On Sustainability

James Farrar

Update - Swartz to Jobs: let Timberland help Apple on sustainability

By James Farrar | May 26, 2011, 4:11pm PDT

Summary: Timberland CEO, Jeff Swartz offers Steve Jobs some friendly advice: Apple should have board level supervision of its sustainability strategy. However, despite repeated shareholder resolutions and the presence of Al Gore on the board this is one piece of advice Jobs maybe likely to ignore. But is Apple really bottom of the rung relative to peers? At least one investor feels that although Apple has problems so too does HP and Dell - its just that people are a bit emotional about Apple.

A quick update to my last piece about Timberland CEO Jeff Swartz’s taking to task of Apple over its sustainability record. Its rare that leading CEOs break peer ranks on sustainability and rarer still that a leading CEO shows up in the comment section of this blog. That Timberland CEO Jeff Swartz chooses to spend time to engage speaks volumes about his genuine concern and passion for sustainability so I think its worth re-posting his comment here in its entirety.

RE: Morality V’s Technology: Timberland takes Apple to the woodshed

James - thank you for challenging me to be more specific about a call to action for Apple. Based on 20+ years of struggling to make Timberland a sustainable business, I know that every journey of a thousand miles begins with a single step. And Apple absolutely has the capacity and the capability to go further in their journey, starting now, if they want to amplify product and technical leadership by adding sustainability to their coolness aura. Here’s one specific action Apple could implement without batting an eye, that would signal a commitment to leading with technology and sustainability:

What keeps Mr. Jobs from establishing a Board level committee, charged with overseeing Apple’s business practice? The committee would hold management accountable for commitments that Apple says they already own like basic dignity in the supply chain, like basic commitments to responsible environmental stewardship. Adding accountability at the Board level is completely within Jobs’ hands to achieve, would elegantly reframe Apple’s posture towards sustainability, and would go gigabytes towards demonstrating a different kind of leadership posture than the frustratingly disengaged posture to date. We’ve had this kind of Board committee for 5 years already, and it adds real value for our shareholders. Apple should feel free to send an email to my iPad, or my iPhone, or my iMac, if they want to hear how our independent board committee functions.

Jeff Swartz

05/25/2011 02:35 PM

I won’t hold my breath for board oversight given that Apple has already seen off a shareholder resolution on this earlier this year. While Swartz has gone public here maybe that’s just the tip of the engagement iceberg. In my minds eye I can imagine the type of boardroom to boardroom ‘Socratic dialogue’ spoken of by Anita Roddick is already underway behind the scenes between Swartz, Jobs and maybe even Gore. Certainly Swartz’s claim of added shareholder value is borne out by Alyce Lomax of Motley Fool.

Moments like this support why Timberland was the first pick for my Rising Stars portfolio, and make me feel even more confident about that decision for the long term. If responsible CEOs’ rantings usher in more big ideas like this, I say bring them on.

And yet despite Swartz’s attempts to get ‘more specific’ I’m still left wondering what really sets Apple apart from an industry of - lets face it - laggards on sustainability relative to companies like Timberland who have made it part of the DNA for a very long time. The answer could lie in the emotions that the Apple brand arouses in its consumers for better or worse. Lomax says:

Apple recently admitted that 137 workers had been injured from exposure to toxic chemicals while making iPhone components at supplier Wintek. Then there are the troubling reports regarding Apple supplier Foxconn, which go beyond the company’s controversy about worker suicides. Just days ago, an explosion at Foxconn killed three workers and injured others…………………….. Granted, Apple’s not alone here. Other Foxconn customers include tech heavyweights such as Hewlett-Packard (NYSE: HPQ ) and Dell (Nasdaq: DELL ) . However, those tech companies’ brands don’t bring about quite the same emotional response that Apple’s products do.

So Apple may just be a victim of its own success. When Dell and HP inspire consumers to get as emotionally roiled up as the Apple brand does they might just see expectations of their sustainability performance increase also.

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Morality V's Technology: Timberland takes Apple to the woodshed

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Topics

Apple Inc., Dell, Hewlett Packard, HP, Corporate Governance, Steve Jobs, Timberland, Jeff Swartz, Sustainability, Ethics, Al Gore, Environment, Human Rights, CSR, Supply Chain, Foxconn, James Farrar

James has more than 15 years of experience working on corporate sustainability issues from both the corporate and NGO campaigning perspective.

