What We Learned in the Rainforest: Nature's Lessons for the Green Building Industry
Thank you for the honor of joining you this morning. The green building industry is perhaps the MOST VIBRANT and MOST SUCCESSFUL element of the sustainability movement, and I am inspired by the example that you have set for those of us from around the world who are seeking to cultivate a sustainable economy.
ONE of your many great successes, in our view, is the LEED Standards for new and existing buildings, and commercial interiors.
We have included the LEED Standards as part of the corporate audit that we ask EVERY FUTURE 500 COMPANY to apply.
We believe that the LEED Standards should be – and can be – common practice for EVERY new and existing building of EVERY FORTUNE 500 COMPANY.
But as we all know, the LEED Standards alone are not enough. The LEED standards are a fine checklist of to-do’s. But to be fully adopted, and improved upon, they must be offered in the context of a larger strategy, a more ORGANIC approach – one which will create compelling economic and cultural incentives, so that the LEED standards – and better ones – are adhered to automatically.
For the Green Building movement to take this more ORGANIC approach may be difficult. Because it asks us to change the whole way we think about the green building industry. Even the name we use – GreenBuild – must be changed. Because in nature, nothing green is built. Instead, it is grown. It emerges from an organic process of feedback and adaptation.
That is true in our economy too. Because the truth is, we cannot build a sustainable economy. We can only GROW one.
We think of cities as collections of buildings and houses and roads and people. Physical things. Hardware. But in reality, cities are dynamic living systems, which evolve according to underlying principles. These principles operate almost like software does in our computer. They consist of a set of rules and values that through which human behavior flows, to create patterns of commerce, housing, and transportation that reflect the code in the software.
Unfortunately, the software that we use today, to design our communities, is obsolete. In some ways it is more than a century old.
For example, look at our rules for zoning, building codes, and property taxation. Most of these rules originated 100 years ago, when we were trying to build a basic INDUSTRIAL economy, not a SUSTAINABLE one.
Under those rules, our objective was to make it easy to convert the earth into cities, and its resources into products, as fast as possible.
To do this, we divided our cities mechanically into zones for each function of industry: zones for extracting resources from nature. Zones for manufacturing them into products. Zones for selling the products to people. Zones where we keep the people, to consume the products. And zones where we throw away the products, so we can make room in our houses for more.
Today’s system of zoning, building codes, property taxation, and development ALL ORIGINATED
- In 1880, when steam power and electricity broke the dense core of industrial cities.
- In the 1920’s, as automobiles spread development further
- And in the 1950s, when today’s SUBURBAN SPRAWL model originated.
So – when we develop and advocate LEEDS standards, and promote green building and development, we must ALWAYS REMEMBER that we are fighting a losing battle. The LEEDS standards will never dominate, until we update the basic SOFTWARE that dictates how we design our buildings and communities.
Today, the advocates of green development often advocate their interests in one of two ways:
1. Some focus on VOLUNTARY actions, like the LEEDS standards, or on proposals for green development projects.
2. Others focus on MANDATORY actions, trying to use the force of law to compel developers to “think green” when they design homes, stores, and buildings.
IMAGINE if, instead of focusing just on VOLUNTARY or MANDATORY actions, we changed the UNDERLYING signals so that they LED NATURALLY to the evolution of a sustainable community, one rich in the economic, social, cultural, and environmental qualities we seek?
IMAGINE if we installed new software that reflects what is possible in a 21st century economy – not a 19th century vision?
THAT is what I suggest you consider as a central challenge and opportunity for the Green Building industry.
Taking up this challenge will lead to much greater growth and profits for the Green Building industry – and most everyone in this room – because instead of being a small subsegment of a huge industry, Green Building can become the main stream of development, the dominant philosophy and practice.
What is the CORE PRINCIPLE that we can apply, to rewrite the software for the design of our communities?
And WHERE CAN WE LEARN how to apply this principle to create our sustainable future?
The PRINCIPLE that most powerfully drives sustainability is FEEDBACK-AND-ADAPTATION.
And the PLACE where this principle best illustrates its power is the RAINFOREST.
My most important lessons about business did not come from my ten years as Chairman and CEO of Mitsubishi Electric America. Or from my many years as Managing Director of Mitsubishi Electric Corporation. Or even from my seven years as Chairman of the Future 500 group of companies.
