ICYMI: Special Feature: Sustainability in Detroit

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SPECIAL FEATURE

SUSTAINABILITY IN DETROIT A look at how Pashon Murray, cofounder of Detroit Dirt, and four other leaders are advancing sustainability in Detroit

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TABLE OF CONTENTS

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5 — JOEL HOWRANI HEERES

THE VALUE OF STAKEHOLDER DIALOGUE

Office of Sustainability, City of Detroit

6 — TIMOTHY PAULE Detroit Hives

8 — PALENCIA MOBLEY Detroit Water and Sewerage Department

9 — PASHON MURRAY

SPECIAL FEATURE

Detroit Dirt

10 — ABIR ALI

SUSTAINABILITY IN DETROIT

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ÁRVAI RENEWS HIS TERM

FACULTY

STUDENTS

ERB IN THE MEDIA

POSTDOCTORAL FELLOWS

ALUMNI

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RESEARCH

THE ERB INSTITUTE is the University of Michigan’s business-sustainability partnership between the University of Michigan’s Ross School of Business and the School for Environment and Sustainability. We work with business leaders to help them improve company competitiveness through enhanced social, environmental and economic performance. Our degree programs prepare students to be future business leaders for sustainability, while our research and executive education prepare current business leaders for what’s next in sustainability.

ICYMI! is a business-focused publication sharing the work of the Erb Institute. In this and future publications, we will share how our research, teaching and engagement are providing ideas and frameworks that will help businesses move forward in meeting their sustainability challenges.

COMMUNITY

Project Manager Carmen Quinonez Writer Allison Torres Burtka Selected Photography Marc-Grégor Campredon Design Susan Ackermann Printing ULitho, Ann Arbor

BY TERRY NELIDOV Managing Director, Erb Institute

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recently joined the stakeholder advisory councils of two global sustainability networks and attended my first council meetings—SustainAbility’s February meeting in London, and iSeal Alliance’s council and annual conference at the Hague in June.

Erb faculty, researchers and staff are eager to have a seat at the table in leading multi-stakeholder fora like these, as part of the institute’s business engagement strategy. These networks provide global platforms to share Erb thought leadership and impact initiatives. Likewise, the institute becomes part of the sustainability dialogue worldwide and hears firsthand from private-sector and policy leaders what sustainability challenges they’re prioritizing; where they’re looking for business opportunity; and how the Erb Institute can catalyze impact with our next generation of research, partnership projects and convenings.

Although iSeal is more concentrated on standards and compliance, and SustainAbility addresses a broader range of issues, some common themes emerged in both discussions. Here are some of the issues, challenges and aspirations that I heard driving these global dialogues.

COMMON THEMES GO GLOBAL! The sustainability “center of gravity” has shifted from the West to emerging economies. And it’s not just the story of a reluctant U.S. administration to accept climate change or promote circular economy. Rather, it’s the explosive economic growth of Chinese AI, the global aspirations of China’s Belt and Road Initiative, European policy leadership, and emerging economic powerhouses from India to Indonesia, and Brazil to Nigeria. Has the global sustainability community truly accepted this new reality, and are we prepared to work with new forms of government, new global brands and emerging consumers in response to what they value in environmental, social, labor and humanrights impact?

POLICY. Business, and its nonprofit partners, can’t do it alone, nor should they try! We can’t aspire to global impact without first finding the platforms to elevate company leadership to the industry level, and then from industry to national policy, and eventually to global policy—all of this through multilateral organizations, global nonprofit networks, transnational codes of conduct, trade agreements and regional collaborations. Are we thinking enough about how to take innovations to scale, develop industry collaborations, and advocate for the next generation of global policy?

AI. Artificial intelligence is already here. The discussion is moving on to the ETA of “super intelligence.” Along with all the hoped-for benefits—from improved health and well-being, to innovative climate solutions, smart cities and personalized commerce—will also come profound changes

in the nature of work, personal privacy, global governance and our very understanding of what it means to be human. Studies vary, but a consensus seems to be emerging that between one-third and one-half of today’s jobs will be at risk for automation by the 2030s. While many environmental benefits are expected, we haven’t even begun to plan for the downside of social, community, labor and human-rights impacts. Are we balancing our lofty sustainability aspirations with the very real possibility of intensified labor conflict, social unrest and geopolitical competition?

STORYTELLING. We are still human, and humans love a good story.

Psychology and decision-making science are just now explaining why, but honestly, we’ve known for millennia that people respond to stories, especially if the protagonists are fellow humans. The social and environmental impact of our work is all about people and their stories, yet this is how we typically make our point: “Oh, so you’re not quite convinced; would a little more (scary) climate data help?” How do we better connect our sustainability work to real people’s everyday hopes, dreams, fears and hesitations?

BIG & BOLD. I saw this point of convergence across the council discussions: We are technocrats, practitioners and implementers. We plan, do, check, act. We make commitments and get things done. But are we thinking big and bold? Are our checklists dimensioned at the scale of the challenges—and opportunities—that business and society face? How will we address climate change? How in the world are we going to get the SDGs done? How do we lift our own hesitations and self-censure to imagine a new role for business in society?

For the Erb Institute, the timing is perfect to consider these questions and themes, as we kick off our strategic planning process in fall 2019.

Indeed, that last question will be the first in our strategic planning dialogues.

This year, we will craft our 2020-25 strategy, starting with researching issues and trends, and then complementing the data with a series of dialogue sessions across our key stakeholder groups—including students, alumni, business partners, academic thought leaders and global nonprofits.

We hope to connect with you in one of these sessions, to help explore—in the words of the Erb Institute mission—how we can create a sustainable world through the power of business.

ICYMI! FALL 2019

SUSTAINABILITY IN DETROIT

BY ALLISON TORRES BURTKA

What does sustainability look like in Detroit, a city that is going through changes that some consider a renaissance? The Erb Institute talked with five people who are working to make Detroit more sustainable—in wildly divergent ways, from bees, to dirt, to real estate development, to stormwater.

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PART I

THE CITY STEPS UP

Joel Howrani Heeres

Office of Sustainability, City of Detroit

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he city recently released its Sustainability Action Agenda, which aims to achieve four main outcomes: healthy, thriving people; affordable, quality homes; clean, connected neighborhoods; and an equitable, green city. The action agenda sets 10 goals, as well as dozens of actions to meet them.

The goals are: 1. Increase access to healthy food, green spaces and recreation opportunities.

2. Improve air quality and reduce exposure to pollution.

3. Advance equity in access to economic opportunity.

4. Reduce the total costs of housing, including utilities.

5. Improve the health and safety of existing and new housing.

6. Transform vacant lots and structures into safe, productive, sustainable spaces.

7. Reduce waste sent to landfills.

8. Make it easier and safer to get around Detroit without a personal vehicle.

9. Enhance infrastructure and operations to improve resilience to climate impacts.

10. Reduce municipal and citywide greenhouse gas emissions.

In developing this agenda, the city took an equitable approach to engagement, “really trying to listen and understand the needs of everyday Detroiters through the use of ambassadors, interactive websites, focus groups, town halls, surveys and SMS responses,” said Joel Howrani Heeres, director of the city’s Office of Sustainability.

Since the city released the action agenda, people have been “excited that the city is taking a serious stance on sustainability and climate issues and putting resources behind it,” he said. For example, “there has been a lot of excitement about the ability of people in multifamily properties to have greater access to recycling.”

Detroit is already moving toward these goals. In July, the city passed an ordinance aimed at cutting greenhouse gases by 30 percent in five years. “Achieving our climate goals will be challenging, although the recent greenhouse gas ordinance is good movement towards that. We will need to change our standard operating procedures about how we build, retrofit, and operate

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Timothy Paule Detroit Hives

PART II

buildings in our city, not to mention transportation,” Howrani Heeres noted.

The city has also made progress on greenspace.

“We have significant momentum towards increasing access to greenspace for Detroiters, having renovated 40 parks in the last four years, with plans to renovate 99 additional parks in the next 10 years,” he said.

What needs to happen to make Detroit more sustainable?

“First, we need to ensure that all Detroiters can be healthy and thriving. That means having access to economic opportunity, which we see growing with the [Fiat Chrysler Automobiles] plant and other new job opportunities. Additionally, they must have access to high-quality, affordable housing. Finally, they must be able to take actions to better steward the planet, by using less energy, sending less waste to the landfill, and to be able to thrive in the face of the climate crisis.”

How is the city poised to become more sustainable than it has been in the past?

“We are embarking on the largest recycling expansion in the city’s history over the next year. We are embarking on an ambitious climate agenda to lower both municipal and citywide emissions. We are continuing the largest expansion of non-car infrastructure for any city in North America. Finally, I think that more and more people realize that a healthy environment is not a luxury, but is rather deeply intertwined with their own quality of life.”

MAKING WAY FOR BEES

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“We reimagine these vacant lots, and we transform them into educational apiaries, whereby they’re beautified— and now they’re serving as an educational hub to teach the community about the importance of bees, and also to give them access to local raw honey.”

