10 Big Green Ideas from Newsweek

This is the headline of the lead article in this year's Newsweek's green issue, replete with their ranking of the "greenest" 100 corporations. It's all pretty underwhelming copy. The #1 big idea is that of Blairo Maggi, who previously signed on to a 2006 moratorium to stop selling soybeans from clear cut rainforest lands. (He is known as the soybean tycoon in his native land, Brazil.) His pick as #1 is based on his recent decision to extend the ban to Amazonian beef. Brazil is now the world's largest exporter of beef.

Maggi, also previously Governor of the state of Mato Grosso, was an arch-villian as late as 2005, receiving the Greenpeace Golden Chainsaw Award as the one most responsible for Amazonian deforestation. He saw the green light at some point, but the reasons are a bit obscure. Newsweek suggests that his change came from a recognition that leaving the forests in place was the right business decision. "The entire world has come to the conclusion that the forests should be worth more standing than cut down."

I can't imagine that Newsweek could not have found a better choice. He may talk about "green beef," but with or without cutting down trees, beef raising is not usually considered to be green. # 3 is entitled, "Get Out of the Gulf." Nothing to it. Just electrify 10 percent of US automobiles by 2020. The numbers may work, but the reality of replacing so much of the present fleet in nine years doesn't sound like the cinch the the ocean advocacy group Oceana claims. #10 is a plea to replace lightbulbs by the new LED models. It may be good for business that will save on energy, enough to amortize the higher cost of the bulbs. But it is not clear that it will be good for the environment. A month or so ago, I posted a blog reporting on a study that argued that the brighter light from these lamps would raise demand for more light, eventually overcoming the efficiency gains.

rating system

The "centerfold" article is the second annual ranking of the 100 greenest companies in America. The full list of the 500 best is available from a website. I see no obvious improvement in the ranking scheme this year over the one used last year (see my earlier posts.)

The health of the environment depends on the total burden we place on it from manufacturing, agriculture, and consumption. It has little to do with policies or reputation, which make up more than half the score. The web site gives the formula "Finally, a weighted average of the Environmental Impact (45 percent), Green Policies (45 percent), and Reputation Survey (10 percent) Z scores was taken to generate the overall Green Z score." I thought about buying the whole report but thought that $1495.00 was a little steep for something that is pretty meaningless in the long run.

The rankings have more to do with competitive advantage than with reduction of the burden. There is no penalty apparent to me based on the growth of the firms from last year, or to the growth targets, or to the advertising budgets, or any other part of the business striving to use up more of the Earth's resources.

The enchantment continues with an article about GoodGuide, my candidate for proving the validity of A. N. Whitehead's pithy comment on reductionism-the fallacy of misplace concreteness. GoodGuide provides a score akin to the Newsweek ranking for a large variety of consumers products. The raw idea is a good one--to have consumers make better choices by giving them better information, addressing one of the key causes of market failure. But the devil is in the details. The inquirer gets a score on a scale of 0-10, like 8.3 or 4.7, on querying the website for the particular product of interest. It's unclear what this score means, as it, like the Newsweek numbers, is a composite of hundreds of factors, bundled into a single result, based on the opinions of experts who determine what weights are to be used in the compilation.

One of the investors in GoodGuide was "shocked by how quickly big companies have realized the relevance of GoodGuide." Shocked in the same way as Claude Rains (Louis) was to find gambling at Rick's (Humphrey Bogart) Bar. Companies spend vast sums to find ways to differentiate their brands, knowing how hard it is to find discreet characteristic to compare. Here comes an "objective" system to do the job for them. I can only imagine all those product specialists scrambling to raise their company's score from 8.5 to 8.7. If that would mean a 2.35 percent improvement in actual impact, the rankings would have a positive value. But the numbers are not meaningful to the precision implied by presenting them to two significant figures. It's pretty hard, given the imprecision of the data inputs to the scoring, to come up with one significant figure, that is, is a 7 any different from an 8 in terms of its real impacts on health, the environment and social responsibility.

Here's an example from the GoodGuide website. It's for a detergent with a score of 8.0, the result of compiling these three sub-scores:

  • 10 Health — no ingredients that raise a health concern.
  • 7.4 Environment — scores well on water management.
  • 6.6 Society — scores well on workforce diversity.

The answer depends on the weights (values) given to each of the three factors. You can do the arithmetic. What would your score be? Readers of this blog should be able to understand this process, but I would guess that most of the users of the GoodGuide site do not understand the process. Furthermore they are being encouraged to tell their friends and the producers how they made "better" choices. I try not to be too much of a cynic, but the only winners I see coming from the Newsweek rankings and from GoodGuide are big companies with well-honed public relations and brand budgets and skills. The environment and society are only sometimes, loosely-connected beneficiaries.

| | Comments (1)

« Previous Entry   Next Entry »

1 Comments

David M. Carter said:

John,

I certainly understand your cynicism regarding measures and rankings such as these. Even without an in-depth analysis of how the numbers were put together, it is clear that many of the highest ranked companies provide products that are all together unnecessary for human thriving. Pharmaceuticals aside, electronic gadgets and cars do nothing to improve our real well-being. If these companies went away tomorrow, no one would notice. Unfortunately, these fluff products contribute heavily to environmental degradation. Worse, they give people the impression that their well-being is somehow tied to the ownership of these products (this is where effective advertising comes in). This, however, is untrue.