” — specifically, to purchase all palm oil exclu-
sively from members of the Roundtable for
Tracking the use of conflict minerals by compa-
Sustainable Palm Oil, a multi-stakeholder orga-
nies has been difficult, and mostly in the domain
nization, by 2015. Walmart similarly commit-
of a handful of activist groups. But in 2010, the
ted to using 100 percent sustainably sourced
2,300-page financial reform bill passed by the
palm oil for its branded products by late 2015.
U.S. Congress and signed into law contained a
Meanwhile, Burger King and Nestlé, both under
provision aimed at curbing the use of four con-
fire from activists, agreed to stop purchases of
flict minerals: gold, tin, tungsten and tantalum.
palm oil from unsustainable sources, while agri-
It put the burden of proof on the firms using
business giant Cargill agreed to initiate a review
these minerals. The new law requires American
of its palm oil sources.
companies to submit an annual report to the
Securities and Exchange Commission disclos- All of this creates opportunities as well as chal-
ing, starting in 2012, whether their products lenges. Consider “rare earths,” a collection of 17
2011
a SMALL BUSINESS INNOVATION JUGGERNAUT?
At the 2010 GreenBiz Innovation Forum, an annual confer-

ence focusing on the intersection of innovation and sustain-
ability, a host of big companies touted their visions, commit-
ments, and accomplishments: How Procter & Gamble set
its sights on a billion new customers in the developing world; how Waste Management is reinventing
itself to prosper in a world of zero-waste factories; how Steelcase is using innovative mushroom-
based cushioning to replace polystyrene foam blocks when shipping its furniture to customers.
But it may be smaller entrepreneurial firms that can teach the Goliaths the most about innovation.
Small companies have the nimbleness to achieve radical innovations, but they lack scale. On the
other end of the spectrum are large companies that have the scale, but face the uncertainty of tak-
ing something that is working and trying to do it in a new way.
The Forum explored how some of the world’s largest companies are taking steps to find and nurture
small and sometimes little-known start-ups working on radically innovative technologies but lacking
the funding and the scale needed to move the needle forward. And how small startups can harness
innovation to compete with the big guys.
Consider Method, the maverick maker of cleaning products. It purposely killed one of its bestsell-
ling products — a liquid laundry detergent — in order to introduce a reforumlated version that is four
times more concentrated than competitors’ brands. Method’s chemistry breakthrough yielded a
laundry detergent that requires 75 percent less packaging and boasts a 35 percent smaller carbon
footprint. It enabled Method to compete with companies that are thousands of times its size.
“We’re probably the smallest consumer products company out there, with few exceptions,” Adam
Lowry, Method co-founder, told the Forum. “So for us, in order to compete in the category, we have
to radically innovate because we don’t have the scale. As a smaller company, we have to do that. We
don’t have a choice,” Lowry said. “And it’s easy for us to do. Let’s face it: We don’t have Wall Street
breathing down our necks.”
chemical elements in the periodic table that are highlighting our dependence on them).
used extensively in technologies such as wind
Viewing the challenges, Hitachi developed a
turbine generators, electric vehicle motors, bat-
new, more efficient system to recycle the rare
teries, fuel cells, and energy-efficient lighting.
earth magnets from discarded technology,
Ninety-seven percent of these materials come
which previously went to landfills. The Japanese
from China — an economic challenge (due to
manufacturer built what it says are the first
limited supply and global demand), an environ-
machines of its kind, capable of extracting 100
mental one (since mining, refining, and recycling
magnets per hour, compared to the current
of rare earths can have major environmental
method, which requires workers to manually
consequences), and a national security one
extract magnets at a rate of about 12 per hour.
(since these materials are critical to infrastruc-
ture and transportation and China in 2010 began That’s a solid recipe for success in a resource-
restricting exports of these precious materials, constrained world.
2011
10
4. Greener Transport Makes Its Move
The year 2010 will likely be remembered for the cheapest product that remains once gas and
rebirth of electric vehicles — not just the vaunted other high-grade fuels have been refined from
Chevy Volt and Nissan Leaf, and not even the crude oil.
pricey Tesla, but dozens of other brands, large
Shippers traditionally have had no visibility into
and small, that came into public view. And their
which companies are using cleaner fuels, but The greening of
entrance has spurred a small but growing eco-
that’s changing. Last year, Maersk Line became transport goes
system of corporate alliances seeking to tap
the first in its industry to independently verify
into the new opportunities. well beyond
its carbon emissions vessel by vessel, enabling
Some of these alliances are predictable — customers to track the environmental data vehicles.
for example, announcements by Hertz and along with other performance information Greener
Enterprise to add EVs to their rental fleets. about the shipping line. The company also said technologies
Others brought together large players with it was slowing down its ships to save fuel and and practices
smaller ones — a partnership by Better Place cut emissions. It found that a 20 percent reduc-
are emerging
and GE to build a battery recharging infrastruc- tion in speed can cut fuel use and CO2 emissions
for a raft of
ture, for example, or Panasonic’s investment in by up to 40 percent. Meanwhile, the world’s first
Tesla, allowing the former to supply lithium-ion hybrid electric tugboat, which plies Southern transportation
batteries to the latter, while jointly they work on California’s San Pedro Bay, emits 73 percent types on land,
next-gen battery cells. Meanwhile, a global alli- less soot, 51 percent fewer nitrogen oxides and sea, and air.
ance chaired by Prince Albert of Monaco set a 27 percent less carbon dioxide than a standard
target of getting 1 million more electric vehicles tug of comparable size, researchers found. Talk
on the road in the next five years than auto- about a sea change.
makers have planned to bring to market. These
Up in the air, carriers found new ways to cut fuel
companies and public agencies join with other
and emissions. Alaska Airlines began tests of
early adopters, such as GE, which pledged to
a new emissions-reducing technology, wing-
buy 25,000 electric vehicles over the next five
ing its way to 35 percent reductions by recon-
years for its own fleet, as well as for customers in
figuring how its planes descend for landing. Its
its fleet management business.
“Optimized Profile Descents” allow jets to idle
But the greening of transport goes well beyond their engines for more of the descent, saving
vehicles. Greener technologies and practices nearly 60 gallons of fuel per flight. Virgin America
are emerging for a raft of transportation types said that it would cut fuel use by up to 3 percent
on land, sea, and air. this year simply because of better routing.
Ocean-going vessels, the means by which two- Back on terra firma, the biggest shipping compa-
thirds of the goods purchased by U.S. consum- nies revved up their competition to cut fuel use
ers arrive on American shores, have long been and emissions. FedEx Corp. developed a new
an environmental problem. While ocean-going program to unify the company’s efforts to meet
vessels worldwide account for just 2 to 3 per- its goals of minimizing its environmental impact.
cent of global fossil-fuel consumption, they are Its EarthSmart program is aimed at inspiring
responsible for 14 percent of the nitrogen emis- innovations that will help the company improve
sions from fossil fuels and 16 percent of all sulfur vehicle fuel efficiency by 20 percent by 2020.
emissions from petroleum, according to a study United Parcel Service, for its part, expanded
by Carnegie Mellon University. One reason: its carbon-neutral shipping program to 35
Cargo ships run on “bunker fuel,” the dirtiest, countries. Under the program, shippers in the
2011
11
GREEN BUILDINGS: A FOUNDATION FOR GROWTH
Green building remains a bright spot in a gloomy economy, according to

GreenBiz’s 2010 Green Building Marketing & Impact Report. The report,
written by GreenerBuildings.com executive editor Rob Watson, one of the
founders of the LEED green building rating system, is an annual assess-
ment of the LEED market as well as the environmental impacts of green
buildings. Among the report’s findings:
Green Construction Remains Strong … for Now: In 2010, the certified

building space (measured in square feet of floor space) nearly equaled the
previous 10 years’ certified floor area combined. In 2010, newly built LEED-
certified floor area exceeded 20 percent of new construction additions.
However, LEED registrations — a leading indicator of green buildings under construction — were
down precipitously at the end of 2010.
The Greening of Facilities Is Growing: In 2010, LEED for Existing Buildings: Operations and
Maintenance, or EBOM, certified almost 50 percent more floor area — over 80 million square
feet — than did LEED for New Construction, growing nearly 80 percent from the previous year.
Cumulatively, since its launch in 2004, LEED for existing buildings has certified nearly the same total
floor area as LEED NC since that standard’s launch in 2000. In spite of this success, LEED EBOM is
less than halfway to where it needs to be to sufficiently contribute to minimizing climate change.
Green Building Yields Strong Environmental Benefits: Watson’s calculations and analysis
found that:
• LEED is having a significant reduction in employee commuting, resulting in a reduction of 1.4

billion vehicle miles traveled, up from 400 million in 2008.
• Water savings from LEED buildings were also up significantly in 2010 — to 33 billion gallons, or
0.5 percent of annual U.S. non-residential water use.
• LEED buildings were found to reduce greenhouse gas emissions by 8 million tons a year from
energy efficiency and the use of renewables.
• Based on average materials costs, green building materials represented approximately $14.5
billion in cumulative spending through 2010.
• More than 1.5 million employees are currently enjoying improved indoor environments while
working in LEED buildings.
U.S. can offset the carbon footprint of their a biodiesel train that runs on beef byproducts.
packages by paying a small fee that covers the
The government-owned rail company began
cost of the offsets, emissions calculation, and
operating its daily Heartland Flyer traveling
administration.
between Oklahoma City and Forth Worth using
Even railroads seemed to be moving down B20 biodiesel fuel. The fuel, which mixes 80 per-
the right track, environmentally speaking. U.S. cent diesel with 20 percent biofuel, cuts both
rail operator Amtrak may have given the term hydrocarbon and carbon monoxide emissions
“cattle car” a new meaning with the first test of by 10 percent.
2011
12
5. Sustainable Food Becomes a Main Course
It wasn’t very long ago that “sustainable agri- sustainable seafood. Indeed, the tide is turning
culture” was the domain of the natural foods on how some companies are sourcing fish, due
industry, locavores, and other greenies, refer- in large part to years of activist pressure stem-
ring to products aimed at a market niche of con- ming from concern about both depleted fish-
sumers seeking foods they deemed healthy for eries as well as the environmental damage of
their families and the planet. But like so many large-scale fish farming. One target was Trader
This is yet
other things in the green arena, sustainable ag Joe’s, which gave in to a relentless “Traitor another arena in
has gone mainstream. A growing list of big com- Joe’s” campaign by Greenpeace, saying it would which Walmart
panies are making commitments and taking sell seafood only from sustainable sources by seems to be
actions that would have seemed unlikely just a the end of 2012. Greenpeace also played “good playing a key
couple years ago. cop,” praising retailers with sustainable seafood
role.
policies, with Target leading the pack.
This is yet another arena in which Walmart
seems to be playing a key role. In fall 2010, the There was action by both companies and activ-
retailer announced a series of five-year goals ists on integrating sustainability considerations
addressing the food supply chain, from farm into a range of food and beverage products,
to fork. The company set a goal of selling $1 bil- from coffee to cattle. And 2010 also brought
lion in food sourced from 1 million small and signs aplenty that food producers were cooking
medium farms while providing training to 1 mil- up innovations that could reduce their prod-
lion farmers and farm workers in such things as ucts’ impacts — aquaculture environments that
crop selection and sustainable farm practices. mimic nature by raising a variety of ecologically
It also pledged to increase the income of the complementary species, for example.
small and medium farmers it sources from by
Beyond that is a growing awareness of what it
10 to 15 percent and, in the U.S., double its pur-
takes to bring food to market, and the environ-
chase of locally sourced produce to 9 percent
mental implications of the journey a typical meal
by 2015. Finally, because an estimated 30 to
travels. Of course, “food miles” and “locavores”
40 percent of the food grown around the world
are hardly new concepts — and the growth of
never reaches a table, Walmart also set goals to
farmers’ markets is an old, albeit positive, story.
reduce food waste in the supply chain.
But the conversation has gotten more sophis-
Walmart was hardly alone among big compa- ticated as experts recognize that distance
nies. Unilever launched a Cool Farm Tool to traveled isn’t the only metric worth consider-
help suppliers measure the greenhouse gas ing; sometimes, what’s local isn’t what’s most
emissions of agriculture practices, and help sustainable.
farmers decrease their carbon footprint with
Nonetheless, when one totals the miles in a rela-
“what-if” scenarios. The U.K. consultancy Two
tively simple meal, the results can provide food
Tomorrows ranked Unilever first in the food
for thought. Students at California College of
and beverage sector — ahead of Nestlé, Danone,
the Arts took on an assignment to map the local
Pepsico, and Coca-Cola — in sustainability
“tacoshed” — the distance traveled of every
leadership, citing their work in founding the
ingredient in that common Mexican dish — and
Marine Stewardship Council and Roundtable
found that for a single, humble taco, the ingre-
on Sustainable Palm Oil, and as one of the early
dients had traversed a total of 64,000 miles, or
supporters of fair trade and nutritional labeling.
just over two and a half times the circumference
Another pool of growing activity is focusing on of the Earth. ¡Ay caramba!
2011
13
Sustainability Becomes a Profession
There’s been a lot of talk about green jobs — what they are and their impact
on the economy. But less attention has been paid to the rising number of
chief sustainability officers and their impact on their companies. As the
number of senior executives overseeing environmental and corporate
responsibility strategy increases, we decided to find out how much they
made, where they worked, and how they got the job.
During the summer of 2010, we surveyed 535 members of our GreenBiz Intelligence Panel and
published the first annual GreenBiz Salary Survey. As a proxy for how important the role is within
corporations, we asked our panel members to identify the highest-ranking executive whose job is
100 percent focused on the company’s sustainability efforts. While there may be limited staff dedi-
cated to sustainability efforts on a full-time basis (54 percent of respondents had 1 to 5 full-time
employees dedicated to sustainability efforts), the individuals leading these efforts are relatively
high-ranking executives: 36 percent were at the vice president level and another 36 percent at the
director level.
Experience and education are critical to securing the top job. Sustainability executives at large com-
panies are well educated, with 65 percent of VPs, 57 percent of directors, and 58 percent of manag-
ers holding a master’s degree. Managers with a master’s degree earned almost 20 percent more
than their counterparts holding only a bachelor’s degree. More than 90 percent of vice presidents
have at least 16 years of experience, making deep and broad experience a minimum requirement for
those jobs.
In terms of gender, sustainability roles mirror other corporate executive positions, as men comprise
60 percent of sustainability executives in large companies. The disparity is greater for staff posi-
tions, where women comprise 63 percent of the sustainability staff in large companies.
While salary is one component of compensation, 67 percent of vice presidents reported receiv-
ing more than 20 percent of their salary in bonus compensation, as did 36 percent of directors.
Seventy-one percent of VPs and 63 percent of directors reported receiving stock or options grants.
At last, companies are rewarding sustainability professionals for a job well done.
Average Salary for Salary

Average sustainability executives
for Sustainability Executives
Vice President $192,064
Director $160,320
Manager $103,197
Source: GreenBiz Group

