Ecopreneurist

My first two posts about the triple bottom line for green businesses addressed the people who make up an enterprise as well as the people who supply it, use the goods or services created, or invest in the enterprise.

First coined by John Elkington and articulated in his book, Cannibals with Forks: The Triple Bottom Line of the 21st Century, the triple bottom line doesn’t drop the idea that businesses should earn a profit. It adds that businesses should do so in ways that take into account environmental and social performance in addition to financial performance. It requires a strong and efficient organization, perhaps even more so. Not only do you need to make a profit, you need funds and resources to reach beyond where mainstream business stops. A triple bottom line means expanding the spectrum of values and criteria for measuring business success to include: the planet, people and profits.

A Planet Bottom Line

Is what is being produced or services provided better for ALL life? A Planet bottom line continually examines inputs and outputs, addressing the materials we use and how we use them as well as minimizing – if not eliminating — waste. Ecopreneurs recognize and incorporate ecological limits into their business models. Many shun the use of toxic chemicals, hazardous materials or processes, or exploitative approaches to nature. A growing number of people are adopting an approach to product development or design that involves biomimicry.

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Last week I shared the triple bottom line adapted from our ECOpreneuring book. The triple bottom line encompasses people, planet and (some) profits. Since people run a business, I started by examining how the DNA of a Green Business Starts with People, touching on customers and employees (apparently not highly valued at the now defunct Lehman Brothers and Bear Stearns).

The other two People bottom lines are vendors/suppliers and investors (if your business has any), addressed below:

(3) Vendors and Suppliers

How a sustainable business chooses and interacts with vendors and suppliers, so-called business-to-business transactions, that provide the supplies and services the business needs to run is one way ecopreneurs are helping grow and magnify our impacts. We seek out like-minded vendors with whom to do business. Co-op America’s Green Pages (greenpages.com) is often our first stop to look for products our business might need, since it lists thousands of socially and environmentally responsible businesses.

A growing number of small businesses are perhaps inspired by the Amish and their collaborative sense of community and shared economic prosperity. Rather than working alone, many Amish provide goods or services to each other, working together on projects that on the surface may benefit only one farmer, but on the whole end up benefiting the entire community. As author Bill McKibben writes about in Deep Economy, there’s greater comfort and security from community membership than individual ownership. This idea is reflected in the business-to-business commerce mushrooming on the Internet and in small businesses, especially the nanocorps, or new forms of interlinked commercial websites, like Sohodojo.com.

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People, planet and profits (at least some). That’s what the triple bottom line means for green businesses and a truly sustainable society.

The triple bottom line is not greenwash, a PR campaign or the “principles” part of a Sustainability Report. It’s the DNA of how a green business operates. It’s measured by such things as trees planted, living wages paid and problems solved (not created).

This is the first of a series of blogs that explore various facets of the triple bottom line commitment to operating sustainably and responsibly, starting with people.

People play a fundamental role in the ecopreneur’s business philosophy, realizing four different groups of people have their own sets of needs and priorities: customers, employees, vendors/suppliers, and investors. Many ecopreneurs we’ve interviewed for ECOpreneuring talk about stakeholders, not stockholders. They generate profits by caring for their stakeholders, not trying to crush competing businesses. They’re more concerned with nurturing their community, customers and employees and investors, if they have them. The following are the first two of the four groups of stakeholders (the other two addressed next week).

(1) Customers

Cultivating conserving customers drives ecopreneurial business success. Ecopreneurs view their customers much more as kindred spirits, sharing Earth-based values and priorities. Customer service, product quality and guaranteed services or products are crucial to their business success. Valuing customer communication translates to showcasing honesty, integrity and transparency. A respectful challenge banters between customers and sustainable businesses, much deeper and more personal than in typical customer interactions. Ecopreneurs expect to be scrutinized by their customers, and
likewise, our customers expect candid, honest replies. Customers challenge ecopreneurs with questions like: Do you carry envelopes made with post-consumer waste? Can I get this in hemp? How do you offset your greenhouse gas emissions? Where are your ingredients sourced from? These questions keep our business constantly moving forward toward higher goals and expectations. On the flip side, at our Bed & Breakfast, Inn Serendipity, we must be honest that our guest rooms don’t feature air conditioning or TVs.