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little over two years ago, Timothy Paule and Nicole Lindsey started the nonprofit Detroit Hives, transforming vacant lots into urban bee farms. They also teach the community about the importance of honeybees and conservation.

“We’re working to strengthen our communities as well as our bee population,” Paule said. Vacant lots often mean blight, potential injuries and crime. “But one great thing about these vacant lots is that they’ve been overgrown over time . . . a lot of neighbors have left, but their fruit trees and their plants are still there.” These lots are full of plants and wildflowers that “provide food security for pollinators, and what’s happening is that it’s actually boosting native bee populations,”

he explained. Then, “in return, these pollinators are providing food security to us, by way of cross-pollinating our local gardens and community gardens.”

Detroit Hives has seven locations and 35 beehives in Detroit, only some of them in formerly vacant lots. They installed a hive at Mumford High School, Paule’s alma mater, where they speak to students regularly.

Detroit Hives also partners with community farms, which offer sources of pollen and nectar for the bees, and the bees in turn boost the farms’ yield. “This provides more food to the community,” Paule said.

The apiaries are intended to be inviting spaces for the community.

“We reimagine these vacant lots, and we transform them into educational apiaries, whereby they’re beautified—and now they’re serving as an educational hub to teach the community about the importance of bees, and also to give them access to local raw honey.”

Detroit Hives’ East Warren apiary has hosted well over 500 tours, for local schools, businesses and community organizations. Paule said that multiple generations sometimes show up for tours: children, their parents and their grandparents. Sometimes the grandparents grew up on farms in the South and migrated to Michigan, but “they still remember how honey can heal them,” he said. At the same time, “a lot of people want to know where their food comes from,” and they look for local raw honey.

Children—particularly high schoolers—might initially be uninterested in bees. “But when we bring them to the bee farm, that’s when we know we have their full attention, because this is something they’ve never seen before. They’re bringing out their cell phones and taking pictures, they’re asking questions, they’re raising hands—so we know they’re more engaged,” Paule said. Detroit Hives also uses art, music and technology to engage youth. For example, they’re working on a recording of bees buzzing to incorporate into music. “Art is the way we can usher in these conversations” about bees and conservation, he said.

Detroit Hives allow Detroit residents to learn about something that they might never be exposed to otherwise—or that they might have to drive hours to get to. With apiaries right in the city, people can learn more about where their food comes from and their local environment. Paule, who is African American, also noted that many people haven’t seen black beekeepers. So the experience might open doors for black children to get interested in beekeeping or conservation.

What does a more sustainable Detroit look like to you?

“A lot of the spaces we create, in regard to development—we should make them more inclusive,” Paule said. “A lot of times, we create spaces that are just for people, and we kind of leave out nature and environment.

We need to figure out ways we can make them more inclusive. That would make a more sustainable Detroit—everyone and everything would be included.”

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PART IV PART III

STORMWATER

THE DIRT Pashon Murray Detroit Dirt

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obody really knows what the climate will look like in 10 or 20 years, but this year, Detroit has seen excessive rainfall, said Palencia Mobley, deputy director and chief engineer of the Detroit Water and Sewerage Department (DWSD). “This year, we’ve seen river levels that we’ve never ever seen in the City of Detroit. And some people may think it’s temporary— others of us may think it’s the new normal,” she said.

“How do you adapt to that?”

One way the city is adapting is through green stormwater infrastructure (GSI) projects, such as planting trees, demolishing and “greening” vacant properties, converting impervious parking areas into pervious ones, and building swales and bioretention practices (also called rain gardens). They manage stormwater runoff by retaining the water on site or, in some cases, slowing it down before it reaches the city’s combined sewer system.

Some municipalities have separate sewer systems, where surface runoff goes directly into a stream or other waterbody without being treated, and only wastewater goes through the treatment system. Combined systems combine surface runoff with wastewater for treatment. Managing heavy rainfall to avoid overtaxing the combined system is a challenge, and GSI projects are intended to mitigate the challenge where appropriate.

Palencia Mobley

Detroit Water and Sewerage Department

“Green infrastructure typically acts in a manner that we call ‘shave the peak.’ It can help us delay the rate at which the system ultimately sees the flows from rainfall runoff,” Mobley said. She explained that with GSI, “instead of the stormwater running right off the road, hitting the catch basin and going directly into the combined sewer system, it runs off the road, goes into an inlet structure that may have formerly been a catch basin, and goes into either a swale or bioretention practice, or an underground subsurface storage tank.” Then whatever isn’t soaked up by the vegetation “ultimately goes into the system, but it’s delayed, so it’s not hitting at the same time everything else is.”

Many of the city’s GSI projects are in the right of way, managing stormwater runoff from roadways by building a bioretention practice or swale. “Stormwater management in Detroit is extremely challenging because Detroit is very flat, so we have to do a lot of upfront site work to try to figure out how to make something work,” Mobley said. Lack of data is another challenge, she said. “There’s really no data on how the catch basins connect to each other and how they ultimately connect to the combined sewer system.” So they may think that runoff follows a certain path based

on elevation and grade, “and then you start to dig down and see that this catch basin may not really be connected to the other ones the way that you thought.”

An essential part of sustainability is “trying to preserve what you have in terms of resources,” Mobley said. With Detroit’s combined sewer system, GSI projects help reduce the number of wet weather treatment facilities the city needs to manage combined flows.

What does a more sustainable Detroit look like to you?

“From a perspective of green stormwater infrastructure and overall infrastructure management, what Detroit needs to look at as it relates to sustainability is how to make best use of existing infrastructure, and getting a very good and thorough understanding of all the systems that are in place, and whether or not they can be operated or managed or retrofitted to accommodate changes that may potentially arise due to climate change,” Mobley said.

For example, if the city knew that winters would become unusually cold, it could consider putting water mains down lower to reduce the potential water main breaks, or using different materials to withstand colder temperatures, she said. “Those are the types of things we have to look at to understand how to behave in a way that adapts to climate change and makes us more resilient and sustainable.”

etroit Dirt makes waste into a commodity. It takes food waste, green waste, spent grains and herbivore manure and uses an aerobic process to make it into high-quality compost for local urban farmers and gardeners—and whoever else can use it.

Two of Detroit Dirt’s major partners are General Motors and the Detroit Zoological Society, whose food waste and animal waste gets diverted from the landfill. The process reflects circular economy principles, and “these are solutions and practices that will impact our culture—and policies we can adopt,” said Detroit Dirt cofounder Pashon Murray.

“We need investment in infrastructure so we can build sustainable systems from the best practices.” The organization’s mission is to create a zero-waste mindset and drive forward a low-carbon economy.

The strength of Detroit Dirt’s partnerships has been crucial since the beginning, Murray said. The pilot began with General Motors’ Chevy Volt plant and the Detroit Zoological Society in 2013. At first, the zoo “didn’t really have a place to send the manure—it was kind of inconsistent. Farmers could use it or they could send it to landfill. The benefit was that if they basically sourced that to us, we would do something positive. And that would be positive reflection on them as well.”

The Detroit Zoological Society has an anaerobic biodigester, which supplies Detroit Dirt with tons of herbivore compost. “The anaerobic digester provides methane generation, and they power the animal hospital with renewable energy,” she explained. “When you really think about it, the system is producing energy, helping Detroit Dirt produce a product and sustaining the ecosystem while mitigating climate change.”

Initially, General Motors didn’t have a composting program in place. Now, the company’s Detroit headquarters collects food waste from its roughly 30 restaurants and takes it to a designated docking

area. Detroit Dirt recovers food scraps from the headquarters three times per week and processes the materials to produce compost.

“Relationships, for me, have always been one of the main ingredients for success,” Murray said. “If you get the General Motors and Detroit Zoological Societies of the world, if the community knows that these companies are working with you,” then other people in the community are likely to follow that lead, she explained. Detroit Dirt also works with other large and small partners, including some local coffee shops and breweries, whose food waste gets added to the mix.

Anyone can buy compost through Detroit Dirt’s online store, and the company sells it wholesale to gardeners and urban farmers. “We were approved for a new composting site though the city council in April, which is going to be four times the size of the current site,” Murray said. “We’ll be able to supply more wholesale in the future. Next year, our hopes are to expand to scale the model and to push the retail side.”

What does sustainability look like?

“Sustainability looks like cities that are viable while sustaining the economy and ecosystem, our buildings, mass transportation, energy usage and roads—infrastructure as a whole. If we implement policies and

legislation that will regulate our practices, we need to invest in infrastructure that will help us sustain humanity. Climate change is real, and in order for the next generation to carry the torch and live a fulfilled life, we need investment with focus on climate mitigation and resiliency,” she said.

In Detroit, “I would love for our city to implement zero-waste practices over the next five years. We need curbside composting, residential as well as commercial.”

When the United Nations created the Sustainable Development Goals (SDGs), they set a standard for everyone to follow, Murray said. “They brought the climate issues right to our doorsteps without asking for permission, and taking leadership for the world.

We can’t afford to ignore these issues. Now we have the United Nations saying, ‘Join forces with us, it’s all of our responsibility, and let’s stop discussing these issues and create the plan of action.’ Looking at the climate crisis from a global perspective is one thing, but now we can start creating plans nationally, regionally and individually.”

