Saturday, Sept. 1, 2007 | As a graduate student at the University of California, Davis more than three decades ago, David Bainbridge wanted to study how to make cities sustainable. But the school’s ecology department told Bainbridge to take his doctoral thesis on the ecological city to the planning department — which, in turn, sent him back to ecology.

So Bainbridge dropped out and started his own company instead. Now, a professor at San Diego’s Alliant International University, Bainbridge coordinates a program that allows graduate students to receive an MBA with a concentration in sustainable management. He said the program is the first of its kind in San Diego.

For Bainbridge, who has long argued that businesses can make money while being good corporate citizens, the program represents a sea of change.

“I used to be an environmentalist teaching money, and now I’m a money person teaching the environment,” Bainbridge said. “And this is really the best place to be, because often, with environmental issues, you’re preaching to the choir. I’m not preaching to the choir anymore.”

After three decades in government and private industry — Bainbridge helped California start its first program to incentivize the purchase of solar energy and recently published a book on desert restoration — he argues it’s businesses, and not policymakers, that are best positioned to make the world more green.

Tell me a little about what the main impetus for the program was.

Well, the main impetus for the program was my 30-year career in sustainable management, and the fact that if you don’t have a living planet, you’re not going to have any business or place to put your house. The environment has finally changed enough so that businesses are finally starting to think seriously about the environment, and we were fortunate to be able to start the first concentration in sustainable management here in San Diego.

What sort of students are you seeing? Is it fresh-out-of-college business students or reformed, recovering CEOs?

It’s mostly students who have been out of school, but not for very long. No CEO types — yet. Eventually, we’ll get them, I suppose. But for now, it’s mostly younger students who have grown up through these times and appreciate that this needs to be done, what the opportunities are.

And how does the sustainable management program differ from the traditional management?

All we do is add three courses, but it’s there through all of the courses in some sense. We have a course in sustainable management itself, which is about resources and money. We have a class on environment management reporting, which looks at ecological accounting, how you count the true cost of things, and it also looks at sustainability reporting, which is becoming very common now. About 10,000 reports worldwide are done on the sustainability of companies. And it has grown very fast, from a few a year to a hundred a year to 10,000 to recently 100,000. One of the things we think our students will be able to do is fill some of those jobs, doing the reporting and helping companies become more sustainable. …

So is this being driven by industry demand or academic do-goodness?

Both. Certainly, there aren’t many places that you get just academic do-goodness anymore. If there isn’t a market, you don’t do it. But it’s also a reflection of my career. I’ve been doing this for 30 years, starting in San Diego in about 1970. And I’ve been saying the same things all along, it’s just that the world has finally come around to the point that they’re starting to go, “Oh yeah, those things do matter.”

So what are those things that matter now that didn’t matter before?

Appreciation for the fact that the impacts you have on the world really do have an impact on the world, and they’re really going to change everybody’s lives. Global change, sea-level rise, more intense storms, more droughts, like the fires in Greece right now. It all adds up to big money. And much of the drive for sustainability has come from the reinsurance companies, the companies that insure the insurance companies. They like to think about a 100-year planning horizon, because they know that if we don’t make changes, they’re the ones that get hurt. …

And the other class we offer is the one on sustainable marketing, looking at opportunities for sustainability. We have a great professor from Germany … and she’s really great on opportunities and also the issues of people trying to sell things as green when they really aren’t, a term called green-washing. It’s become increasingly common. And helping consumers sort out what’s good and what’s not so good, and that’s ultimately the goal of all of this: Giving consumers the choice and saying, “What do you want? Do you want a livable planet? Or do you want really cheap stuff? That’s what the question really comes down to.”

The program description talks about the “triple bottom line.” What is that?

The triple bottom line is that we need to consider money first. If you’re not making money as a company, you’re not going to be around. But you also need to consider the people and the environmental impacts of your business. And it’s pretty much a worldwide phenomenon. The United States, unfortunately, is trailing other countries. Australia has done a good job, Europe is about 10 years ahead of us, and the people have adopted this earlier, finding that there is big savings to be made. If you look at it seriously, you can eliminate a lot of costs.

Historically, the environmental management functions were put in a separate department, often it was called Environment, Health and Safety. Often, it was treated as an overhead cost. So if you have a really bad product, the impacts got dumped all into overhead, it didn’t get reallocated back to that product. Through a lot of our accounting efforts, we can say, if there is a cost, put it back into the product where that cost comes from. And then people will go, “All of our products we’ve been subsidizing with our good products, if we just get rid of it, we can make more money.”

Some would argue it’s the job of government regulation to align the incentives so that these bottom lines are all the same. So with this program, are you saying that the government has failed?

The government has definitely failed, and all you have to do is look at our local government, our state government, our federal government, and you’ll realize that we haven’t paid attention to our environmental issues. And government, in general, is inefficient.

One of the first jobs I had was working for the state Legislature, for the Environmental Quality Committee. And you realize quite quickly that politicians just have their hands tied for a lot of reasons. They can’t do things very quickly, they can’t always do the right thing. But businesses can. Businesses can be different tomorrow, all they have to do is decide that they want to change. And we’re starting to see that.

So, in these classes, are you teaching the future executives that their job is no longer to maximize shareholder profit?

Exactly, and that’s the perfect thing to bring up. Milton Friedman’s comment in 1972, “Our only responsibility is to make profit for the stockholders,” is wrong. It was a bad idea then, and now it’s fading away. Fortunately, if you do a survey, even here in the United States, about 95 percent of the people will say that it’s not a company’s only responsibility. And even executives are starting to say, “Well, we’d like it to be our only responsibility, but we have to look at the bigger picture and say that we want to keep people healthy, we have to keep the planet healthy, that’s our responsibility.”

But how do you instill that in a corporate culture where you have the quarterly profit reports, the quarterly earnings reports?

It’s definitely a challenge, and one of the best things about it is that you can often show that you can save money or make more money by doing the right thing. You can reduce risk, so you can get fewer legal liabilities now. A couple of chemical companies have done exactly that by saying, “What are the 50 worst products that we make, and then how hard would it be to get rid of them.” When they were first starting out, people were saying, “Oh, it will take five or 10 years to get rid of all of these chemicals.” And they got serious about it, and sometimes they realized that they could get rid of 48 of the 50 in the first year. And they’re going, “Hey, we’re going to save a lot of money by getting rid of these bad chemicals.” You have to track them, you have to get rid of them, you have to worry about them for the rest of your life. Why not just do away with them? And that’s really the solution we’re looking for, it’s not doing bad things better but doing completely different things.

One of the things you e-mailed me I think was called “What is sustainability.” And at the end, you say, “Every decision we make about spending money is a dollar vote for sustainability or environmental damage. Which way will you vote?” So which way have we voted so far?

So far, we voted against. But we’re starting to see a change. We see it in the foods that people buy, and the products that people buy. We’re starting to see options that are healthful and last a long time and last a long time and are good for the environment. All you have to do is look at the success of Whole Foods, for example, there you see a company that’s really made a big difference.

One of the best green companies is Patagonia, which makes mountain equipment, and they have just walked the talk from the beginning. We use one of Yvon Chouinard’s books (the company’s founder) for one of our classes. It’s called “Teach My People to Surf.” And it’s about finding a balance in life between work and play and doing all of the rights things while you’re at work. And really, it can be done — and you can make money doing it.

— Interview by VLADIMIR KOGAN

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