Deep in the Bins: A Look at Small Business Recycling Practices

I never thought that it would be easy to get small businesses recycling. A task like this requires more than simply distributing blue bins and registering businesses with recycling haulers. Through a fellowship with the Alcoa Foundation this summer, I’m experiencing the challenges first-hand.

GreenovateThough the city does not measure it, Boston’s commercial recycling rate is known to pale in comparison to its mediocre residential recycling rate of 19 percent. Anecdotally, local waste experts and businesses estimate that less than half of all businesses in Boston do any recycling at all, and those that do may only engage in periodic, material-specific recycling.

At the same time, the City of Boston has limited authority over commercial recycling practices. While the city manages residential waste contracts, businesses are left to their own devices. There is no universal approach to helping businesses recycle. This summer, I’m looking to change that.

I recently hit the pavement and spoke to store owners from Allston to Jamaica Plain and (almost) all neighborhoods between to enroll businesses in a recycling co-op pilot designed to reduce each businesses’ overall waste costs while increasing recycling rates in their neighborhoods.

The extent of the logistical challenges that reared their ugly heads was stunning. Of the dozens of business owners I’ve met, no two waste processes are the same. It seems that every owner has a personal story behind his or her waste practice, and the stories speak volumes about the savvy of different business owners, specific limitations within each neighborhood, persuasion of the customer base, and environmental awareness of the managers.

Consider the case of the Ill-Informed Manager. Just days ago I spoke with the manager of a popular Boston liquor store. Almost all of his store’s waste is cardboard—a material most recycling haulers will pick up at minimal cost because of its high resale value. With a trash bill of roughly $500 per month, this manager is paying over five times what he would pay a recycler to have the load hauled away. So one must wonder: how can Boston improve its channels of waste management education?

Next, we have the Cost-Conscious Owner. A South Boston bakery that has all the trappings of a conscientious vegan restaurant—bright walls, hipster art, chalkboard menus—does not recycle or compost despite its clear appeal to a green customer base. The barista, in slight embarrassment, told me that the manager simply does not want to pay for those services. If even the granola businesses won’t cover the cost of recycling, does a values argument for recycling have any standing?

I also met the Space-Constrained Manager, a pizza shop owner who prioritizes store space over nearly everything else. With no alley access for waste storage, she has daily trash and bi-weekly recycling pick-ups; she wishes she had more space for waste storage so she could cut costs by reducing the number of pick-ups per week. Though its historic city plan means narrow streets and few alleys, Boston is not unique in this sense. So how can a scalable program address the varied space challenges in urban areas?

Finally, the At-Home Recycler: down the street from the pizza shop, a home goods store owner opts to take her waste and recycling home in her car every day to deposit it in the residential waste stream. She stockpiles her cardboard waste in the store’s basement and, three times per year, a friend with a pick-up truck takes it all to an unknown location. With such niche approaches to waste management, how can the city measure commercial recycling rates?

These stories represent only a sliver of the vast array of waste approaches that businesses have adopted throughout Boston. Each store has its own bottom line, space constraints, and operating priorities that will trump recycling initiatives with conflicting requirements or considerations. It is clear that the challenge is to develop a program flexible enough to meet the myriad needs of each business, but also universal enough to be duplicated in a variety of industries and locations.

While some ideas have been put forth—the co-op, for instance—a few weeks on the street have offered me an important insight. In practice, the challenge is not so much the grand structure of a program, but it is the block-by-block, business-by-business flexibility of whatever program gets put in place. For a universal recycling plan to succeed it must be customizable for a wide range of priority sets and waste streams; we must find a way to aggregate all of these micro-problems into a single solution to the macro-problem: Boston’s low commercial recycling diversion rates.

Maryrose Myrtetus is an MBA student at The Yale School of Management. She studies the intersection between business practices and public policy as well as the application of the principles of innovation to entrenched societal challenges. This summer she is working with Greenovate Boston to improve commercial recycling rates by building a scalable, market-based co-op program. Outside of work she enjoys running along the Charles River.