With food waste, this means we can manage our food systems better and reduce greenhouse gas emissions. Murray added, “Empowering local economies will empower global economies.”

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PART V

REAL ESTATE DEVELOPMENT A

bir Ali describes herself as a city builder. Her career has included architecture, philanthropy, design and real estate—with specialized positions across disciplines. In real estate, she has worked with the Platform, a development firm that aims to contribute to Detroit’s resurgence. Its projects run the gamut from new construction and adaptive reuse to rehab and historic rehab, across several neighborhoods. It was here that Ali began reexamining the practice of sustainability.

“The acceptance of a project by neighbors and citizens is what ultimately makes a project sustainable,” Ali explained. “The exit strategy is a very real part of the development process. The developer will, at some point, sell.” So Ali, as a steward for design and culture in development, is “very interested in what we leave behind for the city, regardless of how the ownership transition happens.” This means that development “should be planned and designed thoughtfully and confidently up front, so that it matters less whose hands it’s in moving forward. The project—for the next several decades—should blend in and enhance the neighborhood it’s in.”

In some cities, sustainable green thinking is built into development practices, but that’s not yet the case in Detroit. “It’s not quite instilled in our culture of development and construction, but it’s slowly getting there,” Ali said. Many buildings in Detroit, especially around commercial corridors, have suffered from deferred maintenance and neglect, so they require substantial initial investment just to bring them back up to a baseline, she explained.

One example is the Platform’s work to rehab an old bank building in Old Redford, dubbed the Obama Building because of a painting above the entrance by a local artist. It will contain retail and residential units, and the Platform is working with residents, small

“To me, sustainability is connected to longevity and the way a project will age, because I ultimately believe that no matter what we build and whatever the timeline is around ownership with what’s built, the city is inheriting that piece of architecture for decades to come.”

—Abir Ali

businesses, community organizations and the city to make sure the building will fit into the neighborhood.

They are “looking forward to bringing life back into the building,” Ali said. And, in doing so, they also hope to open-source the project, so that lessons can be shared and replicated elsewhere.

“By making the rehab process transparent, developers can create case studies to open-source, which would make development in Detroit less mysterious and potentially catalyze other projects and developers,” Ali said. “I like to connect the dots as much as possible and build infrastructure on one project that can be used on other projects. Knowledge and smart infrastructure is at the heart of sustainability,” she added.

An example of this infrastructure is the fourth floor of the Fisher Building, a previously dormant space that once served as doctor and dentist offices.

“We took a handful of these old offices, rehabbed them into simple studios, and met the market where it was”—inviting emerging art and design practitioners in at accessible lease rates and terms, she explained.

The spaces are now 98% occupied. These creative tenants work in a building with a rich history—Ali points out that the Fisher Building is known as Detroit’s “largest art object”—and they diversify the building’s largely office tenant mix.

With these tenants, the group can “tap into that talent pool to be able to do projects on other developments,” from painting murals on buildings to graphic design work, Ali said. “This project created an infrastructure of human talent—a pipeline that can actually feed other projects.”

What does sustainability in Detroit mean to you?

“To me, sustainability is connected to longevity and the way a project will age, because I ultimately believe that no matter what we build and whatever the timeline is around ownership with what’s built, the city is inheriting that piece of architecture for decades to come.”

What does this kind of sustainability require?

“At the moment, sustainability on existing buildings is a 2-step process: One is addressing all the deferred and delayed maintenance common to many buildings in the city and getting them back to a functional baseline. Once we acknowledge that work as standard practice and we’re really good at executing, it’s naturally integrating the development into its neighborhood and making it as smart and thoughtful as possible. I think you have to understand Step 1 to do Step 2. Right now, Step 1 is a very big problem.”

An old bank building in Old Redford, dubbed the Obama Building PHOTOGRAPHY

BY ARA HOWRANI

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ELEMENTS OF SUSTAINABILITY “This is a great example of collaboration between academia and the business world to better educate people on the complex challenges of building a sustainable world.”

TOM LYON Erb Institute faculty

CAN WE LEAVE IT TO THE NEXT GENERATION?

IN APRIL,

the Erb Institute again partnered with Dow on the second annual Elements of Sustainability Series. Designed to deliver valuable business sustainability insights, this open-source video series includes five new lectures from prominent academics on topics ranging from Responsible Operations and Supply Chain Management to the Circular Economy and Industrial Ecology.

The Dow Elements of Sustainability Series brings together an all-star cast of faculty who specialize in corporate sustainability, and it offers free lectures to the public on topics ranging from the history of sustainable business, to the use of life-cycle analysis to solve environmental problems, to the role of eco-certification in building greener consumer markets.

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BY MELISSA ZAKSEK Research Manager Erb Institute

n June, I had the good fortune of participating in a lively panel discussion at Innovation Forum’s “Positive Impact” conference in London. This panel delved into some early research on Generation Z (people currently between the ages of 7 and 22) and explored what we might expect from this generation of rising consumers and change agents. As far as panels go, this was by far the most fun and engaging panel I’ve seen at a conference! Heralding from the finance, NGO and independent research sectors, all my copanelists offered incredibly unique perspectives and insights.

Unlike other panels I’ve seen, where drawing out questions and reactions is like pulling teeth, the audience quickly jumped in, sharing their observations and insights. The session was very interactive and inspiring—panelists and audience members alike shared stories and examples of younger people leading the way in making the world a more sustainable place.

At the Erb Institute, we are seeing a tremendous increase in interest and demand among U-M’s younger students for

business sustainability content. Not only do our undergraduate students want the world to change, but they also want the skills, training and access to jobs to be able to bring about that change. That being said, as we know from research by our own faculty director, Joe Árvai, the passion we see in these students may not actually be representative of their generation as a whole—these students may simply value or be politically motivated to value sustainability more than their peers. And sometimes, such passion might not translate into action. So, while it might make us feel better to think about how today’s children and young adults—whether as consumers, activists or business leaders—will save us from the mess we’ve created, it’s simply not wise (or fair) to put that responsibility on their shoulders.

P.S. This panel was a “WOManel” (all female panel)! Kudos to our colleagues at Innovation Forum for working so hard to host more inclusive and diverse events.

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JOE ÁRVAI RENEWS HIS TERM AS FACULTY DIRECTOR A Q&A about what lies ahead

Professor Joe Árvai’s first three-year term as the Erb Institute’s faculty director began in August 2015.

He started a second term in August 2018. Here, he talks about some of the progress the institute has made and what he has in mind for the future.

What are some of the things the Erb Institute achieved in your first term as faculty director?

My goal since my first day on the job was to deepen the institute’s impact across teaching, research and engagement. I think we’ve worked hard together as a team of staff and faculty to come up with some really smart, ambitious and timely ideas: A more focused research agenda, a strategy for targeted and impact-driven engagements, and a plan to teach a broader array of students, from undergraduates and grad students to emerging and established corporate leaders. We’re delivering on all three. And there’s still more potential for us to tap.

I’m interested in building and maintaining forward momentum.

Moving forward, what should the institute do more of?

When I think about organizations that sit at the intersection of business and sustainability, the word that comes to mind is “nice.” The conversations border on overly kind and congratulatory. I find this strange—it’s like, “Congratulations!

It’s not as bad as it could be.” From where I sit, I see a world that is dealing with major problems. Our society, environment and economy are being threatened by climate change and by careless overexploitation. Decades after the emancipation of women, the fall of apartheid, and the civil rights movement, we’re still tolerating full-on discrimination and major inequality. And while companies and organizations and governments talk a mean game, actions fall far short for most of them. Against this backdrop, I’d like for the Erb Institute to do more truth-telling, to focus more on holding organizations—including our own—accountable, and to offer bolder ideas that challenge the status quo. Truth to power is always a good strategy.

We know there’s an urgent need for global attention and action on the UN Sustainable Development Goals (SDGs), especially from the private sector. How do you see the SDGs fitting into sustainability in business?

When the SDGs first came out, I was elated. Unlike the Millennium Development Goals, we were treated to a set of comprehensive goals that were developed by a large, collaborative group of stakeholders that included policy-makers, NGOs and some of the world’s most influential and successful companies. I also appreciated that the SDGs covered a cross-section of social, environmental and economic objectives. But, to be perfectly honest, the SDGs have lost some of their luster for me. It’s not that I don’t think the goals are worth striving toward; I do. Instead, it’s that I see companies and organizations retreating to their familiar corners when it comes to advancing the SDGs. Part of the reason, I think, is that the SDGs come off as overly prescriptive, and they tread into areas where there are major measurement challenges. If a company or organization can’t measure performance across objectives, they seldom account for it. So, my hope—indeed, advice—for companies is that they simplify: Identify sensible social, environmental and economic objectives that they can actually measure, build forward-looking strategy around those, and go from there. Every step forward is a step forward.

The Erb Institute has changed a lot over the last 23 years. What’s next for us in terms of teaching, research and business engagement?