2011
14
6. Metrics and Standards Become the Rule
The paradox about sustainable business, say their products. Meanwhile, Nike created a one-
some, is that there are too many standards screen Environmental Apparel Design Tool, in
and not enough metrics. There’s truth to that, which designers plug in what materials they’re
though it’s misleading. For all of the hundreds of using, how much recycled or organic content
eco-labels and certifications, there remain huge they have, and other details. The tool gives the
gaps — product categories where there are few design an environmental score. Nike made the
The paradox
or no labels or certifications, from cars to cloth- tool available for other companies to use. And about
ing to cosmetics. Timberland announced that its Green Index, sustainable
which rates the environmental footprint of business is that
Many of the existing standards and certifica-
about one in seven pairs of shoes it sells, will be there are too
tions are limited in scope, focusing on, say,
applied to all of its footwear by the end of 2012.
energy consumption or greenhouse gas emis- many standards
sions, but not necessarily on any of several Such efforts reflect the growing requests — or, and not enough
other impacts a given product may impose on in some cases, demands — from customers
metrics.
the environment. and stakeholders for manufacturers to mea-
sure, manage, and track the full impacts of their
A number of organizations are stepping in to fill
products and processes. That’s given new life
the gaps. Underwriters Laboratories is one exam-
to the world of lifecycle assessments, whether
ple: Its UL Environment division began issuing a
through the use of formal LCAs or less-formal
range of standards in 2010, such as one for cell
(though not necessarily less accurate) lifecycle
phones that takes into account their entire life-
measurement techniques.
cycle, from raw material extraction to customer
use to disposal. (UL Environment is also part- One form of product assessment, called an
nering with GreenBiz to create a company-level Environmental Product Declaration, or EPD, is
sustainability standard, ULE 880, intended for gaining favor. EPDs are structured and detailed
manufacturing firms.) Green Seal expanded its documents disclosing the lifecycle impacts of
scope with a new pilot standard that seeks to products. Modular carpet maker Interface said
certify the sustainability of an entire company. it would complete EPDs for all of its products
The group’s new GS-C1 certification is aimed at by 2012 and challenged other companies to
consumer goods manufacturers. set similar goals. UL Environment said it would
launch an EPD program in 2011 as a means to
Some standards are coming from companies
provide greater product transparency.
themselves. UPS launched a green standard for
responsible packaging, which allows customers The use of EPDs and LCAs is likely to grow in
to ship their goods with a label attesting to that lockstep with the introduction of software tools
fact. Its Eco Responsible Packaging Program and databases designed to help companies
evaluates a customer’s shipment packaging conduct such assessments. Those tools are just
in three key areas — damage prevention, right- emerging. Seventh Generation, Walmart, and
sizing and packaging materials. The goal is to Tetra Pak are among companies that said they
use the least packaging that offers the greatest would test-drive something called Earthster
protection. A group of apparel and footwear 2 Turbo, an LCA tool with a companion open-
companies, including Levi’s, Patagonia, and source database. It aims to give companies
Timberland, banded together to launch the greater knowledge of their supply chains in order
Eco Index, a set of guidelines, indicators, and to make smarter, more sustainable design deci-
metrics for measuring the lifecycle impacts of sions. Earthster is just one of a growing toolkit of
2011
15
a sustainability standard for business
During 2010, GreenBiz Group, in partnership with UL Environment, unveiled a company-level sus-
tainability standard, ULE 880 — Sustainability for Manufacturing Organizations. A draft of the stan-
dard — which covers a company’s policies and performance in environment, workforce, governance,
customers and suppliers, and communities and human rights — was published in mid-2010. A public
review period yielded more than 1,500 comments, which was followed by a two-day stakeholder
meeting and the subsequent issue, in January 2011, of an interim standard, which will be piloted by
several companies during 2011.
The standard is intended to enable procurement officials, customers, trading partners, investors,
and employees to consider company environmental and social performance in decision-making,
thereby elevating the importance of these issues to organizations.
For more information, visit www.greenbiz.com/ratings.
software products being marketed to help com- reports has continued to increase despite
panies track not just their products, but their the global economic recession, and that such
entire operations. Several carbon accounting reports have “become critical to a company’s
software products were on view at SAP’s 2010 credibility, transparency, and endurance.”
annual user conference, among the many soft-
Among the global organizations pushing sus-
ware firms, large and small, eyeing the market
tainability reporting is the Organization for
for sustainability tools — a market that’s grown
Economic Co-operation and Development,
to north of a half-billion dollars a year.
or OECD, a forum for industrialized nations.
And with new rules from the U.S. Securities and During 2010, the OECD teamed with the Global
Exchange Commission, and increasing pressure Reporting Initiative to bring “increased coher-
from other regulators, investors, and custom- ence and consistency” to sustainability report-
ers, GHG accounting has become an expected ing by big corporations. GRI’s Sustainability
practice for large companies, leading to a bevy Reporting Framework is the world’s most widely
of new software tools. used sustainability reporting mechanism.
The state of the art of sustainability measure- GRI, for its part, is one of several global organiza-
ment and accounting is still relatively nascent, tions pushing to marry sustainability reporting
but should grow as demand accelerates overall with financial reporting. The idea is that sustain-
for corporate sustainability (or corporate social ability metrics be standardized and integrated
responsibility) reporting. Reporting by compa- into the financial reports required of all publicly
nies of their environmental (and social) impacts held companies and, presumably, those volun-
continues to grow modestly, though there are tarily produced by non-public companies.
forces that could shift the landscape.
The notion of such an integrated annual report
One force for change is the increasing demands is the ultimate goal for reporting advocates, as
for transparency put on corporations by stake- it would embody the triple bottom line of social,
holders and shareholders. This isn’t a new phe- environmental, and economic performance.
nomenon, but it is a persistent one, pressure that Such reports will be forthcoming within a few
over time takes its toll on reluctant companies. years from a handful of leadership companies,
Accounting giant PricewaterhouseCoopers though it could take a decade or more before
reported that the number of sustainability integrated reporting becomes mainstream.
2011
16
7. Toxic Concerns Spur Greener Alternatives
Revelations of toxic ingredients in consumer Environmental Protection Agency was seeking

goods reached a crescendo during 2010, ele- public comment on a petition to ban triclosan
vating the topic on the agendas of companies, for some uses. Colgate-Palmolive said it would
activists, and regulators alike. Toxics, endocrine move away from the ingredient, as did Staples,
disruptors, carcinogens, and other chemical the office retail giant, which said that it would
evils seemed to be showing up everywhere: baby consider banning the ingredient from soaps and
Green chemistry
bottles, fast-food toys, celebrity-branded jew- hand sanitizers sold in its stores. has been around
elry, mattresses, wallpaper and flooring, food for well over a
All of these activities and other forces shined a
packaging, even cash register receipts. decade, though
bright light on the already growing field of green
Heavy scrutiny focused on bisphenol A, or BPA, chemistry, a nascent movement that seeks to it is only recently
the primary component in a plastic used in the transform the way products are made, reduc- hitting its stride.
resin lining of food and beverage cans. In ani- ing or eliminating the unknown and potentially
mal studies, BPA exposure has been linked to harmful substances commonly used in manu-
everything from cancer and diabetes to repro- facturing. Green chemistry has been around for
ductive abnormalities and changes in brain well over a decade, though it is only recently hit-
development. ting its stride as mainstream chemical compa-
nies invest in new, more benign ways to arrange
BPA came under fire during 2010, the result of
molecules that perform the everyday miracles
scores of media reports that seemed to build
of our modern age.
on one another. BPA was found to be present
in 91 percent of the Canadian population, par- Example: BASF and Dow Chemical developed a
ticularly in teens aged 12 to 19, according to one new way to make propylene oxide, which has a
study. It was found in organic canned foods worldwide demand of 14 billion pounds and is a
produced by leading companies like General chemical building block for many industrial and
Mills. The fact that BPA had earlier been found commercial products. The new method elimi-
in a popular brand of stainless steel water bot- nates hazardous effluents, creates up to 80 per-
tles used by green-minded consumers became cent less wastewater and uses 35 percent less
a cause célèbre for Oprah, Ellen, Martha, and energy. Perhaps best of all, production facilities
other talk-show hosts with large viewerships of using the new process are 25 percent cheaper
anxious moms. Politicians in Europe and North to build since they don’t need collection and
America rattled their regulatory sabers, banning purification equipment.
— or threatening to ban — BPA from products.
As BASF and Dow showed, the economics of
Companies like Heinz and ConAgra led a run for
green chemistry are becoming favorable. And
the exits, banning BPA from their packaging.
as larger firms begin to press chemical manu-
It wasn’t just BPA. Another toxin in the news was facturers to squeeze out problematic ingredi-
triclosan, an antibacterial and antifungal agent ents, the volumes are reaching a scale that will
found in many consumer products. Laboratory increasingly make more green alternatives cost-
studies on animals have linked triclosan to competitive. For example, Aveda leveraged the
changes in hormone regulation, though there scale of its parent company, Estée Lauder, when
was no clear-cut evidence of its impact on it asked suppliers of ethoxylated surfactants
humans. Nonetheless, activists pressed U.S. to make modifications to align with Aveda’s
regulators to ban the ingredient from soaps green chemistry efforts. The surfactants are
and other products. By year end, the U.S. widely used in cosmetics as foaming agents,
2011
17
WHY GREEN MARKETING CONTINUES TO CONFOUND
During 2010, the U.S. Federal Trade Commission issued a long-awaited update to its “Green
Guidelines,” which guides companies on what they can and can’t say about products they are pro-
moting as environmentally responsible. The guidelines were originally issued in the 1990s and hadn’t
been updated for more than a decade.
The proposed changes weren’t exactly earth-shattering, adding guidance on such matters as bio-
based materials, products made with renewable energy, and those claiming carbon offsets.
Like their predecessors, the guides represent a low bar, intended to eliminate outright misrepre-
sentation and fabrications. And they don’t address some of the more potent claims a company can
make about its product or packaging. Cradle to Cradle — a standard that certifies products whose
ingredients can be recycled back into nature or industrial processes — is not mentioned. Biomimicry
— products inspired by nature that use less energy and whose designs or materials mimic plants,
bugs, sea life, and other critters — you won’t find guidance for that. Green chemistry — the next-gen
substitutes for some of the world’s most toxic chemicals? It’s nowhere to be found.
There’s no guidance on the word “sustainable” or “sustainably.” Or “green.”
In the end, the FTC guidelines address only a tiny fraction of what companies are doing — the overt,
relatively minor improvements companies make to their products and processes. As such, green
marketing will continue to be a niche activity, as companies continue to pursue their most significant
environmental actions quietly, with precious little fanfare.
emulsifiers and humectants, but their manufac- only a few hundred of them, and take action on
turing process creates carcinogenic by-prod- fewer still.
ucts. Leveraging both companies’ purchasing
Perhaps more significant was an EPA pro-
power allowed them to reduce costs.
nouncement that could lift the veil of secrecy
Perhaps the biggest driver of green chemistry is surrounding chemicals in products. The rule,
legislation. Increasingly, regulators around the handed down early last year, says that compa-
world are eyeing the health and environmental nies that submit information on chemicals that
impacts of BPA, triclosan, and other problem- pose substantial risks to humans and the envi-
atic ingredients. In the E.U. and the U.S., and ronment will not be able to claim that the identi-
especially in the trendsetting state of California, ties of the chemicals are confidential business
policy makers have trained their sights on drasti- information. One study showed that companies
cally reducing public exposure to toxics. had been able to claim confidentiality on some
17,000 registered chemicals.
The regulators at the U.S. EPA appears to have
awoken from a long slumber to take a proac- And in California, a debate stewed throughout
tive role in chemical regulation. During 2010, the year, as yet unresolved, over the fate of a
the agency said it was adding 700 chemicals to Green Chemistry Initiative. Among other pro-
the list of those being put through its ToxCast visions, it would require companies that manu-
screening system, which subjects chemicals facture anything deemed a chemical of concern
to 500 quick tests. But that’s still a drop in the to perform an assessment of alternatives. The
bucket: More than 84,000 chemicals are regis- hope is that shining a spotlight on non-toxic
tered in the United States, and due to current options will leave companies with fewer reasons
laws, the EPA has been able to order tests on to continue with toxic business as usual.
2011
18
8. Water Footprinting Makes a Splash
Water has been rising as a sustainability issue. water embedded in products. For example, a
In past reports, we’ve referred to it as “the water footprint conducted by one of Coca-
new carbon” due to its parallels to companies’ Cola’s European operations found that it takes
efforts with their greenhouse gas footprint: 70 liters of water to make one liter of the com-
understanding and measuring it, reducing it, pany’s flagship cola, at least when producing
even offsetting it to the point of being “neutral.” it in the Netherlands using Dutch sugar beets.
Business
Companies in water-intensive industries, such The measurement segregated water types into headlines about
as beverages, semiconductors, electric power, three types of consumption: “green” (stored water these
and chemicals, have been increasingly address- rainwater used by farms to produce raw materi- days almost
ing their impacts over the past several years. But als), “blue” (water from rivers, lakes, and aquifers always contain
now attention has trickled down to a broader used in factories and processors to manufac-
the word “risk.”
array of companies, as the tide of attention ture products and grow crops), and “grey” (fresh
reaches a new high-water mark. water that absorbs pollutants from agriculture
and manufacturing).
Business headlines about water these days
almost always contain the word “risk.” “Why If all this sounds complex, it is. Water’s compari-
Water Is A Risk And Opportunity Your Company son to carbon notwithstanding, accounting for
Can’t Ignore,” “Growing Water Scarcity And the former can be more complicated than it is
Its ‘Hidden’ Risks To Investors,” and “The for the latter. For one thing, the amount of water
Consequences of Ignoring Water Risks in the used to produce something can vary widely,
U.S.” are just three of several such headlines depending on where and how it’s produced.
GreenBiz.com ran during 2010. These stories A given item can also consume all three types
stem from the growing understanding of how of water. Example: a kilogram of sugar beets
global water issues will likely affect company sourced in Europe has, on average, a green water
operations in the coming years, as droughts, footprint of 375 liters, a blue water footprint of
floods, climate shifts, growing populations, 54 liters and a grey water footprint of 128 liters.
increasing consumption, and other factors
Despite the complexity, companies are finding
cause manufacturing perturbations, disrupt
that conducting a water footprint analysis can
markets, displace customers, lead to energy
help them seek opportunities for efficiency and
shortages, and otherwise wreak havoc on pro-
optimization. It can also lead to innovation. Levi
ductivity and profits. All of which places water
Strauss & Co. found a way to reduce the water
security squarely in the boardroom, where it is
consumed to make a pair of jeans by up to 96
becoming a strategic issue.
percent, reducing water use by 16 million liters in
For boards, the first order of business is inevita- a typical season. True, manufacturing accounts
bly getting one’s arms around the nature of the for only about 4 percent of the 1,000-gallon
risks. That means conducting a water footprint footprint of a pair of Levi’s jeans — 94 percent
analysis, a means of understanding how much of it comes from growing cotton and consumer
and what kinds of water are used in the making laundering of the jeans — but it is that 4 percent
of products and running a business, including that Levis pays for directly.
the water used by suppliers as well as custom-
Water footprinting is an emerging discipline, and
ers — upstream and downstream, as it were.
companies are often left to create their own
Among other things, such analyses can yield rules. Kimberly-Clark, which makes bath tis-
some surprising results about the amount of sue, debated whether to include in its water
2011
19
WILL ASIA OUT-GREEN AMERICA?
A great deal of ink and electrons have been spilled by publications and websites ringing the alarm
about China’s growing dominance over clean technology. Indeed, that country is becoming the
low-cost producer of a range of green innovations, from solar cells and wind turbines to batteries
for electric vehicles. In that regard, there is genuine concern within U.S. borders about whether
these technologies — many of them invented and perfected in America — will join the ranks of other
technologies lost to other countries.
China shouldn’t be the only concern. During 2010, a spate of Asian companies made bold gestures
toward a green future. The Korean industrial company LG announced it would spend nearly $18 bil-
lion over the next 10 years cutting its carbon footprint 40 percent and developing greener products.
It was just one of several Asian manufacturers to make significant commitments last year to clean
technology and greener products:
• Panasonic unveiled a three-year plan called “Green Transformation 2012,” which it said will
lay the groundwork for it to become the world’s leading “Green Innovation Company” by 2018,
Panasonic’s 100th anniversary.
• Hitachi, which reached its century milestone in 2010, said it would put environmental innova-
tions at the core of the company’s operations for the next 100 years.
• Samsung said it spent $865 million during 2009 to develop greener products and make its
manufacturing sites more efficient as part of a multi-pronged effort to become one of the
world’s most environmentally friendly companies.
• NEC Corp., Japan’s largest PC maker, unveiled plans to invest $1.1 billion over eight years in
battery and smart grid technologies.
The impact of these efforts won’t be known for years, but collectively, they made it loud and clear
that Asian firms view green and clean innovations as their path forward to growth — and, perhaps, to
long-lost profitability.
footprint the water used to flush a toilet, which CDP Water Disclosure, an initiative seeking to
represented 85 percent of the tissue’s water increase reporting on water-related risks and
impact. The company found that the amount of opportunities, especially by companies oper-
water a toilet uses can affect whether and how ating in water-intensive sectors. During 2010, it
its tissue goes down the drain. So the company received its initial responses from companies.
began giving away free Smart Flush bags, which Among the findings: There is a drought of met-
can save one liter of water per flush — up to rics used by companies to measure and track
2,000 gallons a year for a family of four. their water use.
All of this represents the next wave of how com- That’s bound to change, and quickly, as water’s
panies must think about water. Growing pres- importance to the bottom line becomes more
sures to disclose water footprints — much as widely understood — and experienced — and
companies have done with their carbon foot- as new tools become available from a variety
print — will lead many companies to dive in. In late of entities, and as more companies begin to go
2009, the Carbon Disclosure Project launched with the flow.
2011
20
9. Companies Learn to Close the Loop
The promise of a closed-loop society — where pencil cases, and portable speakers. Five U.S.
everything is recycled endlessly into new prod- Walmart stores began testing a collection sys-
ucts and packaging — remains a distant dream, tem for 28 types of trash to send to TerraCycle.
though it creeps ever closer. Companies are Walmart also launched a partnership with a firm
finding new and innovative ways to turn old called Worldwise, in which the retailer will sell
things into new things. It’s far from the Holy Grail pet products made from recycled materials —
Starbucks has
of Cradle to Cradle — in which every material is dog beds made from used plastic soda bottles, put plenty of
recycled back to a raw material or into a benign cat scratchers made from recycled hangers, lit- time and effort
or beneficial soil amendment — but it’s a start. ter liners made from old paper bags, and the like. into promoting
Sometimes, a little recycling becomes a step- There are others. Hasbro, maker of G.I. Joe, recycling of its
ping-stone to a bigger achievement. For exam- Transformers, and other iconic toys and games, cups, but only a
ple, Starbucks announced it had completed said it would increase the recycled content of small fraction of
a test toward a longstanding goal: turning used its packaging and paper materials to 75 per-
the four billion
coffee cups into new cups. The coffee giant said cent in 2011. Massachusetts-based Recycline
cups it produces
it wants to provide only recyclable or reusable said it collected 50 tons of used polypropyl-
cups by 2015, and has run various recycling proj- ene plastic in 2010 though its Gimme 5 recy- a year are kept
ects to see what its cups can be turned into. Its cling program (polypropylene is marked as No. out of landfills.
pilot project sent about 8,000 pounds of cups 5 in the plastics coding system), turning it into
to a company that provides the post-consumer toothbrushes and other goods. The company
content that’s been in Starbucks’ cups since makes razors, plates, mixing bowls, and more
2006. The pulp processor sends the pulp to out of 100 percent recycled polypropylene,
various companies that make Starbucks’ cups. which is rarely accepted in recycling programs.
All of the companies’ cups, including the newest Pepsi-owned Naked Juice said it is making good
ones, have 10 percent recycled content. on its plan to convert all of its bottles to recy-
cled content. Last year, it began transitioning
Starbucks has put plenty of time and effort
its juices and smoothie bottles to 100 percent
into promoting recycling of its cups. It hosted
post-consumer recycled content.
two “cup summits” to bring together all of the
relevant paper and recycling players. It also True, some of these efforts may seem under-
sponsored a contest seeking ways to reduce whelming, given the 300 million or so tons of
the number of non-recyclable cups leaving its trash that comprise the municipal solid waste
stores, which resulted in several submissions stream in the U.S. each year. But each must
for how to encourage customers to opt for reus- break through barriers to succeed, not the least
able cups. For all this, Starbucks still has a ways of which is the lack of an infrastructure to recy-
to go: Only a small fraction of the four billion cle many types of packaging and product waste.
cups it produces a year are kept out of landfills.
In truth, many of these efforts aren’t really
Walmart threw its hat into the loop, too, in the closed-loop. They involve increasing recycled
form of a pilot project with TerraCycle, the content in products or “upcycling” waste into
maverick manufacturer of consumer prod- new products or packaging. Such cycles are
ucts made from branded waste packaging. finite — perhaps amounting to just one addi-
TerraCycle converts waste like candy wrappers, tional use for a given item — and eventually, most
yogurt tubs, pens, and coffee bags into prod- will end up in landfills. That they get a second life
ucts such as tote bags, plant pots, backpacks, is laudable — though it only delays the inevitable.
2011
21
10. Bioplastics Become Material
For years, the search for alternatives to petro- heat-resistant and molds in half the time as bio-
leum-based plastics has led researchers down plastic made from polylactic acid resin, which is
a variety of paths, many of which turned out to typically derived from corn starch or sugarcane.
be dead ends. Henry Ford, the automaker and
Organic yogurt maker Stonyfield Farm began
showman, produced a prototype plastic car
switching its multi-packs to corn-based bio- Suddenly,
made from soybeans in 1941, but plastic from
plastic and will fund the planting of enough bioplastics
plants wilted as plastic from oil gained favor as
non-genetically modified corn crops to equal
a substitute for scarce steel during World War II. made from
the amount of corn used in the new packaging.
Since the 1970s, as concern over plastic’s envi- (About 85 percent of U.S.-grown corn is geneti- plants and
ronmental impacts grew in lockstep with the cally modified.) The company was able to off- agricultural
growth of plastic itself, a steady parade of inno- set the extra costs of the bioplastic packaging materials are
vators in both large and small companies have because it is stronger than the oil-based plastic sprouting like —
tried to create more environmentally benign it replaces, and offers some other performance
well, weeds.
alternatives. Few succeeded, failing to meet the characteristics. For example, it reduces break-
demanding price and performance specifica- age during shipping and forms a tighter seal
tions of today’s manufacturers. Now suddenly, with the lid. The plastic is stronger than polysty-
bioplastics made from plants and agricultural rene, so less is needed, making packages lighter.
materials are sprouting like — well, weeds. Because of PLA’s higher efficiencies and lower
losses, the shift to plant-based plastics was
Introductions of bioplastic materials and prod-
done at no net cost increase to Stonyfield.
ucts reached a crescendo during 2010, as more
mainstream companies introduced bioplastics Ford said it was using foam derived from soy
from a dizzying array of commodities. Beverage instead of petroleum and would expand the
maker Odwalla, a Coca-Cola subsidiary, said use of bio-based foams through nearly all of its
it was switching all of its single-serve drinks to vehicle lineup with an eye toward one day using
bottles made almost entirely of plastic derived compostable plastics. British snack company
from molasses and sugarcane juice. (In 2009, Walkers said it was looking into transforming
Coke announced it would begin phasing in a potato peelings into crisp (chip) packets.
similar bioplastic bottle for its flagship cola.)
Two Texas companies teamed up to turn some
Procter & Gamble is bringing sugarcane to of the 50 million coconuts that fall from trees
shampoo and makeup with new packaging that each year into reusable packaging. Whole Tree
will be on shelves next year. The company will has been researching uses for coconut husks
start using sugarcane-based plastic packag- for about two years, partnering with packaging
ing for certain products from its Pantene Pro- firm Compadre to design and test different uses
V, Covergirl, and Max Factor brands, made with for coconut-based materials.
ethanol derived from Brazilian sugarcane.
And then there’s the packaging material made of
Sugarcane is just the start. Electronics com- mushroom roots and agricultural waste from a
pany NEC said it developed a bioplastic made startup called Ecovative Design. It makes pack-
with an extract from non-edible cashew nut aging by growing mushroom fibers on wastes like
shells and plant cellulose that is twice as strong cottonseed, wood fiber, and buckwheat hulls. Its
as another bioplastic typically made from corn EcoCradle technology already consumes one-
starch. The company says its material is not tenth the energy used to manufacture foam
just doubly strong, but also more than twice as packaging, but a new version, made with a blend
2011
22
of cinnamon bark oil, thyme oil, oregano oil, and overall, though one study found that most facili-
lemongrass oil, lowers its energy needs to just ties accept compostable packaging.
1/40th of foam’s. The company’s packaging is
Those problems aside, innovative packaging
being used by some big companies, including
of any kind can occasionally have downsides,
office furniture maker Steelcase, which last year
and that’s equally true of bioplastic packaging.
began shipping products packed in EcoCradle. Bringing
Consider the fate of SunChips, the snack food
Bringing bioplastics to scale in the marketplace made by Pepsico subsidiary Frito-Lay. In 2010, bioplastics to
will take more than innovators playing with it introduced a long-anticipated package made scale in the
coconuts and mushrooms. It will also require from a corn-based polymer. marketplace
thinking through the “end of life” scenarios so
So far, so good. But the bag turned out to be noisy will take more
that bioplastics can either be integrated into
— so noisy, in fact, that it engendered consumer than innovators
existing plastics recycling or sent to municipal
complaints. (It also became a social media phe- playing with
composting facilities.At present, bioplastics
nomenon, with a Facebook group called SORRY
can contaminate conventional plastics sent to coconuts and
BUT I CAN’T HEAR YOU OVER THIS SUN CHIPS
recycling, and the low volume of bioplastics in
BAG garnering more than 50,000 fans.) Frito-
mushrooms.
use does not give recyclers much incentive to
Lay ended up sacking the clamorous chip bag.
invest in new technologies for identifying and
separating bioplastics. Meanwhile, the com- Consumers, it seems, want their packaging
posting infrastructure is nascent in the U.S. green — soft green.
2011
23
THE GREENBIZ INDEX
This fourth annual edition of the GreenBiz Index continues our quest to
measure and assess a representative basket of indicators that tell us,
in aggregate, the progress U.S. companies are (or aren’t) making in 20
aspects of environmental performance — from operational efficiency to
employee commuting to investments in clean technologies.
As always, we had some indicators shift this year — some In a few cases, indicators are measured differently this
fell off and new ones were added. This year we changed year than last, though the change is consistent — that is,
our Carbon Intensity metric to measure the greenhouse we’ve “backcast” the methodology to ensure we com-
gas emissions caused specifically by energy use; added pared data the same way from one year to the next.
a new metric on the growth of organic agriculture in the
For each of the 20 indicators, we’ve attempted to go
U.S.; and another new metric looking at corporate trans-
beyond the numbers to provide context, explaining why
parency, developed by Trucost, the research firm that
the numbers did what they did, their historical underpin-
helped us develop our Environmental Financial Impacts
nings, and their likely short-term forecast. That context
indicator. Those new data sets replace Greenhouse Gas
is particularly important in the current economy, where
Commitments, which was folded into Carbon Intensity,
the recession and the stimulus have roiled some of the
and Water Intensity, which continues to be a challenge,
indicators, in both positive and negative ways.
with industry-specific, consistently compiled, year-
over-year data as elusive as a desert mirage. In aggregate, the GreenBiz Index paints a portrait of
a green economy — or at least a greener one — that
This continuous evolution illustrates the challenges any
is emerging, ever so slowly. The story it tells is one of
researcher faces when trying to gather reliable and com-
incremental change — too incremental, in many cases,
parable data on corporate sustainability. Data gathering
to result in meaningful progress in reducing the envi-
and reporting by government comes and goes, due to
ronmental impacts of business at the scale and speed
funding, shifting politics, organizational shuffles, and
needed to address some of the more serious problems.
other reasons. (At least one of the key data sets we’ve
relied upon in past years was delayed by several months, We’ve summarized each data set via one of three icons,
well past our publication date, requiring us to scramble stating whether we are making progress (“swimming”),
to find other sources.) Similarly, research firms, nonprof- standing still (“treading”), or falling behind (“sinking”).
its, and trade associations that collected information a
certain way for years may stop doing so or may change
their methodologies or frequency of publication, lead-
ing us to search for reliable, alternative data sources. SWIM TREAD SINK
2011
THE GREENBIZ INDEX: SUMMARY 24
Swim
Tread
Indicator What We Measured What We Found Sink
Carbon Intensity Emissions of energy-related Emissions rise slightly
carbon dioxide per unit of after years of decline
GDP
Carbon Transparency S&P 500 companies U.S. response rates rise,

