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On Jan. 8 2003, John Baldacci was
sworn in as governor of Maine. That same day, the largest paper
mill in the state closed its doors, eliminating 1,700 jobs. The
closing represented
the latest episode in the saga of job losses for the industry.
Since the 1990s, Maine has lost more than 30 percent of its forestry
jobs, the best-paying
jobs in the state and a major source of tax revenues.
Two months later, David Refkin from Time Inc. teamed with representatives
from L.L. Bean to approach the state with a unique proposition aimed at
reversing the fortunes of the forestry industry. Their offer: If the state
of Maine did the right thing environmentally, the companies would reward
the state economically.
Maine responded with the first state-led forest certification program,
announced by the governor in July 2003. The program called for increasing
the number of certified acres in Maine from 6.5 million to 10 million by
2007. Refkin provided an incentive for certification by outlining an aggressive
goal set by Time that 80 percent of the fiber used to make its paper come
from certified forests by 2006. In the three years since that announcement,
Time has rewarded Maine’s certification efforts by increasing its
paper purchases in the state from 90,000 to 120,000 tons.
Refkin’s work with the state of Maine illustrates one of his key philosophies—to
provide economic rewards for environmental leadership. “For a long
time our strategy has been to reward leaders, encourage laggards, and for
those with egregious business practice we have either stopped doing business
or never started,” Refkin says.
In his current position as director of sustainable development
at Time, Refkin is leveraging the company’s clout as the world’s
largest purchaser of magazine paper to drive sustainable business practices
in the supply chain. His goal of reducing the environmental footprint of
the magazine industry has positioned the company in the vanguard of efforts
not only to promote sustainable forestry, but also to combat climate change,
advance recycling and fight pollution in the industry.
Refkin’s role as an industry leader has evolved over time. He credits
a business conference in Paris, which he attended soon after moving to the
paper-purchasing division of the company in 1989, with formulating his early
notions on environmental issues. “Environmental issues first need
to be managed, and secondly they represent an opportunity for smart businesses,” Refkin
says. He points to Toyota’s hybrid-car program and GE’s ecoimagination
initiative as examples of how companies translate sustainable development
into huge business opportunities. “It is a good thing for their shareholders
in addition to being a positive thing for the earth,” he says.
Time’s decision to take a proactive role with environmental issues
can be traced to a challenge by Greenpeace in the early 1990s over the paper-pulp
bleaching process. At the time, the bleaching process used to make paper
white employed chlorine gas. Wastewater from the process released into rivers
and streams was, in some cases, contaminated with dioxins. The episode helped
to formulate one of Refkin’s often-repeated mantras, “You can’t
play defense when it comes to the environment.”
The company’s first offensive move was to team with the Environmental
Defense Fund, McDonald’s, Johnson & Johnson, Duke University and
the Prudential Insurance Company to form the Paper Task Force. “The
task force represented the first real effort to balance economic and environmental
aspects of paper purchasing,” Refkin explains. “They don’t
need to be in conflict.”
The task force, which included a non-governmental organization
(NGO) and other like-minded companies, has proved to be a model emulated
by Refkin to find solutions to other challenges facing the industry. “I
think it helped build credibility that we could work with a responsible
NGO to find solutions that made sense from a business perspective, and also
made sense environmentally,” he says.
Recommendations from the final report of the task force emphasized
three main areas of focus for the industry—the sustainable use of
forests, resource conservation and the promotion of a philosophy of pollution
prevention. As a result of task force recommendations, Time, under Refkin’s
leadership, has embarked on a number of initiatives to advance sustainable
business practices in the industry.
The company now requires paper suppliers to complete a sustainable
development report card and incorporates the report cards in its paper purchasing
policy. To meet its goal of 80-percent-certified fiber by the end of 2006,
Refkin is assuming a very proactive role in promoting forest certification
and evaluating certification standards for both large and small landowners.
In a separate initiative started in early 2004, Time, in conjunction
with the National Recycling Coalition and International Paper, launched
the ReMix (Recycling Magazines is Excellent) campaign. At the start of the
campaign, only 17 percent of the magazines in homes were being recycled.
The program aims to increase the home recycling rate for magazines and catalogs
in an effort to reduce pollution and landfill costs, increase local community
revenue from recyclables and promote local job development.
Time has also taken a very active role in the climate change debate,
initiating a soon-to-be released study with The Heinz Center and other leading
companies to examine the carbon footprint of the magazine production process.
The report will measure the carbon emission of the complete magazine production
process and make recommendations about ways to cut greenhouse gas emissions.
David Refkin recently spoke with green@work about Time Inc.’s sustainable
business initiatives.
green@work: You’ve been focused on improving the environmental
performance
of your paper suppliers. What are the biggest challenges you face
in convincing forest managers to adopt sustainable practices and achieve
certification?