The Erb Institute today is what it is because of all the people who passed through it yesterday. It started with a bold vision championed by Fred and Barbara Erb, which continues through John Erb and his team. We’ve had some of the brightest and boldest academic minds lead the institute—people who weren’t afraid to take a stand. We’ve had a dedicated and talented staff. We’ve always had partners who are just as passionate about broad sustainability as we are. And, most important, we have seen amazing students come through this institute; they give us hope every day that, collectively, we can do—and be—better. What do I see in terms of the future of this institute? More. I see more.

“We have seen amazing students come through this institute; they give us hope every day that, collectively, we can do—and be—better.”

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CONGRATULATIONS to Erb faculty member Tom Lyon, whose article, “CSR Needs CPR: Corporate Sustainability and Politics,” won the Best Article of 2019 Award from the California Management Review! This award is given each year to the authors of the article published in the preceding volume of the California Management Review that has made the most important contribution to improving the practice of management. One anonymous reviewer described the article as “timely, well-written and extremely informative.” Bravo!

Erb in the Media

BY BROOKE SWEENEY ARCS Managing Director

and TOM LYON Dow Professor of Sustainable Science, Technology and Commerce

ALLIANCE FOR RESEARCH ON CORPORATE SUSTAINABILITY ADVANCES THE FIELD

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he Alliance for Research on Corporate Sustainability (ARCS) is a consortium of leading business schools around the world with a commitment to sustainability research. Its flagship activities are its annual Research Conference and its annual PhD Sustainability Academy. ARCS was founded in 2008 by a core group of six North American schools, which held its first research conference at the University of Michigan’s Ross School of Business in 2009. Since then, interest in the topic has exploded, and the conference has grown from 13 papers in its first year to 43 in its eleventh year, at the University of North Carolina, Chapel Hill. The organization’s president is Tom Lyon, and its managing director is Erb Institute staff member Brooke Sweeney.

The goal of ARCS—as initially envisioned by its first president, Michael Lenox (University of Virginia), with the collaboration of Andrew King (Dartmouth), Lyon (Michigan), John Maxwell (Western University) and Michael Toffel (Harvard)—was to help corporate sustainability mature from the then-prevalent “guru-ism” to a field grounded in rigorous scientific knowledge. Early corporate sustainability writing featured lots of hopeful hype about how “it pays to be green,” how industry self-regulation could take companies from “green to gold,” and how stricter regulation would raise profits by making companies

become more innovative. Because business is “the most powerful institution on Earth,” people suggested that if companies would just start measuring and managing their environmental impacts, our environmental problems would be solved.

It turns out life is not so simple. Research shows that it does not always pay to be green; instead, managers need to understand when it pays to be green, which depends on a complex set of market, social and political forces. Self-regulation is often designed to fend off regulation and does not make actual environmental improvements. Stricter environmental regulation does not automatically raise profits, although it may do so for leading firms.

Over the past decade, ARCS has helped to legitimize the area of corporate sustainability research.

The field’s maturing is evident in Sage Publishing’s four-volume collection of Major Works in Corporate Sustainability, edited by Tom Lyon, Daniel Diermeier and Glen Dowell. Hundreds of articles now address sustainability in corporations, and they have expanded to include not just environmental concerns and natural resources but also social issues.

One of ARCS’s most important roles has been to welcome and encourage younger scholars to enter the field. It has been exciting to see many winners of the ARCS Emerging Sustainability Scholar award earn tenure, including Michael Toffel (Harvard), Caroline Flammer (Boston University), Jeff York (UC Boulder),

Ioannis Ioannou (London Business School), Pascual Berrone (IESE), Sarah Light (Wharton) and Shon Hiatt (University of Southern California). A strong new generation of corporate sustainability scholars is indeed emerging.

ARCS has grown to 25 member schools around the world, the most recent addition being the London Business School. Other international alliance members include HEC-Paris, INSEAD, Bocconi University, NTU Singapore, Rotterdam School of Management and the Stockholm School of Economics. The 9th Annual Conference, held in 2017 at Erasmus University in Rotterdam, Netherlands, marked ARCS’s first venture overseas.

It attracted more participants than any previous ARCS conference, and in 2020, ARCS will host its second international conference at Bocconi University in Milan, Italy.

Under Lyon, ARCS has broadened its range of activities through creating its Focused Workshop Program, which brings together smaller groups of scholars around a specific, focused agenda.

The pilot workshop focused on “The Role of the Corporation in Sustainability Transitions” and was held at the Chateau de la Bretesche in Normandy, France, with financial support from the Borchard Foundation. This discussion’s goal was to explore, using detailed case studies, how and when firms can lead systemic change. With Lyon as lead author, all

13 participants co-authored a paper, “CSR Needs CPR: Corporate Sustainability and Politics,” which received the award for 2019 Best Article in California Management Review. A second important outcome was a special issue of Organization & Environment titled “Understanding the Role of the Corporation in Sustainability Transitions,” published in June 2019 and edited by Magali Delmas (ARCS past president), Thomas Lyon and John Maxwell. The five papers in this special issue explore just how far corporate leadership can advance sustainability transitions in practice.

Based on the success of the Bretesche pilot, ARCS is hosting its next Focused Workshop in October 2019 at HEC-Paris. The event, titled “Accelerating Researcher-Practitioner Collaborations in Sustainability Research,” aims to bring researchers and practitioners together, to encourage collaboration to address sustainability issues on a global scale.

ARCS has pushed rigorous research at the intersection of sustainability and business. Compared to 10 years ago, practitioners have a much more solid research base on when and how corporate sustainability pays off for business, and when it makes a real difference for people and planet. ARCS will continue to expand, welcoming more high-level institutions and working to connect with Ph.D. students—the next generation of sustainability scholars.

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e are pleased to share that Erb faculty member Andrew Hoffman is a winner of the 2019 Responsible Research in Management Award!

Hoffman’s 2015 book, How Culture Shapes the Climate Debate, examines what causes people to reject or accept the scientific consensus on climate change.

“I wanted to compile all the research— social science, sociology, psychology, and political science—to try to understand why people are rejecting the science on climate change, and then go the next step and say: What does the science say to help us overcome this schism where people are divided on this issue?”

Congratulations!

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en and women in business school faculty experience similar challenges, including paper rejection, failed promotion, organizational politics and negative teaching evaluations. But women are experiencing another layer of negative experiences, according to recent research by Erb faculty member and Assistant Professor Sara Soderstrom at the University of Michigan and Assistant Professor Maria Farkas at Imperial College Business School.

When compared with men, women less frequently feel positive about meeting their career goals, and they more frequently feel negative, Soderstrom and Farkas have found. While men and women share negative experiences, “women are expressing issues of harassment, more tension between work and home

life, a sense of isolation, and a feeling of pay disparity,” on top of that, Soderstrom said. “When you look at it in the aggregate, these are things that women are talking about that men, for the most part, are not.”

Soderstrom and Farkas surveyed faculty in the top 100 international business schools, as a follow-up to a pilot survey they conducted previously. They have analyzed the more than 1,000 responses and now are developing a journal article out of the survey findings.

Soderstrom explained, “Women feel like they’re given less credit for their ideas, and they are more likely to feel under scrutiny for what they’re doing at work.” This feeling often comes from negative interactions with students, she said. “Students are less likely to treat you with respect and more likely to address you in unprofessional terms and make demeaning or derogatory remarks about you.”

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One respondent talked about how there were certain types of classes that they just wouldn’t teach anymore because of the level of bias and antagonism that they faced from students,” Soderstrom said. “[Y]ou see this across the board— women feeling more disrespected and challenged to navigate that.”

Erb in the Media

HIGHLIGHTING THE BARRIERS THAT WOMEN IN BUSINESS SCHOOL FACULTY POSITIONS FACE

In teaching evaluations, women get more qualitative comments on appearance, attire or age, and “then they have their authority and expertise challenged, both one on one and in the classroom,” Soderstrom said. Women have explained that they face harassment that is akin to bullying, targeted by gender, rather than sexual harassment—although there are examples of sexual harassment as well.

For example, “One respondent talked about how there were certain types of classes that they just wouldn’t teach anymore because of the level of bias and antagonism that they faced from students,” Soderstrom said. “Now, this is a person who had tenure, so they had the space to be able to say more about what they would and wouldn’t do, but you see this across the board—women feeling more disrespected and challenged to navigate that.”

In August, Soderstrom and Farkas led a symposium on “The Impact of Gender on Teaching, Research, and Career Trajectories for Business School Faculty” at the Academy of Management conference.

It explored structural and cultural barriers to women’s success in academic careers in business schools, as well as issues of diversity and inclusion.

A common refrain has emerged: Women say, “I felt like something was off, but then I was worried it was just me,” Soderstrom said. “And this helps validate that it’s not just me. There’s a more systemic issue.”

After the panel discussion, participants shared an Erb Institute-sponsored lunch (a nearly waste-free one!) and working session, which divided participants into three groups by tenure. They talked through the challenges and the potential solutions they see.