responding to Carbon but lag global peers
Disclosure Project
Cleantech Venture capital investments Opportunities in

Investments in clean technology solar, EVs help charge
investor interest
Clean-Energy Patents Patents issued by U.S. Patent A surge of innovations

Office
Corporate Reporting Number of reports from S&P Up slightly, but most

500 companies companies still avoiding
disclosure
Employee Commuting Number of workers driving Even in tough times,

solo, carpooling or using commuters are stuck
mass transit behind the wheel
Employee Number of U.S. Slightly more

Telecommuting telecommuter households employees staying
home and logging in
Energy Efficiency Energy use per unit of GDP Both buildings and
people get smarter
about energy use
Environmental Environmental damage costs Costs of company

Financial Impacts as a percentage of economic environmental damage
output increase slightly
E-Waste Percentage of recovered Mountains of waste

equipment growing faster than
recyclers can handle
SWIM TREAD SINK

2011
25
Swim
Tread
Indicator What We Measured What We Found Sink
Fleet Impacts Estimated annual Changes in fleet
greenhouse gas emissions management just getting
per vehicle into gear
Green IT Products certified under Micro electronics make

Energy Star and EPEAT macro improvement
Green Office Space LEED-certified commercial Remains bright light in

building space construction world even
during recession
Green Power Use Renewable energy as a Generation up, but lack

percentage of all electricity of policy puts damper on
generation growth
Organic Agriculture Acreage of U.S. agriculture Organics take root, but

certified organic still are a small bite of the
pie
Packaging Materials used per unit of Manufacturers take

Intensity GDP the wraps off green
innovations
Paper Use and Paper use and recycling per Paper use continues to
Recycling unit of GDP drop while recycling rises
Toxic Emissions Toxic releases per unit of Emissions still falling, but
GDP not enough to make a
dent
Toxics in Emissions per year of 27 Piecemeal gains as green

Manufacturing bioaccumulative and toxic chemists seek the right
chemicals formula
Transparency How much data companies Incremental growth,

disclose on environmental but far from radical
impacts transparency
SWIM TREAD SINK

2011
CARBON INTENSITY
26
progress is going in the wrong direction
525
Million tons of energy-related CO2 per million dollars of GDP*
500 487.2
U.S. companies have
474.5 a long way to go in
475
456.1 setting meaningful

455.2
targets that will help
450
441.1 move the country
closer to President
421.4 424.5 Obama’s goal of
425
reducing emissions 17
percent below 2005
400
levels by 2020.
375
2004 2005 2006 2007 2008 2009 2010
Source: U.S. Energy Information Administration
Last year began and ended without compre- cold weather in the Southeast. When normal-
hensive climate change legislation passing the ized to gross national product, energy-CO2
Senate, and with the shift in political winds fol- intensity inched up in 2010, following years of
lowing the midterm elections, there’s a high like- decline since at least 2003.
lihood 2011 will end without a climate law, too.
Companies from industries across the spec-
In spite of the uncertain policy environment, trum aren’t waiting for congressional action to
carbon dioxide (CO2) emissions have declined in set goals for reducing emissions. The bottom-
recent years, largely due to the economic reces- line benefits to carbon reduction are increas-
sion. Even with the economy on the upswing, the ingly hard to ignore, making carbon a remarkably
U.S. Energy Information Administration doesn’t accurate proxy for efficiency and a powerful
believe CO2 from energy — which accounts lens through which companies can uncover sav-
for more than 80 percent of all greenhouse ings and improvements.
gas emissions — will return to 2005 levels until
Toward that end, a growing number of com-
around 2027.
panies are setting greenhouse gas emissions
We are turning our attention this year to energy- reduction targets. When we examined compa-
related CO2, rather than total U.S. greenhouse nies on Standard & Poor’s 500 Index, we found
gas emissions, because of a lag in the release of that 54 percent responding to the Carbon
EIA data. The agency predicts energy-CO2 rose Disclosure Project reported emissions reduc-
3.8 percent in 2010 and blames it on a warm tion targets, a slight uptick from 2009. Moreover,
summer in the Rocky Mountains and unusually our own informal survey of the nation’s 20
*All GDP data in this report are from the U.S. Department of Commerce’s Bureau of Economic Analysis and
are stated in 2005 chained dollars.
2011
27
largest companies by revenue revealed that at 2005 levels by 2020. This would require a 1.05
least 15 had greenhouse gas emissions reduc- percent average annual absolute reduction
tion targets in place or under development. rate; instead, emissions of S&P 100 companies
These targets varied widely but some common are growing at a rate of 0.36 percent a year, “cre-
traits emerged. The year 2012 was the most fre- ating a Carbon Chasm between current emis-
quently used target for commitments, while the sions trends and required cuts,” says CDP.
type of targets typically fell into two categories:
The EIA believes 2011 should return to normal
absolute or efficiency/intensity based. (The for-
temperatures, requiring less electricity and
mer committed to a specific reduction in emis-
lower coal consumption. With generation from
sions, while the latter pegged reduction levels
hydropower and other renewables expected
to revenue.) Most involved a reduction target
to swell in 2011, the agency forecasts energy-
range of at least 10 percent, though some were
related CO2 to fall 0.6 percent this year, despite
as high as 50 percent for longer-term goals.
increases in petroleum consumption in the
But with such variation in the type of goals being transportation sector.
pursued, it can be difficult to assess whether
That’s progress, but not enough. Scientists have
these commitments are truly moving the nee-
been telling us for years that emissions need
dle, and by how much.
to fall at least 25 percent below 1990 levels by
Research from the Carbon Disclosure Project 2020 and to 80 percent by 2050 in order to
suggests U.S. companies have a long way to go stem the worst impacts from climate change.
in setting meaningful targets that will help move Based on the incremental improvements we’ve
the country closer to President Obama’s stated seen over the past few years, we’re simply not
goal of reducing emissions 17 percent below going to get there.
S&P 500 Greenhouse gas reduction commitments