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Civil and environmental professor and ecopreneur-inventor Jack V. Matson, PhD.
dedicates his life to practicing “intelligent fast failure,” an expression he coined to capture the essence of innovation. It’s captured in his irreverently titled book, Innovate or Die: A Personal Perspective on the Art of Innovation. As an ecopreneur, he started an environmental design firm, Matson & Associates Inc., housed in a green office building and personally holds two patents on water purification products.

In Innovate or Die, Matson suggests that the goal with intelligent fast failure is to move as quickly as possible from new ideas to new knowledge by making small and manageable mistakes — intelligent failures. By moving quickly, we can determine what works, and what doesn’t, without draining the bank account and energy devoted to developing the idea. With the increasing variability in climate and rapidly changing global marketplace and social fabric, ecopreneurs are creating new business models, products and services that defy common conventions. Some will fail. The key is to keep learning and try to avoid letting your intelligent failures negatively influence your emotions and self-esteem. And by all means, fail falling forward.

Given the widespread interest in producing biodiesel domestically, Matson launched the Green Biodiesel, LLC, a spinoff venture of Matson & Associates Inc., seeking to develop a new biofuel production process that relies entirely on nontoxic materials to produce a clean-burning alternative fuel from renewable resources in the US. One of the problems facing biodiesel producers and users is that the conventional biodiesel production process uses a number of toxic chemicals to convert vegetable oil feedstocks into a usable fuel. Methanol and sodium hydroxide, two toxic industrial chemicals widely used in the transesterfication process to produce biodiesel, are potentially dangerous to humans and the environment. In order for biodiesel to be a truly environmentally friendly fuel, current and future producers need an alternative process that does not use toxic chemicals or produce significant waste products.

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Of the nearly 26 million business firms in the US, about 97 percent have fewer than 20 employees according to the US Small Business Administration. These small businesses account for about half of the non-farm Domestic National Product, or GDP (not that my wife and I agree that this is the best way to measure prosperity and well-being), and generated 60 to 80 percent of the net new jobs over the past decade. While big businesses fired, laid off, downsized and outsourced jobs, in part, to squeeze more profits for shareholders, small businesses added employment.

Entrepreneurial trends are difficult to track and ecopreneurial enterprises even more so. The US Small Business Administration estimates that there are about 4.5 million small businesses with 9 or fewer employees. About three-quarters of all business firms have no employee payroll at all because they’re set up as self-employed persons operating unincorporated businesses. According to the Association for Enterprise Opportunity (microenterpriseworks.org), there are more than 23 million microenterprises (a business with five or fewer employees) in the US, representing 18 percent of all private employment and 87 percent of all businesses. You might be among the 15 million full-time or part-time small office/home office entrepreneurs, or SOHOs, like my wife and I with our diversified small enterprise.

Identified by Dan Pink in Free Agent Nation, there are about 33 million free agents in America. These “job-hopping, tech-savvy, fulfillment seeking, self-reliant, independent” workers represent about 16.5 million soloists, 3.5 million temporary workers (temps) and 13 million microbusinesses that include construction contractors, real estate agents, nannies, direct sales ventures (e.g., Shaklee, shaklee.com), services subcontractors and accountants. Operating as a microbusiness, or what Pink refers to as a “nanocorp” with three employees or less, is both a personal preference and competitive advantage, allowing the owners to downsize to provide incredible adaptability, innovation and creativity. Our sub-chapter S Corporation is a nanocorp committed to ecological restoration and social change while turning a modest profit.

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“Simple living” continues to garner much pop culture hype, sparking books, magazines and a slew of self-help opportunities to assist you to declutter, scale back and slow down. Environmentally conscious and sustainable living fall under the simple living radar, but where does ecopreneuring or running a green business fit in?

My wife and I incorporated numerous “simple living” strategies into our business over the years. While our lifestyle may exude quintessential simple living elements — from canning applesauce to crafting holiday gifts — there remains an inherently complex element to our ecopreneuring workstyle. Our calendar looks like a treasure hunt map of lines of travel, Bed & Breakfast guests arriving and departing, writing deadlines, family gatherings, and our son’s home-school group projects. We always juggle multiple unrelated projects.