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Want Scale? Then Measure and Report

by Ana Bachurova

“Having a redefined understanding of the true value of the organization is paramount for insuring that businesses are successful.”
– Rodney Irwin, Managing Director – Redefining Value & Education, World Business Council on Sustainable Development

Scale Up, this year’s U.S. Business Council on Sustainable Development conference at Yale, started with a stimulating question: why is scaling up so damn hard? Participants from the business community and academia articulated a few possibilities: there are too few change agents inside big corporations; perhaps we just aren’t innovative enough; or maybe we lack the necessary emotional intelligence tactics. While all of these discussions offered answers, I found that a major bottleneck to scaling up became evident during the session, “Measurement, Valuation, and Integrated Reporting.” The fact is, a company needs clear, consistent measurement and reporting to effectively scale up.

The session began with a global perspective, presented by Rodney Irwin of the World Business Council on Sustainable Development (WBCSD), who joined remotely from Paris. The good news, he noted, is that issues of sustainability and social impact have climbed up the business agenda. A study by the professional services firm KPMG found that in 2012-2013 the 100 largest global companies across 10 industry sectors (and their associated corporate foundations) invested, on average, the equivalent of 2.5 percent of their pre-tax profits in social and environmental programs. That said, only 20 percent of these companies have quantified metrics for measuring the impacts of these programs, making it difficult to appreciate the value of their efforts. The old management adage “What gets measured gets managed” holds true here. When managers need to select which programs to continue and scale, how are they going to decide? Should they look at inputs and outputs, or at outcomes and impacts?

Reporting MattersThe same applies for what is typically considered the core of a business. Business activities do not happen in a vacuum, so measuring and reporting only the financials omits part of the whole picture. This is where integrated reporting comes in. The WBCSD has begun discussions to consolidate existing efforts around integrated reporting and to develop a common understanding and application of the concept. Their recently launched “Redefining Value” initiative, for example, measures natural and social assets and costs as a complement to financial metrics. This will help managers make better business decisions based on a fuller picture of costs and benefits.

Natalie Allan Teear, of PwC, followed Irwin with a national perspective, walking the audience through the U.S. landscape of sustainability and integrated reporting. She highlighted the principle of materiality—the information needs of a reasonable investor—in the context of environmental and social issues. She also discussed the role of the Sustainability Accounting Standards Board (SASB) in establishing sustainability accounting standards for publicly-listed U.S. corporations. The SASB develops industry-specific metrics for sustainability that can be used in company filings to the Securities and Exchange Commission. Work is now underway for standards in three new sectors: transportation, services, and resource transformation.

Teear also demonstrated PwC’s Total Impact Measurement and Management (TIMM) framework, which provides a holistic view of an organization’s value-creation. TIMM looks beyond simply inputs and outputs, taking into account the outcome and impacts of activities. It was created to assist companies as they transition to integrated thinking and integrated reporting.

Teear’s presentation closed out with a well-known example of corporate leadership in this space: PUMA and its Environmental Profit and Loss Account (EP&L), which was designed to put a monetary value on the environmental footprint across the value chain—from the production of raw materials to the point of sale. The EP&L is used throughout PUMA as a tool for strategic decision-making, risk management, and transparency.

Erica Guerra from Holcim, a global building materials company, finished the session on an optimistic note. Holcim just released its Corporate Sustainable Development Report for 2013. It is not an integrated report per se, but it successfully shows how to incorporate sustainability impact indicators in day-to-day operations. Instead of simply looking back at past achievements, the report contains Holcim’s sustainability strategy, the Sustainable Development Ambition 2030. This strategy details Holcim’s aspiration to generate one-third of their revenue from the portfolio of Sustainability Enhanced Solutions, and it sets intermediate targets across three focus areas: Climate, Resources, and Communities. It is an excellent example of a company reevaluating its solutions portfolio and business model. According to Guerra, the formulation of this ambition presents an opportunity to change the entire materials industry.