S&P 500 Greenhouse Gas Reduction Commitments
60
50
40
30
20
10
2007 2008 2009 2010
Percentage of CDP respondents with reported reduction targets

Percentage of all S&P 500 firms with reported reduction targets
2011
carbon transparency
28
REPORTING RISES IN QUANTITY, BUT NOT QUALITY
Number of S&P 500 companies responding to Carbon Disclosure Project
350
A smaller percentage
332
321 of U.S. firms
have board-level
282 oversight of climate
issues, fewer offer
235
management
incentives to reduce
carbon emissions, and
they are less likely to
view climate change
as a regulatory risk.
2006 2007 2008 2009 2010
Source: Carbon Disclosure Project
The number of the U.S. companies commit- For the first time this year, we’re using data from
ting to climate change disclosure continued the S&P 500 for the Carbon Transparency indi-
its steady climb in 2010, despite a struggling cator — rather than global indices used previ-
economy and legislative gridlock that stymied ously, such as the Global 500 and FT500 — to
all efforts for a comprehensive energy bill. evaluate the speed with which U.S. companies
are disclosing their greenhouse gas emissions
Since its launch 10 years ago, the nonprofit
and the risks they face from climate change. We
Carbon Disclosure Project has kept tabs on how
found that 70 percent of S&P 500 companies
the world’s largest companies are taking action
responded to the CDP’s annual questionnaire in
to address climate change through its annual
2010, up from 66 percent the year before, con-
survey. The questionnaire, which has evolved to
tinuing an upward trend that has played out for
include more pointed and probing questions, is
at least the past five years.
sent on behalf of institutional investors wanting
to know about the climate risks and opportuni- U.S. firms share several traits compared to their
ties lurking in their portfolios. The CDP rates the global peers, according to CDP: A smaller per-
quality of respondents’ disclosures, assigning centage have board-level oversight of climate
a score that is now available alongside compa- issues, fewer offer management incentives to
nies’ traditional financial statistics through such reduce carbon emissions, and they are less
outlets as Bloomberg and Google Finance. likely to view climate change as a regulatory risk.
2011
29
Still, a number of factors are driving the upward as a material risk, or don’t want to deal with the
trend, including a growing awareness of climate hassle or expense.
change, stakeholder pressure, and potential
Interestingly, there are a handful of S&P 500
business opportunities. Although Congress
companies that responded to the CDP or sup-
failed to pass comprehensive climate legisla-
plied information in 2009, but chose not to in
tion, another driver — regulatory activity — does
2010. The pressures to disclose how they’re
continue in some form, such as greenhouse gas
addressing climate change and its potential
regulations under the EPA, the U.S. Securities
business implications, however, will likely out-
and Exchange Commission’s guidance on cli-
weigh the reasons for staying on the sidelines in
mate disclosure for public companies, and the
future years, as more companies lean on suppli-
Obama Administration’s mandate for all federal
ers to increase transparency, and regulation at
agencies to measure and report their emissions.
various levels ramps up.
There is, however, a gap in response rates
As mentioned, maturity in the process will play
between the companies in the S&P 500 and
a key role, not just in the number of companies
those in other regions, although it appears
responding to the CDP, but in their level of dis-
the gap is closing. For example, the Europe
closure. Although U.S. response rates are edging
300 index boasted an 84 percent response
higher, the quality of the responses lags global
rate, while the Global 500 had an 82 percent
peers. The average disclosure score for S&P
response rate, a sign that disclosure is more
500 companies was 58 in 2010, compared to 65
mature in other regions.
for the Global 500 and 69 for the Europe 300.
As for why companies choose not to respond U.S. Carbon Disclosure Leadership Index com-
to the CDP questionnaire, perhaps some don’t panies, comprised of the highest-scoring firms
see climate regulation as having a direct impact in each index, also trailed in 2010 (see graph),
on their operations, don’t view climate change after being on the verge of parity the year before.
Average Carbon Disclosure Leadership Index Scores by Region

Average carbon disclosure leadership index scores, by region 95
90 90
85 85
Europe 300 *
Global 500
80 S&P 500
* Europe 300 data n/a prior to 2009
2008 2009 2010
Source: Carbon Disclosure Project

2011
cleantech investments
30
EVs keep vcs on the move
Venture capital investments in clean technology, in millions
$5,751
The past year saw
an acceleration
in investments in
electric vehicles and
related technology,
$3,982
as car companies got
$3,702
traction, along with the
growing ecosystem of
products and services
$3,212 that support them.
$1,819
2006 2007 2008 2009 2010
Source: Ernst & Young, based on Dow Jones VentureSource
Cleantech is back — not that it ever really left. Behind the numbers are some interesting
trends. The past year saw an acceleration in
Following a recessionary swoon in 2009, invest-
investments in electric vehicles and related
ments in U.S. cleantech companies made a
technology, as car companies gained traction,
comeback during 2010, and all signs for the road
along with the growing ecosystem of prod-
ahead seem favorable.
ucts and services that support them. Some of
According to an analysis from Ernst & Young these were big deals, money-wise. Better Place,
based on Dow Jones VentureSource data, a startup seeking to build a market-based EV
investments in cleantech last year grew 7.6 infrastructure in several countries, received
percent over 2009, to just under $4 billion. $350 million in 2010. Two EV manufacturers,
However, that’s still way down from the 2008 Fisker Automotive and Coda Automotive, pulled
peak of $5.75 billion. in $93 million and $100 million, respectively.
2011
31
Investors shined brightly on solar companies, Still another growing sector is in energy-effi-
too — 2010 investments were up 76 percent ciency technologies, a shift from conventional
over 2009. thinking by venture capitalists that efficiency —
principally service-based businesses — doesn’t
Investments are also shifting toward later-stage
scale the way VCs like. “One segment that
deals — that is, companies’ third, fourth, fifth, or
popped was energy management and efficiency
later rounds of financing, which tend to be big-
services,” notes De Yonge. “It’s not so much the
ger amounts of money aimed at taking a proven
hardware but what can you do with the informa-
concept to scale in the marketplace. That would
tion that’s being generated by the hardware.”
be appropriate for a maturing sector like clean-
tech, where we’ve seen a wave of funded start- One other notable trend in cleantech investing
ups over the past several years. In 2010, 33 per- is the growing importance of corporate inves-
cent of deals were first round, compared to 36 tors — large companies that place sizeable
percent in 2009 and 50 percent in 2008. “On financial bets on emerging companies and tech-
a proportional basis, it’s natural to see a shift in nologies. Seventeen percent of all cleantech
later-stage financing as these companies get investments included a corporate investor last
further along the maturity scale,” says John year, compared to 12 percent of venture invest-
De Yonge, research director, Global Cleantech ments overall. “We’re seeing a lot of corpora-
Center, Ernst & Young LLP. tions interested in figuring out how to play in the
space created by the advent of electric vehicles,
Another area of significant investment is con-
in terms of the infrastructure needs and new
struction — which may seem curious, given the
kinds of relationships with customers,” says De
unsteady state of the building market, but likely
Yonge. These statistics understate the magni-
reflects the growing interest in “smart” building
tude of corporate investments in cleantech.
products and services that optimize resources
They reflect only deals in which a company par-
and improve occupant comfort and security.
ticipated in a venture round of financing. Other
Construction-related investments grew 75.5
deals are done privately, outside the VC arena.
percent in 2010 over the previous year. Similarly,
conservation and monitoring technologies grew Those trends — growing investments by big
a whopping 347 percent year over year — again, companies and continued interest in the EV
related to the growing interest in technologies ecosystem — will continue to dominate in 2011,
that can monitor nearly anything in any environ- as the evolving world of transportation cata-
ment, indoors and out. lyzes a new round of innovation and investment.
Cleantech Investments 2010, by select Category

(millions)
Solar $1,158.89 Fuel Cells $34.33

Power and Efficiency Management $365.28 Recycling $32.25
Biofuels $305.10 Wind $32.25
Energy Efficiency Products $249.73 Hydrogen Electricity $26.16
Batteries $136.94 Water Conservation & Monitoring $10.24
Solar Energy $107.90 Gasification $8.07
Water Treatment Processes $97.55 Waste Management $4.80
Industrial Products $73.98 Air Monitoring $3.07
Natural Gas $38.63 Hydropower $0.95
Source: Ernst & Young, based on Dow Jones VentureSource
2011
clean-ENERGY patents
32
A BATTERY OF HIGH-POWERED INNOVATION
Number of patents filed with the U.S. Patent and Trademark Office
1,882
Clean-energy patents
reached an all-time
1,125
high in 2010, up almost
917 928 170 percent over

884 894 2009, far outpacing
827
technology in general.
2004 2005 2006 2007 2008 2009 2010
Source: Heslin Rothenberg Farley Mesiti P.C.
Patents filed for clean-energy technologies over 2009. “This is the largest year-to-year jump
provide a window into two aspects of the clean since we began tracking clean-energy patents,
economy. They are at once a lagging indicator by more than three times the previous year-to-
(of innovations in energy and energy-related year difference,” says Victor A. Cardona, intellec-
products and services) and a leading indicator tual property law attorney at Heslin Rothenberg
(of potential forthcoming products and ser- Farley Mesiti in Albany, N.Y., which compiles the
vices). As such, we include them here as another data. “This compares to a 31 percent increase
key measure of business activity in the greening generally for all patents from 2009 to 2010 —
of the economy. which was the best showing ever for patents
generally. Clean-energy innovation is clearly far
In 2010, they told a compelling story: Clean-
outpacing technology in general.”
energy patents seemed — well, electrified.
Clean-energy patents reached an all-time high Why is this? Part of it reflects the overall growth
in 2010, up almost 170 percent (757 patents) of clean technologies, and energy technologies
2011
33
in particular. But that’s just the beginning of the the nearest competitor, up almost 160 percent
story. Increasingly, clean-energy technologies (362 patents) relative to 2009. Solar patents
are moving beyond venture-backed start-up followed fuel cells, outshining last year’s second
companies to the R&D labs of major companies. place winner, wind energy, and ending wind’s
four-year run in second place. Solar was up more
And not just traditional energy companies. An
than 230 percent (208 patents) relative to the
ever-increasing number of companies are find-
year before. Wind patents were up 89 patents,
ing their way into the energy business: chemical almost 160 percent over 2009. Hybrid and elec-
companies (which make materials that wind up tric vehicles similarly went into high gear, grow-
in solar panels, fuel cells, and the like), auto- ing 160 percent (63 patents) relative to 2009.
motive companies (which are rapidly moving Tidal patents almost doubled (26 to 40) and
to electric vehicle technologies, which involve biomass/biofuel patents were up 14 patents.
both energy production and storage), agri- Hydroelectric patents were up 630 percent, by
cultural companies (which make fuels from a 16 patents. Geothermal was the only technol-
growing array of crops), information technology ogy that cooled, decreasing activity from 2009
companies (since today’s energy grid is getting — but only by four patents.
“smarter” thanks to chips, switches, routers,
and software), and many others. Each of these All of this bodes well for the cleantech sector, as
brings a wealth of research as well as a sizeable it moves past adolescence into maturity. And it
bodes well for large corporations across a range
appetite for innovations.
of sectors, which will be both the customers of
According to Heslin Rothernberg’s data, there clean-energy innovations as well as the path-
were more patents filed in all but one category ways for commercialization, as clean energy
of energy technology. Fuel cells continue to lead moves out of the lab, and out of small-scale
the other clean energy sectors, almost tripling pilots, and into the mainstream.
Clean energy patents, by type
Hybrid or
Electric Fuel Hydro- Tide or Geo- Biomass/
Wind Solar Vehicle Cell electric Wave thermal Biofuels Other Total*
2002 42 162 144 349 6 9 2 12 9 723
2003 49 156 122 464 5 11 5 24 3 824
2004 72 124 98 551 8 18 8 16 4 885
2005 92 104 101 501 7 11 6 14 3 827
2006 109 95 105 572 8 18 5 13 5 917
2007 133 100 105 517 4 15 4 28 2 894
2008 155 95 86 530 10 34 9 19 9 928
2009 156 155 105 634 3 26 10 49 2 1,125
2010 245 363 168 996 19 40 6 63 17 1,882
* Row totals may be less than the sum of the row because a small number of patents fall into more
than one category
Source: Heslin Rothenberg Farley Mesiti P.C.
2011
corporate reporting
34
beyond compliance, a management tool
Number of reports filed by S&P 500 companies
All Reports
163
GRI-Compliant 230
Overall, U.S. firms are
beginning to hold their
197 own in terms of the
148 number of reports
being produced.
131
97
108 107
81
68
55
45
37
2005 2006 2007 2008 2009 2010
Source: CorporateRegister.com
If sustainability is a journey, as many like to say, that maintains a massive database of corporate
the non-financial corporate report is the vehicle responsibility and sustainability reports dat-
increasingly used by companies to document ing back more than 20 years. Since 2008, it has
the trip. analyzed the S&P 500 to help us measure the
performance of the largest U.S. companies in
A slew of drivers are fueling the rise, such as
the realm of non-financial reporting.
growing stakeholder and investor pressure,
interest from rating agencies, regulatory activity, Beyond the S&P 500, U.S. firms are beginning
and the desire to protect brand and reputations. to catch up in terms of the sheer number of
reports, CorporateRegister.com’s Paul Scott
The Great Recession may have put the squeeze
notes, though it is still fewer reports than are
on bottom lines of companies across the board
produced by companies in the U.K., which has
these past few years, but the number of firms
a much smaller corporate base. U.S. companies
reporting on their social and environmental per-
have historically lagged behind their European
formance continued to grow in 2010. Forty-six
peers, where non-financial reporting has been
percent of companies on the Standard & Poor’s
adopted more quickly, in part due to culture and
500 index published a non-financial report last
regulatory developments. Sweden, Norway, and
year, a near 17 percent increase over 2009.
Denmark, for example, all have introduced man-
This mirrors global trends, with the number of datory reporting for various types of companies,
first-time reporters on the rise, according to from those that are state-owned (Norway) to
CorporateRegister.com, a London-based firm large and listed (Sweden, Denmark).
2011
35
Roughly 42 percent of non-financial reports pro- It is hard to say whether verification will ever
duced by S&P 500 companies were compliant catch on in the U.S., where companies are risk-
with the Global Reporting Initiative, the world’s averse and generally hesitant to release anything
most widely used reporting framework. This into the public domain that isn’t already there.
percentage, which outpaces the global average, Verification offers many benefits, from uncov-
will likely grow as GRI works to meet its 2015 goal ering errors and mitigating against reputational
for all large and medium-sized companies to risk, but it is an added cost for what may already
disclose on environmental and social matters. be an expensive process. Pulling together all the
Companies also appear poised to begin accel- information for a corporate report and produc-
erating the trend, such as Puma, which is training ing it can cost up to several hundred thousand
its key suppliers to use the GRI to produce sus- dollars, one of many challenges facing compa-
tainability reports. nies in this type of endeavor.
S&P 500 companies lag in third-party verifi- But once they put in the necessary processes
cation, one of CorporateRegister.com’s key needed to capture consistent data, companies
barometers for report quality. Just 9.6 percent are finding that they can use the report as a
of non-financial reports were verified for accu- management tool to make better business deci-
racy, a percentage that hasn’t reached more sions and improve performance. Ultimately, this
than 14 percent in the last seven years. In com- will help companies boost their bottom lines — a
parison, verification rates in Europe run in the critical milestone in any company’s sustainabil-
low to mid-20 percent range. ity journey.
S&P 500 Reports by Type, 2010