David Refkin: The biggest challenge is dealing with the small-landowner
base. Seventy percent of the fiber comes from small landowners, more than
10 million of them. On average, many of these people own land for only seven
years. In the Northeast, trees are harvested once every 40 years. So how
do we get them to care? How do we get them to want to be certified?
A couple of people have stood out and really made this happen.
One of them is a truly amazing woman from Fort Kent, Maine, named Sandy
Brawders. Sandy is the executive director of the Professional Logging Contractors
of Maine. She has a degree from Princeton in divinity, and as Sandy likes
to say, “How did this 60-year-old woman wind up in Maine organizing
loggers to enhance their practices?”
Sandy organized a group of loggers in Maine who probably had not
been treated with as much respect as they would have liked over the years.
She educated them about best practices and put together the Maine Master
Logger program, which includes third-party certification. It is a very rigorous
program—people need to get certified and recertified.>
Sandy organized the loggers and now has 121 of them in the program.
They harvest a big percentage of the wood in Maine. This is one of the key
ways we are getting small landowners certified in Maine. That program has
been copied in Wisconsin and the Maritime Provinces, and is in the process
of being copied in other states.
g@w: Will you meet the goal of having 80 percent of the fiber used
to make the company’s paper coming from certified forests by 2006?
DR: Some of the mills will. It looks like with a lot of great work
the mills in Wisconsin are going to make it. The mills in Maine will come
close.
With the European mills we have an interesting situation. Europe
started at a really high number and is doing a lot of good work within its
countries, but there is more and more fiber showing up from Russia. For
example, the mills in Finland are stuck at their numbers because Russian
fiber is increasing and it is not certified. We talked about this for a
couple years, but it’s like everything—you can talk and talk
and talk, or you can lead.
We got involved with a project that was started by Axel Springer
in Germany and now includes ourselves, Random House UK, Stora Enso out of
their office in Scandinavia, a Stora Enso subsidiary in Russia called Russkiy
Les, and a group called Transparency International. Transparency International
evaluates companies and countries on their corruption-free (or lack thereof)
policies.
The project is called “From Russia With Transparency.” Our goal
is to get certified fiber from Russia, but there are some important corporate
social responsibility issues that need to be dealt with first. Among those
are health and safety. The accident rates in Russia are very high, to be
polite. Legality is another problem; there is still a fair amount of illegally
harvested wood in Russia. Stora Enso, UPM and others have made a good effort
to trace all the wood, but it is still an issue. Finally there is corruption,
which is where Transparency International comes into play.
This is some really cutting-edge stuff. We are trying to have the
marketplace help promote the goals that we have outlined.
g@w: There has been an ongoing discussion regarding the credibility
of various third-party forest certification programs. What is your view
on the various certification programs, and what do you require from your
suppliers?
DR: A lot of energy has been spent debating the major programs.
We looked at the research various groups have done, and came to the conclusion
that FSC (Forest Stewardship Council), SFI (Sustainable Forest Initiative)
and CSA (Canadian Standards Association) were credible programs.
Recently, I was up in Portland, Maine, in September at the annual
SFI conference expressing my concerns about the procurement rules in SFI.
I gave what I would call a fairly outspoken speech. We have talked about
this with our suppliers for years, and feel that it is time that the procurement
rules are amended.
But those programs only address large landowners. The real challenge
is with the small landowners because there are virtually no certification
rules or standards. So we have taken it upon ourselves to evaluate the different
systems. We have hired a forestry consultant in British Columbia, Patrick
Armstrong, to help with the evaluation. About 10 programs have been evaluated,
with the Maine Master Logger Certification Program being the first, and
then Wisconsin, the Maritimes, the American Tree Farm (ATF) System, etc.
We worked closely with ATF on its group certification, and based on negotiations
have made some amendments to the interpretations of the rules.
We will have a state come up to us and say, “We have this new master
logger program, so because it is called master logger it is all right—right?” The
answer is no. We say, send us all your documentation about the program,
who is on the certification board and how independent they are, and we will
evaluate it. Then we go back and forth with negotiations. Frankly, no one
else is out there doing it. So we have become the evaluator of these programs.
g@w: The ReMix campaign is aimed at increasing the recycling rate
for magazines and catalogs from homes. What is the status of the initiative
and what are the next steps?
DR: We launched ReMix in three metropolitan areas: Boston in March
2004, Prince Georges County just east of D.C. in April 2004, and the Milwaukee
area in April 2005. Since the beginning of the program, recycling rates
have gone up in the range of seven percent in Prince Georges County to 24
percent in Boston. So far we have run $3 million worth of advertising in
34 magazines, reaching an audience of 74 million people. A lot of those
are repeat people, but that is a good thing because we are drilling the
message into their heads.