More than 250 people signed in to the workshop, and another 75 to 100 attended without signing in. This turnout “signals the need for this type of conversation and space—and a need for doing it at an aggregate level, and not feeling like we’re all fighting it alone,” Soderstrom said.

“Our hope is that—through this energy, from the lens of the professional conference, in highlighting how people build resilience and what strategies have been successful—it provides that inspiration that fills the reservoir to keep going,” Soderstrom said.

They also hope their work will show that this issue is “significant enough and critical enough that we need to be thinking about it more systematically.”

This type of research “adds legitimacy and validity and references that people can bring as they try to advocate for change within their organizations,” she said. “We’ve been thinking about this as a general structure that can help build support—and that energy and community.”

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Erb in the Media

TRAINING PLASTICS AMBASSADORS AT BERRY

BY JIM JOHNSON Plastics News Staff Reporter

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ob Flores has some pretty lofty expectations for Berry Global Group Inc.’s new outreach program designed to explain the importance of plastics and where the material fits in society.

As vice president of sustainability for the Evansville, Ind.-based company, Flores helped design the company’s new Certified Plastics Ambassadors program, recently conducted at the University of Michigan.

The program is a specially designed curriculum at the school’s Erb Institute. An initial class of about 25 Berry employees took part in the week-long training effort designed to help them explain the importance of plastics and how they fit into today’s sustainability movement, Flores said.

The expectations, he said, are high.

“Today, sustainability is more important than ever. And just because it’s important doesn’t mean everybody understands what that means,” he said.

“We get a lot of question of: What is sustainability?

What’s Berry doing about sustainability?”

So the ambassadors program sets out to explain just that, he said, and give participants the tools to engage others in the subject, both at work and in the communities where they live.

“Educate and empower about the broader aspects of sustainability, so once they have that information, they would be empowered to act upon it,” Flores said.

Certified Plastics Ambassadors brought together an initial class of participants from throughout the company. There were folks from a variety of positions,

including operations, sales, communications and product development.

“We wanted to bring in those roles to educate them and empower them to drive sustainability within the company. And then as part of that, since it is a Certified Plastics Ambassadors program, we wanted those people to have the confidence they need to talk to others, both within Berry and external, within the community, about what we are doing for sustainability,” Flores said.

“All of us, every day, we’re not just strictly Berry employees, right? We’re all members of the communities in which we live. We all have countless opportunities to interact with people within the community as well as our networks to get the message out,” he said.

Sustainability is a wide-ranging topic that covers a variety of impacts, including greenhouse gas emissions, waste reduction and recycling.

“Through the course, as a whole, I wanted people to come out educated on sustainability. When I think about sustainability, I think it’s multifaceted,” Flores said.

“We want people to have a broad, in-depth understanding of sustainability. Not just one individual aspect, not just plastics have lower greenhouse gas emissions than alternatives,” he said.

There’s a business concept called the triple bottom line, which seeks to address the social, environmental and financial impacts of a company. Think people, planet, profits. And that’s a lens the company wants to view its ambassadors program through.

“We want to give everybody a big-picture

understanding of sustainability and the full life cycle of a product,” he said.

While only Berry employees took part in the initial classes in Michigan, the company is exploring ways to share the program, in some form, with other plastics companies.

Company spokeswoman Amy Waterman said the recent formation of the Alliance to End Plastic Waste is creating links among its 40 or so member companies. Both Waterman and Flores are heavily involved in the alliance as Berry employees.

“Something that we’ve been noticing at our alliance meetings, there’s really a sense of ‘We’re in this together. We’re not going to solve this by ourselves and we need to band together,’” Waterman said.

“The problem of plastic waste, the perceptions of sustainability with plastics, they didn’t happen overnight and they didn’t happen from one company or one product,” she said. “So we really see that we’re all in this together and we all have to come together to make a change.”

Creation of the ambassadors program comes from the top, Flores said, as the initiative is being driven by Berry CEO Tom Salmon.

“He challenged each of us,” Flores said. “There is a lot of negative in the news, we all hear that. He challenged us to educate ourselves and be prepared to be ambassadors and tell the benefits of plastics, not just roll over when we hear those things and stay quiet.

“There has been a lot of negativity about plastics in the news, especially focused around marine debris.

If you have that negative sentiment, if we don’t speak up, who will?” Flores said.

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Why do some sustainability initiatives become firmly embedded in an organization while others fizzle out?

It may have something to do with how your employees interact as they tackle the sustainability issue at hand.

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SIGNS YOUR SUSTAINABILITY INITIATIVE WILL SUCCEED—OR NOT

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ustainability work covers a massive range of potential issues—from waste reduction to social inclusion—and companies often struggle with how to move forward or how to prioritize multiple issues. Research by Assistant Professor Sara Soderstrom and Northwestern University Professor Klaus Weber, published in Administrative Science Quarterly, sheds some light on the internal processes organizations use to address sustainability, and the influence that employees can have.

“Our study is grounded in field data collected over 18 months at a large biomedical company that sought to become more sustainable. Over that period, some sustainability-related issues became firmly embedded in formal structures and procedures, while others faltered,” the authors wrote.

Their research found that the progress a company can make on sustainability does not depend only on top executives’ decision-making.

Senior executives aren’t the only ones whose actions matter. Lower-level employees also have a hand in these initiatives’ success or failure. Their research indicated that internal advocates at middle and lower levels influenced how organizational structures developed. When the CEO and other senior executives make decisions, they may rely on SARA initiatives and proposals that mid-level employees SODERSTROM developed.

Assistant Professor Soderstrom and Weber noted that the quality of of Organizational employees’ interactions can influence how successStudies and Program ful a sustainability initiative is. When employees are in the Environment attentive and emotionally invested, understand the topic, feel positive about interactions or discussions, and are committed to allocating their time toward a sustainability issue, that issue is more likely to be adopted by or embedded within the organization. The more frequent these positive interactions are, the more likely the company is to make real progress on the issue at hand.

Soderstrom shared her takeaways from the research: “What happens inside an organization matters. When it comes to sustainability, it’s not just about whether the CEO cares or not. Sure, having a CEO that’s excited opens the door for sustainability, but it doesn’t tell you what to do. Our work shows that it’s actually how you interact with others internally to build excitement and commitment that helps to influence which initiatives happen and which initiatives succeed.”

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arlier this year, 16-year-old Greta Thunberg inspired youth climate protests in more than 100 cities around the world.

Among the Green New Deal’s champions is the Sunrise Movement, which says it is “building an army of young people to make climate change an urgent priority across America.” It’s clear that young people care about the planet. But can we assume they’ll do what’s necessary to save it? Are they more concerned than older people about declining environmental health, and are they more likely to support policies to do something about it? Press coverage in the U.S. seems

WE CAN’T LEAVE IT TO YOUNGER GENERATIONS TO SAVE THE WORLD Research by SARA GOTO GRAY, KAITLIN T. RAIMI, ROBYN WILSON and JOE ÁRVAI

to suggest that they are, but academic research sends mixed signals.

New research supported by Professor Joe Árvai suggests that age is not a great predictor of environmental action—instead, values and political views are more likely to drive action. Árvai and his colleagues sought to better understand who is more concerned about environmental losses and more willing to support policy actions aimed at preventing future losses. In addition to age and generational differences, the research team also considered the effects of education, income, political orientation and concern for the environment.

The team surveyed U.S. citizens, gauging their concern about hypothetical environmental losses caused by climate change. “Overall, our research suggests that political orientation and concern for the environment are better predictors of environmental concern and action than are generation and age, which had inconsistent or non-existent effects,” the researchers wrote.

So why is age less important than it seems like it should be? It’s not necessarily that young people care less than they appear to. Even when people care about something, there may be a disconnect between their attitudes and behaviors. This study highlights that disconnect, noting that concern about the environment (as highlighted in the media) does not necessarily translate into action.

But people’s value orientations and political views seem to do that. This study suggests that people who are more liberal and place greater value on the environment care more about environmental losses and are more willing to support action to address them—whether they are Baby Boomers or Millennials.

The researchers wrote, “The factors that shape our behavior often conflict and compete, and they demonstrate that—despite increased concern about the environment amongst younger people—it is not safe to assume that concern will translate into action.”

Rather than hoping Millennials will save us, lead researcher Professor Sara Goto Gray points to the need for “a sharper focus on other variables that more accurately distinguish who people really are. At a time when diversity in terms of worldview and culture is receiving frontline attention from researchers and practitioners, it may be impractical to continue with the idea that labels based on generational cohort will suffice to differentiate individuals.”

So this research suggests that people trying to garner support for policies that protect the environment should not concentrate only on younger generations. And targeting messaging may be especially important now, as the U.S. gears up for the 2020 elections.

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TOO MANY ECOLABELS, OR NOT ENOUGH? Are some ecolabels better than others? What happens when there are different labels on two products from the same industry? Are competing ecolabels a good thing?

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esearch by Resources for the Future’s Carolyn Fischer and the Erb Institute’s Tom Lyon offers some insight into these and other questions, published in their recent Journal of the Association of Environmental and Research Economists article, “A Theory of Multitier Ecolabel Competition.”

