Profiles
Wall Street Journal Europe
23 March 2000
Tilling the Middle Ground
Consultant Brings Environmentalists and Executives Together
by Konstantin Richter
John Elkington may rack up as many frequent flier miles as some of the top executives he advises on boardroom presentations and after dinner speeches. But unlike most jet-setters, he offsets the environmental impact by paying air-travel tolls to a non-governmental organisation that plants trees and invests in renewable energy.
Mr Elkington, the chairman of London-based consultancy SustainAbility Ltd., has devoted his working life to bridging the gulf between environmentalism and business. En route, the author of books such as The Green Consumer Guide and The Green Capitalists has emerged as one of big business’s favourite environmentalists - a position that can be delicate at times. His major challenge is to remain true to the lofty ideals he shares with the community of non-governmental organisations, or NGOs, while addressing business concerns that such ideals don’t translate into commercially viable propositions.
“Often there’s no middle line, so you have to create it”, says the 50 year old British native, who co-founded SustainAbility in 1987. (The company’s name echoes its premise of aligning business strategy with social, economic and environmental accountability.) “Sometimes you’re pushing against business, sometimes against environmental activists.”
The balancing act translates into a peculiar business model. Though it had net profit of £675,000 (€1.1 million) last year, SustainAbility has tended to put its NGO credibility first and profitability second, carefully picking its clients and resisting the temptation to expand rapidly. For two years, the consultancy rejected the pleadings of Royal Dutch/Shell Group for its guidance after a public uproar forced the oil giant to abandon plans to dispose of its Brent Spar oil platform in the North Sea in 1995. (Now, Shell is one of its biggest clients). And in early 1999, SustainAbility bowed out of a lucrative agreement with Monsanto Co. when the U.S. pharmaceutical concern was in the midst of an escalating confrontation with European consumer groups over imports of genetically modified food.
Major clients including Ford Motor Co., Procter & Gamble Co. and ING Groep NV draw on Mr Elkington to tune in to NGO thinking and sensibilities. Mr Elkington, in return, insists on access to top-level executives like Shell Chairman Mark Moody-Stewart or Ford Chief Executive Jacques Nasser.
“John was brought in at the very top level,” says Deborah Zemke, director of corporate governance at Ford, adding that “we have a history of being quite insular in our thinking, but that’s changing with Jacques Nasser. There’s a greater commitment to listening to consumers and other stakeholders. John helps us to do that.”
Influential though it may be, SustainAbility has chosen not to expand beyond a limited core team. It’s 12 consultants advise on environmental reporting, assist companies in composing sustainability principles, and organise meetings with NGOs, academics and other stakeholder groups. Mr Elkington says he is uncomfortable with managing a bigger business.
For now, much of SustainAbility’s appeal is based on Mr Elkington, which raises the question of how a globe-trotting one-man show can help companies implement the mantra.
Competitors say Mr Elkington plays an important but limited role. “There is a difference between a guru/adviser and a professional consultant”, says Robin Bidwell, the chairman of Environmental Resources Management, which has 2,500 consultants in 32 countries. “John communicates well with the business community and raises awareness,” says Mr Bidwell, “but in order to get to the next stage, companies have to integrate (the vision) with proper management systems and incentives.”
Mr Elkington counters that he perceives his role to be “more of a cultural catalyst than a robot-like mechanism,” adding that “the nature of a catalyst is that it’s infinitesimally small and that it reacts and profoundly changes molecules and gets them to do wonderful things.”
The guru role certainly suits the tall and soft-spoken Mr Elkington, who charges corporate clients up to £3,000 a day. A prolific writer and newspaper columnist, Mr Elkington has perfected the art of recycling business jargon for environmental purposes. Reading the 1982 bestseller In Search of Excellence, written by Tom Peters and Robert H Waterman, Mr Elkington noticed that the management gurus made no reference to environmental performance. Soon he started marketing the term “environmental excellence.” Then, in 1995, Mr Elkington came up with “triple bottom line,” a term now widely used by companies to denote accountability in financial, environmental and ethical terms.
“We think of language as enormously important,” says Mr Elkington. “There was nothing new about the concept of the triple bottom line. But we were trying to simplify it into an advertising-like line.”
He says concepts like the triple bottom line give managers a framework for discussions and thought processes. But other environmental consultants argue that such jargon can get in the way when it comes to implementation. “He feels that it gives him credibility with the boardroom,” says a British environmentalist who has worked for some of the major consultancies in the field. “But the vast majority of middle managers who don’t have MBAs don’t know what to do with that kind of language. It might even make them doubt that it has business value.”
Such doubts weren’t evident on a recent morning in a high-ceilinged, freezing hotel ballroom outside the Scottish city of Aberdeen, where Mr Elkington addressed 27 managers of Shell Expro, the oil company’s UK exploration and production arm. Following a 20-minute presentation by Mr Elkington, groups of five junior to senior executives huddled around tables, enthusiastically discussing what the organisers described as “key features of Expro as the top-performing sustainable development company in 2010.”
Mr Elkington suggested “partner of choice for leading NGOs” and “willingness to say no to key prospects if they don’t fit triple bottom line.” But a second session after the coffee break proved more challenging, as participants struggled to identify the measures needed to get there. “It’s all statements, it’s all principles,” said one junior manager. “The question is how to make it work.” Added another: “There’s enough elevator-speech material, but people don’t know what to do with it.”
Still, participants said they were grateful for Mr Elkington’s contribution as an outside facilitator. “Part of the feeling is that we’re not working in isolation, that we’re working with the rest of the business and the environmental community,” said Judith Munro, an external-affairs manager.
SustainAbility failed as a mediator, however, when Monsanto clashed with European consumer groups and environmentalists over its genetically modified food imports. Mr Elkington was brought on board in March 1997 to assist Monsanto in communicating with NGO critics who worried about the long-term implications of genetic alterations. But Monsanto’s campaigning efforts backfired amid the widespread perception that it wasn’t taking its opponents seriously enough and that it was talking down to them. Monsanto, which in December 1999 agreed to merge with Pharmacia & Upjohn Inc., has scaled back some of its biotechnology projects and announced that it will spin off a part of its agricultural unit.
The fallout came as a shock to Mr Elkington, who believes in the potential environmental benefits of biotechnology but ultimately disagreed with Monsanto’s approach. In December 1998, SustainAbility consultants and outside advisers narrowly voted against maintaining the agreement with Monsanto. A Monsanto spokesman says only that the relationship was cancelled by mutual agreement.
“They were heading for a brick wall,” says Mr Elkington, adding that SustainAbility’s image wasn’t the main concern, but “we felt the risk of becoming a soft target (of the criticism) would have grown.”
Says Virginia Terry, one of SustainAbility’s four
directors: “Our credibility is our main asset, and we have to protect
that.”