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It's Not That Easy Going Green

Duncan Berry, ardent environmentalist and CEO of Apparel Source Inc., describes the ethical dilemma he faced when he learned that his industry causes massive amounts of pollution.

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Nobody can fault you for wanting to make a profit. But are there times when the bottom line isn't only about money?

For six years entrepreneur Duncan Berry worked in his off-hours to save a 13.5-acre estuary on Vashon Island, now called Fern Cove Sanctuary, off the coast of Seattle. He helped raise $750,000 to set aside the area of natural forest and tidelands by purchasing it from its fourth-generation owners. "It's a little jewel," says Berry, who considers himself an ardent environmentalist. "And I really felt strongly that it should belong to the Puget Sound community and should not go to one wealthy Microsoft owner."

But 15 months ago Berry quit the board of Fern Cove because of a discovery he'd made about his industry.

Berry's privately held company, the Apparel Source Inc., makes cotton-knit shirts, selling $50 million worth a year. Much to his chagrin, he had just learned that the cotton industry was unleashing a "staggering number of toxic chemicals" into the environment.

Berry wanted time to study how the 53 million pounds of pesticides and 1.6 billion pounds of synthetic fertilizers applied to cotton grown in the United States each year is not only destroying farmland but finding its way into food and cattle feed.

"What I was doing during the day in a very lucrative business was at odds with what I was doing with my life in the off-hours," says Berry, 43. "I had two choices: I could quit, or I could stay at the table and try to effect change." Berry chose the latter.

But even so, Berry has not considered the one move that could have had the most dramatic--and immediate--impact on his company's use of conventional cotton. He and his partner, Randy Clark, could make the decision to shift to using some organic cotton tomorrow. But it would cut into the company's profits--not erase them, mind you, but certainly reduce them.

So why not do it? Berry's reasoning is familiar. Companies, as owners are inclined to argue in situations like this, must guard profits above all. "Our primary mission as a company is to be a profitable organization," Berry says. "I believe very strongly that for this to sustain itself, it has to financially make sense for everybody." For Berry, who operates in a very low margin business, what makes sense isn't anything that would cut into the company's profits.

Of course, Berry never envisioned the Apparel Source as a mouthpiece for environmental change, a company that would tout its devotion to the environment as a selling point to consumers. Yet, "like everyone else," says Berry, "down to the staunchest 'green' customer, I'd said, 'Cotton? Oh yeah, that's great stuff. It's 100% natural.'"

Right now Berry won't change his company's ways, because of the effect it would have on his company's profits. But couldn't the fact that the shift would cost him money make it more worthwhile to do? Indeed, it "speaks of greater commitment if the company can sustain a financial penalty in the short term," says John Elkington, chairman of SustainAbility, a London-based consulting firm that advises companies on economic, environmental, and social issues.

Berry has opted to focus on urging others--namely, one of his major customers--to take the first step. That in itself is a bold decision for the five-year-old company, which ships more than 8 million shirts a year to only two customers, discount retailers Wal-Mart and Target. Based in Kent, Wash., the company employs only 10 full-time workers. To manufacture its shirts, the company works with plants in Los Angeles; Muscle Shoals, Ala.; and Karachi, Pakistan. Berry's recent discovery has left him conflicted about the way he's running the business. "It's been harder to sleep at night since I found out, and it hasn't stopped being harder," he says. "I don't sleep better yet, because I'm not reducing pesticides. It's not visible yet."

Tossing and turning isn't the only barometer of Berry's commitment. He has seriously investigated some of his options. For instance, he learned enough about the cost of organic cotton to understand that he couldn't afford to switch over to it entirely. Whereas traditional cotton costs 65¢ to 70¢ a pound, organic cotton can cost an additional 50¢ to 60¢ a pound, according to Anderson Warlick, president of Parkdale Mills, the country's largest spinner of cottons.