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Right or wrong on this subject I doubt

Mr Jobs will likely take Timberlands offer or Mr. Swartz's offer. After all with a person like Jobs one does not begin a conversation with an attack and expect pleasant results. Also I still don't know what the actual complaint is? Is this about the whole "GREEN" thing or is it something else? Sustainability is such a weird word and is it being used to get Apple to open up and let secrets out? (Same thing?) Secrets that are in the end it's bread and butter.

Pagan jim
James Quinn

05/26/2011 05:48 PM
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RE: Update - Swartz to Jobs: let Timberland help Apple on sustainability

@James Quinn No, it is about improving the conditions in their manufacturing plants in Asia.
Peter Perry

05/26/2011 08:30 PM
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Well Apple does not own these places.

@Peter Perry
Isn't that for the owners to do, and the Chinese government? Also does not "OTHERS" do business with the very same people? Why specify it as Apple's responsibility? I'd say lets stop off shoring all these primo manufacturing jobs and bring them back home to the states myself where American laws and regulations rule. But if that is to be the thing then it should go for all including Timberland:P

Pagan jim
James Quinn

05/26/2011 09:56 PM
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Apple has manufacturing plants only in Japan, where conditions are perfect

@Peter Perry: Apple does not have anything to do with owning and operating of other plants, in China.

They have their controllers which control production processes and their IP, but this infinitely away from owning the plants and controlling everything on them as operators.

So Chinese authorities go to Taiwanese HQ of Foxconn, the owner of these plants, and it is the only way.
DeRSSS

05/26/2011 11:17 PM
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WRONG

As long as Steve is healthy, he IS the committee. The last thing a man with the vision, brains and ability to make incredibly fast decisions, act on them and get the results he's gotten, is any BS from a board of people who can't hold his jock. When Timberland becomes the second largest company in the world, Mr Swartz's may chime in on how SJ runs his show. Not to mention his outstanding leadership at Pixar that has made him the largest shareholder in Disney. Pixar sustained. Apple is more than sustained....it's a juggernaut loaded with talent. Tim Cook, Johnny Ive, Phil Schiller...I could on and on. Let Jobs clear the way and guide this massive pool of talent he has assembled and watch them fly. He might buy Timberland and shut them down as a response to Swartz's offer.....
msmith3@...

(Edited: 05/26/2011 06:44 PM)
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Here, read my ad

As a marketing strategy, targeting people who are left-of-center is a reasonable thing for a relatively small company in an industry dominated by giants. Working Assets Long Distance worked because appealing to people's politics got them more customers than they would have had otherwise, even though half the country would have nothing to do with them.

Timberland is a $1.4 billion company, but some of its competitors do $5 billion a quarter. Becoming the "Ben & Jerrys" or "Working Assets" of the boot business makes sense for them.

Swartz is just using Apple to make some noise that he hopes will sell some boots to people who might buy his instead of somebody else's if he blows his horn about "sustainability."

Why this boot advertising rates coverage on ZDNet is a mystery.
Robert Hahn

(Edited: 05/26/2011 07:56 PM)
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Sustainablity

Begins with not pulling a Green Peace on Apple. Just sayin'
jaypeg

05/27/2011 12:59 AM
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Tough crowd..

I didn't expect to see comments like these on here, but as I do, I feel like adding my thoughts on the matter.

Swartz comes across as someone who is truly dedicated to sustainability. He isn't approaching Jobs in some cheap publicity stunt type of way. He is talking to Jobs because Apple's emotional relationship with customers gives it an especially important role in shaping what is thought about as "cool." If Apple was to embrace responsibility and make it more "cool," it would mean much more (and therefore encourage others to follow suit).

And targeting Apple as opposed to the Chinese government or individuals is absolutely the right way to do that. Apple contracts are worth their weight in gold. If the company decided to require its entire supply chain to be more responsible or risk losing their contract, I'd bet good money that they'd do it. Whether a committee is required to make this happen isn't really this issue. I don't really care whether one person or a thousand lead this initiative, as long as it works.

And finally, this does make business sense for Apple. I'll admit that Apple is huge and powerful, and it can survive a few events that would be PR disasters for smaller companies. BUT that does not mean that they don't have a business reason to work to avoid these incidents. Apple should think more like Wal-Mart. With a record for socially bad business practices miles long, Wal-Mart has decided to change gears and start demanding responsibility throughout its supply chain. And we all know they aren't just doing it to feel good.

So I applaud Swartz here, and hope that Jobs pulls Apple towards sustainability.

Bradley Short
http://www.businessearth.com/category/blog
http://www.twitter.com/businessearth
Bradley Short

05/30/2011 09:00 AM
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