S&P 500 Report, by type
Corporate Responsibility
6.1% Environment
3.9% Environment & Social
4.3% Environment
0.9% Health & Safety
50.9%
Environment
Health & Safety
& Community
27.8%
Sustainability
Social/Community
5.2% Integrated
0.9%
Source: CorporateRegister.com
CorporateRegister.com is the global corporate responsibility (CR) resources website. It hosts the world’s most comprehensive
directory of CR and sustainability reports, profiling over 30,000 reports worldwide from almost 7,500 companies. With an archive
stretching back to 1990, it is indispensable for anyone working in the field of CR and sustainability reporting.
Working with some of the leading organizations in corporate responsibility, CorporateRegister.com hosts several official reporting
registers. Further site features include a fully searchable directory of over 6,000 organisations (‘reporting partners’) actively involved
in CR reporting. CorporateRegister.com developed the world’s first annual global online CR reporting awards, the CRRA – see www.
reporting-awards.com
www.corporateregister.com • info@corporateregister.com • +44 20 7014 3366

2011
employee commuting
36
what will it take to separate commuters and cars?
Mode of commuting, by percentage
76.1
75.7
73.2 Only 7 million
64.4 Americans commute
by public transit,
compared to the
105 million who drive
alone to work.
19.7
13.4
12.2
10.0
6.4 5.3 4.7 5.0
1980 1990 2000 2009
Public Transportation Carpool Drive Alone

Source: U.S. Census Bureau and American Community Survey
Working Americans are stuck in traffic. Record And while the American Public Transportation
high gas prices in 2008 changed commuting pat- Association figures that riding the bus or train
terns a bit, but for the most part, we were back saved each commuter roughly $9,660 in 2010
behind the wheel in 2009, the most recent data (on average, depending on gas and parking
available, with 76.1 percent of Americans driving prices), only 7 million Americans commute by
solo to work. Only 10 percent carpooled in 2009, public transit, compared to the 105 million who
down slightly from the year before and by about drive alone to work. Transit ridership was down
half since the carpool heydey of the early 1980s, slightly in the third quarter of 2010 compared to
driven by cheap gas, more affordable car owner- the same time in 2009, which APTA attributes
ship, and longer commuting distances. to high unemployment as well as fare increases
2011
37
that many transit agencies have been forced rise, this lack of funding will leave transit systems
to levy to make up for losses in revenue. If the in poor shape to handle the growing demand.
decline is, indeed, due to job losses, transit use
That means it’s employers who hold the keys to
may increase as the economy recovers — espe-
green commuting. A number of companies —
cially if, in concert with a healthier economy, gas
facing everything from a lack of parking space
prices rise.
to corporate sustainability goals — are start-
Congress passed a one-year extension of the ing to use car-sharing, either as a replacement
commuter tax benefit, which allows employ- for maintaining fleets of company cars or as a
ers to provide a tax-free stipend of up to $230 a lower-impact — and, often, less costly — alter-
month to cover commuting by mass transit. And native to paying mileage costs for employees to
2008’s Bike Commuter Act allows employers to use their own vehicle for company business.
offer workers a tax-exempt fringe benefit of $20
Corporate car-sharing schemes are often tied
a month for purchasing, maintaining, or storing a
to vanpooling services or are part of alternative
bicycle as the primary ride to work.
commuting programs, and are designed to give
But if you’re hoping for other policy changes to employees extra incentives to leave their own
give a lift to greener ways of getting to work, don’t cars at home. At Google’s Mountain View, Calif.,
hold your breath, says commuting expert Alan campus, for example, employees who commit
Pisarsky. Congress has been delaying spending to taking mass transit or getting to the office by
on transit systems, and the likelihood that the means other than driving are granted access to
new Congress will pass such legislation is slim, a fleet of hybrid or other low-emissions vehicles
partly because of political gridlock but mostly from Enterprise’s WeCar program. This way,
because there’s simply no money to spend. they have wheels when they need to attend an
Pisarsky worries that when employment levels offsite meeting or run a personal errand.
Ticket to Ride
Amount Commuters Save on Mass Transit, Compared to Driving and Parking Costs
City Monthly Savings Annual Savings

1 New York $1,180 $14,159
2 Boston $1,083 $12,993
3 San Francisco $1,061 $12,738
4 Chicago $972 $11,660
5 Seattle $952 $11,427
6 Philadelphia $942 $11,305
7 Honolulu $922 $11,063
8 Los Angeles $866 $10,395
9 Minneapolis $848 $10,180
10 San Diego $839 $10,074
11 Portland $827 $9,926
12 Denver $821 $9,854
13 Baltimore $810 $9,726
14 Washington, DC $809 $9,709
15 Cleveland $805 $9,663
Source: American Public Transportation Association, Jan. 2011 figures
2011
EMPLOYEE TELECOMMUTING
38
government and younger workers show the way
Millions of telecommuter households
10.0
As the economy
slowly climbs out of
9.5
9.2 its trough, so does the
9.1 number of Americans
9.0 8.9 who regularly
8.7 telecommute.
8.6 8.6
8.5 8.4 8.5
8.0
7.5
2003 2004 2005 2006 2007 2008 2009 2010
Source: IDC
Starting in 2007, fears over job security led some climb over the next few years, reaching 9.6 mil-
telecommuters to change out of their pajamas lion by 2013. The growth is aided by the ease with
and head back to the office. which workers can log into remote systems and
access data through Web-based networks.
While there’s no proof that occupying a cubi-
cle reduces one’s chance of getting a pink slip, The Telework Research Network estimates that
being in the office makes many workers feel less if U.S. workers who are allowed to telecommute
vulnerable to the ax. did so half the time, 288.7 million barrels of oil
would be saved annually. Adding in the energy
But as the economy slowly climbs out of its
savings through reduced office construction
trough, so does the number of Americans
and use, TRN estimates annual savings of 52.8
who regularly telecommute. There was a slight
million metric tons of greenhouse gases.
uptick, from 8.4 million in 2009 to 8.5 million
in 2010, according to research firm IDC, which Though some equate “working from home” with
defines telecommuters as those who work from fitting work in between house cleaning and long
home more than three days per week. Senior lunches, studies show telecommuters can be
IDC analyst Justin Jaffe expects the figure will more productive, take fewer sick days, reduce
2011
39
employers’ facilities costs and often work longer Many large firms have embraced telework in
hours than the office-bound. Telecommuting recent years — especially those, such as Cisco,
can dissuade some workers from looking for that make tools for virtual meetings and online
a new job, too, reducing turnover. Combined, collaboration. But not all telecommuters work
these factors can save $10,000 a year per half- for behemoths. IDC found that 36 percent of
time telecommuting employee, says TRN. firms with fewer than 100 workers and two-thirds
of midsized companies employ telecommuters.
That doesn’t take into consideration emer-
gencies. For four days in the winter of 2010, a The editorial staff of Inc. magazine, a publica-
blizzard (a.k.a. “Snowmageddon”) paralyzed tion that serves small companies and entrepre-
Washington, D.C., costing the feds $71 million a neurs, experimented with telecommuting for its
day in lost productivity, according to the Office April 2010 issue. All staffers left the office for a
of Personnel Management. Luckily, 30 percent full month. While some loved the flexibility (and
of federal workers could log into work remotely. quiet writing time) it provided, others found
themselves yearning for coworkers’ company.
That helped win support for the Telework
They’re not alone. IBM brings together many
Enhancement Act of 2010, signed into law in
of its 400,000 employees who telecommute,
December, which establishes a consistent tele-
through outing and mentoring clubs, and virtu-
working policy and structure across all govern-
ally, through an in-house social network, where
ment agencies and provides training to telecom-
telecommuters can catch up with coworkers
muters (or teleworkers, as they are referred to in
and have digital water cooler chats.
the Act) and their managers. It also requires that
teleworkers and non-teleworkers be treated So while telecommuting is still slow to grow,
equally when it comes to promotions and work its future is bright. And the next generation of
requirements. And it requires that OPM collect workers — raised in a digital world with social
data on teleworking. If this leads to more quan- media and online collaboration — will demand
titative proof of productivity gains among tele- telecommuting as a workplace benefit. Private
commuters, it could lead to greater employer employers may take Uncle Sam’s lead with bet-
support of telecommuting. ter designed telecommuting policies.
Telecommuting Hotspots
telecommuting
The 15 Metro Regions hotspots
with Highest Percentage of Telecommuters
15 metro regions with highest percentage of telecommuters
Bellingham
Bremerton
Poughkeepsie
St. Cloud
Chico
Santa Rosa Fort Collins
Boulder
Denver
San Luis Obispo Colorado Springs

Raleigh
Columbia
San Diego
Pensacola
5% or more telecommuting 4% telecommuting 3% telecommuting
Source: TeleworkResearchNetwork.com
2011
energy efficiency
40
TURNING TO SOFTWARE TO FIND HARD SAVINGS
BTUs per dollar of GDP
8.33
6.96
Energy management
software is helping
6.37 decision-makers see
the value and payback
4.57 achieved through
relatively low-cost
3.12
efforts.
2.42
1.86
1.76
1950 1960 1970 1980 1990 2000 2008 2009

In 2009, the commercial and industrial sectors But this doesn’t mean we’re swimming fast
consumed 1.76 BTU of primary energy — that is, enough, say many energy experts, pointing to
energy derived from its natural state, such as lagging investments and state budgets being
coal or natural gas, and not converted energy, stripped of dollars once marked for efficiency
such as electricity — for every dollar of U.S. gross projects. Plus, the Property Assessed Clean
domestic product. That’s a solid improvement Energy, or PACE, program, which the govern-
over 2008, which was an improvement over ment backed with $150 million in stimulus
2007. So, we’re swimming in the right direction, funds and which was designed to make energy
and have been doing so for a while. In fact, effi- efficiency improvements more affordable for
ciency has led to lower energy consumption homeowners, was derailed this summer, as the
for decades. In 2009, it took less than half the result of a California appeals court decision.
energy to produce a dollar of GDP than in 1970.
Still, some hopeful signs emerged in 2010. Inside
We learned last year that the Great Recession big companies, government agencies, office
didn’t short-circuit energy-efficiency projects in complexes, and other large buildings, efficiency
2008, and it now appears that the trend contin- projects increasingly are managed through a
ued in 2009, even as the recession languished facility’s IT command center. Sometimes that
and despite a drop in energy prices. means installing energy management software
2011
41
and sensor-based control systems that allow own survey of sustainability executives’ spend-
heating and cooling to be triggered on demand, ing priorities placed energy efficiency invest-
rather than being run indiscriminately. Other ments at the top of the list for the third year in
times, this systems approach means taking a row.
a broader view of energy management. For
However, there’s little energy on the policy front
example, the city of Las Vegas is using software
to compel corporations to cut power use or find
to measure the resources consumed and emis-
cleaner sources of energy. Still, some notable
sions produced across the city, with the goal
voluntary efforts to boost efficiencies on a
of helping reach its sustainability goals, includ-
grand scale grabbed headlines in 2010. Take the
ing reducing its greenhouse gas emissions. The
Empire State Building: Its owners are complet-
odds are high they’ll also save money.
ing a retrofit that will reduce its energy use by
A number of big companies are collaborating to 38 percent, driving down energy costs by more
improve and streamline the business of energy than $4 million a year, a towering achievement.
management. For example, IBM joined forces
The U.S. Energy Department is taking steps to
with Schneider Electric and Johnson Controls
lead by example, installing a white roof on its D.C.
to pair mechanical systems with software to
headquarters. It is only playing catch-up to the
create smarter, more efficient buildings. Energy
National Nuclear Security Administration, which
management software is helping decision-mak-
has installed more than 2 million square feet of
ers see the value and payback achieved through
energy-efficient cool and white roofs, saving
relatively low-cost efforts, such as updating
about $500,000 a year in energy costs.
lighting or improving insulation, or even more
complex projects, like optimizing energy flow in We won’t know until later this year how much
manufacturing systems. energy the commercial and industrial sectors
squeezed out of each dollar of 2010’s GDP. But
Energy management software is the key to illu-
by the end of 2011, if economists’ predictions
minating where and how energy is wasted, and
about higher oil prices are correct and if the
cutting that waste seems to be a high prior-
pieces of the smart grid start coming together,
ity for companies. Sixty percent of the execu-
energy efficiency could experience a surge.
tives responding to a 2010 survey by Johnson
Controls said they planned on increasing expen- One thing is certain: There are still plenty of
ditures for energy efficiency. GreenBiz Group’s gains to be made in using less energy.
Most Energy-Intensive Industries

BTUsMost
used perenergy-intensive
dollar of product shipped to industries
market
BTUs per dollar of product shipped to market
Cement 53.68
r dollar of product shipped to market
Bulk Chemicals 30.20
Iron & Steel 22.71
Aluminum 16.51
Refining 16.25
Paper 14.95
Mining 9.54
Glass 9.21
Wood Products 4.07
Agriculture 3.82
2011
environmental financial impacts

42
a rise in what companies are costing the earth
Cost of environmental damage as a percentage of economic output
4.46
All told, the direct
4.35 4.32 and supply-chain
3.86 environmental
impacts had a
combined cost of
$995,783 million in
2009 — that is, nearly a
trillion dollars.
2006 2007 2008 2009
Source: Trucost
For more than a decade, the U.K.-based research brought the impacts to roughly the same level
firm Trucost has measured the financial costs of they were in 2007. All told, the direct and supply-
hundreds of environmental impacts of 4,500 or chain environmental impacts had a combined
so companies. It does this through what it calls cost of $995,783 million in 2009 — that is, nearly
an “advanced environmental profiling model,” a trillion dollars.
which tracks more than 700 environmental
Trucost prices the damage from pollutants and
impacts — a wide range of emissions into air,
natural resource use, including quantifying asso-
water, and soil, including a witch’s brew of pol-
ciated human health costs. Trucost and many
lutants from acetaldehyde to zinc. It assigns a
academics believe that pricing these resources
dollar amount to each impact. Trucost uses this
and pollutants in financial terms provides the
information both to assess and benchmark indi-
most suitable weighting factor to differentiate
vidual companies and sectors, but also to track
the relative damage of a range of impacts. (The
interactions and cash flows in order to map
same approach was applied by the Stern Review
each sector’s supply chain.
on the Economics of Climate Change, a study
Thanks to Trucost, we can also look at aggregate commissioned by the U.K. government in 2006.)
data — the sum total of all of the impacts of all By applying a price to each resource, based on
of the companies it tracks — to gauge overall the environmental impact of that resource, the
improvements, or lack thereof, across the entire model is able to analyze, in financial terms, the
economy. productivity and environmental performance of
companies, sectors, indexes, etc.
Trucost’s latest research shows that, after a
sharp drop in 2008, the financial costs of envi- Trucost has compiled a library of prices for
ronmental impacts ticked up in 2009, the most different natural inputs and outputs, derived
recent year for which data is available. The rise from academic and professional literature. For
2011
43
example, it uses the marginal social damage cost

environmental impact of a company, based
of $31 for each ton of greenhouse gas emissions.
on Trucost’s understanding of the industries in
Trucost’s damage costs distinguish between which it operates. It then incorporates reported
different methods used to manage resources environmental data for each company, as avail-
or waste. So, for example, process water has a able from the company’s own public and pri-
higher damage cost than cooling water used vate disclosures. Companies are then given the
by power utilities because of its higher con- opportunity to respond with more or amended
centration of pollutants. And costs assigned toinformation, which is incorporated into the
waste sent to landfills are higher than for waste
company profile. Trucost uses the completed
incineration. profile to calculate a company’s environmen-
tal and financial impacts. To ensure apples-to-
To develop their scores, Trucost analyzes each
apples comparisons, Trucost calculates what it
company’s publicly available financial infor-
calls an Environmental Impact Ratio — a compa-
mation. Its data model can then predict the
ny’s environmental damage costs divided by its
overall revenue. So, if a company’s
dustry Contributions to Environmental
financial impacts, by industry Intensity environmental impacts are $10
ons of dollars)
(millions) million and its sales are $100 mil-
lion, the company’s Impact Ratio
will be 10.
So, why did the aggregate Impact

