State of Green Business
Inside Interface's bold new mission to achieve 'Climate Take Back'
Next week at the National Exposition of Contract Furnishings, better known as NeoCon, Interface, the Atlanta-based carpet company, plans to roll out its next corporate mission. In the process it plans to set a new marker for what it means to be a sustainable business.
“Climate Take Back,” as the new mission has been named, is the successor to Mission Zero, the name given to a vision articulated in 1997 that, for most outside the company, seemed audacious at the time: “To be the first company that, by its deeds, shows the entire industrial world what sustainability is in all its dimensions: People, process, product, place and profits — by 2020 — and in doing so we will become restorative through the power of influence.”
Over time, that sentence turned from an aspirational statement to a set of goals designed to “eliminate any negative impact Interface has on the environment by 2020”: zero waste, greenhouse gas emissions and net water use; 100 percent renewable energy; a closed technical loop, via product takeback and 100 percent recycled or biobased materials; and other goals related to transportation, stakeholder well-being and business models that “redesign commerce.”
Such bold goals are more common now — albeit, not common enough — and with Interface on a trajectory to achieve many of its 2020 commitments ahead of schedule, the company has been on a quest to formulate a new vision that seems as audacious today as Mission Zero did 20 years ago.
Specifically, Climate Take Back includes four key commitments:
- We will bring carbon home and reverse climate change.
- We will create supply chains that benefit all life.
- We will make factories that are like forests.
- We will transform dispersed materials into products and goodness.
Over the past few weeks, I’ve had the opportunity to look under the hood of Climate Take Back, including interviewing Interface’s senior management team and several of its core advisors about the journey it has taken to settle on its still-nascent mission; the work Interface already is doing to implement its Climate Take Back commitments; and the company’s plan to transform its operations, supply chain and customer relationships to reinvigorate its reputation as an exemplar of sustainable business leadership.
'Spear in the chest'
In 1994, after being asked by a customer to articulate the company’s environmental stance — it did not yet have one — Anderson recognized the need to look beyond environmental compliance to take a more proactive stance. He read Paul Hawken’s book, The Ecology of Commerce, and, at age 60, Anderson had a “spear in the chest” epiphany, as he would later describe it, inspiring him to recognize that he was, by his own reckoning, “a plunderer of the Earth.” Anderson declared that Interface would swear off oil on the road to becoming the world’s first environmentally sustainable — and, ultimately, restorative — company.
That began a quarter-century journey for Anderson that would continue until his death in 2011, giving more than a thousand speeches and talking to just about anyone who would listen about the company’s climb up “Mount Sustainability,” as he came to call it, including the seven “faces” that represented the key goals of Mission Zero. As he put it in 1997:
If we’re successful, we’ll spend the rest of our days harvesting yester-year’s carpets and other petrochemically derived products and recycling them into new materials; and converting sunlight into energy; with zero scrap going to the landfill and zero emissions into the ecosystem. And we’ll be doing well — very well — by doing good. That’s the vision.
Anderson took Interface far down the path of achieving that vision. It would propel his company in myriad directions in the form of new products, services and business models. Interface began taking back and recycling used carpet, designing new products from recycled materials, developing nontoxic adhesives and textiles, harnessing nature’s designs for products and experimenting with leasing “flooring services” as an alternative to selling carpet.
Among his proudest contributions was Entropy, a carpet tile inspired by the forest floor: No two tiles were alike, in the same way that no two sticks or leaves in a forest are identical. Tiles could be laid and replaced randomly, without regard to color matching, thereby reducing time, cost and waste. As David Oakey, the product’s designer, put it: “It’s only in our synthetic world that we want perfection — one shade, no blemishes. If we can’t match a carpet’s color exactly, we call it a defect. Nature doesn’t work that way.”
Entropy, which started as one product and now represents an entire line, grew to represent about a third of Interface’s roughly $1 billion annual sales.
