Timberland and VF: A tale of merging two sustainability programs
A corporate merger, like a marriage, can lead to a whole stronger than its parts — but throwing disparate sustainability programs into the mix can be enough to make even the Brady Bunch shudder.
Consolidating sustainability initiatives within a single organization can be challenging enough — engaging key stakeholders such as customers, employees, the C-Suite and investors is more than a full-time job for corporate sustainability executives.
While the worst-case scenario might be a parent company refusing to prioritize sustainability and neglecting or outright dismantling its acquisition’s sustainability initiatives, the best case could mean that two sustainability-focused firms come together to create something better than either could alone.
The 2011 acquisition of outdoor lifestyle brand Timberland by VF — one of the world’s largest apparel and footwear companies — may well represent one such best case scenario.
Communication key to conquering merger pains
Although VF also had sustainability commitments, it took a different approach to Timberland’s, which meant overcoming some initial challenges in integrating the two programs.
"Right at the outset, the biggest challenge was simply making sure we were coming from the same place relative to our CSR commitment," Stewart Whitney, president of Timberland, told GreenBiz. "Timberland has a long history of social and environmental responsibility; it’s ingrained in our culture and truly part of what makes Timberland, Timberland."
In its early conversations with VF, Timberland was reassured that its parent-to-be was committed to continuing Timberland’s sustainability traditions. But once the acquisition was underway, both companies needed to dig deeper to understand to what extent they were aligned.
"Upon that digging, we were pleased to discover we were quite aligned in our commitment to sustainability, and coming together to create something even bigger and better than either of us could do alone," Whitney said.
With this knowledge in place, Timberland and VF proceeded to the possibly hardest part — the integration itself.
"I’d say the biggest challenge here, while maybe not the most glamorous part, was related to process and operations," Whitney said. "We each had our own approach to setting metrics, gathering data and measuring progress. We each had our own reporting processes and cadence."
Another major challenge for Timberland was making the transition to centralized sourcing under VF.
"While there were certainly many advantages to moving to this model, at the same time, how did we ensure all those factory relationships, and all the great progress we had made together over the years, would continue under a centralized model?" Whitney said.
But VF followed through on its commitment to work through these challenges and make it work, helping to drive both firms’ sustainability agendas forward.
Both sides benefit by becoming one whole
Both Timberland and VF affirm that their collaboration has allowed them to develop stronger sustainability practices.
"Having access to VF’s platforms and resources has been an incredible advantage for Timberland," Whitney said. "Whether it’s deep consumer insights work, access to tools like Life Cycle Analysis or materials innovations, we simply did not have the resources five years ago that VF can offer us today."
Timberland also benefits from VF's taking over some back office and operational functions, which frees up time and resources to focus on what Whitney calls Timberland’s "passion points" — the initiatives that are really going to drive progress relative to sustainability.
"It’s not an add-on, but integrated into our business at every juncture," Whitney said.
On VF’s side, one key area they were interested in exploring was how Timberland had managed to embed sustainability into both its culture and business model.
"The Timberland acquisition didn’t necessarily shape VF’s sustainability strategy as much as it confirmed and enhanced it," Letitia Webster, senior director of sustainability at VF, told GreenBiz.
"Our strategy all along was to create a central function that could deploy VF’s powerful platforms and centralized operations to help scale each brand’s individual sustainability expertise and best practices across the entire portfolio of 30-plus brands for maximum impact."
VF calls this "sustainability at scale," which is fueled by collaboration among its brands with VF playing the role of enabler, facilitator and accelerator. Adding Timberland into that mix — which already included such sustainability-focused brands as the North Face — elevated everyone’s game and helped to infuse VF with more environmentally focused actions, ideas and approaches than before.
"We believe the whole is best when each individual part is focused on a specific action that can drive the greatest impact," Webster said. "As the corporate center VF oversees and manages the sustainability management systems, programs, reporting and collaboration tools, and data management, such as carbon accounting, that the brands use and leverage for their benefit. We serve as a central resource for information."
Webster added that this, in turn, allows VF’s brands to focus more intently on integrating sustainability into their products, their go-to-market strategies and consumer marketing initiatives. Meanwhile, they are encouraged to share best practices with their VF brand peers to extend the reach and impact where applicable.
Best merger advice: Take your time
When asked what advice he would give a company facing acquisition and the merging of sustainability programs, Timberland’s Whitney said: "First and foremost, don’t move too fast."
"Take your time to talk with the folks on the other side and learn before acting and making decisions," he said.
In others words: Corporate mergers, like marriage, shouldn’t be rushed into. Both parties should "get to know" one another before taking the big plunge.
VF’s Webster concurred: "Take time to really understand what sustainability means to each other and its position in the company or brand DNA. Then you need to explore each other’s unique skills, resources and assets, and begin thinking about how you can leverage them together to achieve both individual and shared goals. Be collaborative and willing to share and learn from each other. And, honesty is always the best policy."
It’s also important to approach the merger with an open mind and avoid making assumptions.
"When we first heard we were being acquired, some people were skeptical — would a major, multi-billion-dollar powerhouse support Timberland’s commitments? Would Timberland still be Timberland? Four years later, I can say with confidence to both questions, yes."