Ratio rise in 2009? Did the reces-
sion play a role? It’s possible,
at least in some sectors, says
James Salo, Trucost’s Senior Vice
President, Strategy and Research.
“If you have a depressed economy
you may have lower demands for
manufacturing, and that will gen-
erally decrease the environmen-
tal impacts,” he explains. But it’s
not that simple, he says. Some
industries may have a fixed level
of resource use regardless of out-
put. “In those cases, you may be
having the same environmental
impact but making less money, so
you’re becoming more environ-
mentally intensive per dollar of
revenue.”
Source: Trucost
2011
e-waste
44
growing concern, but not enough action
Thousands of tons of electronics discarded and recycled annually in the U.S.
2,600 2,590
Governments,
2,460 corporations, activists,
d
D iscarde and the public are
oducts
2,270 ters Pr
Compu increasingly aware
that we are exporting
our environmental
1,710
600 impacts to the
developing world, even
560 as we are giving away
valuable resources.
550
g
for R ecyclin
360 Collected
2009
2008
190 2007
2005
2000
Source: U.S. Environmental Protection Agency
Last year, we reported that one of the big trends broken electronics are exported to China, Africa,
from 2009 was the ways in which IT aims to save and Latin America, where they are dismantled
the world, through such things as dematerial- under primitive and toxic conditions to salvage
ization, reducing travel, and saving energy. And the valuable metals they contain.
while that’s true, it doesn’t exactly explain away
Sending all these unloved electronics to other
the vast mountain of toxic trash generated by
countries is starting to have national security
all of this wondrous technology. Despite more
implications for the U.S. With global demand
and more used electronics being taken back
for electronics climbing nonstop, high-value
for recycling at a growing number of locations,
materials critical to their manufacture — so-
those discarded gadgets are being replaced by
called rare earth elements — are in ever-higher
an equal or greater number of new ones.
demand. Seeing a market crunch coming, in
Of course, as the data show, an increasing num- 2010 China — both the world’s largest supplier
ber of these gadgets aren’t going to landfills — and one of the largest consumers of rare earths
but that doesn’t mean we’re making progress. — tightened its grip on its supplies. Once again,
Most of those unwanted, outdated, and often Western nations are finding themselves at the
2011
45
mercy of another country for a critical resource. R2; e-Stewards centers around a commitment
by recyclers and their customers to forbid the
The good news is that governments, corpora-
use of incineration, prison labor, and exports in
tions, activists, and the public are increasingly
dealing with unwanted electronics.
aware of the fact that we are exporting our envi-
ronmental impacts to the developing world, The two other big splashes in the world of
even as we are giving away valuable resources. e-waste came from the private sector. First,
But the pace at which reform is happening lags eBay launched its “Instant Sale” option for elec-
the growth of the problem. tronics, offering gadget owners a near-guaran-
teed sale on used goods, depending on the age
Since last year’s report, we’ve seen a number
and quality of the gear.
of promising developments. About a dozen U.S.
states, leading the charge on e-waste regula- And Best Buy unveiled a “Buy Back” program,
tions in the face of inactivity in Washington, guaranteeing customers a percentage of their
enacted laws related to e-waste during 2010, or money back when they return electronics within
implemented previously approved laws. two years. The hope is that by making it quick
and profitable to sell back electronics, more
But as has long been the case, activist groups
will end up in the collection stream and fewer in
and private companies were responsible for
landfills.
the greatest progress on e-waste. In 2010, we
saw the launch of the e-Stewards e-waste recy- The success of e-Stewards will be on the radar
cling certification, which joined the Responsible this year, with likely commitments from high-
Recycling (R2) standard in the suddenly com- profile companies and governments to use the
petitive market for responsible electronics take- standard in their contracts. Congress will again
back. Both certifications began at a multi-stake- work on e-waste legislation, although its future is
holder dialogue between the EPA, activists, and uncertain.
the recycling industry, but talks fell apart in 2009
And look for attention focused on the national
when the activists and some recyclers disagreed
self-interest of recycling e-waste, as awareness
on how, where, and by whom electronics would
of looming shortages of rare earths moves to
be responsibly recycled.
the fore and policymakers realize how much of
Those groups created e-Stewards to address the a precious material we’re exporting instead of
perceived shortcomings of the industry-backed keeping it for reuse in the United States.
E-Waste Takeback by Electronics Manufacturers

(metric tons)
Company Amount Region

Acer 2,177 North America
Dell 8,100 Worldwide
Fujitsu 6,445 Worldwide
HP 37,500 Americas
IBM 41,400 Worldwide
Lenovo 11,547 Worldwide
Sony 112,122 Worldwide
Source: GreenBiz Group research
2011
fleet impacts
46
MORE HYBRIDS AND EVs ARE AROUND THE CORNER
Estimated annual greenhouse gas emissions per vehicle (in tons)
14.59 14.63
The number of fleet
managers who are
measuring fleet
emissions has soared
12.16 — from 28 percent in
2008 to 49 percent
in 2010, according to
11.56 fleet management
company PHH Arval.
2007 2008 2009 2010

In recent years, we saw the recession lead to a When it comes to vehicle fleets, the math is
downshift in emissions per fleet vehicle — not fairly simple: Manage more-efficient fleets and
necessarily because of conservation efforts as you’ll drive down fuel costs. And lower fuel costs
much as lower demand. Fleets took a similar have special appeal to fleet managers when the
route in 2010, with emissions down 5 percent economy’s engine stalls (and gas prices rise).
over 2009. The gallons of fuel consumed also That could be one reason why the number of
dropped, despite larger fleets, signaling that fleet managers who are measuring fleet emis-
2010’s lower emissions aren’t due only to a sions has soared — from 28 percent in 2008
flat economy, but also to concerted efforts to to 49 percent in 2010, according to a survey by
reduce fuel consumption. PHH Arval.
As in the past, we tracked greenhouse gas emis- The number of fleet companies that are chas-
sions per vehicle, based on fuel consumption ing environmental goals is also up. Some say
patterns of the largest U.S. fleet management the economy slowed their progress toward
companies, including ARI, Donlen, Enterprise, these goals, while others say it accelerated
GE Capital Fleet Services, LeasePlan and PHH it. But nearly all (74 percent, according to the
Arval. The addition of new company data this PHH survey) said they’re turning to the people
year required us to revise last year’s results. behind the wheels to help reach those goals. By
2011
47
offering incentives to drivers who reduced their Electric vehicles are just starting to roll into
idle time, Poland Springs managed to reduce fleets, so they’re not responsible for the reduc-
fuel costs by $20,000 in 2008. Changing driving tion in GHG emissions we saw in 2010, but they
behavior, such as accelerating more slowly and should certainly start to affect emissions num-
monitoring tire pressure, has also paid dividends bers next year. In late 2010, GE announced it will
for fleets, as have GPS navigation systems that buy 25,000 electric vehicles over the next five
provide the most efficient routes to drivers. years for its own fleet, as well as for customers in
its fleet management business (not surprising,
GreenDriver, a firm specializing in driver edu-
perhaps, considering that GE recently started
cation, is partnering with the Environmental
selling EV charging stations). GE is also working
Defense Fund and Donlen to reduce green-
with Better Place, which is rolling out a battery
house gas emissions from across the commer-
swapping network for EVs.
cial fleet sector by 20 percent over the next five
years. Government-backed programs are con- Increasingly, companies are opting for car-
tributing to cleaner fleets, too. California’s Air sharing services. While car-sharing incumbent
Resources Board created the Hybrid Truck and Zipcar is clearly benefitting from this, fleet man-
Bus Voucher Incentive Project (HVIP) to accel- agement companies are also launching car-
erate the deployment of new hybrid trucks and sharing arms, such as WeCar from Enterprise.
buses in that state. It subsidized the purchase of Car-sharing makes great sense for fleet manag-
650 hybrids in 2009. ers: It reduces fleet size, increases the utilization
of each vehicle, and can cut emissions by half,
Most fleets upped their purchases of four-cyl-
since many cars in car-sharing programs are
inder passenger vehicles in 2009, and many are
hybrids and, increasingly, EVs.
also moving away from sport utility vehicles and
minivans. Automakers know that fleet managers Yes, questions loom about charging infrastruc-
are more interested in alt-fuel vehicles; Ford is ture and how to address battery life, but no-gas,
producing more 6.8-liter F-450 and F-550 Super or at least low-gas, vehicles are looking pretty
Duty chassis cabs that are conversion-ready for attractive to fleets facing $4- or $5-a-gallon gas
compressed natural gas (CNG) and propane. in the coming year. Ultimately, as everybody
Verizon is adding more than 1,000 CNGs and knows, the most gas-efficient car is one that
electric hybrids to its fleet. requires no gas at all.
Large U.S. Alternative Fuel Fleets
Schwan's 5,200
Enterprise Holdings* 5,100
U.S. Postal Service 4,535
AT&T 3,477
FedEx Express 3,304
Waste Management 3,042
PG&E 2,394
Commonwealth Edison 2,118
Consolidated Edison 1,959
Johnson & Johnson 1,785
U.S. vehicles only, excludes flex-fuel and off-road vehicles
*Includes Alamo, Enterprise, and National car rental divisions
2011
green it
48
IT’S TIME FOR STANDARDS TO REBOOT
Number of computers certified by Energy Star and EPEAT
9,798
10000
8000 The evolution from

7,004
6,196
Energy Star 3.0 to 5.0
6000 between 2008 and
2012 will drive down
4000 3,656* 3,881* the energy used by
large televisions by as
much as two-thirds.
2000
0
2006 2007 2008 2009 2010
*Denotes year of transition to new level of Energy Star certification requirements

The past year has seen tremendous growth in impacts on the planet. With a new set of stan-
green IT, as measured by the numbers of com- dards, we’re sure to see a drop in the number
puting products certified under the two leading of products certified under both. The last time
standards for greener electronics, Energy Star Energy Star introduced a new spec, in 2009,
and EPEAT. Unfortunately, when it comes to the number of certified notebooks dropped by
green computers and monitors, it’s possible to nearly 60 percent, and just one-sixth as many
have too much of a good thing. monitors earned the certification by the end of
2009 as bore the Energy Star logo at the begin-
Both of the standards that feed into the chart
ning of that year.
above have been set at the same level — for
nearly two years, in the case of Energy Star, But these changes have big environmental
and almost five years in the case of EPEAT. Two impacts, and raising the bar gets companies
years is a lifetime in electronics, and five years is to step up their game. Consider televisions,
the tech equivalent of an eon, so both standards where the evolution from Energy Star 3.0 to
are due for a reboot in the coming year, raising 5.0 between 2008 and 2012 will drive down
the bar to push manufacturers to reduce IT’s the energy used by large TVs by as much as
2011
49
two-thirds. Such achievements are easily pos- The EPEAT standard, administered by the Green
sible with computers and displays as well. Electronics Council, looks beyond energy use
to award its ratings. Manufacturers must also
Energy efficiency has been steadily on the rise
address hazardous chemicals, product pack-
for IT products, driven in large part by the shift of
aging, product disposal, and overall corporate
the market toward battery-dependent mobile
environmental performance. Despite this broad
devices: Laptops and netbooks accounted for
and rigorous set of criteria, EPEAT keeps grow-
more than 5,300 Energy Star-certified com-
ing, expanding to 40 countries in 2009 and add-
puter models in 2010, compared to just over
ing certifying partners to keep up with demand.
2,000 desktop models. But energy efficiency is
easy to characterize as low-hanging fruit, and There is still plenty of room for improvement,
there are many more — and more ambitious — especially when it comes to the end-of-life
changes needed to achieve greener IT. impacts of electronics. The world’s largest com-
puter companies are working to phase out toxic
One area where manufacturers are making
chemicals from products, and IT packaging is
steady progress, at least for some products, is
getting increasingly smaller.
in lightweighting, exemplified by the quick evolu-
tion from the 200-pound console TV from the But there have been few signs of progress on
1990s to the even larger LCD or plasma set you how we deal with IT’s short life-cycle from shiny
can pick up to hang on your wall. The agency object to unwanted junk. While design for dis-
responsible for collecting fees for Washington mantling is included among EPEAT’s criteria,
state’s e-waste takeback law has tracked steady it’s a far cry from the vision of a short animated
improvements in lightweighting. As the table 2010 video called “The Story of Electronics”:
below shows, TVs in particular have undergone endlessly upgradable, easily recycled gadgets
rapid weight loss, dropping as much as 20 per- that, while still an elusive goal, sets a high bar for
cent of their heft in just one year. what green IT can be.
less is morE
Average weight of selected electronics, in pounds
2009 2010 2011

LCD TV, 17-39" 24.4 24.2 19.4
LCD TV, 40”+ 78.7 68.6 65.5
Plasma TV, 17-39" 42.1 36.2 41.5
Plasma TV, 40”+ 108.4 91.1* 66.7
Rear Projection TV, 40+" 109.4 108.3 87.8
Direct View TV, 17-39" 89.6 91.1 84.3
LCD Monitor, < 19" 9.8 9.9 10.3
LCD Monitor, > 19" 15.9 16.5 18.4
Laptop, < 3 lbs 2.4 2.5 2.7
Laptop, 3-5 lbs 4.1 4.1 4.3
Laptop, 5-7 lbs 6.7 5.9 5.9
Laptop > 7 lbs. 10.2 10.3 10.4
PC, Tower 28 21.3 25.6
*Average weight Q1-Q2 2010 = 100.8 lbs., average weight Q3-Q4 2010 = 81.3 lbs
Source: Washington Materials Managment and Financing Authority
2011
green office space

50
THE POTENTIAL FOR EXISTING BUILDINGS IS SKY-HIGH
LEED - New Construction

NC Certifications
NC Registrations
18,573
There are more than

15,751
80 billion square feet
of existing building
floorspace in need
9,905
of energy- and
water-efficiency
5,205
2,464 3,744 improvements.
2,187
927 1,453
549
2006 2007 2008 2009 2010
LEED - Existing Buildings and Commerical Interiors

CI Registrations 5,909
EB Registrations
CI Certifications
EB Certifications
4,009 3,934
2,775
2,121
1,435
1,711
701
626 767 814
199 399
137 209
103 170 356
42 69
2006 2007 2008 2009 2010
Source: U.S. Green Building Council
As far as green standards go, few have been as Despite a near-meltdown in the building mar-
successful, or as influential, as the LEED stan- ket, almost every element of the LEED ecosys-
dard developed by the U.S. Green Building tem for commercial buildings — LEED for New
Council (USGBC). With a meteoric rise and pan- Construction (NC), LEED for Existing Buildings:
oramic scope, LEED has become the blueprint Operations & Maintenance (EBOM), and LEED
for green certifications. for Commercial Interiors (CI) — continues to
2011
51
grow. Indeed, the certification of buildings under Retail chains are also likely to benefit from the
all three reached record levels in 2010. other new LEED standard, the Volume pro-
gram. Aimed at large developers such as retail-
The most notable impact of the recession on
ers, hotels, school districts, and home builders,
our data is the sharp slowdown of registrations
LEED Volume lets companies that plan to build
for New Construction, with projects entering the
25 or more similar buildings to achieve a batch
NC pipeline at the slowest rate since 2005.
certification. Starbucks is among those joining
But while companies are building fewer new the Volume certification out of the gate, brew-
green buildings, they are increasingly seeking ing plans to get new stores certified.
to green existing ones, as evidenced by the still-
Looking ahead to 2011, the biggest news on the
rapid growth of EBOM. This bodes as well for the
green building front comes from California,
planet as for LEED: There are more than 80 bil-
which recently became the first state to
lion square feet of existing building floorspace
require green building practices for all new
that are in need of energy- and water-efficiency
buildings. The state’s CALGreen building code
improvements, sustainably sourced materials,
will require across-the-board improvements in
and the other criteria that LEED factors into
water use, construction waste, HVAC systems
its rating system. As noted by Rob Watson in
and indoor air quality. (Separately, California
GreenBiz.com’s annual Green Buildings Market
already requires state-operated facilities that
and Impact Report, the growth of the EBOM
are new or undergoing major renovations to
market represents the sweet spot for growth in
reach at least a LEED Silver certification level. )
the LEED system.
The state’s building code will likely set the pace
Last year also saw the formal launch of two for the growth of green buildings nationwide.
new LEED standards: The LEED for Retail spec And starting this year, the USGBC will begin the
focuses on the environmental impacts of retail process of upgrading all of its LEED standards,
spaces as widely divergent as McDonald’s and to raise the ceiling on what green means for the
Kohl’s, Citigroup and Starbucks. next generation of buildings.
New, Big, and Green