Not all of Anderson’s innovations succeeded. The company’s “Evergreen Lease,” for example — a business model where Interface retained ownership of its carpet in customers’ facilities, leasing flooring services to customers, maintaining and reclaiming the tiles as necessary — failed to catch on, the result in large part of having to get customers to move floorcoverings over from capital to operating budgets.
The vagaries of oil prices periodically roiled the economics of carpet recycling, making virgin nylon cheaper than recycled. And economic booms and busts further challenged the company’s sustainability efforts, at time subjecting Anderson and his company to criticism that his high-minded sustainability ideals led him to take his eye off the prize of profitability.
Anderson, for his part, never wavered. In fact, he credited sustainability with saving the company during down cycles due to “the goodwill of the marketplace based on what we’re doing,” he told me in 2004, as the company clawed its way back from the dot-com collapse that had cut Interface’s revenue by 30 percent. In 2005, he told a business audience that “cost savings from eliminating waste alone have been $262 million.”
At the time of Anderson’s passing, from cancer at age 77, he was still active in the company, though he had shed day-to-day responsibilities to Dan Hendrix, who became Interface’s president and CEO in 2001 and who succeeded Anderson as chairman in 2011.
Anderson’s death put the company in a bit of a tailspin — not necessarily financially, but more in a psychic sense. Though Anderson had worked to embed sustainability deep into the company’s culture, Interface became relatively quiet after years of public engagement on sustainability, perhaps uncertain how to show its face to the world in the absence of its inspirational founder and cheerleader.
Its financial performance remained lackluster, too: Earnings were essentially flat from 2011 to 2014. “We had kind of stopped demonstrating this virtuous business value, which is creating value for our shareowners as well as our other key stakeholders, including the environment,” Jay Gould, Interface’s president and COO, told me recently.
Going beyond 'zero'
The march towards Mission Zero continued unabated, however, with consistent year-over-year improvement in most metrics. Today, the company forecasts that by 2020 it will halve its energy use, power 87 percent of its operations with renewable energy, cut water intake by 90 percent, reduce greenhouse gas emissions 95 percent (and its overall carbon footprint by 80 percent), send nothing to landfills, and source 95 percent of its materials from recycled or biobased resources.
Given the fact that the company was within striking distance of many of its 2020 goals, it decided last year to build a framework for what would happen next. In fact, that conversation had begun years earlier: In 2011, not long before Anderson’s passing, Interface hosted a Global Innovation Summit where the company assessed its progress and began to refine the language it had already been using about “being restorative.” The event was held in LaGrange, Georgia, so that Anderson, by then too ill to travel, could participate.
“It was the last time many of our employees got to see him before he passed away,” recalls Erin Meezan, Interface’s Vice President, Sustainability.
Also last year, Interface reconstituted its Dream Team, “a collection of experts and friends who have joined with me to remake Interface into a leader of sustainability,” as Anderson wrote in the company’s 1997 sustainability report.
The original team included Sierra Club executive director David Brower; Buckminster Fuller devotee Bill Browning, then with the Rocky Mountain Institute (RMI); community and social activist Bernadette Cozart; author and entrepreneur Hawken; Amory Lovins, RMI co-founder and chief scientist; L. Hunter Lovins, RMI’s other co-founder; architect and designer William McDonough; John Picard, a pioneering consultant in green building and sustainability; Jonathan Porritt, co-founder of Forum for the Future; Daniel Quinn, author of Ishmael; Karl-Henrik Robèrt, founder of The Natural Step, a sustainability framework; and Walter Stahel a resource efficiency expert. (Additional members would be added over the years, including Biomimicry author Janine Benyus.)
The group became Anderson’s kitchen cabinet, a combination idea catalyst, cheerleader and bullshit detector. Picard recalls the Green Team meetings: “There were some big outbreaks and some fights and some ‘F-U’ moments and some, ‘Oh, there's no way’ moments. And ‘That's not our role.’ Then we'd turn around, and Ray would say, ‘Yeah, it is.’ And history would be bent right there.”
