Category Archives: Politics

Bt Steve Percy, Fast Company.

Climate change has been a wake-up call that only the smartest businesses are willing to hear.

I became head of BP America in the mid-1990s, when the company was undergoing a metamorphosis brought on by climate change. More than just changing its culture around an environmental issue, BP decided it would change course entirely.

This was the beginning of “Beyond Petroleum.” Everything changed in BP, starting with a fundamental shift in corporate strategy from an oil based company to one more involved with natural gas (through the acquisition of Amoco) as well as solar panel and biofuel research and development.

From my years as an oilman to my current role helping companies and future business leaders understand sustainability, I’ve learned a few lessons about business, the environment, and the true meaning of “going green.” Here are my top six.

Lesson #1: It’s a Thankless Job–But Every Company Has to Do It

I always start my classes by saying that corporate sustainability is about doing well by doing good. It is not about altruism. This statement seems obvious to those of us already steeped in sustainable business, making it easy to forget that most people still see the dynamic as “planet vs. profit.” And so it bears repeating, early and often: we’re making money while helping the environment. To do that, a company has to define its core business, and then take a step back: how will trends like climate change legislation and a better-educated consumer affect that core business? For existing companies, the first step is to be very open to the fact that changes are happening in the first place.

Here’s the catch, though: once you’ve stuck your chin out and made a big deal about your “greenness,” even a small stumble can make you a real target. Environmental groups even admit that they will target the “greenest” companies because they will buckle under the pressure to prove themselves environmentally sound. You really set yourself up for a more difficult time if you take the high road, and you have to be willing to recognize that risk.

To illustrate: BP was declaring that it was “beyond petroleum.” Well if the core of your business is in petroleum, what does that say? Taking such a position can lead to questions about the core of the business–and these questions can come to a head as we saw last spring in the Gulf of Mexico.

But there are huge benefits that outweigh the risks. The biggest benefit? Sustainability is an enormous opportunity to think more broadly about corporate strategy. For example, as of the mid-1990s, BP was an oil company. With the acquisition of Amoco, it became an oil and gas company. The thinking was, if the world is going to change and we’re only an oil company, we had better diversify the portfolio to include gas, solar, wind, biomass and other fuels.

The implications of BP’s decision played out in every corner of the organization, right down to how we hired people. Back in the 1990s, oil companies were considered the dinosaurs; BP’s change in direction was very forward thinking and it made a big difference in recruiting talented people.

Lesson #2: Go Big or Go Home

Another key learning is that if you take a position on one issue, you have to take a position on all of them. For example, if you take a stand on climate change, you’d better raise your game with respect to water, ecosystems, and even social issues such as human rights. Because of globalization, we’re at a point in our evolution where a company’s ecosystem is its operating environment. So if you are building up reputational equity on sustainability, you have to raise the bar on all issues that play a role in that system.

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