Michael I. Roth, Chairman, CEO of Interpublic Group of Companies, shares his insights on Green business.
From ‘tree-huggers’ to mainstream influencers
If you go back many years - back to the eighties you will find a socially conscious minority, sometimes more or less affectionately called 'tree-huggers'. In those days it was a hippy kind of thing mostly. They did not play a particularly important role at the time but over the years their ideas became part of the global consciousness. It just grew. 'Save the planet' became a well-known phrase. I think their continuous presence at the annual meetings of the World Economic Forum in Davos tremendously helped to put it all on the agenda.
What used to be a hippy thing is now an integrated part of the strategy of the biggest companies in the world. That says a lot. So, for me it is here to stay. Not just because of its growing presence but because the problems addressed are not going away just like that - they will most likely become more urgent. The key question is what role it will play in the emerging markets? A lot of work has to be done there.
Consumers expect a good Green record from a brand
Every successful brand has a trust factor in it. Unilever is a client of ours and we work closely with them. Paul Polman, the CEO has said last month: "We're calling for a business model that decouples growth from environmental impact, and that frankly isn't out there yet." Unilever has established a range of sustainability goals it believes will drive long-term growth and strengthen brand equity. Our client Johnson & Johnson is doing something similar and in fact most of our other global clients are as well. This is more than an advertising campaign. This means that it is now an accepted belief that the position and actions of a brand in regard to the sustainability issue have become a key factor in the decision making process of consumers all over the world.
Profit vs Global wellness
The goal of any big corporation was to make profit for the shareholders - period. Being charitable, giving, global wellness and so on didn't seem to be consistent with that. That has changed. The consumers now have so many choices; they want to buy from a company that ads something, not just takes. That company is much better thought of in the marketplace and will in the end be more successful.
Practice what you preach
Of course at IPG we help our clients with this whole way of thinking and the insights we have in regard to this development. But in my view you have to take a good look at your own organisation to start with. Are we practicing what we are preaching? Diversity has been a big issue for us for quite some time; including people from all walks of life. What you do with your carbon footprint, travel, the use of energy - we have several programmes running to optimise it and people managing those programs. We actively assess the credentials of our suppliers and encourage them to adopt environmentally friendly policies. We set goals and perhaps most importantly we report publicly on our progress. We have now truly arrived at a stage where doing the right thing has become profitable as well. Apart from all that - I have grandchildren - of course I'm interested in making sure they have a cleaner and better world to grow up in.