Ecolabeling in and of itself is an industry—and a complex one at that. Ecolabels vary widely, and internal competition among them is growing. Some are supported by nonprofits, others by industry groups. Some ecolabels are binary (for example, a product is either certified Fair Trade or it is not); others have different tiers or levels (a building might be LEED silver, gold or platinum). To further complicate matters, some industries have multiple, competing ecolabeling schemes. For example, the timber industry is home to both a binary ecolabel from a nonprofit (Forest Stewardship Council, or FSC) and a multitier ecolabel from an industry group (Sustainable Forestry Initiative, or SFI).

“Ecolabels are important tools for companies and consumers who prefer sustainable products,” Lyon notes. “Most labels originated from nongovernmental organizations (NGOs), and they gave NGOs power to shape environmental norms in markets from coffee to forestry to seafood. But today, most labels face competition, often from industry-sponsored labels, and we’re just starting to understand how competition works in these ‘standards markets.’”

This research indicates that NGO-led certifications and industry-led standards differ in significant ways.

NGOs tend to set tougher standards. They are also more likely to prefer binary standards, while industry-led efforts tend to prefer multi-tiered standards. As Lyon explains, the implications of these differences can be complicated.

“Sometimes, all an industry label does is entice producers away from a tougher NGO label. But sometimes it’s good to have multiple tiers of standards, because firms just starting out on their ‘sustainability journey’ may only be able to meet an entry-level standard. If there are a lot of ‘beginner’ firms in the market along with a lot of ‘advanced’ firms, then the environment gains when there are standards tailored to each group.”

So how can consumers use ecolabels to figure out whether they are doing the environment right?

Fischer and Lyon’s research suggests that, when there are multi-tiered labels on offer, the environment benefits most when only NGO-led ecolabels are available. Lyon notes that “industry label[s] can design a set of weak tiers that cater to every possible industry segment and never push firms beyond their comfort zones. In the end, it’s all about who has the power to set the standards. In effect, an industry label robs the NGO of bargaining power, forcing a move to a situation with higher profits but less environmental protection.

“A striking result in the paper is that under many conditions, an NGO will design a multi-tiered standard that does what is best for society overall, but an industry association never does.”

RESEARCH

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How can a company motivate its employees to advance sustainability?

Above: Andrew Hoffman; at right, from top to bottom: Chantelle Barreto, Chelsea Blau, Kelsey Pace and Joshua Tooker

Working closely with Professor Andrew Hoffman, a team of three Erb students, Chantelle Barreto, Chelsea Blau and Kelsey Pace, and Ross student Joshua Tooker, are researching the question, “What types of incentives are companies using to advance their sustainability goals?”

In partnership with the Cambridge Institute for Sustainability Leadership (CISL) at the University of Cambridge, Hoffman and his students are researching the type and effectiveness of incentives different organizations use to further their sustainability initiatives.

Building on a study CISL conducted in the fall of 2018, the research team reached out to hundreds of mid- to senior-level business sustainability leaders to learn more about what incentives work best to drive internal sustainability strategies.

Preliminary results suggest that companies are relying more on strategy (24%) and business process (24%) levers than rewards/financial incentives (12%) to drive action. What is not yet clear, however, is how effective these mechanisms are. While 76% of the people surveyed reported that their company has sustainability-related goals, only 51% of respondents were satisfied with their organization’s progress toward achieving these goals.

“We are excited about these preliminary results and hope to be able to gain deeper insight, through analysis of the survey results and case studies with respondents, into the role that rewards can play in achieving sustainability-related goals. By the end of this project, we hope to provide actionable recommendations to industry, informing their use of rewardbased levers to successfully achieve sustainable results,” Blau said.

lthough many companies adopt a triple-bottom-line approach to sustainability in theory, they often struggle to apply it in practice. In particular, many companies have trouble accounting for the social component of the triple bottom line. They often consider “doing good” mainly in the context of either environmental or financial performance. Social impacts are often relegated to the sidelines, considered in qualitative terms and addressed through the narrow lens of corporate philanthropy. This is a problem: By failing to fully account for social impacts, companies underestimate the potential social risks their operations and supply chains pose, and on the flip side, they undervalue the societal benefit they can create.

This failure is due, largely, to the lack of a universal understanding of what “doing good” ought to look like from a social perspective—and how to measure it. Although a small number of social measures have been developed (such as the metrics included in the GRI and SASB frameworks), many of these measurement approaches suffer from a lack of standardization and an overreliance on generic metrics (or poor proxies) that fail to fully capture the complexity and reach of a company’s impact on well-being.

As a postdoctoral fellow, my research at the Erb Institute with Professor Joe Árvai focuses on addressing this challenge by developing new tools and approaches for measuring social impact in decision-meaningful ways. My ongoing research in this field has identified some examples of best practice. Here are three of the most important:

“By failing to fully account for social impacts, companies underestimate the potential social risks their operations and supply chains pose, and on the flip side, they undervalue the societal benefit they can create.”

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BEST PRACTICES FOR MEASURING SOCIAL IMPACT

BY MERRIAM HAFFAR Postdoctoral Fellow, Erb Institute

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Begin with mapping risks and benefits.

In what ways is the company contributing to societal well-being?

Companies’ social footprints are significant and diverse. Through their value and supply chains, businesses have the potential to create jobs, generate tax revenue, and protect the health and well-being of their employees and suppliers. In doing so, they contribute to the economic prosperity and well-being of the communities in which they operate.

In turn, this impact reverberates outwards to help enhance the quality of life at wider regional and even national scales, over time. So fully understanding these impacts and exploring their interconnections is a critical first step in assessing social impact.

2.

Consider the full “impact value chain.”

The steps through which a company’s activities ultimately influence societal well-being are known as the company’s impact value chain. It begins with the company inputs (such as money or personnel) invested in a particular business activity. This activity then generates outputs (including socially beneficial goods or services). These outputs, in turn, translate

into social outcomes (such as the number of people affected by these outputs), and ultimately, into wider—yet less tangible—societal-level impact (how the investment enhanced community well-being).

The impact of a company’s activities may be measured anywhere along this impact value chain, with each step providing different insights and requiring different metrics. Moving further along the chain gets closer to measuring the true impact of a company’s activities at a systems level, but further away from direct causality—as well as from the company’s direct control.

Most existing social impact measures focus on inputs and outputs, as these tend to be more tangible and more closely linked to business performance.

But they tend to miss important aspects of the bigger picture. Measures of outcomes and societal-level impact can better capture the company’s wider systems-level impact on society.

3.

Integrate metrics into decision-making.

Tracking social impacts not only helps companies demonstrate accountability, secure funding and gain legitimacy, but it can also guide strategic decisionmaking around sustainability. Measuring social performance may help businesses identify how well their socially focused sustainability programs are performing and to develop alternative program designs as needed. More important, social measures may also be used to inform broader business sustainability decisions that involve trade-offs among the different dimensions of sustainability, by guiding companies on what to prioritize, and ultimately ensuring that sustainability investments are leading to holistic, systems-level positive outcomes.

Ultimately, these examples of best practice underscore the importance of measuring corporate social impacts in a rigorous and systematic fashion, across the entire impact value chain. By tracking social impacts this way, companies stand to create shared value and give back to their communities and stakeholders.

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ultinational corporations wield immense power. A mere 100 companies control a quarter of global trade. Walmart is the 10th-largest economic entity on the planet. CocaCola is the world’s largest consumer of aluminum and sugarcane. In choosing where to invest, what products to develop and push, and what environmental and labor standards to uphold, corporations like these continually shape the global economy’s geography and its effects.

Because of this influence, corporations are indispensable in shifting toward a more sustainable economy that respects people and planet. By pledging to not source wood from areas of damaging deforestation or by ensuring that upstream suppliers pay their workers livable wages, a single multinational can transform an entire sector, as competitors attempt to match these “green” or “socially accountable” credentials. But, to make this happen, we need to know which companies have environmentally and socially problematic supply chains, and occasionally put pressure on those companies to redress stubborn sustainability challenges related to their direct and indirect operations.

We analyzed nearly 11,000 academic articles on supply chains, and we were surprised to find that only a little over two dozen of those studies focused on the supply chains of individual corporations. Our review, recently published in the

NEW WAYS TO STUDY INDIVIDUAL CORPORATIONS’ SUPPLY CHAINS

BY BENJAMIN GOLDSTEIN Postdoctoral Fellow, Erb Institute

AND JOSH NEWELL

Nicholas Poggioli is a research fellow in the Erb Institute. Poggioli studies how companies depend on and affect natural resource systems, especially the role of remote sensing technology in corporate sustainability strategy. He earned his Ph.D. from the University of Minnesota’s Carlson School of Management. He earned his bachelor’s degree at the University of Illinois at Urbana-Champaign and a Master of Urban and Regional Planning degree from the University of California, Irvine. Prior to academia, he worked for the Orange County Business Council and served in the United States Peace Corps, AmeriCorps VISTA and the National Park Service.

Journal of Industrial Ecology, shows that most researchers have prioritized studying anonymized supply chains, hypothetical “average” supply chains, and economic sectors.

