In This Issue
Sustainability Engineering
March 1, 1999 Volume 29 Issue 1

Creating Corporate Environmental Change

Monday, March 1, 1999

Author: Edgar S. Woolard

DuPont's drive toward sustainable practices follows on a decade of corporate leadership that challenged the company and its employees to think and act in new ways.

I would like to share my experiences in working to bring about a change in environmental attitude, policies, and performance at DuPont. At present, DuPont has a single standard against which all environmental performance is measured. That standard can be summed up in a phrase heard all the time at the company: "The goal is zero."

Contrary to what some may think, we did not set out consciously to create a zero standard, and certainly I did not have that in mind when I became chairman and CEO in 1989. However, I did begin my tenure in office with a determination to change the way we thought about environmental performance. The first major public speech I delivered as chief executive was in England, and given the public policy climate at the time, many at DuPont urged me to use that platform to say something about the environment. I agreed, with the proviso that what I said had to be substantive. I also wanted it to be proactive, not so much for the external audience, but rather for the internal audience that I knew would be listening very carefully to what the new CEO was going to say.

In the late 1980s, the prevailing attitude toward environmental performance in the chemical industry in general, as well as at DuPont, was still largely reactive. The industry's environmental practice consisted chiefly of following regulations and avoiding fines. Our public posture with regard to environmental policy making was grounded in science. Unless we could be persuaded scientifically that a product, operation, or waste posed a genuine threat, we saw no need to change.

In this climate, environmentalists were generally viewed as adversaries. They were promoting change -- sometimes very radical change -- based on what many in the industry perceived to be philosophical or ideological grounds at best and pure emotionalism at worst.

In the late 1970s, I watched as this strategy of inertia began to unravel on the chlorofluorocarbon (CFC) issue. For the first time, the global community was coming together and building a consensus on what was perceived to be a major environmental threat to the global commons. DuPont was then the largest manufacturer of CFCs. For years, we had rebutted environmentalists' arguments with science. Then the scientific tide began to turn. To our credit, once we examined the new data, we did an about-face and led the industry conversion away from CFCs to the substitutes we use today.

A More Proactive Approach

But that experience demonstrated -- to me, at least -- that a much more proactive approach was appropriate. I believed and still believe that good science is an indispensable element in environmental policy. But it is not the only element. And the environmental activist community had done society a service by correctly pointing to an industrial and consumer economy that could not be sustained over the long term without dire consequences. In the face of this challenge, industrial corporations were complacent and antagonistic. So, in my speech in London in May 1989, I said that we had to become environmentalists ourselves. As far as I was concerned, CEO stood for chief environmental officer as well as chief executive officer.

We introduced the concept of "corporate environmentalism," which, in addition to reliance on science and compliance with regulations, required a company to satisfy public expectations. Public expectations are something of a moving target, because the public view of how much and what should be traded off for a clean environment varies depending on economic circumstances. That meant that we in industry had to spend a lot more time listening and evaluating.

We could have stopped there. And in retrospect, I'm sure that many people in DuPont at the time would have loved for me to do just that. But we went on. If corporate environmentalism was to be more than empty rhetoric, we had to put the company's performance on the line. So, I proposed a series of numerical goals by which we could measure our performance and for which the public could hold us accountable. These goals included reducing levels of hazardous waste at the source; eliminating heavy metal pigments used in the manufacture of some plastics; achieving major reductions in airborne emissions, especially carcinogens; and setting aside land for wildlife habitat. Looking back on those early goals from the perspective of what we have accomplished nearly 10 years later, they almost seem quaint. But I assure you, a pledge to reduce hazardous waste production by 35 percent and air emissions by 90 percent was a wake-up call. Six months later, in a speech in Washington, I upped the ante. I said we were going to try to eliminate discharges to deep wells and had to begin to think about the possibility of moving toward zero emissions.

That was the approach I continued on for another year and a half. I gave a speech on an environmental topic about every quarter and made sure that everyone within the company knew I was very serious about making this change happen. This initial phase I call "leadership and challenge." I must admit, most of the leadership and most of the challenge came from me -- but I knew that was not going to be sufficient.

Phase two, "leadership and persuasion," began shortly after my first speech in London. I think many people back at DuPont were stunned, wondering whether this guy was for real. Some, I know, convinced themselves that what I was saying was an exercise in smoke and mirrors. Others knew I was very serious and would insist on step-change. Many were just plain skeptical -- not so much about whether I was serious, but about whether we could change. During this period, we continually had to remind everyone that the drive behind this change was not to make this or that numerical goal or to accomplish any particular performance objective, although the goals were concrete and had to be taken seriously. Our ultimate goal was to make the value of environmental protection comparable in importance to that which we had assigned to safety for nearly 2 centuries. We believe that our concern for safety has made us one of the safest -- if not the safest -- companies in the world. In the same way, we wanted a high level of environmental performance to become second nature. Our company would become an industry leader in this important area of corporate social responsibility.

I had learned very quickly that in an engineering culture such as exists at DuPont, philosophical statements will not carry the day. However, put a number on something -- commit to a target that is measurable -- and the focus is immediate and intense. Even so, employee reaction was not all favorable and supportive. Everyone had an opinion as to why the company could not achieve the goals we had set. There was the cost argument: It would be prohibitively expensive. There were the legal arguments: If we voluntarily went beyond the letter of the law, we would invite even more onerous legislation or increase our liabilities. Or, the government would mandate a different standard or remedy, and our investment would be lost. And then there was the technical argument: It simply couldn't be done from an engineering standpoint.

