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Jeffrey B. Swartz

Jeffrey B. Swartz

Posted: October 27, 2009 02:53 PM

Cap and Trade, Meet the Opposition

What's Your Reaction?

The shoe business was different in my grandfather's day...

First came 65,000 friendly email blasts to my mailbox in a week, certain that Timberland could do a better job preventing global warming by helping to end deforestation of the rainforest in Brazil. Two days ago--a quiet Sunday on the calendar--became a correspondence exercise with the next population of irate citizen consumers. This group, who call themselves the NoTradeNoCap team, began diligently filling my personal mailbox at Timberland with notes like "you communist socialist, how dare you support cap and trade legislation which will destroy America's competitive position!" Hmn.

Truth is, if I could wave a wand I'd have every government on earth impose a straightforward tax on carbon emissions--less bureaucracy, less confusion--but I am a boot maker, not a wand waver. And smart folks tell me cap and trade is the only way democracies like ours can dare to price carbon emissions into social policy. So, I'm joining the growing number of voices of for-profit CEOs who call on our government to enact cap and trade legislation.

Now my new pen pals are indignant--don't I recognize that cap and trade will create real costs for businesses, and therefore consumers? Don't I realize that the economy is already really challenged? To which I would reply, yup. But pricing carbon into the marketplace is not creating a new cost--it is recognizing a real cost, a cost for dependence on foreign oil, a cost for despoiling the outdoors, a cost borne by citizens, which we've been ignoring for decades. I am not debating the science of global warming--I make boots, not long-term climate predictions--but I know that a fundamental threat to the outdoors is a fundamental threat to our brand and our business, let alone to the natural order we owe to our children. And so pricing carbon into the economy seems to me like recognizing a social "past due," a cost borne now, on my back and yours, and while I don't like it anymore than you do, this is a bill that demands payment--now, before it is too late.

Cap and trade isn't the only idea on the table--but it is the closest practical means to address the risks inherent in global warming. If we care about protecting the environment--which we as an outdoor brand do - and if we believe that given the right policies and incentives, business can play a powerful role in crafting innovative environmental solutions--which I do--then the legislation grinding its way through Congress, even with its imperfections, is a path forward worth pursuing.

I am sympathetic to the latest "I will boycott your company into oblivion" emails that decry too much government. I share the view that micro-managing through government is not the source of sustainable social change. Government should set social policy, and then call on the innovative power of the marketplace to respond. Because that is how private enterprise is cultured--in response to stress, we innovate, rapidly, because we are not "accountable" the way politicians boast--we are accountable the way the marketplace demands. Government should set policy that creates a level playing field for business and then step back and let the market operate.

Case in point--consumers organize these days overnight, and concentrate their energy with great ease and effectiveness. Faster than you can say "die, corporate scumbag," the CEO's mailbox is full of consumers, demanding attention to their concerns. Demanding not speeches, but action--demanding, address my concern or face the consequences, at the cash register, today. By contrast, our accountable government grinds ahead at the same interminable pace as in the days of the telegraph. In a world where communication is nothing less than instant and viral, the CEO who wants to survive has got to be able to manage changing attitudes in minutes.

Consider our experience with the Greenpeace campaign as an example--in the three months since Greenpeace focused on Amazon deforestation, look what has changed--a list of major consumer brands have shifted their attention to the issue, focused energy on remediating failures in their supply chains, forged innovative and progressive solutions to a major environmental challenge--with no help from the Brazilian government, the UN, or any other government. In three months' time--driven by consumers--CEOs and NGOs have collaborated for real and positive impact. Left to government, the issue of deforestation would've been "in committee."

Climate legislation is an even more powerful example. How much longer do we need to hear the critics whine "we didn't sign Kyoto?" While our leaders bleat on and fail to draft and execute legislation to address the fact that the US sends $25B a month out of our economy to buy foreign oil whose consumption threatens the natural order--while the Congress meets, and talks, there are vibrant examples of real life, for-profit, honest to goodness competitive brands and companies that are reducing their carbon emissions, lowering operating costs, improving profits, innovating for sustainability both environmental and financial. Our small company--for five years we've been acting, lowering our carbon footprint and our costs, making incredible, concrete progress--if only Congress wanted to see rather than keep on keeping on. One thing I know for sure--our consumer demands a faster response, and holds us differently accountable. Ironic to me, how civic democracy works in the marketplace, but nowhere near as quickly, in government.

The latest emails in my box seem to want no government. Here we are in New Hampshire--where the license plate says "Live free or die." But my newest pen pals are wrong--government has its role, if only it would play it. The private sector is well equipped to find meaningful environmental solutions - we have the resources, the capacity to innovate - but without incentive or consequence, why should the CEO focus? Nice to say, business should act accountably and responsibly for the environment because it's the right thing to do, but practically, the marketplace will act accountably and responsibly when government does its job--setting social policies with rewards, incentives and consequences. No CEO with a mind would pay employees less than minimum wage--the government set a policy, and business innovates for profit given that policy. When government enacts climate legislation, innovative business leaders will take the policy, and build strategies that meet the challenge, delivering profit in a more responsible environmental fashion. Don't tell me it can't be done--we've been doing it for years.

So keep those cards and letters coming. Our elected representatives may not feel the sting of minute by minute accountability--but we in the private sector do. From the engaged consumer, be they informed or simply outraged, comes the clear reminder for the CEO--woe unto (s)he in this connected day who thinks even for a second, good enough is.

 

Follow Jeffrey B. Swartz on Twitter: www.twitter.com/Timberland_Jeff