About 18 months ago, Interface brought the band back together — the Dream Team had stopped meeting regularly even before Anderson’s death — to begin an effort to help build out the company’s next mission and set new post-2020 goals. The group holed up for several days last August at Serenbe, a New Urban village on the outskirts of Atlanta, about 50 miles northeast of Interface’s headquarters.
At the same time, the company set out to revitalize and recapture its innovative spirit, which had dissipated somewhat. “We asked ourselves, ‘Why are we not innovating as much?” Meezan recounted. “Why are we not as close to achieving our sustainability goals in some areas as we would like?’” She cited the company’s decentralization, disconnectedness, lack of communication and a lack of collaboration as contributing factors that had hampered the company’s ability to accelerate progress.
Interface had lost its competitive edge, as COO Gould would find when he joined Interface early last year. Gould — who came to the company after more than 20 years stewarding such brands as American Standard, Minute Maid, Dasani and Rubbermaid — was keen to see where Interface was on its 2020 goals, and even more keen to create the next step and framework. He took to the road to visit factories and customers, logging nearly a quarter-million miles last year. “One of the things I heard was that Interface is a really special company, but it’s less distinct, less authoritative, less of a leader than it once was,” he said.
Indeed, much of what had distinguished Interface, from a sustainability perspective — eliminating waste, toxics, energy and carbon while creating innovative products inspired by nature’s genius — was now commonplace, including among Interface’s biggest competitors, Mohawk Industries and Berkshire Hathaway’s Shaw Industries, both of which had closed the recycling loop, introduced sustainability-inspired innovations and undertook efficiency measures. The field had become crowded.
“It was a complex discussion to talk about how Interface is different than the others,” Gould recalled.
Other relative newcomers saw a similar situation. “When I joined Interface, it was a couple years after Ray passed,” recalled Global Chief Marketing Officer Jo Ann Herold, who signed on in 2013. “It felt like the company was still a little bit in mourning. Ray had been such the face and voice of Interface. He was so transparent and authentic in all his writing and speaking. The company had gotten real quiet and introspective.”
“We went into a holding pattern for quite a while,” said Picard. “There were a lot of people circling that situation trying to figure out what's the next best step.”
Moreover, added Meezan: “Our thinking had shifted a lot over the last five years in terms of what it means to be a sustainable business. We certainly had undergone an intellectual transformation, from ‘It's not just about having a zero footprint or doing less harm’ to ‘It really is about how can the business have a positive impact. How can we be more of an instrument for change?’”
In some respects, Interface already had been well on its way to moving beyond Mission Zero. One example is Net-Works. Launched in 2012, it helps turn discarded fishing nets into the raw materials for nylon carpeting in some of the world’s most impoverished communities.
Net-Works is not just charity, says Nigel Stansfield, Interface’s Vice President and Chief Supply-Chain Officer, who led the program’s creation. “Not only are we connecting some of the poorest people in the world into our global supply chain, we've set that model up as a business. It’s not a philanthropic or charitable kind of offshoot — it's a business model.”
In creating the program, Stansfield and his team set up community banking systems to support the collection of fishing nets and the resulting financial transactions. “What we did is not only create a business model for our raw materials supply, but we were able to provide a financial banking infrastructure on remote Filipino islands that’s run by the community, giving people access to finance and loans that we take for granted in the developed world.”
Stansfield and several other Interface execs I interviewed cited Net-Works as a prototype for the kind of initiatives the company plans under Climate Take Back — specifically, to achieve its commitment to “transform dispersed materials into products and goodness.”
Says Stansfield: “I think that's been a huge example of what inclusive business can do within supply chains.”
Making some noise
With a growing number of such stories to tell, it became clear over the past year or so that many in the company were eager to raise the bar and make some noise.
Stansfield, who joined the company in 1985, was one of them. In 2001, he moved into research and development, in large part inspired by Mission Zero, and eventually ascended to become the company’s chief innovation officer before taking on his current role early this year.