The ads in the Boston area run from the New Hampshire border down
to Cape Cod, Mass. The ads in Prince Georges County cover the entire D.C.
metro area, Maryland and Virginia. In Wisconsin, the ads cover all of southeastern
Wisconsin. Additionally, Time Warner Cable has the southeast Wisconsin area,
and they have run more than 600 30-second ReMix spots on their local cable
TV network. In Boston, every homeowner now has a magnet on their refrigerator
encouraging them to recycle their magazines and catalogs.
We are learning what has been successful and what has been less
successful. We plan to expand ReMix to three more cities in the next year,
including one city on the west coast. We want to make this a truly national
effort—so we have big plans.
g@w: Would you discuss the study Time Inc. is working on in conjunction
with Stora Enso, Canfor, Home Depot and The Heinz Center to measure the
carbon dioxide emissions of the magazine industry?
DR: The study has been lead by Dr. Tom Gower, a professor at the
University of Wisconsin, although the project is with Dr. Gower and not
with the university. The study is using real data for Time and InStyle magazines,
not industry averages. We are looking at the entire chain from A to Z—from
the time the wood is harvested through the pulping, the papermaking, the
printing, all the distribution steps and the disposal of the magazine, asking,
what is the carbon footprint?
g@w: What are some of the challenges you face, based on the outcome
of the report, to reduce the industry’s carbon footprint?
DR: We are doing several things, including the ReMix program. Obviously,
fewer magazines in landfills emitting methane is a good thing. Source reduction
is also a part of this whole issue. There are too many magazines on newsstands
that do not get sold.
The pulping process is rather energy-intensive. For those paper
companies that are located where coal is used to produce the preponderance
of the purchased electricity, there is an issue. We are talking to the CEOs
of the power companies to let them know that one of the major customers
of the paper industry is very concerned about these issues, and trying to
find out what they are doing to improve their carbon footprint.
This is a landmark study; no one else is doing this and no one
asked us to do this. This is a project in which the partners came together
and said that this is a big issue for the future. Frankly, not enough paper
buyers are paying attention to the climate change. There is a lot of talk
about recycled content, but we need to be thinking more about the future,
and the future is climate change.
Another interesting aspect—and you will have already seen this in
our chain of projects—is that we like to work with responsible organizations
that can give us independent advice about how to do the right thing environmentally.
So we have Transparency International, NRC, Metafore and The Heinz Center.
g@w: Many U.S. companies believe that environmental initiatives
like Kyoto will increase their costs and hinder their ability to do business.
How do you counter those fears when you are talking to executives in other
companies?
DR: You can look at the environment as a threat, which is typically
how many businesses have looked at it—higher cost, regulation and
just a pain in the neck that does not add any value to your product. But
there is a different way to look at the environment. For example, you can
use your environmental initiatives as a way to attract employees. Companies
like Starbucks, IKEA and Office Depot talk about their company’s commitment
to sustainability as a way to attract employees.
Let’s look at the six companies Fortune magazine named as the most
admired companies. I think it is more than just a coincidence that four
of the six—Dell, GE, Starbucks and FedEx Kinko’s—say that
sustainable development is a key part of who and what they are.
You can also find environmental/economic win-wins. These days,
especially on the energy side with the high price of gasoline and natural
gas, companies need to look at ways to make their buildings greener, to
encourage their salespeople to drive the right kinds of vehicles and to
encourage their employees to use public transportation. There are a lot
of things that you can do that will save costs and be right environmentally.
Not always, but often.
g@w: Can you give an example of how your environmental leadership
has created opportunities for the company?
DR: We are starting to approach advertisers. We just got an advertising
client for InStyle magazine based on our sustainable development work. It
is the first time since 2001 that InStyle has had this company as an advertiser.
That is one example, and we need to have more like it.
g@w: What other sustainable development initiatives are you working
on?
DR: The Paper Working Group is a project organized by Metafore
out of Portland, Ore. It was started two-and-a-half years ago and now has
20 companies working together on the goal to increase the availability of
environmentally preferable paper. The major output will be something called
the EPAT, the Environmental Paper Assessment Tool. We are trying to develop
a scorecard that will address all the key sustainable development issues
related to paper production and paper procurement.
The scorecard includes energy, forestry, manufacturing, recycling,
social responsibility and credible verification. The effort is really a
who’s who of corporate America. In addition to Time, we have Starbucks,
Staples, HP, McDonald’s, FedEx Kinko’s, Nike, Toyota, Bank of
America, Hearst, JC Penny, L.L. Bean and four large printers. The printers
are important because they have many customers who use paper. In the next
year or so, you could have hundreds of companies using the assessment tool
as the printers start making EPAT available to their customer base.
The other key point is that we talk about the things we are doing.
People learn from each other. The Paper Working Group brings it all together,
providing a forum to talk with 20 leading companies on the initiatives we
are working on, as well as to promote these ideas through the EPAT.
Diane Greer is a freelance writer and researcher based in New York,
specializing in sustainable business, green building and alternative energy.
Her articles have appeared in major magazines, newspapers and trade publications.
She can be reached at dgreer@greerresearch.com. |