That last argument was one of my favorites. The watershed case concerned our plant in Beaumont, Texas., where we manufacture acrylonitrile. Ammonium sulfate waste from that process was being disposed of in underground injection wells. I told the plant managers that they had to figure out a way to dramatically reduce that waste and stop putting it in deep wells. They said I was not sufficiently technically trained to understand why this could not be done! I responded that while I might not have all of the necessary technical expertise, I was technical enough to insist they improve or shut down. So, they went back and examined their models, which they had not done for some time. I am happy to say that they successfully modified the process to produce better yields and cut their emissions by two-thirds. The plant also realized net savings of $1 million per year, demonstrating that a financial benefit to improved environmental performance was often, though not always, possible.

During this phase of leadership and persuasion, the most encouraging development was the emergence of leadership from other parts of the company. Several senior executives understood precisely what we were trying to accomplish and led the way in their respective businesses units. Most heartening of all, employees around the company responded with affirmation, encouragement, and ideas. In fact, in my 40 years at DuPont, no other corporate initiative had so galvanized the company's employees.

Awards Program Established

One of the best ideas came from a plant operator in Tennessee, who recommended that we begin a corporate awards program for environmental excellence. Beginning in 1990, we did just that. We used a panel of judges that included outside environmentalists to pick the winners. It is easy to be cynical about awards programs, but this program accomplished several very important things: It rewarded innovation; it reminded the entire company that this effort was here to stay; and it served as an excellent means of intelligence gathering and information sharing. As nominations poured in, we learned very efficiently and directly what was happening, where the best practices were being developed, and who the leaders were. It became a self-generating inventory of our best ideas and accomplishments on an annual basis.

The success of the awards program, which continues to this day, indicated that we had entered into a third phase, "leadership and response." In this phase, we saw leadership occurring everywhere at all levels in the company. It was at this point that support really began to build for moving beyond numerical targets and establishing a zero goal for all wastes, emissions, and environmental incidents. Collectively, employees had made the link between environmental performance and performance in safety, where DuPont has a nearly 200-year history of a zero goal for accidents, injuries, and illnesses.

This shift was made possible not only because we sensitized everyone in the company to the value of environmental excellence, but also because we took the necessary steps to make certain that environmental performance was a fundamental factor in all our engineering protocols. By 1992, we had our engineering department create what we called our Corporate Environmental Plan, which encompassed 3,000 projects and programs at more than 150 sites.

The plan enabled us to do three important things. First, it connected environmental goals to the actual day-to-day work of our manufacturing sites, so that employees could see that what they were doing was vital and necessary to reaching our goals. Second, the plan put in place performance measures by which we could gauge progress toward our goals as well as others of interest to society and government agencies. Third, the plan provided for competitive execution and proper prioritization. It gave us the big picture and enabled us to focus our technical resources, identify opportunities for synergy, and determine best practices. As a result, even though a very large company, DuPont was able to climb the learning curve one time, sharing what was learned along the way, rather than go up the curve a dozen times in different businesses.

A $15 Billion Environmental Budget

This efficiency in corporate learning was vital, because at the beginning of the 1990s, we expected to spend about $15 billion on environmental work during the decade, and we wanted that expense to be as productive as possible. It worked. In the early part of the decade, our environmental costs were increasing at a rate of 8-10 percent per year. By 1995, that growth rate plateaued, and by 1996, it began to decline. During the same period, emissions of chemicals tracked by the Environmental Protection Agency Toxic Release Inventory dropped close to 70 percent and total emissions went down even more.

As much progress as we have made, we are now just entering a fourth phase of environmental progress at DuPont, "leadership and sustainability." I believe that we have in place everything we need for our company to attain a level of environmental performance that meets the expectation society had for an industrial company during the 1990s. What we have to work toward now is meeting the expectations that will exist in the next 10 years and beyond.

These expectations will almost certainly deal with minimizing the environmental footprint of a company from its use of resources to the ultimate disposition of its products. For many industrial companies, especially chemical companies, the creation of value is still linked to throughput of materials and increased pounds of production made possible by the expenditure of tremendous amounts of energy in the form of fossil fuels. To become sustainable, we have to develop ways of creating value while minimizing the burden we place on the environment and meeting the basic human needs that our companies and products have historically satisfied.

We believe that step-change will have to come from advances in biotechnology, microengineering, information science, and other fields. Regarding biotechnology, I believe progress will come in three waves. Presently, developments in this field are contributing to advances in agricultural products and improved nutrition. Just around the corner will be advances in human health. Five to 10 years out, we expect biotechnology will begin making a major contribution to sustainability. It will do this by allowing us to replace fossil-derived hydrocarbons with biologically derived intermediates. Biotechnology will also enable the manufacture of consumer products in facilities that are simpler, more cost efficient, and that create far fewer environmental impacts than the facilities we have today.

It will be to these newer fields that we will look for ways to augment the advances we have made through classical chemistry and chemical engineering. As far as we have come in the last decade, it may well be that the most important work lies ahead. Getting a grip on our impact on the environment through metrics and engineering will turn out to be only the prelude to truly sustainable practices in the century ahead.

About the Author:Edgar S. Woolard is former chairman and CEO of DuPont. This paper is adapted from remarks he made 3 November 1998 at the NAE International Conference on Industrial Environmental Performance Metrics.