iupui ceo alliance sustainable business strategy by george bandy jr

IUPUI CEO AllianceSustainable Business Strategy

by

George Bandy Jr.

"Humanity has the ability to make development sustainable--to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs."

World Commission on Environment and Development, Brundtland Commission

what is sustainability?

A System Perspective Emphasizes:

Principles rather than details

Shared framework and a common language

Focusing “upstream”

Necessary (non-negotiable) system conditions

Science Principles

Matter and energy cannot be created or destroyed (the Conservation Law)Matter and energy tend to spread spontaneously (2nd Law of Thermodynamics)Biological and economic value (quality) is in concentration and structure of matter (What we consume)Green cells are essentially the only net producer of concentration and structure (Photosynthesis)

The Concept of the Funnel

Decline of Living Systems

Margin for Action

Population x Affluence x Technology

1. substances from the earth’s crust must not systematically increase in nature.

2. substances produced by society must not systematically increase in nature.

3. the physical basis for productivity and diversity of nature must not be systematically diminished.

4. we must be fair and efficient in meeting basic human needs.

The Natural Step

what is sustainability?

HOW THE JOURNEY BEGAN

Ray Anderson

Ray’s Epiphany˜August 31, 1994

Today, key driver of:˜Competitive advantage˜Innovation˜Workforce engagement

GLOBAL LEADER.

2005 Market Share Analysis

All Competitors 70%

Interface 30%

InterfaceFLOR / BentleyPrinceStreet / Heuga Brands/FLOR

DIVERSE PRODUCTS & SERVICES.

Services 2%

Broadloom 14%

Fabrics 20%

Modular 64%

CATEGORY SALES BREAKDOWN

InterfaceFLOR Bentley Prince StreetInterfaceFabric (SOLD)Strategic Flooring ServicesFLOR (residential)2006 estimated revenue $1.4 Billion

HEUGA: CARPET TILE THEN.

Interface/Heuga Installation

~Contract Customers Receive a 20% Discount~Order Online With Discount Code at www.florcatalog.com

RESIDENTIAL EMPLOYEEPURCHASE PROGRAM.

GLOBAL LOCATIONS.

Asia 2

ManufacturingLocations

Canada 1

Europe 3

Latin America 0

United States 3

Asia 47

Distribution Sites

Canada 25

Europe 93

Latin America 26

United States 132

Asia 8

Servicing; Sales and Marketing Sites

Canada 6

Europe 21

Latin America 3

United States 10

Using InterfaceFLOR global network reduces cost and lead time issues vs. shipping overseas from US competitors.

GLOBAL MANUFACTURING LOCATIONS.Interface Americas Global Manufacturing

LaGrange, GA(Modular)

Picton, Australia(Modular)

Belleville, Canada(Modular)

Chonburi, Thailand(Modular)

Holland(Modular)

N. Ireland(Modular)

West Point, GA(Modular)

Yorkshire, England(Modular)

City of Industry, CA(Modular, Broadloom)

Note: Tile plant in Georgia & Fabric Plant in Maine are members of U.S Environmental Protection Agency’s National Environmental Performance Tracking Program.

THE MARKET.Custom product website.

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THE MARKET.Inspired Online Design Tool.

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INNOVATIVE PRODUCT IDEAS.

Old Model vs. New Model of Environmentalism

Doom & Gloom

Old Model vs. New Model of Environmentalism

Positive vision of the futureSustainability as business opportunityNo compromises

The Interface Vision

IMAGE HERE“To be the first company that, by its deeds, shows the entire industrial world what Sustainability is in all its dimensions: people, process, product, place and profits – by 2020 – and in doing so we will become restorative through the power of influence.”

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INTERFACE’S SUSTAINABILITY PROGRAMS.

LEED

Cool Blue

ReEntry

Cool Commute

Cool CarpetClimate Neutral

Think LocalAct GlobalBrazil & India

The Interface ModelSeven Fronts of Mt. Sustainability

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

~ Reduced solid waste to landfill by 70% since 1996~ $336 million in waste savings since 1994

Front 1: Zero Waste

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Sample Return Program•2005: over 55,000 samples were returned

•2006: 90,163 samples returned

SIMs•In 2006, 8,000 SIM prints sent

•Conserving > 2,000 gal of oil

•Keeping 20,000 lbs carpet out of landfill

Front 1: Zero Waste

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1 Carpet sample=1 Qt oil

Water savings•Exited energy intensive printing process in 1998

•Water intake per square meter is down 87% since 1996

•Today no wastewater leaves manufacturing area

•No environmental permits are needed

˜ Big cost savings!

