Why sustainability is a team sport

One question they were asked: If you were in charge at McDonald's and could do one thing, what would it be? "Use your size and leverage to make beef more sustainable" emerged as the answer. So the company has begun to dig into its beef supply chain, to better understand its environmental impact, which is itself no easy task.

“We buy beef from people who make patties," Bob explained. "They buy it from the slaughter house. They buy it from the feedlots. They buy it from a broker. They buy it from the calf producers.” But that's not an excuse. Dealing with the beef supply chain is "our No. 1 priority," he said.

Skeptics -- and you can count me among them, for now -- will ask: Will McDonald's push hard to reduce the environmental footprint of beef? Can it even be done? [See my story at YaleEnvironment360, Should Environmentalist Just Say No to Eating Beef?]

Bob's track record at McDonald's provides reason to be optimistic. The company has enough buying power to change industries, once it gets its own, er, ducks lined up. As Mark Bittman, who is no fan of the chain, wrote last year:

When, in 1999, McDonald’s requested that its suppliers give caged hens 72 square inches of space instead of 48 (72 is still smaller than a piece of 8×10 paper), not a single factory-farmed hen in the country was being raised with 72 inches of space. Yet the entire supply chain was converted in just 18 months, and 72 square inches is now effectively the industry standard.

Last year, McDonald's required its pork suppliers to phase out gestation crates for sows. Long ago, it set animal welfare standards for beef. Even earlier, McDonald's committed to buying all of its fish from fisheries certified by the Marine Stewardship Council.

Now Bob would like to do more to win support from consumers. "We’re not going to have a successful sustainability effort unless the consumer is engaged,” he said. To that end, McDonald's has just rolled out a Marine Stewardship Council eco-label that it is attaching to its Filet-O-Fish sandwiches. It's the first national restaurant chain to do so, and the hope is that consumers will reward the company by driving up fish sales. We'll see.

In an entirely different industry, Meyer (Sandy) Frucher, vice chairman of the NASDAQ stock exchange, affirmed the idea that an institution like the NASDAQ can't get much done without partners. Environmental advocates would like the stock exchanges to require listed companies to report on their environmental footprint. Should NASDAQ to do so, Frucher said, companies might opt to list with competing exchanges, like the New York Stock Exchange, that make fewer demands.

“Their salespeople would be out saying, those guys want to overburden you with regulation," Frucher said. "Unless it's universal, we'll lose listings."

So what needs to be done to bring about universal sustainability metrics? It would help, Frucher said, if the various groups seeking metrics could agree on what metrics matter most.

It would also help, he said, if people voted with their dollars. Like other exchanges, NASDAQ has a sustainability index, but "virtually no one trades these indexes," Frucher said. “I hear a lot of talk. I’d like to see some walk.” [One problem there may be the index itself. See Chevron's shocking sustainability news at GreenBiz.]

Earlier, in a conversation with GreenBiz's Joel Makower, Craig Philip, the CEO of Ingram Barge Co., which owns 5,000 barges that transport commodities on the nation's inland waterways, talked about the risks posed by extreme weather to his business. 2011 brought some of the worst floods ever to the Mississippi River system. 2012 brought some of the worst drought.

“Since the hurricanes of Katrina and Rita in 2005, we’ve seen a significant disruption in every year,” he said. “Systemically, these problems are chronic. They are likely to stay chronic.”

Farmers, power plants, recreational users, shippers like Ingram -- all of them place demands on the river systems, and depend on its waters. Some have come together with The Nature Conservancy and the U.S. Army Corps of Engineers in a collaborative effort called America's Watershed Initiative, to try to sort out the conflicting demands.

Joel's reaction: "The complexities of what you are dealing with are astounded."

As I said, this is why sustainability has to be a team sport.

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