“For the last 16 years, I've been in a senior leadership position, either in Europe or in the global business, and for the majority of that time leading innovation in sustainability and product development for the organization,” he told me. “For me personally, Mission Zero has only ever been a significant milestone on a journey. I've never considered Mission Zero to be finite and the end point.”
Mission Zero, among its other achievements, helped sustainability become embedded in the company in a way few, if any, companies of its size can claim. When Jo Ann Herold first arrived at the company, she was struck “by how the company truly walked the talk and how sustainability was a part of almost every conversation that we had, almost any strategy that we had,” from innovation to investment.
The same seemed true at the sales end of the company. “It's no longer up to our sales team to sell a sustainable versus a non-sustainable product,” says Rob Boogaard, President & CEO for Interface Europe, Middle East and Africa. “It's all coming out of a green manufacturing plant. That’s really, really helped the discussion for sales. And if you are competing between two solutions, and one product is produced in a green plant, it’s a pretty easy choice.”
But Ray Anderson’s sustainability vision was always about more than just a “green manufacturing plant.” He wanted Interface to be a shining example, an ideal to which other companies could aspire, a test bed for new ideas that stood to upend how business is done — and, not incidentally, an opportunity to stand above the crowd in the world of commercial flooring.
Climate Take Back is the noise the company wanted to make.
Reversing climate change?
As its name implies, at the heart of Take Back is the climate crisis. “The mission is that we will demonstrate that we can reverse the impact of climate change by bringing carbon home,” says COO Gould, who is expected to ascend to the company’s CEO role next year, with the current CEO, Hendrix, remaining chairman. “We want to be able to scale that to the point where it actually does reverse the amount of carbon in the atmosphere.”
“Bringing carbon home” may be a head-scratcher for those who have heard only about the need to dramatically slash carbon emissions, or to become “carbon neutral.” But carbon is an essential element of life. The carbon content of soil is a key to its fertility, for example. There’s a small but growing movement to use carbon dioxide molecules to build things — plastics and other materials, for example — thereby bringing it “home” to earth as a beneficial ingredient, as opposed to a climate-warming gas in the atmosphere.
Interface’s commitment to “bring carbon home and reverse climate change” is a prime example how the company intends to move from “doing less bad” to “doing more good” — in this case, by not merely reducing the company’s contribution to climate change, but actually working to solve the climate crisis.
Much of the inspiration for this goal comes, once again, from Paul Hawken, whose nonprofit Project Drawdown is aimed at reducing greenhouse gas concentrations in the atmosphere in order to reduce, not just stabilize, atmospheric gases and reverse rising global temperatures. Hawken’s Drawdown team is developing the methodology and scientific underpinnings for 100 technological solutions that, “when deployed at scale, can lead us to climate drawdown,” according to the group’s website. The solutions will be released in a book in 2017.
“Positive instead of doing less harm — I mean really it’s the continental divide, isn’t it?” Hawken asked, rhetorically, when we spoke recently. “If we just do less harm, we’ll still go over the cliff of climate change, only more slowly. We’ll still be Thelma & Louise.”
Hawken may have provided the inspiration, but Gould — who is responsible for the wording behind the new climate commitment — deserves credit for embracing the vision, says Green Team member Picard.
“I think Jay, in a really interesting way, went through quite an epiphany and a huge change in the last 12 months,” he said. “I think he got the bug and saw the importance of this and said, ‘Well, if we're going to do this, we're going to go big or we're not going to do it. If we want to change the world and reverse climate change, what would it take to do that?’ And he threw out some wild ideas at that level.”
“There’s a growing aspiration in the company to really, really want to talk about climate change publically,” says sustainability chief Meezan, who conducted interviews with employees, stakeholders and advisors around the world to inform the company’s new mission. She says people told her, “Why aren’t we talking about climate change. Why aren’t we shouting about it? Why isn’t this the biggest issue we’re talking about?”
