Wednesday, March 12, 2008

Of Carbon, Marketing, Consumerism, and Natural Capitalism

I’m really happy to see that “carbon neutrality,” as a concept, is making its way into mainstream media and business. It is a sign that our impact on Earth’s resources is real, and that everything has a “cost” associated with it.

We’re at the beginning of the cycle however, and it will take years for reality to find its way into regulation, standards creation/adoption, and reporting. In the end, millions of dollars will be spent contending and lobbying, and it will boil down to the usual “simple number” that consumers can digest, even though it is hardly representative of the whole picture. The food industry is a good example of this process in the US. Consider that Nutrition Information label on nearly all complex food stuff you buy at the grocery.

The particularly unique challenge with carbon emission measurement and reporting is that it is diametrically opposed to capitalism and consumerism; the two pillars of the “American Way of Life.” The only way to truly be carbon neutral around a product or service is to simply not partake in it at all. Are you worried about the impact the auto manufacturing industry has on the planet? Then don’t buy/use a car. The very act of engaging in product acquisition and use sets in motion enough environmental impact to negate your enlightened sense of being to begin with. Rather than walking this blog post down the rough path of activism and counter culture, I’ll stay on course.

I was an intern at IBM for 3.5 years during my college years. I wrote software for the Logistics department, that optimized supply chain management scenarios for the company on a global scale. How many variably sized widgets can you fit on that pallet? Is it more cost effective to manufacture chipA in countryX, given the import tariffs on silicon, and the export/customs fees for volumeY, blended with construction costs, labor market, and government/political stability? I had a total blast! I had great exposure to the infinitely complex cost models required to vet supply chain management. Those models are equally complex when trying to evaluate and measure the impact a company, or product, ultimately has on the environment.

If you want to get smart on these challenges, I recommend Carbon Confusion published by Business Week, and the book Natural Capitalism. Both, are fantastic reads.

As a counter intuitive example of the measurement dilemma, consider this. AOL was pummeled for the carpet bombing of installation CDs across the globe. The environment impact of production and distribution and litter of those CDs has been enormous. But... Was the net effect a gain or a loss. Did the act of getting more of the world’s population online benefit the environment more, or less, than the impact of the CD distribution itself. Moving shopping, media consumption, bill payment, and account statements online has had an incredibly positive impact on the environment. The natural counter is that people had to use heavy metal laden computers in the process, and that shipping of goods purchased online has had a negative effect. The argument goes on and on and on; frankly, it doesn’t end unless you simply disconnect yourself from the grid entirely, and don’t “consume.” Natural Capitalism provides a fascinating, engulfing, look at these complexities, and offers suggestions and hope around how we can all do the right thing, as individuals, and businesses.

I look forward to the progression.

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