My most important lessons about business I learned in the forest. For those of you who have not read my book, let me explain.
My first lesson in the forest happened 43 years ago, days after I graduated from the University of British Columbia.
I was asleep when I got my lesson. This was unfortunate, because at the time I was driving a little British car, through the forests of the Canadian Rockies.
It is not advisable to drive a car through the Rockies when one is asleep. You might drive off a cliff, which is exactly what happened to me.
When I woke up in the hospital, I had plenty of time to reflect upon what I could learn from this incident. I remembered advice that my father had given me a few years before.
He knew I was an adventurer, and a risk taker. He liked that, but he didn’t want me to have too much of a good thing. So he took me aside and told me: "Do whatever you want. But don’t die."
I wanted to call my father to tell him that I had taken his good advice. But my jaw was clamped shut. So I couldn’t.
He found out anyway. The Japanese Consul General saw an article on my adventure in the local newspaper, and sent it to him.
I have since passed along my father’s advice to others. To me, this is what it means: "Do what you want. Follow your purpose. But don’t die."
For a young man, driving off a cliff in the Rocky Mountains teaches a valuable lesson:
STAY ALERT. WATCH WHERE YOU’RE GOING.
In other words – stay awake. Get feedback from what’s happening around you. If you are driving toward a cliff, it is best that you know this before you reach the cliff. Then, it is a good idea to ADAPT – to TURN – away from the cliff.
It seems to me that the global business community is driving quickly toward a cliff.
As we speed forward, we close our eyes tight, and ignore the feedback we receive, by repeating our mantra, over and over:
Consume. Consume. Consume. To drive our economy, create jobs, and sustain our affluence, we must consume. The more we consume, the better.
This mantra is like the wind against our faces – it is the stimulus that keeps us driving ever faster, rushing toward out destination, confident that our dreams will be fulfilled there.
The problem is, this mantra – to consume more and more of the earth’s physical resources – does not ever provide us with the qualities that we desire to receive – a sense of satisfaction, fulfillment, belonging, purpose, and community.
Of course, SOME consumption is essential if we are to live fulfilling lives. But as many of you prove every day, LESS consumption can bring us MORE satisfaction – better products, superior workplaces, stronger communities.
But less consumption does not AUTOMATICALLY lead to greater satisfaction. These two outcomes are EACH produced by a THIRD force – the principle I mentioned before: FEEDBACK-AND-ADAPTATION.
That may sound simplistic. But it is not. The vitality of nature – its capacity to cultivate ever more advanced forms of life, and to support them, for billions of years, on finite resources and a fixed flow of energy from the sun – this capacity comes from the process of feedback-and-adaptation through which nature evolves.
In the economy, the same is true. The success of the capitalist system is based on its capacity to harness marketplace feedback-and-adaptation.
The problem is that, in a global economy, too many costs are externalized to people OTHER than customers and shareholders, and never show up on the financial statements. As companies extend their reach thousands of miles from their headquarters, they become less and less tied to the communities they serve. They cut themselves off from feedback. They know nothing of their impacts on people, culture, health, or the environment. They subsist only on the shallowest feedback: direct internal financial returns.
This is dangerous. It leads, in effect, to false statements of corporate returns. These corporate statements ignore huge and growing cost categories. Because these costs are external, they build over time, to take dangerous and sometimes deadly forms.
Shareholders may not notice these unstated costs.
But STAKEHOLDERS DO notice these costs.
They notice the environmental costs when a new suburb destroys open space and farmland.
They notice the social costs when a new Walmart undermines a vibrant downtown.
They notice the cultural costs when corporate icons crowd out the SACRED CULTURAL icons of an indigenous community or a developing economy.
Too often, we in business CUT OURSELVES OFF from the feedback of these stakeholders. We try to ignore them, or overpower them, in the shortsighted belief that our profits depend on it.
That may be true in the short run, as it was for Enron. But it will not be true for long. Companies and economies that systematically repress feedback from this larger marketplace – the economic, social, AND environmental feedback of the triple bottom line – will ultimately doom themselves, and potentially all of us.
The LEED Standards are an important source of feedback. And we stand firmly behind them. Yet we know they are not enough. They are simply a “to do” list, one that good corporate citizens may tend to employ, if they care to take the time to do so.