10 Largest LEED-Platinum Commercial Buildings Certified in 2010
Gross
Project Name City State Square Feet
One Bryant Park New York NY 2,200,000
Hyatt Center Chicago IL 1,687,710
Duke Energy Tower Charlotte NC 1,500,000
Joe Serna Jr. Cal/EPA Headquarters Bldg. Sacramento CA 950,000
IFC Headquarters Building Washington DC 882,174
50 Fremont Center San Francisco CA 817,412
560 Mission Street (JP Morgan Chase) San Francisco CA 778,782
Two Constitution Square (Dept. of Justice) Washington DC 636,000
The Orrick Building San Francisco CA 560,513
Twelfth & Washington Mixed-Use Portland OR 551,932
Source: U.S. Green Building Council
2011
green power use

52
A MILD SURGE DESPITE A LACK OF POLITICAL POWER
Percentage of all U.S. electricity generation from non-hydropower renewable sources
146 3.95*
140
138 In 2010, wind
3.68 installations declined
121
by nearly 50 percent
84 3.10
due to lower demand
2.57 and lack of a long-term
65
2.41 national policy.
2.22
2.16
2004 2005 2006 2007 2008 2009 2010

* As of September 2010
Although coal remains the source for nearly growth of renewables in recent years. For exam-
half of all electricity generated in the U.S., the ple, the tight credit market stalled many proj-
percentage of electricity being produced from ects in 2009 before loosening up considerably
solar, wind, geothermal, biomass, and other the following year. The recessionary economy
sources continues to creep upward. sapped demand for electricity across the board,
which in turn dragged down electricity prices
As a result, renewables’ share of total electric-
and negatively impacted green power purchase
ity generated in the U.S. keeps growing. For the
contracts. Some utilities weighed whether they
first nine months of 2010, non-hydro renewable
even needed to buy additional energy in the face
energy accounted for nearly 4 percent of all gen-
of abundant capacity, and if they did buy renew-
eration — its largest proportion ever. Moreover,
able energy, they wanted to pay less, even in
total generation of renewable energy during this
areas where buying renewables was mandatory.
period was nearly 17 percent higher than it was
the year before. This follows a nearly 14 percent But the recession also brought down costs of
growth in green power generation during 2009. renewable energy projects due to lower demand
What’s unclear is if, in a changing political envi- for things like wind turbines and solar panels.
ronment, such growth is sustainable.
Project developers are still finding success if
The growth in clean energy comes despite a they can carefully balance the demand side,
range of obstacles that have challenged the garnering reasonable prices from their utility
2011
53
customers while also managing the supply side 2010 was Iowa, where 20 percent of its electric-
by keeping their costs down, says Edwin Feo, ity in 2010 came from wind sources. Meanwhile,
Managing Director of USRG Renewable Finance. New Jersey reached 200 megawatts of solar
capacity from more than 6,800 projects in 2010,
Another hurdle for the industry has been the lack
up from just six projects eight years ago.
of federal policy that could provide long-term
certainty and unleash a wave of investment in The American Recovery and Reinvestment Act
renewable energy technologies. The American provided another bright spot for the market,
Clean Energy and Security Act squeaked largely through the Department of Treasury’s
through the U.S. House of Representatives in successful tax grant program. The program,
2009, but ran out of gas in the Senate. With which was extended through 2011, offered clean-
the political shift following the mid-term elec- energy project developers a cash grant instead
tions, any movement on clean-energy legisla- of a 30 percent investment tax credit that
tion seems unlikely in 2011 (and, probably, 2012, became worthless during the economic down-
a presidential election year), even a less-ambi- turn. The Solar Energy Industries Association
tious, scaled-down mandate that would require believes the tax grant benefit played a pivotal
a minimum percentage of U.S. electricity to role in that sub-sector more than doubling in
come from renewable sources. 2010. The American Wind Energy Association
viewed the program as a key factor in powering
There are, however, many state-level renewable
wind installations during 2009 to a record level
energy targets that are generating activity. By
of more than 10,000 megawatts.
the end of 2010, 31 U.S. states had laws mandat-
ing minimum renewable energy purchases, and But in 2010, wind installations declined by nearly
another five had non-binding goals, according 50 percent due to lower demand and lack of a
to the Pew Center of Global Climate Change. long-term national policy, which, unfortunately,
Among the leading state milestones reached in few expect to emerge any time soon.
Countries with Fastest-Growing Renewable Energy industries
CAGR* 2009 CAGR* 2009

2006-09 capacity** 2006-09 capacity**
1 Turkey 99.33% 3.06 11 Iceland 20.04% 4.33
2 China 66.67% 27.93 12 India 19.72% 17.34
3 South Korea 53.60% 2.12 13 Belgium 19.19% 5.59
4 Poland 33.72% 6.01 14 Australia 16.83% 5.74
5 Czech Republic 30.57% 2.07 15 Germany 15.84% 80.13
6 Portugal 27.15% 9.82 16 Brazil 15.31% 22.73
7 Hungary 24.50% 2.64 17 New Zealand 14.64% 6.50
8 France 23.34% 13.69 18 Austria 14.04% 7.87
9 Ireland 21.44% 2.98 19 Sweden 11.68% 13.69
10 Spain 20.35% 44.91 20 United States 11.60% 152.19
* CAGR = compound annual growth rate Source: U.S. Energy Information Administration
** Billion kilowatt hours, total non-hydro net generation
2011
organic agriculture
54
Steady growth, but still small potatoes
Acreage of U.S. agriculture certified organic (in millions)
4.80
4.05 4.29 Organic agriculture
3.05 2.94 represents a mere
2.20 0.54 percent of all
cropland in the U.S., up
from 0.2 percent in the
early 2000s.
2003 2004 2005 2006 2007 2008
Source: U.S. Department of Agriculture
Agriculture, for all its bounty, eats up massive higher prices for organic foods. Despite slowing
amounts of water, carbon sinks, and biodiver- sales in organics during the recession, organic
sity. Pesticides, fertilizers, and genetically modi- food sales experienced 17.4 percent average
fied seeds have allowed farmers to tease greater annual growth from 2000 to 2009, compared
yields out of the ground, but they’ve also caused to just 3.5 percent for all food products.
a long list of problems, including soil erosion,
While organic farming costs more — average
toxic runoff, and greenhouse gas emissions. The
annual production costs are roughly $172,000
Intergovernmental Panel on Climate Change fig-
compared to $109,359 for all farms — it also
ures agriculture accounts for roughly 6 percent
earns more. U.S. organic farms had aver-
of global greenhouse gases.
age annual sales of $217,675, compared with
But ag is changing. Acre by acre, producers in $134,807 for farms overall, according to the
the U.S. are growing food using methods of sus- USDA. So it’s not surprising that between 1992
tainable agriculture — a term the author Wendell and 2008, the number of certified organic oper-
Berry defines as that which “does not deplete ations tripled, from 3,857 to 12,941.
soils or people.” And certified organic agricul-
Yet, organic ag is small potatoes, a mere 0.54
ture — food produced in accordance with the
percent of all cropland in the U.S., up from 0.2
federal government’s standard for the practices
percent in the early 2000s. In agriculture overall,
and inputs that make organic products — is play-
the trend is a shift to bigger farms. In 2002, farms
ing a major part in this process.
with more than $1 million in sales generated 47
Now at nearly 5 million acres, the amount of cer- percent of all U.S. production. By 2007, their
tified organic farmland in the U.S. has steadily slice of the pie was up to 59 percent. The con-
increased since the early 1990s, sprouting centration of large producers means farmers
nearly 150 percent between 2002 and 2008. are striving to maximize yield at the lowest cost
Also increasing is the public’s willingness to pay to satisfy demand from major buyers. Larger
2011
55
farmers are planting more and more acreage their use of chemical pesticides, making apple
and increasing their use of petrochemical fertil- growing more affordable.
izers and pesticides, says Fred Kirschenmann,
The IPM Institute, along with the American
distinguished fellow for the Aldo Leopold Center
Farmland Trust and the USDA’s Natural
for Sustainable Agriculture.
Resources Conservation Service, also offers
Thankfully, this trend has a counterweight, not farmers who grow commodity crops a risk-free
just among organic farmers but also among opportunity to reduce their use of nitrogen,
those practicing other methods such as integra- phosphorous, and potassium fertilizers, as well
tive pest management (IPM). And these alterna- as reducing tillage. The program, called the Best
tive growing methods are starting to bear fruit. Management Practice Challenge, uses a side-
by-side system in which participating farmers
The IPM Institute works with growers to employ
work with researchers to study weather pat-
farming practices aimed at reducing erosion
terns and manage fertilizer use and tillage prac-
and use of pesticides and fertilizers. It has cre-
tices. If test strips yield fewer crops than the
ated a set of protocols called the EcoApple pro-
strips employing conventional techniques, the
gram, used by apple growers in the Northeast.
farmer is compensated for his losses.
Due to pests and climate, growing apples organ-
ically in that region can be prohibitively expen- Such efforts, along with increasing interest
sive. EcoApple growers use traps and biological among consumers in sustainably and locally
controls against pests, allowing them to reduce grown food, is helping ag turn over a new leaf.
Sales of Organic
SLICING Foods,
THE organic PIE 2009
(in 2009 U.S. organic food sales, by product type, (millions)
millions)
Meat, Poultry and
Fish ($496)
Condiments
($496)
Fruits and Vegetables ($9,425) Snack Foods
($1,240)
Breads and Grains

($2,728)
Beverages
($3,224)
Packaged and Prepared

Source: Organic Trade Association Dairy ($3,720) Foods ($3,472)
2011
packaging intensity
56
steady progress, as packagers unwrap innovations
Thousand of tons of packaging material per billion dollars of GDP
New materials made

5.10 from renewable
5.09
4.90 sources will play a
vital role in long-
term packaging
4.59
sustainability, but
4.34
consumers won’t
always immediately
embrace the changes.
2005 2006 2007 2008 2009

The amount of stuff used to package our stuff amount of recycled polyethylene terephthalate,
is decreasing, slowly but surely. In 2009, 4,340 or PET, used in bottles (both food and non-food
tons of packaging were used in the U.S. per every grade) and film grew by 154 percent from 2000
billion dollars of GDP. This represents a 5.4 per- to 2009, according to the National Association
cent drop over 2008 — progress, but a smaller for PET Container Resources (see chart p. 57).
decline than the previous year. Still, it shows that
But the amount of PET captured needs to
packaging continues to remain an important
be much higher, says Anne Johnson of the
area of improvement.
Sustainable Packaging Coalition. Recycling has
In the past year we’ve seen the trend toward stagnated in the U.S. over the past decade or
alternative materials surge ahead. New materi- so, she notes, and less than a third of the PET
als made from renewable sources will play a vital packaging used in the U.S. is recycled — with
role in long-term packaging sustainability, but more than half of that exported to Asia, where it
consumers won’t always immediately embrace is used largely to manufacture polyester. “When
the changes. Frito-Lay — whose compostable we recovered from the Depression, we built
SunChips bag was introduced in 2010 but pulled roads,” says green packaging advocate Dennis
from the market after complaints about the Salazar. “Now, we should be building a national,
noise the bag made — continues to study and consistent recycling infrastructure.”
experiment with new materials. In fact, Frito-Lay
You might not want to start stockpiling empty
Canada didn’t pull the bag; instead, it launched
soup cans in anticipation of such an overhaul,
a lighthearted public service campaign offering
but Kim Jeffery, president of Nestlé Waters
earplugs to consumers.
North America, has proposed an industry-led
The overall drop in packaging use is due in part effort to boost recycling rates that would use
to the increased use of recycled plastics. The an extended producer responsibility model,
2011
57
wherein industry would subsidize municipal Lightweighting — reducing the amount of mate-
recycling programs. rials used to protect, ship, and display products
on shelves — has emerged as an important strat-
Another means by which industry is trying to
egy for reducing packaging intensity.
address packaging’s footprint is the Global
Packaging Project. Started by the Consumer And in 2010 we saw the marriage of lightweight-
Goods Forum, it aims to establish a common ing and reusability in the form of the Replenish
industry language for packaging and sustainabil- bottle, a design that lets consumers mix con-
ity and recently issued a guidance document centrated detergent with water at home, then
that creates common metrics for things such as reuse the bottle indefinitely, purchasing only
water consumption and recycled content. refills of concentrated detergent.
But alongside new and better recycled materi- Look for more companies launching new materi-
als, the first “R” in the “Reduce, Reuse, Recycle” als and packaging innovations — including more
mantra continues to knock down the amount of reusable containers — in 2011. The SunChips bag
materials needed to do a given job, referred to made a lot of noise, but it didn’t let the air out of
as packaging intensity. efforts to re-package packaging.
Recycled Materials Used in Packaging

recycled materials
Millions of pounds of recycledused in inpackaging
PET used bottles and film
Millions of pounds of recycled PET used in bottles and film
500 500
400 400
300 300
200 200
100 100
2000 2002 2004 2006 2008 2009
Source: National Association for PET Container Resources

2011
paper use and recycling

58
HOW MUCH BETTER CAN IT GET?
Thousands of tons of paper per billion dollars of GDP
11
Should a binding
10
climate agreement or
U.S. climate law take
9.77
effect, the methods
9.16 used to address the
9 carbon impacts from
8.58 forests could compel
8.56
8.28 8.31 companies to recycle
every last scrap of
8 paper.
7.88 7.76
7.33
7
6.79
6.13
6
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: American Forest & Paper Association
Paper intensity — the amount of paper used to This progress cannot continue forever, of
power our economy — has been one of the shin- course, and in all likelihood we’re within just a
ing examples of progress over the past few years. few years of reaching a plateau, where all the
This year finds the emergence of an even more paper that reasonably can be recycled is recov-
promising double-trend: Paper use declined for ered and reused. The American Forest and
the second year running, even as the percent- Paper Association, an industry group, estimates
age of used paper recovered for recycling con- that once we reach about 80 percent over-
tinued to climb. all recovery, the remainder will be unfit for the
reuse stream: Bath tissues and building papers
Between 2007 and 2008, paper intensity —
alike pose challenges to recycling for both obvi-
defined as the amount of paper used to gen-
ous and less obvious reasons.
erate a dollar of gross domestic product —
dropped by almost 6 percent while recovery But there is still room for improvement, and
grew by just 1.5 percent. But between 2008 and while businesses have led the charge in making
2009, intensity dropped 4 percent as recovery the corrugated fibers that go into shipping prod-
grew by its fastest rate ever, rising to 63 percent. ucts the most-recycled type of paper around,
2011
59
other areas of business use are lagging. For In addition to the environmental benefits of
example, despite the seeming ubiquity of the sending fewer tons of paper to landfills, there’s
blue recycling bin in offices nationwide, office a growing economic incentive. The recession
and writing papers remain the least-recycled. shredded the recovered pulp market, thanks
to the overall drop in demand for paper, but the
This shortcoming is due in part to the contracts
lull in that market was short-lived, with demand
that companies sign with waste haulers serv-
already at or above pre-crash levels.
ing their offices. These are generally long-term
agreements — some have been in place since What’s more, demand is likely to grow geometri-
before recycling took on the prominence it now cally as the booming economies of India and
holds — and changing these contracts can be a China become, well, paper tigers.
daunting task.
The biggest question looming over paper has to
In addition, education campaigns at home as do with the same question looming over most
well as at the office are needed to continue green business issues: climate legislation. At
to increase recycling. The business-focused the 2010 COP16 climate summit in Cancún, the
nonprofit Net Impact last year partnered with United Nations took a step forward on funding
Staples and International Paper, launching a and supporting REDD+ — for Reducing Emissions
competition to develop new ideas and real- from Deforestation and Forest Degradation
world strategies to help companies increase — moving sustainable forest management
recycling rates. AF&PA hands out annual recy- practices up the agenda, potentially impacting
cling awards, recognizing companies, commu- world paper and pulp supplies. Should a bind-
nities, and schools for their efforts to improve ing climate agreement or U.S. climate law take
recycling. Continental Airlines landed the 2010 effect, the methods used to address the carbon
business award; Hewlett-Packard, Boise, and impacts from forests could compel companies
Giant Eagle are among previous winners. to recycle every last scrap.
Paper Recovery Rate