She readily admits to some apprehension about doing so. “It is an issue that is so divisive and has so many different stakeholders who think so many different things that I worry that we can effectively make a difference. I don’t worry about our ability to do our part at Interface, but can we really have an influence on this broader conversation around climate change, and are we ready to respond to really negative people?”
But Nigel Stansfield is undeterred by the reputational risks — or at the enormity of the task.
“When Ray stood up in '94 and said, ‘We're going to be a sustainable company,’ sustainability wasn't fashionable; we had no roadmap. It was outrageous to think that an organization could get to a zero footprint, and we were ridiculed for it. People stood on the sideline and watched us, waiting for us to fail.”
Stansfield believes Interface is in a similar position now. “We know now what the biggest issues of our generation — and frankly, our children's generation — are, and that's climate change, poverty and inequality on a planetary scale, on a species scale. We are bold and brave enough, as we did in '94, to stand up there and say, ‘If not us, who? And if not now, when?’”
He added: “When we canvassed our internal thought leaders and external people on this and we asked them, ‘What kind of goals should we have?’ unanimously it came back, ‘It should be as outrageously impossible as the first goal.’”
Rob Boogaard agrees. “Climate change requires industry at large to put all hands on deck to turn things around and reverse trends. And I'd rather be almost right about that than totally wrong about not doing anything at all.”
“It starts with changing how people think of what they're capable of doing,” says Green Team member Janine Benyus, co-founder of the consultancy Biomimicry 3.8. “How they think about themselves and what power and agency they have that changes the world. They realize that climate change is the looming thing and that we all need to take a piece of reversing it, not just mitigating it or adapting to it.”
Factories as forests
Benyus provided the inspiration and intellectual firepower for another of Climate Take Back’s commitments: creating factories that operate like forests.
The notion is something Benyus has been talking about, and working on, for a while: to build human development that functions like the ecosystem it replaces. That means providing such ecosystem services to its surroundings as water storage and purification, carbon sequestration, nitrogen cycling, temperature cooling and wildlife habitat. And do so at the same levels as were once provided before humans came along.
It sounds like a tall order, and it is, but Benyus and her team have been developing the metrics and methodology for several years. It begins with “ecological performance standards” — EPS for short — which measure the services provided per hectare for a given ecosystem.
Consider Interface’s facility in Minto, New South Wales, about an hour southwest of Sydney, a test bed for this idea. The factory’s ecology is characterized as a river-flat eucalypt forest, the name given to “the ecological community associated with silts, clay-loams and sandy loams, on periodically inundated alluvial flats, drainage lines and river terraces associated with coastal floodplains,” according to the NSW Office of Environment & Heritage.
As Benyus explains: “What we're working with is a 5.7-hectare site. It is mostly a big factory building with a white roof. It’s got a parking lot. It’s got a buried stream underneath of it. That’s about it. What we're saying is, ‘Let's go to the river-flat eucalypt forest next door and look at what ecosystem services are being produced.’”
In addition, says Benyus, “We asked, ‘What are the most important ecological processes in that place? What are the keys to resilience?’ We prioritized the ecosystem services. We found out that, for instance, nutrient cycling was very, very important in that particular place. So was water management because a lot of what keeps it healthy is intermittent movement of water through that riparian zone.”
The Minto EPS enabled Benyus to calculate how much water the ecosystem needs, and how that syncs with Interface’s business needs as well as the needs of neighbors, whether factories, office buildings or residences.
“Ecological performance is our aspirational goal,” explains Benyus. “Then there's the performance gap, and you try to fill that. You figure out how many years you think it’s going to take you to get to full functioning of the services that you choose.”
It’s largely theoretical right now — the assessment process is underway in Minto, and is just beginning at Interface’s plant in LaGrange, where the company plans to invest $60 million in productivity improvements. Meanwhile, Interface will be moving its headquarters into midtown Atlanta from the suburbs in mid 2018, renovating a 1980s-era building. Will the company be able to replicate all the ecosystem services that once existed in that now-urban environment, from slowing stormwater runoff to improving air quality to storing carbon?
