Paving Paradise

The coming environmental crisis and what business can do about it

  • Environmentalism and the New Logic of Business, by R. Edward Freeman, Jessica Pierce, and Richard H. Dodd (Oxford, 2000)
  • You Can't Eat GNP, by Eric A. Davidson (Perseus, 2000)
  • The Essential Aldo Leopold, edited by Curt Meine and Richard L. Knight (University of Wisconsin Press, 1999)

In an incident described by the authors of Environmentalism and the New Logic of Business, Edgar Woolard, former chairman of E.I. du Pont de Nemours and Co., announces his company's new commitment to zero pollution. When an engineer tells Woolard that there is no way a particular plant can meet the new standards, Woolard suggests that it will have to close. Several weeks later the plant's engineers come up with a solution. When Woolard asks how much the solution will cost, they tell him that it will actually save the company money.

In several new books, stories like that are used to propose that measured analysis of business's effect on nature take the place of the usual finger-pointing. Instead of trying to convince readers that companies have caused massive environmental destruction, Freeman, Pierce, and Dodd choose to adapt the wager that 17th- century philosopher Blaise Pascal used to justify belief in a Christian god: "If God does not exist, one will lose nothing by believing in him, while if he does exist, one will lose everything by not believing." In like manner, the trio wagers that there is an environmental crisis and that companies should behave accordingly.

The authors contend that it's myopic to condemn companies that fail to embrace radical environmentalism. Instead, they applaud those that adopt any level of environmental concern.

The main message of Eric Davidson's book is encapsulated in its title: You Can't Eat GNP. In it Davidson declares that by looking at the gross national product in abstract numbers, you can lose sight of the reality behind the figures. In clear, measured prose, he goes on to lay out how traditional tools of economists (cost-benefit analysis, discounting, and so on) don't work when you're talking about concrete things like soil, forests, garbage, produce, and other environmental issues.

Both books see governmental initiatives as critical to stopping the erosion of the environment. The authors may be right, but they'd do well to remember the words of Aldo Leopold, a legendary early-20th-century conservationist, who is being published in a new collection. He wrote: "Relegating conservation to government is like relegating virtue to the Sabbath. Turns over to professionals what should be daily work of amateurs."

Where have all the bowlers gone?

  • Bowling Alone, by Robert D. Putnam (Simon & Schuster, 2000)

In the January 1995 issue of Journal of Democracy, Robert Putnam, a professor at the John F. Kennedy School of Government at Harvard, wrote an article titled "Bowling Alone: America's Declining Social Capital." His contention was that civic involvement had reached an all-time low. He used the metaphor of the disappearance of bowling leagues to illustrate an alarming decline in community involvement.

The article was widely discussed in public-policy circles, so for the next few years Putnam collected further research on the topic for a book, which has just been published. In it Putnam argues that when employees feel more connected to their colleagues at work, they're more productive and the business benefits as a result. (That idea is borne out by research suggesting that having a best friend at work is one of the prime factors that increases an employee's productivity.) The trouble is that we're less connected than ever before.

While the number of people who belong to professional organizations has increased over the past several decades, their membership as a percentage of the whole population has actually decreased sharply. And though the workplace may have replaced the neighborhood as the prime arena for socialization, Putnam writes, relatively few people have intimate friendships with colleagues.

He also says that the wholesale shift to a contingent workforce may have hastened the decline in workplace intimacy and, ultimately, loyalty. The raucous noise created by all the "You Incorporateds" and "units of one" we read about compounds the bowling-alone trend, which Putnam sees as pervasive.

He suggests that companies encourage volunteer work and civic involvement in ways as simple as offering space for club meetings after work. In times of full employment, Putnam writes, "such practices become a key ingredient in recruiting and retaining a high-quality, loyal workforce."

Putnam may not have concrete solutions to our increasing isolation, but he does foster a provocative discussion. He shows how real the problem is by focusing on the deleterious effects isolation has on all aspects of society, including workers' productivity, satisfaction, and loyalty. And he offers some broad-based goals that will help us to connect better with one another.

Taxes? We don't need no stinkin' taxes

  • Cybertaxation, by Karl Frieden (CCH, 2000)

Talk about a tangled web. If you're doing any business over the Internet, it's nearly impossible to get a straight answer about how to handle sales tax, income tax, or, in the case of European sales, value-added tax.

In the olden days -- like seven long years ago -- when someone walked into your shop and bought something off the shelf, it wasn't hard to calculate the tax implications of that transaction. Now let's say you're based in Boonton, N.J., and someone in Grand Forks, N.Dak., buys business products from your wholesale paper-goods company. He then sells those goods over his own site to someone in Brussels. You'll likely need a tax expert on the payroll just to walk you through all the different forms of tax liability you've incurred.

Karl Frieden, a partner at Arthur Andersen and a member of its global-strategy team on E-commerce, may be the next best thing. He's written Cybertaxation: The Taxation of E-Commerce, one of the first readable tomes on the topic.

Frieden does a terrific job of laying out in specific detail the myriad differences in the ways countries, states, and localities are handling E-commerce taxation. The shelf life of that information may be short, but in the current environment it's a good idea to have some grasp of what you're dealing with.

Executive Reader

John Elkington
Green-business guru and author of Cannibals with Forks: The Triple Bottom Line of 21st Century Business

Recent fave
The Long Boom, by Peter Schwartz, Peter Leyden, and Joel Hyatt. This book suggests that the present economic expansion may continue for years but that destabilizing forces threaten our security, Elkington says. "Among authors' concerns are political conflicts resulting from clashes between interests, social stresses arising from economic gaps, and ecological problems," he adds.

Business bible
Wired magazine founder Kevin Kelly's New Rules for the New Economy. "I loved Kelly's earlier book, Out of Control. But this is a more accessible survival kit for the high-flux new economy."

Favorite bio
Rachel Carson: Witness for Nature, by Linda Lear. "Among thought leaders, few had a bigger impact on baby boomers than Carson did," says Elkington of the famed Silent Spring author, who is credited with fomenting the green movement. --Mike Hofman

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