Paper recovery
Percent rateof
Recovered Total Paper Supply, 1999-2009
Percentage recovered of total paper supply, 1999-2009
65% 63%
55%
45%
45%
1999 2001 2003 2005 2007 2009
Source: American Forest & Paper Association

2011
toxic emissions
60
MODEST DECLINE, BUT ONLY A DROP IN THE BARREL
Pounds of emissions per thousand dollars of GDP
Less than 1 percent of

the chemicals used
0.35 0.35 0.33 0.31 by U.S. industries are
0.29 0.26 covered by the TRI.
The EPA recently
added 16 chemicals,
the program’s largest
expansion in the last
decade.
2004 2005 2006 2007 2008 2009
It took a tragedy in India and near-miss in West percent decrease since 2001. When normal-
Virginia to sow the seeds of what would become ized against GDP, the annual decline in 2009 is
one of the most successful U.S. Environmental 10 percent. The chemicals dominating the TRI,
Protection Agency programs in history. A poi- such as lead, mercury, dioxins, and carcinogens,
sonous gas leak in Bhopal, India, killed thousands showed decreases largely across the board.
of people in 1984, followed by a similar, non-fatal
But the success isn’t all it may seem to be. The
accident in West Virginia that awoke the nation
EPA believes the declines may be due to several
to the toxic hazards in their own backyards.
factors, including a shift to other management
The Emergency Planning and Community Right- methods, fewer facilities reporting, changes in
to-Know Act of 1986 created the Toxic Release raw material composition, and overall reduction
Inventory (TRI) Program, a national data- in chemical use or production. The recession
base now covering more than 650 chemicals may also be a factor. Analysis of production-
released to the environment by nearly 21,000 related waste and the production index from
U.S. facilities. The program shines a light on the the U.S. Bureau of Labor Statistics shows a cor-
nations’s biggest companies, which sought huge relation between the recession and TRI data.
emissions reductions after learning they not Between 2007-2008, production levels fell 5
only were among the world’s largest polluters, percent and production-related waste dropped
but were losing millions of dollars a year in the 6 percent. From 2008 to 2009, production lev-
form of chemical waste. els declined another 12 percent, followed by a 14
percent drop in production-related waste.
U.S. facilities released or disposed of 3.37 bil-
lion pounds of emissions to land, water, and air Still, some sectors are showing signs of decou-
in 2009, a 12 percent drop from 2008, and a 40 pling business activity from production waste,
2011
61
including the computer and electronics indus- for all TRI facilities fell by 7,210 grams.
try, which reduced production-related waste
Second, the mining sector reporting exemption
by 53 percent between 2001 and 2008, a time
underscores an important TRI limitation: The
when production grew 86 percent.
program doesn’t cover every industry or chemi-
Most sectors reported decreases in toxic emis- cal. The oil and gas sector, for example, doesn’t
sions from 2001-2009, but there are some have to report emissions from drilling at a time
caveats. A big contributor to the decline comes when shale gas exploration is growing. Finally,
from the metal mining industry, which is respon- less than 1 percent of the chemicals used by
sible for the largest share of emissions. Metal U.S. industries are covered by the TRI. The EPA
mining disposals dropped 50 percent since recently added 16 chemicals, the programs’s
2001, but this may be due to a court decision largest expansion in the last decade.
giving the industry an exemption from reporting
Even when a chemical is added to the TRI, its
TRI chemicals in waste rock.
disposal or release could decline for the wrong
This raises two issues. First, it shows how a sec- reasons. An analysis from U.S. Census Bureau
tor, or even a large facility, can disproportion- researchers suggests that listing a chemical in
ately skew the data. For example, overall dioxin the TRI can cause offshoring — that is, compa-
releases fell 18 percent between 2008 and nies using TRI chemicals moving production to
2009, mostly because a Dow Chemical plant other countries. The study found an increase
began treating toxic waste rather than dump- in the net import of certain chemicals following
ing it. As a result, dioxin releases at the facility their listing in the TRI, with a disproportionate
dropped by 6,825 grams, while dioxin releases share more likely coming from poorer countries.
Toxic Emissions by Industry, 2009

toxic emissions, by industry, 2009
Pounds
(pounds)
Metal Mining
Electric Utilities
Chemicals
Primary Metals
Paper
Food, Beverages and Tobacco
Hazardous Waste Management
Petroleum
Fabricated Metals
Plastics and Rubber

2011
toxics in manufacturing
62
will the feds help to turn the tide?
Tons of selected toxic chemicals used per billion dollars of GDP
23.57
22.26
20.10 The piecemeal
19.28
18.94 approach to
18.49
addressing toxics in
products amounts to
a game of legislative
Whac-a-Mole: Find
lead in children’s
2004 2005 2006 2007 2008 2009 jewelry? Pass a law
setting limits on its
use. Cadmium later
found in the same
products? Pass
The latest data on the use of toxic chemicals by products, while the U.S. EPA listed it as a chemi- another law.
U.S. companies shows a promising downward cal of concern, the first step on an action plan to
trend, but even that relatively good news serves regulate it.
to illustrate the shortcomings of the system.
The EPA seems to be stepping up its work on
Although the intensity of use of the 27 hazard- toxics, moving forward in 2010 with a project
ous chemicals we measure as a proxy for overall to test some of the most-used chemicals for
toxics in manufacturing has declined for the sec- toxic impacts, and the continuing growth of its
ond year in a row — down nearly 15 percent since ToxCast program to more quickly predict nega-
a 2007 peak — these are a tiny fraction of the tive impacts from chemicals. The U.S. govern-
84,000-plus chemicals licensed for use in the ment’s role in regulating chemicals looms large
U.S., most of which we know little about in terms for 2011, as Congress considers taking up a long-
of their health and environmental impacts. overdue reform of the Toxic Substances Control
Act (TSCA), the overarching toxics law in the U.S.
This piecemeal approach to addressing toxics
in products amounts to a game of legislative Recent history shows that legislation and gov-
Whac-a-Mole: Find lead in children’s jewelry? ernment action can have a huge impact on the
Pass a law setting limits on its use, as California issue of toxics in products. For example, the
did in 2006. Cadmium later found in the same Consumer Product Safety Improvement Act,
products? Pass another law. As a result, a patch- signed into law in 2008, set a steadily decreasing
work of legislation is spreading across the U.S., limit for the amount of lead in products, as well
in part spurred by bisphenol A, the poster child as for other chemicals of concern. Two years
for toxic chemicals in consumer goods. In the after its implementation, NGOs testing prod-
wake of news about BPA’s prevalence in a wide ucts for lead have found near-universal compli-
range of products, 17 states are working on legis- ance with the law, far above what you’d find with,
lation to ban BPA, either entirely or from specific say, speed limits.
2011
63
The work done by activist groups has proven The brightest green news of 2010, however, lost
critical to progress on reducing toxics. Whether a bit of its shine as the year wound down: The
the news is about finding cadmium in drinking California Green Chemistry Initiative was sent
glasses, lead in reusable shopping bags, or form- back to the drawing board in December after
aldehyde in beauty products, the alarms more years of development. The brakes were applied
often than not have been sounded by nonprof- in the wake of last-minute changes to the law
its or private citizens, spurring governments and that supporters said would render meaning-
companies to take action. less a potentially groundbreaking effort to test
chemicals for toxicity and close the information
On the positive side, green chemistry continued
gap on what we don’t know about the impacts of
to grow in prominence, with companies and uni-
chemicals in everyday use.
versities steadily expanding their research into
benign alternatives to chemicals in use today. The year ahead will bring more challenges and
The EPA’s Design for Environment label showed opportunities in the world of toxics regulation.
steady growth, as the chart below shows. The Will the administration of Gov. Jerry Brown
certification amounts to an annual reduction of revive and redirect California’s Green Chemistry
600 million pounds a year of chemicals of con- Initiative? Will Congress start work on TSCA
cern in consumer products. Large retailers are reform, and will it have teeth? Companies will
driving the change, notably Home Depot’s “Eco continue to target the toxics in their products,
Options” label and the private labels of Walmart, but a scattershot approach is the most likely
Safeway, and Giant Foods. solution for the coming year.
Design for Environment

Design for Certified Products
environment-certified products
Number certified
Number certified per2003-2010
per year, year, 2003-2010
2500
2000
1500
1000
500
2003 2004 2005 2006 2007 2008 2009 2010

2011
transparency
64
COMPANIES DISCLOSE MORE, WITHHOLD LESS
39
34
A 2010 survey by the
31 GreenBiz Intelligence
Panel found some
large companies
responding to more
than 300 customer
53 surveys each year.
49
Disclosure of Material Environmental Impacts (percentage)
MSCI World Companies Not Disclosing Impacts (percentage)

44
2007 2008 2009

Source: Trucost
The pressures on companies to disclose infor- For companies, transparency has become a
mation about their environmental performance way of life.
seems to grow every year. A broad swath of soci-
But how much are companies actually disclos-
ety, it seems, wants to know — no, needs to know
ing? And how many companies are keeping
— a great deal of specific information about the
mum, disclosing nothing at all?
companies with which they interact. The inquisi-
tors include customers — particularly large The U.K. research firm Trucost has been tracking
corporate and institutional buyers — as well as company environmental information for years,
investors, regulators, activist groups, employ- and has amassed a treasure trove of data — not
ees and job seekers, the media, and members of just about companies’ impacts and perfor-
local communities surrounding company facili- mance, but about how, and how much, environ-
ties. All have questions. mental information they actually disclose.
The impact on companies is non-trivial. A 2010 Each year, Trucost collects 700 pieces of infor-
survey of 290 companies by the GreenBiz mation about the environmental impacts of
Intelligence Panel, 52 percent with revenue roughly 4,500 companies, part of the “advanced
over $1 billion, found some large companies environmental profiling modeling” it conducts
responding to more than 300 customer sur- for clients. Some of this data is readily available,
veys each year. Many large companies have up disclosed by companies in annual reports, web-
to three full-time employees whose job descrip- sites, and other communications, or in response
tions focus principally on responding to all these to Trucost inquiries. Other information is find-
questionnaires, surveys, and inquiries. able with a little digging — from government
2011
65
reports, press accounts, company presenta- “Overall, companies are improving their trans-
tions, and other means. And some information parency, and are disclosing more of the envi-
isn’t disclosed at all. In those cases, Trucost fills ronmental impacts that are most significant to
in the gaps through its own proprietary modeling them,” notes James Salo, Trucost’s senior vice
and calculations, using industry averages and president of Strategy and Research.
adjusting for size, sector, and other factors.
According to Salo, companies that disclose the
Along the way, Trucost also has tracked overall most are ones that have historic regulatory pres-
disclosure and transparency trends: How much sures, such as utilities and chemical companies,
of their material environmental impacts they or those that have high brand presence, such as
are disclosing — and how many companies dis- telecoms. The sectors with the weakest trans-
close nothing at all. parency are all in the service sector — financial
services, retail, and media — businesses not tra-
Both trends are positive, if gradual. Between
ditionally linked to spewing smokestacks, drain-
2007 and 2009, the latest reporting periods,
pipes, and Dumpsters.
the percentage of data disclosed by compa-
nies increased from 31 percent to 39 percent, Of course, service-sector companies — which
while the number of non-disclosing compa- also include transportation, hospitality, real
nies decreased from 53 percent to 44 percent. estate, and health care — can have large envi-
These are promising trends, though we’re only ronmental impacts. It will be interesting to watch
marginally impressed. That nearly half of com- this indicator over time, as these sectors inevi-
panies are still not disclosing any information is tably come under scrutiny, to see whether and
troubling in a world that increasingly demands how they respond in a world where accountabil-
“radical transparency” of companies. ity and transparency become the rule.
Most Energy-Intensive Industries

BTUs used per dollar of product shipped to market
Average environmental disclosure, by sector
(percentage of data disclosed)
Cement 53.68
Bulk Chemicals 30.20
Iron & Steel 22.71
Aluminum 16.51
Refining 16.25
Paper 14.95
Mining 9.54
Glass 9.21
Wood Products 4.07
Agriculture 3.82
Source: Trucost
2011
66
Defining and accelerating the business of sustainability.

According to Accenture’s survey of 750 CEOs, we are entering “a new age in sustainability” in which 93% of
global CEOs see sustainability as important to their future success. GreenBiz Group is an integrated media
company that has placed itself at the nexus of this business movement, providing a wealth of tools, resources,
and knowledge to help companies capitalize on the sustainability opportunity.
We accomplish this through the four pillars of our business.
We Tell the Stories

Our acclaimed websites and newsletters are daily
“must reads” for sustainable business professionals.
We Build the Network

Our peer-to-peer learning platforms create valuable
opportunities for professionals — both online and off.
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Our conferences and forums bring together
thought leaders and professionals to share trends,
technologies, and leadership practices.
We Provide the Insight

Our backgrounders, reports and analysis provide the
essential information professionals need to make
intelligent decisions.
state of green business 2011

Joel Makower, Executive Editor
Matthew Wheeland, Managing Editor
Tilde Herrera, Editor
Mary Catherine O’Connor, Research Editor
John Davies, Leslie Guevarra, Jonathan Bardelline, Contributors

State Green Business Report 2011

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Top SUSTAINABLE BUSINESS TRENDS OF 2011 3

The GreenBiz Index

Credits / About GreenBiz Group 66

Infographics by Seth Fields

Top Sustainable Business Trends of 2011

1. Consumer Giants Awaken to Green

2. Companies Aim for ‘Zero’

Stalemated Laws and Corporate Thaws

Businesses continue to increase their investments in sustainability inversely to their confi-

• Investments continue to rise. Eighty-nine percent said their 2011 environmental,

• Government’s role is in decline. In 2009, when we asked when they anticipated

Firms that haveopen

Source: GreenBiz Intelligence Panel

3. The Developing World Yanks the Supply Chain

a SMALL BUSINESS INNOVATION JUGGERNAUT?

At the 2010 GreenBiz Innovation Forum, an annual confer-

4. Greener Transport Makes Its Move

GREEN BUILDINGS: A FOUNDATION FOR GROWTH

Green building remains a bright spot in a gloomy economy, according to

Green Construction Remains Strong … for Now: In 2010, the certified

• LEED is having a significant reduction in employee commuting, resulting in a reduction of 1.4

5. Sustainable Food Becomes a Main Course

Sustainability Becomes a Profession

Average Salary for Salary

Vice President $192,064

Source: GreenBiz Group

6. Metrics and Standards Become the Rule

a sustainability standard for business

For more information, visit www.greenbiz.com/ratings.

7. Toxic Concerns Spur Greener Alternatives

Revelations of toxic ingredients in consumer Environmental Protection Agency was seeking

WHY GREEN MARKETING CONTINUES TO CONFOUND

There’s no guidance on the word “sustainable” or “sustainably.” Or “green.”

8. Water Footprinting Makes a Splash

WILL ASIA OUT-GREEN AMERICA?

9. Companies Learn to Close the Loop

10. Bioplastics Become Material

THE GREENBIZ INDEX

THE GREENBIZ INDEX: SUMMARY 24

Carbon Transparency S&P 500 companies U.S. response rates rise,

Cleantech Venture capital investments Opportunities in

Clean-Energy Patents Patents issued by U.S. Patent A surge of innovations

Corporate Reporting Number of reports from S&P Up slightly, but most

Employee Commuting Number of workers driving Even in tough times,

Employee Number of U.S. Slightly more

Environmental Environmental damage costs Costs of company

E-Waste Percentage of recovered Mountains of waste

SWIM TREAD SINK

Green IT Products certified under Micro electronics make

Green Office Space LEED-certified commercial Remains bright light in

Green Power Use Renewable energy as a Generation up, but lack

Organic Agriculture Acreage of U.S. agriculture Organics take root, but

Packaging Materials used per unit of Manufacturers take

Toxics in Emissions per year of 27 Piecemeal gains as green

Transparency How much data companies Incremental growth,

SWIM TREAD SINK

456.1 setting meaningful

Source: U.S. Energy Information Administration

S&P 500 Greenhouse gas reduction commitments

Percentage of CDP respondents with reported reduction targets

Number of S&P 500 companies responding to Carbon Disclosure Project

2006 2007 2008 2009 2010