Much of the time, they will not, because the feedback signals conveyed by LEED alone are too weak. The economic benefits are often too small, and the social and environmental benefits are too disperse, to compel companies to apply them consistently throughout the United States, much less in the developing world where they are most vitally needed.
So far, it seems that we only make major changes when we reach a crisis. The Bhopal disaster in India. The Exxon Valdez in Alaska. Shell’s human rights tragedy. Child labor issues for Nike. Forest protection issues for Mitsubishi. Governance safeguards against another Enron or WorldCom. Each of these crises forced sudden, dramatic changes. Changes that could have been made years before, at much lower cost.
How can the Green Building Industry help the world avoid an ECOLOGICAL crisis? How can we accelerate the growth of this movement, increase the profits of your sector, and deliver more social and environmental benefits to the world?
By adopting a business model that THRIVES on the principle of feedback-and-adaptation. The RAINFOREST business model. Let me explain how.
Three years ago, several executives and I boarded a small plane in Costa Rica, and flew out over the dense tropical rainforests of Tortuguerro, to begin an adventure we are still continuing today.
Looking over the miles of green that stretched out below us, it was easy to imagine the rainforest as a place of great resource abundance. But it is not.
The rainforest is constantly short of resources. Its soils are thin. Minerals are leached quickly by the rain. Even sunlight and water are scarce at the forest floor, blocked by the dense canopy above.
Yet despite this scarcity – or because of it – the rainforest is the MOST EFFECTIVE value creating system in the world.
· It is home to two-thirds of our biodiversity
· It is a catalyst for breakthrough innovation and continuous improvement
· And it is the kind of place that created ALL ADVANCED LIFE, even our own.
No smart business would ignore a system that had that capacity. A system that could adapt and excel in the face of all these LIMITS.
How does the rainforest develop this capacity? We began to understand when we stepped off our planes in Tortuguerro, boarded small boats, and began winding our way along the river.
Around every turn, birds were standing, perched almost like statues, in the MANGROVE swamps along the edge of the water.
Mangroves are pioneers. Ecologists call them r-Strategists – r for reproduction. Their survival strategy is simple: high fertility, and fast growth.
To support that growth, the mangroves have HUGE appetites. In fact, pioneers are among the least efficient plants on earth. But they do their job: the mangroves create a swamp.
Now, oddly enough, a mangrove SWAMP is not a very friendly place for a mangrove PLANT. As they grow and die, the mangroves fall to the ground and create debris. The debris builds up to form soil, which strands the mangrove plants high and dry. There they die, atop the very soil they created.
But the mangroves have served their ecological purpose. They create homes, niches, secure places where creatures begin to appear. Insects, fish, plants, birds. These remain even after the mangrove move on.
The mangrove to me is a bit like today’s industrial economy. The pioneer industrial economy exploded across our landscape, consuming HUGE amounts of resources, according to the classic r-strategist system: high fertility, and fast growth. Economies of scale, to replicate identical products by the billions.
Like the mangrove, industry’s pioneer phase will be short-lived. But if we learn the lesson of the mangrove swamp, we can now harness the fabric laid down by industry, and begin to cultivate a richer, more diverse and resilient human ecosystem as well.
So far, our learning has not been perfect. For example, by failing to account for its losses, Enron grew unsustainably. Then, because it failed to adapt, it collapsed.
Much of our INDUSTRIAL economy has been operating on an accounting system much like Enron’s. We too are blocking feedback. We are ignoring ecological and social costs and benefits that should appear on our balance sheets.
One way we do this is the way we account for hydrocarbons. When we buy hydrocarbons, we don’t count the cost of CREATING them. We just count the cost of EXTRACTING them, ready made, from the bank – the earth.
That’s like valuing our life savings according to the cost of driving to the ATM to withdraw them.
What is the difference between ENRON’S habit of hiding costs in off-the-books subsidiaries, and our ECONOMY-WIDE practice of hiding the loss of NATURAL capital by keeping THOSE off the books?
The IMPACT is the same as with Enron. There’s no feedback.
No feedback, no adaptation. No adaptation, no innovation. We slow our response to change. We make ourselves vulnerable. Gradually, the feedback signals grow louder, until we finally are forced to react to them. They take the form of Bhopal, Valdez, global warming, energy conflicts, terrorism, war.