Though the conference kicked off with a discussion of why scaling up is so damn hard, this panel nicely tempered the message: yes, that’s true, but integrated measuring and reporting can make the prospect much damn easier.

Ana Bachurova (MBA’14) is a graduate of the Yale School of Management. She has a background in international development, particularly with environmental governance, sustainable development of natural resources, and the water-energy nexus. Her academic and professional interests now focus on the dual linkage between business and sustainability: how business can offer solutions to environmental and societal problems, and how incorporating sustainability in corporate agendas can create value for business and society.

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Making the Big Pivot at Sustainable Brands 2014

by Marissa Galizia

sb2014At the Sustainable Brands San Diego Conference 2014, sustainability and marketing executives from top companies around the world gathered to discuss what their companies are doing to promote greater environmental sustainability while building the value of their brands. The depth of the sustainability programs represented varied from the deep green, like Patagonia and Buycott, to 3M, which had Forest Ethics protesting its use of the infamous SFI certification for its post-it notes from boats on the bay just outside the conference center. Yet, whether the changes the companies had made so far were big or small, the conversations at the conference did prove that corporate America is at the beginning of a great shift towards redefining their brands and the way that customers derive value from their products with health and sustainability in mind. Some companies were just further along than others.

Front and center of this discussion was School of Forestry and pivotEnvironmental Studies alumnus Andrew Winston, who defines this shift as, The Big Pivot, the title of his latest book, which every conference attendee received a copy of. The book describes the challenges that businesses will face given an increasingly resource constrained world due to climate change and population growth. It then provides ten strategies for leaders to use to change the way their companies operate to succeed in this fundamentally changed world. The strategies advocate brilliant things like taking a longer-term view, changing the incentives to engage the whole organization, redefining ROI, inspiring customers to care and use less, and being extremely innovative and collaborative to deeply challenge conventional wisdom. Winston explained these strategies in one of the first plenaries of the conference and they were echoed in speeches and conversations all week long.

I got to sit down with Winston between two sessions to ask him about some of the challenges leaders and companies would face in actually implementing these changes and achieving that paradoxical goal of economic growth while reducing environmental impact that everyone at the conference was after. I am going to focus on two in particular here: the need to innovate away the tradeoffs that are commonly associated with environmentally preferable products so we don’t even need to talk to customers about “sustainability,” while at the same time needing to inspire consumers to care about using less.

winstonThese were both big themes of the conference. In the book, Winston calls for “heretical innovation” such that we create things that are simply better and inherently more sustainable. Recent popular innovations like Uber and Lyft got a great deal of attention for advancing the “sharing” or “collaborative” economy and making it such that people have access to car services, without actually needing to produce any additional cars. They cause us to question our assumptions about needing to own a car. As a result, it can be argued that they are simply better at providing the services that people need, while reducing resource use on new cars.

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The Urban Endgame

karen-seto-yale-fes1-browserAccording to Karen Seto, Professor of Geography and Urbanization at Yale F&ES, cities are not only laboratories for sustainability, but they are defining the newest frontiers of sustainability. Cities are where we will see changes that matter, and where we will transform how our society uses energy and resources.

Seto offered this insight at Scale Up, this year’s annual U.S. Business Council for Sustainable Development Conference held June 25-26. She was responding to a question posed by conference organizers and attendees: how can projects that address urban planning, building efficiency, and mobility on a macro level utilize cities as a lab to introduce, test, and deploy new ideas and methodologies that promote urban sustainability?

Seto began by presenting results from the Human Settlements, Infrastructure, and Spatial Planning chapter of the IPCC Mitigation Working Group’s contribution to the Fifth Assessment Report (AR5). Seto was a lead author of this chapter, which was released earlier this year. The findings reveal that urban areas are the focal point of energy use and CO2 emissions, consuming and emitting around three-quarters of global totals. Within the Organization for Economic Cooperation and Development (OECD), cities nonetheless produce fewer emissions per capita than their countries’ national averages. But the opposite is true of cities in non-OECD countries, where much of the future urban growth will occur. Across the globe, and in non-OECD countries in particular, urban areas are the fastest growing human habitat, as people flock to centers where jobs are plentiful and access to modern technology is available.