A better word than “simple” to describe our ecopreneuring approach is “focus.” By consciously choosing to do certain things, we inherently simplify by prioritizing. We open more time to focus on what we really want to do by eliminating (or at least seriously reducing) time drains, including the following:

(1) Daily commute.
With the average daily commute in the US now nearly a half-hour, by working from home, we save over seven days per year driving to someplace, not to mention the fossil fuel emissions of daily driving.

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There are many financial benefits of becoming a business, depending on how you structure it. Not only are businesses taxed after their expenses have been deducted, but many legitimate deductions are available to a small business that reduce its reported earnings.

The IRS tax code specifies the following related to business expenses:

IRS Code Section 162(a),Trade or business expenses:
“There shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business.”

IRS Code Section 212, Expenses for production of income:
“In the case of an individual, there shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year.”

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It’s not just any number: 350.

Returning to 350 parts per million of carbon dioxide in our Earth’s atmosphere is the level that most of the world’s scientific community agrees as the safe upper limit for carbon dioxide in our atmosphere. When industrial revolution began, it was 275 parts per million. Today, we’re far above that at 385 parts per million and continuing to rise at an accelerating pace, often contributing to the extreme weather, shrinking glaciers and numerous other effects of climate change familiar to more and more of us.

View this stunning 350.org video animation on YouTube, created by the innovative Free Range Studios, designed to reach out to the world to foster the coming together of global community to address this challenge — and hold our political leaders accountable to provide the policies that encourage the changes we must all make as citizens and green business owners.

For most ecopreneurs, addressing climate change is at the core of our triple bottom line approach to operating our green business, putting into practice ways to mitigate climate change, be it in how we use or over-produce energy from renewable energy sources like the wind and sun, serve up organic or pasture-raised cuisine from a sustainable food system, focus on a more bio-regional or local economy, and cultivate relationships with their conserving customers. Many paddle a kayak with a community of like-minded ecopreneurs, rather than try staying afloat on the Titanic dependent on increasingly expensive fossil fuels while trying to dodge melting glaciers. Read the rest of this entry »

This is the final post related to Strategies of Abundance for green business ecopreneurs. The first two addressed how banks have a stranglehold on our lives (Part 1). Part 2 addresses the KISS principle (keep it small stupid), relocalization movement, and thriving on natural capital.

Following are a few more strategies we’ve employed, like many other ecopreneurs.

Strategy # 5: Enough Is Enough

A key facet for many small business ecopreneurs is the recognition of living within our ecological and financial means. By exiting the rat race and crafting our own business at a level we can manage, we can commit ourselves to our Earth Mission. A key step, however, is to let go of the idea that we must own a new car or new stereo, go on lavish vacations or in myriad ways keep up with the fictional Joneses. Many Europeans have known this for years.

Strategy # 6: Be Creative and Innovative

“Of three precious resources in life — time, money and creativity — the only unlimited one is your creativity,” writes Ernie Zelinski in The Joy of Not Working. “Make creativity your number one resource, and time and money won’t be as scarce.” Ecopreneurs sometimes thrive in a service economy where there are not products or in a durable economy where there is no waste. After all, who really wants to “own” carpet. I, for one, will be the first in line for an affordable service contract for a computer (famous for their obsolescence in less than three years).

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This is the second post related to Strategies of Abundance for small business ecopreneurs. My first post addressed why paying the bank is often an unwise decision.

Strategy # 2: KISS Principle: Keep It Small Stupid

While the mantra today might be get big or get out, be a millionaire or — for the more socially responsible — “getting to scale” without losing the values the business was founded upon, we’ve discovered the more human-scaled our operations and practices, the more we can accomplish in terms of reaching our Earth Mission.

Size matters not. It’s what and how we operate. Do the best we can in whatever our priorities and live without regrets. It’s a qualitative measure of success, not a quantitative one. Not bigger, but better.

There’s a small mart revolution going on, proclaims Michael Shuman in The Small Mart Revolution. It echoes the “power of one” worldview; we are the world. We don’t underestimate what a nation of ecopreneurial proprietors might collectively accomplish. Perhaps that’s how we view scale: a nation of ecopreneurs. However, we also respect the decision of those ecopreneurs whose fire in their belly lead them to become household names or lead to the sustainable transformation of their communities.

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