What can the Green Building industry learn from these experiences? How can we make BETTER use of feedback?
Let me propose FOUR PRINCIPLES FROM THE RAINFOREST that can help us change our BUSINESS incentives, our FINANCING methods, our TAX system, and our ZONING system, to reflect the sustainability principles of the rainforest, and grow the demand for Green Building.
Principle Number 1: The rainforest is a place where “waste is food.”
You have probably heard this from sustainability leaders like Bill McDonough: WASTE IS FOOD.
That means that a sustainable community is one where pollution and waste are nearly zero – where every unit is either eliminated, or transformed, recycled into something of value.
To make this happen in the rainforest, gentle feedback signals give an advantage to plants and animals that minimize waste, or use it as food.
These signals are not harsh and selective, the way our laws are. They are gentle but consistent and automatic.
How can we make sure that “waste is food” in our communities?
Very simply, we provide simple systems of FEEDBACK, that encourage people to REDUCE AND RECYCLE pollution and waste.
For example, don’t just try to convince buyers and builders about long-term savings from more energy-efficient buildings. Instead, create new financing vehicles, that take future savings, and pay them to people today.
Buyers would gladly pay for super-efficient buildings, if the long term savings could show up today. And investors with capital to loan would gladly pay it to buyers today, if they could get back a higher return over the long term.
In addition, there are many ways we can ask local and state government to create better incentives for sustainable communities.
For example, charge for every unit of garbage that residents put out as trash, like Seattle does.
Charge for every gallon of water that people or companies use. Communities that do this save as much as 40% of their water.
Or, charge for every pound of pollution generated by our cars or our factories.
The charge does not need to be very much. It is amazing what people and companies will do, to save a little bit.
The magic in this is that it provides gentle, continuous FEEDBACK, and helps people ADAPT.
Principle Number Two of the rainforest is that it is a place where “value is created by design.”
Let me repeat that: VALUE IS CREATED BY DESIGN.
The rainforest has so few resources that it can’t afford to use them up. Instead, it has an extraordinary DESIGN, through which a rich array of qualities emerge. Millions of species, each designed to with others, to create a rich community.
The same is true of a sustainable HUMAN community. Instead of designing our cities to be a channel for the CONSUMPTION of value, we can design them to be a catalyst for the CREATION of value, through economic and cultural development, creating a rich quality of life.
For example, current PROPERTY TAXES discourage in-fill, and encourage sprawl. We tax undeveloped pockets of land at a LOWER rate than we tax developed land right around it. That makes it cheaper to sprawl OUTSIDE the city than to promote INFILL INSIDE the city. And suburbs are like giant pipelines that extract resources from our communities – they drain the city center as people leave for the suburbs; they drain petroleum since people become dependent on cars; and they drain our spirit as we begin to live separated and alienated from the other people in our communities.
This seems to be happening RIGHT HERE IN PITTSBURGH – TODAY! When I arrived, the newspaper headlines read: Pittsburgh is declaring itself a DISTRESSED CITY – because too much money and resources are flowing OUT of the city, and not enough is flowing IN!
Imagine if the Green Building community – meeting right here in Pittsburgh – can leave behind ideas that can SOLVE Pittsburgh’s problem, AND make it a green city?
I am sure there are people in this room, right now, who can make that happen. You probably already know that some cities in Pennsylvania have ALREADY FOUND a partial solution. They tax their land differently, to ENCOURAGE infill, and keep the city center vibrant, creative, and alive, like the rainforest.
A third principle is that the rainforest is a place where “feedback drives creativity.”
FEEDBACK DRIVES CREATIVITY
Above all – this is the rainforest principle that can be applied most effectively to cultivate a sustainable community. Harness feedback, to cultivate a rich, diverse community with the quality of life, diversity of lifestyles, and cultural richness you envision.
How can we cultivate this? With NEW SIGNALS. New FEEDBACK LOOPS that will grow a sustainable community organically – not seek to impose it by mandate.
One way we do this is by a simple software tool, that gives our companies feedback from the SOCIAL AND ENVIRONMENTAL marketplace, to supplement the feedback they already get from the ECONOMIC marketplace.
This software tool has ALREADY BEEN DEVELOPED AND USED. Several Future 500 companies – like Mitsubishi Electric, Bank of America, Nike, Coors, and Coca-Cola – helped to create and improve it.