In light of the need to reduce global carbon emissions, the fact that our growing global population is demanding access to energy-intensive urban areas may sound like a complex and daunting challenge. But Seto brought a message of optimism to the conference. She framed the issue of unprecedented population growth in urban areas as, in fact, a source of unprecedented opportunity for business and industry to implement positive change.

With a growing population and a global shift toward urban centers, it is estimated that we will double or triple our urban infrastructure in the next quarter-century. This means that two-thirds of our future urban areas have yet to be designed and built. Given this outlook, Seto urged everyone to search for and identify “synergistic win-win solutions” to unsustainable practices in cities. She noted that there are “great achievements to target at the local level.”

For example, Seto identifies urban form as an important factor in determining a city’s greenhouse gas emissions. More specifically, co-locating denser centers of residential and commercial activities will reduce transportation emissions, which account for about 27 percent of total urban emission. And as societies’ tastes change, this density may actually lead to happier people.

Further, Seto stresses that the critical piece of the puzzle for achieving the sustainability outcomes we need is pursuing strategies that cut across sectors. The traditional approach of separating planning agencies from sustainability offices, of separating energy from water from transportation departments, will continue to obscure systemic changes that could allow us to create more efficiently designed cities. Here, we see an opportunity for the private sector to pursue public-private partnerships, allowing innovative ideas from the business world to infiltrate city infrastructure.

With this realization and her time on stage at an end, Seto made clear that the recognition of today’s problems is the first step toward tomorrow’s solutions. Cities may be a testing ground for projects coming up, but they are also the central force driving a sustainable future. They are the endgame.

Sarah Bolthrunis is an MBA/MESc joint-degree student (‘16) at Yale School of Management and Yale School of Forestry and Environmental Studies. Her academic and professional interests focus on coastal adaptation to climate change impacts. Specifically, her summer research is in assessing the economic risks faced by coastal energy infrastructure due to sea level rise and storm surge. In her free time, Sarah enjoys marathon training and experimenting with vegan food.

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Yale’s Nespresso Sustainability team earns top honors

NespressoIn the last month and a half, FES/SOM joint degree students Brendan Edgerton, Susannah Harris, Sarah Smith, and Heather West went from writing final papers to participating in real world sustainability planning with Nespresso. CBEY is proud to announce that, as runners-up in the Nespresso MBA Sustainability Challenge, the team went from submitting their carbon reduction proposal this spring,  to being selected as Challenge finalists in May, to presenting to leading thinkers at Nespresso headquarters in Lausanne in June. Donning aprons with CBEY Program Director Stuart DeCew (left), the team also got to get a close look at how the Nespresso process works, and got to try many cups of the final product.

nespresso cup

From farm to packaging, highlights of their proposal include:

  • Filling a new capsule with shade grown coffee and marketing its social and environmental benefits
  • Implementing an on-farm polyculture biomass strategy with built-in climate change risk reduction and revenue incentives for farmers

  • Modeling how to scale the approach across Nespresso’s supply chain by using regionally available materials and sharing resources and waste streams
  • Leveraging Costa Rica’s 2021 carbon neutrality goals, thereby aligning the project with both Nespresso and Costa Rica’s greenhouse gas reduction desires.

nespresso heatherLearn more about their process, how the experience fits in with their work at Yale, and the key aspects of their approach in The Guardian’s Sustainable Business Series. Before making their way to Switzerland, Heather and Sarah spoke with Tim Smedley about their project, as well as the importance of practical, sustainable approaches to business in their graduate school work, and the team had the chance to explain their approach on camera while in Lausanne.

Make sure to watch these CBEY rockstars in action and check out the other finalists’ proposals. Congrats to the team!

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