Most of the academic work on individual corporate supply chains has focused on how upstream suppliers can enhance their economic value capture, while environmental and labor issues have taken a back seat.

Also, the bulk of this work has been largely sympathetic to corporate interests, sidestepping thorny questions of how multinationals’ supply chains contribute to persistent environmental degradation and social dislocation around the globe. By largely not studying the individual corporations with the power to reshape supply chains and sectors more sustainably, and by focusing only on the economic dimension of sustainability, researchers of supply chains have limited the positive potential of their work in the business world.

Fortunately, we found a second stream of literature in our review that shows how academics can begin addressing this gap. Since the 1990s, NGOs have been holding powerful business interests responsible by associating corporate brands with damaging deforestation, acute pollution, sweatshop factories, child labor and modern slavery. By shining a light on unsavory practices in corporate supply chains, NGOs have compelled large corporations, including global players like McDonald’s, Nike, Unilever and Nestle, to commit to more sustainable sourcing, with positive ripple effects within and across sectors. For instance, when Unilever commits to removing deforestation from its supply chains, this affects both the agriculture and forestry sectors, setting a new bar for their business competitors in both arenas.

We argue that the time has come for academics to start analyzing the supply chains of individual corporations in the same manner as NGOs have. Our review included 30 NGO “brand activism” campaigns, highlighting how NGOs have been able to reconstruct the normally confidential supply chains of individual corporations and link them to environmental and social change. We have taken these disparate approaches and developed a methodological framework, Tracking Corporations Across Space and Time (TRACAST), that gives researchers the requisite tools to study individual corporate supply chains. Researchers need not become activists in doing this, but our proposal does ask researchers to probe how the current economy fails to produce gains for all players involved and what business can do to change this.

Recent movements in the business world, specifically the Business Roundtable’s explicit commitment to shareholder capitalism, show that many large, powerful multinationals are prepared to tackle challenges of social and environmental sustainability. But business cannot do this alone. Academics can lend their trusted voices by studying the supply chains of individual corporations, disseminating their findings through journal articles, websites and media, and collaborating with companies to understand where hotspots of negative environmental and social change lie in their sourcing. By revealing individual companies’ sustainability challenges, and sometimes advocating for them to do something about them, academics can help multinationals wield their immense power to reshape the global economy in ways that help both people and planet.

How to promote sustainable decisions in polarized times

BY CAITLIN DRUMMOND Postdoctoral Fellow, Erb Institute

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ustainability needs evidence. Evidence enables us to better understand how our actions affect the environment. It empowers us to make more sustainable choices, both as consumers and as managers. For example, as managers, is that new initiative really going to reduce water usage? As consumers, is recycling that peanut butter jar worth all the energy it takes to clean it out?

(For the record: cleaning out that peanut butter jar, especially if it’s plastic, is probably not worth it.)

But evidence can get caught up in larger social and societal conflicts.

Consider the political polarization surrounding climate change: Research shows that people on either side of the political spectrum are likely to have different perceptions of the strength of the evidence suggesting climate change is happening. They also perceive the risks climate change is likely to pose differently.

When sustainability issues like climate change become part of larger conflicts, making evidence-based decisions on these issues is more difficult. Productive discussions about what course of action the evidence suggests are replaced by unproductive discussions about whether the evidence should be believed.

These discussions often have more to do with people’s identities, such as their political views, than with the decision at hand, making it hard to move forward.

Research that I and others have conducted suggests a few strategies managers can use to prevent stalemates in sustainability decision-making: We often don’t know we’re biased.

Our identities often influence our decisions without us realizing it. This means that it can be very difficult to know when to take a step back and ask ourselves whether we are thinking objectively about a problem. Research from me and my colleague Baruch Fischhoff, published in Thinking & Reasoning, finds that an external warning to think carefully about the problem at hand, combined with an opportunity to warm up participants’ critical thinking skills, reduces the influence that participants’ political views have on their evaluations of evidence.

Try building reminders to focus on the problem at hand into your organization’s decision-making processes.

We don’t always consider the alternatives to our favored decisions.

Research on good decision-making has found that decisions can be improved by asking decision-makers to argue against decisions that they favor. As described in an article by Wharton Professor Katy Milkman and colleagues, published in Perspectives on Psychological Science, asking decision-makers to “consider the opposite”—by considering what might go wrong with a favored decision, and what might go right with a non-favored decision—can promote more critical thinking and better decision-making. Try asking colleagues to argue both for and against their favored decisions.

These strategies can help decision-makers focus on the immediate problem, rather than the broader social and societal context, helping organizations make sustainability decisions based on the evidence.

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Reprinted from The Detroit News

Opinion

FLYING CARS SHOULD HAVE A LIMITED ROLE IN SUSTAINABLE MOBILITY

BY AKSHAT KASLIWAL, JIM GAWRON and GREG KEOLEIAN

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he Jetsons cartoon created a futuristic image of flying cars back in the 1960s. Flying cars are now in the prototype stage, with commercial deployment expected in the near future.

We recently studied the sustainability implications of flying cars and found that this rapidly evolving technology provides benefits in a niche role, but also could result in unintended consequences.

Before this technology comes to market, its full effects should be considered, including displacement of more efficient travel modes and promotion of urban sprawl.

Flying cars, formally known as vertical takeoff and landing aircraft (VTOLs), could contribute to sustainability by displacing single-occupant cars in areas where congestion makes it difficult to expand efficient mass transit systems.

Examples include trips from Irvine to Malibu or San Francisco to San Jose. VTOLs may also be beneficial for trips with geographic constraints that are removed by flying, like having to drive around a Great Lake from Detroit to Cleveland or Grand Rapids to Milwaukee, or where higher-emission regional jets are the prominent option.

The Center for Sustainable Systems at the University of Michigan’s School for Environment and Sustainability has focused on sustainability assessments of products and emerging technologies for over a quarter century. Transportation has been an important part of our research agenda since our inception. We have studied electrified vehicles, connected and automated vehicles, and now flying cars to help guide their deployment and enhance their environmental, economic, and social sustainability.

[Earlier this year], Nature Communications published our assessment of the energy consumption and greenhouse gas emissions of flying cars. Since then, our paper has received much attention.

We focused on comparing flying cars to ground-based cars across various deployment scenarios. This is an important comparison since light-duty vehicles—sedans, SUVs, and trucks—are currently the most common mode of transportation in the United States. However, the comparison to ground-based cars we made in the Nature Communications paper is only part of the story. From a broader mobility system

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From left to right: Akshat Kasliwal, Jim Gawron and Greg Keoleian

There is no convergence on [vertical takeoff and landing aircraft] design yet, indicating that the industry is still in its infancy and that we now have the opportunity to incorporate sustainability as a primary driver into VTOL development, instead of it being an afterthought. perspective, it is also imperative to understand how flying cars could influence mode shifts (e.g. from light rail to flying cars), and if they are likely to contribute to urban sprawl.

Flying cars combine the capabilities of a helicopter for vertical takeoff and landing, with the cruise efficiency of a winged airplane. We studied electric VTOLs; although they produce zero emissions during flight, their batteries require electricity generated at power plants.

To determine their energy requirements, we developed a physics-based model to characterize generic VTOL design based on publicly available data.

Several aerospace corporations and startup companies—Airbus, Boeing, Joby Aviation and Lilium, for example—and agencies such as NASA have developed prototypes. There is no convergence on VTOL design yet, indicating that the industry is still in its infancy and that we now have the opportunity to incorporate sustainability as a primary driver into VTOL development, instead of it being an afterthought.

The results presented in our Nature Communications paper indicate the sustainability performance of flying vehicles is dependent on two factors: trip distance and occupancy.

We find that for trips longer than 60 miles, a fully loaded 4-occupant VTOL results in fewer emissions than average occupancy ground-based cars. It is important to note that a single-occupant VTOL never outcompetes a single-passenger electric groundbased car.

We strongly discourage VTOLs as a means of transit within urban centers. Flying a short distance in a VTOL is inefficient because of the energy-intensive takeoff and hover phases of flight, and the relatively short time spent in the more efficient cruise mode.

Not only would energy use increase compared to ground-based cars, but urban deployment would increase noise, visual disturbance, and aerial traffic concerns.

We also caution against deployment that leads to unintended consequences. Public transit systems such as light rail are the most efficient modes of transportation. Buses can also perform well when they have high occupancy. If VTOL deployment shifts travel from these modes, it will be unfavorable from an environmental perspective. For reducing environmental impacts of transportation, investment may be best directed towards improving public transit and increasing ridership levels.

VTOLs could also encourage less dense patterns of development. If VTOLs make travel more convenient, they could induce travel demand and encourage people to live further from work. Strategic policies and regulations that would constrain VTOL deployment to the types of trips where they are the best option may be effective tools to mitigate this effect. Urban design focusing on mixed-use and high-density development could also encourage more people to live closer to work and reduce time and distance spent commuting, resulting in reduced environmental impacts.

So, what is the future for flying cars?