This software takes the expectations of many different groups – the Global Reporting Initiative, the Dow Jones Sustainability Index, Domini, Calvert, FTSE, and even the LEEDS standards – and tells the company how it scores against those standards.
Then, the software tells them how their score is impacting their FINANCIAL bottom line.
The software is now being deployed by companies who will deploy it in 60 countries around the world in the next 12 months.
We call the software the CORPORATE ACCOUNTABILITY GAP AUDIT, and we ask that EVERY Future 500 company use it.
It enables Future 500 companies to measure NOT JUST their financial bottom line – their return to SHAREholders – but their TRIPLE BOTTOM LINE – their return to shareholders and STAKEholders.
Now, I have a very special announcement to make. This is the FIRST PLACE in the country where you will hear this announcement – because we just signed the AGREEMENT yesterday!
You probably all know about the CONFERENCE BOARD.
The Conference Board has just announced that they will establish a WORKING GROUP and an ACTION GROUP of their member companies – to apply the Corporate Accountability software, and record the IMPACTS on each participating company’s operations.
This is an extremely positive step, we believe. It means that the principles of Smart Growth, the LEEDS Standards, the Global Reporting Initiative, and standards of sustainability, will be used to calculate a TRIPLE BOTTOM LINE, at more of the world’s largest companies.
If your company is a Conference Board member – or might wish to learn more about the process – please meet me in the bookstore at 11 o’clock, and give me a business card or pick up the Rainforest book, and I will get the information to you.
A FOURTH Rainforest Principle is: The rainforest is a place where “diversity equals choice.”
Again, DIVERSITY EQUALS CHOICE.
The rainforest doesn’t depend on just one resource, like we depend on oil. The rainforest uses its resource scarcity to create MILLIONS of kinds of resources.
Just listen to the way this works in the Rainforest. Feedback leads to adaptations. Every adaptation leads to new varieties. Every new variety creates more diversity. And every increase in diversity means greater choice.
Think about it: Each diverse species is a SPECIAL, UNIQUE COLLECTION of qualities. Each species serves DIFFERENT NEEDS. Each fits PERFECTLY in one very specific niche in the forest. As it does, the rules of survival change – from the survival of the fittest, to the survival of ALL WHO FIT.
In the same way, a sustainable community has a rich array of people and neighborhoods. Each takes a different form. And each is unique, fitting perfectly its niche. In a sustainable community, competition and the survival of the fittest declines, as people integrate together, cooperatively, in a mutually supportive whole.
Imagine what you and your colleagues can develop, beginning at this conference, and after you return home, if YOU fit perfectly into YOUR niche, and contribute what YOU can to create sustainable communities.
How? Three steps.
First, sit down together with community and political leaders, at the local, state, and federal level – wherever you can have the greatest impact. Set aside your traditional positions. But hold on tight to your interests, desires, and values. Think: Which qualities and conditions are desirable? Which are undesirable? Which serve my interests, desires, and values? Which do not?
Second: What are the underlying values, practices, and legal designs that bring about the undesirable or desirable qualities?
Third: What NEW sets of values, practices, and legal designs will bring about the DESIRABLE qualities, and impose the costs of the UNDESIRABLE qualities on actions that cause them?
Do THAT – and you will grow rich and sustainable communities – not with political battles and mandates, but organically.
There is one other thing we must do – perhaps the most important step of all. We in business must begin to follow the examples of Andrew Carnegie here in Pittsburgh, Henry Ford in Detroit, Iwasaki of Mitsubishi, William McKnight of 3M and others, the inspired business activists who created some of the first great companies. Their greatness is NOT that they saw opportunity in selling to the already wealthy. Their greatness is that they saw opportunity in the poverty of the masses. The poor became their customer base, and ceased to be poor. And here we are, gathered here today.
This has never been so true as it is today, two years after September 11.
Imagine how different that day might have been, if a generation ago we had begun to create opportunity for the poor in the Middle East and Africa, and the alienated in the U.S. and Japan.
Imagine what it will be like a generation from now, if we do not do so starting today.
Today, 600 million of the Earth’s inhabitants -- in Europe, Japan, and the United States -- enjoy the material benefits of industrialism.