Says Gould: “We can filter the air so that we breathe out cleaner air than we breathe in. We're going to build our headquarters consistent with that.”
The idea of factories as forests presents no end of challenges, including the price tag, which is currently unknown. And Erin Meezan is quick to point out that this goal, like many of Interface’s ambitious projects, are long-term initiatives.
“I think it could be a 10-year plan for Interface to achieve, in some locations, a factory that functions like a forest, and that would be okay,” she says. “I think it would be really amazing if we could do something like that in a decade.”
There also are local zoning and building codes that could inhibit, if not prohibit, some of these initiatives. Like any company, Interface is constrained by the types of space it needs for its operations, and the places it needs to locate. Some of these sites, suffice to say, are hardly verdant meadows.
Benyus maintains that there may be additional business benefits to Interface for its ecological sensitivity to place, including attracting and retaining talent, enhancing employee morale and being a welcome neighbor. Moreover, she says, “It will help them in terms of their land holdings by reducing risk while increasing land values because it’s a nicer place to be.”
Real, serious, accountable
Compared to “Mission Zero,” a largely internal initiative, “Climate Take Back” is aimed at extending Interface’s influence beyond its own value chain — from “us” to “all of us,” an expression that came out of the company’s conversation with its employees and others. The company’s leaders understand that the mission has to turn into a movement. “The permission our employees gave us was that this needs to be bigger than just Interface,” says Meezan. “It can’t just be good for us. It needs to be good for all of us.”
Toward that end, Interface plans to hold a series of conferences in the U.S., Europe and Asia in late fall, engaging what Jay Gould calls “like-minded companies” — customers, suppliers and others — to join in on this mission.
“I think Interface is going to benefit from the influence of others more than they can even imagine today by putting that kind of a vector out there,” says John Picard. “They've really set a bar that no one else has, and I don't think they're going to be able to do it alone. In five years, we'll look back and they will have not gotten there on their own, and that will be probably the best part.”
Interface’s leadership recognizes that it must, as Ray Anderson did two decades ago, demonstrate that Climate Take Back isn’t just a lofty aspiration — that its goals can be measured and managed just like so many other business tactics. The company plans to spend the next year or so creating metrics for each of these commitments, then targets and timetables for achieving them.
Says Gould: “We want this to be real and serious. We want to be held accountable for it. And we're going to track and measure our success. So this is the beginning of how we will think about measuring our success.”
He is well aware of the risks. “To go public with such an audacious goal, it's a little scary,” he admitted. “There's not a roadmap for this. Not only is the Interface credibility on the line, I'm personally completely invested in this.”He confided: “Even talking to you makes me nervous. We're not as prepared as I'd love to be at this stage. But we decided that we have to start the dialogue now. We just can't wait to get it more baked. I'm excited about the potential, but I'm nervous about delivering on the legacy that we've built.”
Meanwhile, the “old” mission isn’t exactly over, stresses Meezan. “We are not abandoning Mission Zero. It will be an important check-in point in 2020, a big milestone, and we remain focused on hitting those targets. It's an important foundation and it’s now our business as usual.”
Gould, Meezan and the others clearly see how its mission-driven culture has sustained the company over the past two decades, in particular the impact it has had on Interface’s nearly 4,000 employees globally.
“If you talk to the 25-year-olds now in the job marketplace and ask, ‘Would you like to come work for a carpet-tile company?’ I don't imagine many would say yes,” says Nigel Stansfield. “But, ‘Do you want to come work for one of the world's most sustainable manufacturing businesses?’ It's a very different conversation to have.”
Janine Benyus and Paul Hawken saw the impact clearly when they traveled earlier this year to three Interface sales meetings — in Phuket, Lisbon and Atlanta — to present the new strategy. At each, they spoke on stage with Gould to an audience of 500 or more Interface sales reps. Climate Take Back was immediately and enthusiastically embraced.
Says Hawken: “People were exultant and just singing, dancing, happy. And the very common reaction was two words: ‘We’re back.’”