We want to emphasize to manufacturers and service providers that when VTOLs are launched commercially, they should only be deployed in certain scenarios.

While concluding that high-occupancy VTOLs can have a niche role in sustainable mobility for long-distance trips, we want to actively avoid unintended consequences like urban sprawl and increased vehicle miles traveled. Further, VTOLs should complement public transit for congested, indirect, or long-distance routes, and should do so in an equitable manner that increases access.

In conclusion, our study comparing flying cars to ground-based cars is only one chapter of the story; the rest remains to be written.

As a society, we must be thoughtful about what comes next. It is important to recognize that any aerial transportation has an inherent disadvantage owing to the laws of physics. However, we recommend further detailed analyses of flying cars compared to other transportation modes for identifying other niche applications where they provide an environmental benefit.

Given the grand challenge of climate change and the urgent need for the deep decarbonization of transportation, we hope that our recommendations can help guide sustainable development of flying cars and constrain their use solely to cases that enhance environmental, economic, and social dimensions of future mobility.

Greg Keoleian is the Peter Wege professor of sustainable systems in the School for Environment and Sustainability, professor of civil and environmental engineering, and the director of the Center for Sustainable Systems at the University of Michigan.

Jim Gawron is an Erb Institute MBA/MS candidate at the Stephen M. Ross School of Business and the School for Environment and Sustainability, and a graduate student research assistant within the Center for Sustainable Systems at the University of Michigan.

Akshat Kasliwal is an MS candidate at the School for Environment and Sustainability, and a graduate student research assistant within the Center for Sustainable Systems at the University of Michigan.

SERVING UP MORE SUSTAINABLE FOOD PROCUREMENT

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he University of Michigan held the inaugural Sustainable Food Procurement Conference for Institutions in April, drawing nearly 100 undergraduate and master’s students, professors, and directors of dining and procurement professionals. The day buzzed with stories of procurement successes and challenges.

The conference was jointly organized by the President’s Advisory Committee on Labor Standards and Human Rights (PACLSHR) and Michigan Dining and supported by the Erb Institute and Ross Business+Impact.

Attendees came to

BY AMELIA HARRIS U-M from across the MBA/MS 2019 U.S.and Canada to engage in conversations about the importance of—and the details involved in—the shift toward more sustainable food procurement.

Steve Mangan, conference cochair and senior director of Michigan Dining, welcomed the participants, and Professor Ravi Anupindi, conference cochair and chair of PACLSHR, outlined the conference’s purpose: to bring together various stakeholders in institutional food procurement to discuss issues and challenges and share best practices.

Morning keynote speaker Alexa Delwiche from the Center for Good Food Purchasing began with a call to action. She highlighted the vast amount of

money spent on institutional food and suggested that even a 10% shift toward more responsibly sourced food could mean a living wage for all California agricultural workers—some of the poorest and most marginalized farmworkers in the U.S. The first panel, Ensuring Sustainability, included four professionals from the nonprofit and certification space and discussed the role of external validation in ensuring the legitimacy of institutional environmental and social sustainability efforts for consumers.

Panelist Matthew Wooten, senior analyst with the Fair Food Standards Council, noted that universities are trying to better align their procurement practices with their institutional values. “Over the last 25 years, universities have rejected garment sweatshop conditions to become leaders in ethical sourcing for licensed apparel. Similarly, educational institutions are well-positioned to leverage their market demand to ensure that low-wage workers at the bottom of agricultural supply chains enjoy basic labor protections.” Provider Perspectives, the second panel, discussed the challenge of balancing all the different interests of the customers and institutions they serve. Many of their customers are beginning to look for sustainable food options, but priorities vary from customer to customer, and it’s up to these providers to supply them all.

The third panel, Making It Work, celebrated several successful transformations dining services across the country have achieved. For example, they included a farm incubator program through Stanford Dining and a cultural exchange between Yale and a chef training program in China.

Closing keynote speaker Zia Ahmed, senior director of Dining Services at the Ohio State

Above: The University of Michigan recently procured a Freight Farm that will sell lettuce to MDining and provide research data.

University, laid out the reality: Transforming our food system into one that values people and the environment will require some significant detangling.

His team has started with specific projects such as bringing more transparency and proximity to their fish and chicken supplies. They will continue to dig into these challenges, and Ahmed urged the rest of the attendees to do the same.

And educational institutions may be well positioned to make this kind of progress.

One participant, Thomas Stebbins, executive chef at Beaumont Hospital-Dearborn, noted, “The food industry has not changed in a very long time—people rarely ask or care where their food comes from and what impact it has on the environment. We have to start asking questions and getting involved in the process. Colleges have a great amount of students being taught to ask questions and wanting change, and they can really start pushing for better food and lead in making improvements.”

The organizational committee would like to thank the speakers, the sponsors and the engaged attendees who who participated in this inaugural conference.

We hope that the connections made and the discussions begun will sow the seeds of not only collective awareness, but also cooperative efforts toward defining best practices and changing the status quo of institutional sustainable food procurement.

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WHERE CORPORATE RESPONSIBILITY AND D&I INTERSECT

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orporate responsibility (CR) and diversity & inclusion (D&I) share some common history—both started from a reactionary approach, as businesses sought to mitigate risk, and now both are becoming more embedded in businesses, the paper “Common Purpose: The Intersection of Diversity & Inclusion and Corporate Responsibility in the United States” points out. Erb Institute alum Rachel Sylvan, MBA/MS 2001, director of corporate responsibility at Sodexo, coauthored the paper with Rohini Anand (University of Michigan) and Imraan Lilani (a London-based research consultant). Sylvan talked with Erb about her experience and this research.

How did Sodexo start moving in this direction, to align these two priorities?

We had strong functions around both corporate responsibility and diversity, and we saw over time that diversity should be part of our global corporate responsibility road map. Any company that does sustainability

If you’re a corporate responsibility professional, ask yourself: What can I learn from this D&I team and the way they’re approaching organizational change?”

RACHEL SYLVAN, MBA/MS 2001

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two functions sit in the same department. At Micron Technology and other organizations that follow GRI standards, the two are included in the same reporting and communications mechanism.

At Sodexo, we use a number of approaches where team members in D&I and corporate responsibility work on shared projects and share best practices. In North America, the two report to a common leader.

Other companies are working with integrated governance councils.

That’s a really practical way of starting to integrate the two. If you have a governance council for D&I, you can have someone in sustainability be part of that, and vice versa.

What do you think individual employees can do to encourage this kind of alignment?

If you’re a corporate responsibility professional, ask yourself: What can I learn from this D&I team and the way they’re approaching organizational change? And the same for D&I professionals. If you work in one of those fields, get to know someone well who’s working in the other, and ask about how they’re driving change within the company. What are the most important levers for them? Both are going to be working on things like how to make a business case, engaging senior leadership together, measuring progress and motivating both internal and external stakeholders. So these professionals should make an effort to learn from each other.

reporting with standards like the Global Reporting Initiative (GRI) is asked to include diversity in that. So there is some degree of overlap. But, from a functional perspective, there are diversity specialists, and then there are separate corporate responsibility specialists. Now, as the two functions embed more in the business, we’re seeing more alignment, and that’s why we did this research.

The paper points out that both D&I and CR motivate people, encourage innovation and create opportunities to build consumer trust. Why else does it make sense to consider these two issues together?

Professionals in both fields address a lot of common needs within the business, and they’re part of the purpose of the organization. In some cases, they’re speaking to similar stakeholders, like clients and customers. Both are important drivers for employee recruitment and engagement. Both are influencing the design of products and services.

When people in the field or in operations coordinate on D&I and CR, it creates a more coherent message for a wide range of stakeholders.

The Common Purpose paper lays out some approaches companies are taking to align CR and D&I. From your research, are there any specific examples you can share of what they are doing well?

I was pretty impressed with Gap. They are looking at their supply chain, and how both sustainability and D&I topics—especially gender—work together to create positive impact. I think looking at both issues this way is a leading practice. At QVC, the two teams meet regularly to share information with each other. That allows learning between the two, in terms of how to drive change in the organization. At Warner Media, the

How have you put your Erb Institute education to use in this work?

In a function like corporate responsibility, you need to get a really good bird’s-eye view of the business. My Erb MBA education has been incredibly helpful in understanding business processes and leading change initiatives. And at the same time, the natural resources part of my Erb background has helped me to understand public issues. Really, both corporate responsibility and D&I are about how you put together a business approach to addressing public issues and the related marketplace opportunities.

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Ross School of Business 701 Tappan Street Ann Arbor, Michigan 48109-1234 School for Environment and Sustainability 440 Church Street Ann Arbor, Michigan 48109-1041 CONTACT US

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Regents of the University of Michigan Jordan B. Acker, Huntington Woods Michael J. Behm, Grand Blanc Mark J. Bernstein, Ann Arbor Paul W. Brown, Ann Arbor Shauna Ryder Diggs, Grosse Pointe Denise Ilitch, Bingham Farms Ron Weiser, Ann Arbor Katherine E. White, Ann Arbor Mark S. Schlissel, ex officio Š 2019 by the Regents of the University of Michigan