Soon, 2.5 billion more -- China, India, the former Soviet republics -- will join us.
And after them, the final 3 billion will seek the same.
To do that today, we would need three planets. But we have only one. In the face of limits, how can the needs of the world be met?
Last month, I read that the U.S. Secretary of Defense was frustrated that the War on Terrorism has not been as easy as he expected.
Let me suggest a better way to win this war.
The objective of terrorists is to foster terror, to make people afraid, and provoke them to anger. The terrorists that bombed the U.S. two years ago were trying to provoke us to be afraid, and to strike back in anger. They do not expect to win the support of the one billion RICHEST citizens of the world. They want to win the support of the 3 billion POOREST citizens of the world. They are trying to provoke us to strike back in fear and anger, and to turn those 3 billion against us.
Lately, it seems like we have been doing their job for them. It is important that we be careful not to fall into their trap. If we want to win the war on terrorism, we need to turn our attention to the people who the terrorists falsely claim to represent. We must begin to realize that THEIR interests are OUR interests.
The old way of thinking was that only the fittest survives. There is only one winner.
This is the way of the mangrove jungle in nature – the way of the old Fortune 500 in the economy – the way of war. In a simple, primitive system, only the one fittest survives.
But in the rainforest, the law takes a different form. From these simple early forms, a complex ecosystem emerges, filled with a rich array of niches. In the rainforest, the law is: Survival for all who fit.
The same can be true in our economy, and in our world.
Remember: In a rainforest economy, it is not a question of who is MOST fit – west or east, north or south, industrial or developing, corporate or NGO. It is a question of where we all BEST fit.
If we in the green building community FIT -- if we solve a social problem, fulfill a social need -- we will survive and excel. We will follow in the footsteps of Andrew Carnegie, right here in this community, and CREATE a new burst of wealth.
But if offer only minor refinements – without getting to the ROOT of the problem – we will miss our opportunity.
At the global level, if we in the industrial world FIT – if we advance the interests of all six billion of our neighbors – we will survive and excel. If we frighten and alienate them, we will not.
I am often asked whether the needs of the corporation and the world are in conflict. I do not believe they are. In the long run, they cannot be.
Conventional wisdom is that the highest mission of a corporation is to maximize profits. Maximize return to shareholders.
That is a myth. It has never been true. Profit is just money. And money is just a medium of exchange. You always trade it for something else.
So profits are NOT an end. They are a means to an end. The ECONOMIC bottom line ONLY EXISTS to feed the SOCIAL AND ENVIRONMENTAL bottom lines. That is why ALL companies must now measure their TRIPLE bottom line.
My philosophy is this: We don’t run our companies to earn profits. We earn profits to run our companies. Our companies have meaning and purpose -- a reason to be here.
People talk today about businesses needing to be responsible, as if this is something new we need to do, on top of everything ELSE we do. But sustainability is not something that one should do AS AN EXTRA BENEFIT of the business. The whole essence of the business should be sustainability. It must live for a purpose – and that purpose is to HELP US ALL TO LIVE. Otherwise, why should business live at all?
That suggests my FINAL lesson from the rainforest: For every creature in the rainforest, there is a mission, inscribed in its design, its DNA. This design – this code – makes each species, and each individual, unique. It gives each the capacity to serve its own needs, and to fit within and serve the needs of the whole.
For every business too there is a mission – an underlying purpose, a way that you fit into the world, to serve the world’s needs and your own. Your business TOO has a DNA, a design that makes it uniquely able to meet your needs, and those of your community – if you can find your way to fit.
So LIVE the mission of your business. For the MISSION OF BUSINESS -- THE MISSION OF CIVILIZATION -- IS TO FURTHER THE PATH OF DEVELOPMENT THAT BEGAN IN THE RAINFOREST. THE SAME PATH THAT CULTIVATED HUMAN CIVILIZATION, AND SUPPORTS US TODAY: TO DEVELOP THE HUMAN ECOSYSTEM, SUSTAINABLY, in all its diversity and complexity.
What I learned in the rainforest is easy to understand. We can use less, and have more. Consume less, and be more. It is the ONLY way. For the interests of business, and the interests of environment, are not incompatible. They are the east and west, north and south, Islam and Christendom, yin and yang, product and process, economy and ecology, mind and spirit -- two halves.
Only together can we make the world whole.
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