Front 1: Zero Waste

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1 Carpet sample=1 Qt oil

50 gallons/sq yd

0.9 gallons/sq yd

versus

INNOVATIVE PRODUCTS INSPIRED BY NATURE How does nature create random beauty?

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Entropy – inspired by natureEach tile is slightly different in pattern & color

Typical i2 installation waste: 1.5%

Typical broadloom installation waste: 8-12%

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Reduced installation wasteReduced manufacturing wasteNo attic stock, no storage space needed

The Interface ModelSeven Fronts of Mt. Sustainability

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

COOL CARPET TM

Carpet Tile

GHG Emissions

=???

Manufacturing

Use & Maintenan

ceTransportati

on

Return and Reuse

Raw material extraction

Carpet Tile35 lbs

COOL CARPET TM

The Only Climate Neutral Carpet Offering

Reductions& Offsets(Solution)

Total Life CycleGHG

Emissions(Problem)

Carpet that Cools the Planet

35 lbs

COOL CARPETTM

Carpet that Cools the Planet

177 tons

Carbon Offsets

177 tons

GHG Emissions

COOL CARPETTM

10,000 sq yds =

177 tons GHGs =

21 households’ electricity use for

1 year!

Carpet that Cools the Planet

The Interface ModelSeven Fronts of Mt. Sustainability

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2

3

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

Front 2: Benign Emissions

Landfill gas is fueling manufacturing processes at LaGrange, GA facility

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Front 3: Renewable Energy

The Interface ModelSeven Fronts of Mt. Sustainability

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2

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

Front 4: Close the LoopReEntry Program

Interface has diverted more than 103 million lbs of carpet since 1994

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1. Carpet shipped back to LaGrange, Georgia2. Full carpet tile is ground up, fiber and backing3. Agglomerator converts material to pellets

Front 4: Close the LoopReEntry Program

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Front 4: Close the LoopReEntry Program

4. “Cool Blue Food” sprinkled onto conveyor belt5. Pellets heated until they ‘ooze’6. Backing cured and face fiber added

The Interface ModelSeven Fronts of Mt. Sustainability

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

Interface Business Travel Since 1997

~ 136 million miles

~ Emitting 30,000 tons of greenhouse gas emissions

Front 5: Resource Efficient Transportation

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Greenhouse Gas Emissions Offset through “Trees for Travel” ~ Planted over 75,000 trees since 1997

Front 5: Resource Efficient Transportation

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The Cool Fuel™ program offsets CO2 from company car fuel purchases

˜To date: offset 7,000 tons CO2

Cool Co2mmute offsets GHG emissions from employee commuting

˜10,000 trees planted, 416 employees

EPA SmartWay Transport Charter Partner, to reduce emissions from ground freight

Front 5: Resource Efficient Transportation

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Partnership with Subaru

Subaru will sponsor the planting of thousands of trees through AMERICAN FORESTS’ Global ReLeaf program, making the operation of the vehicles “climate neutral” for the first 60,000 miles.

The Subaru plant was the first auto assembly plant to achieve zero landfill status.

Front 5: Resource Efficient Transportation

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The Interface ModelSeven Fronts of Mt. Sustainability

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6

1

2

3

4

7

1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

Front 6: Integrate SustainabilityLegacy Projects

•Annual tradition for Interface sales force •Creates culture of social responsibility

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The Interface ModelSeven Fronts of Mt. Sustainability

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6

1

2

3

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1. Eliminate waste

2. Eliminate harmful emissions

3. Use only renewable energy

4. Create closed loop processes

5. Resource efficient transportation

6. Integrate sustainability into the culture

7. Pioneer new business models for sustainability

Front 7: Redesign Commerce

1 Carpet sample=1 Qt oil

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*Not recommended for installation over existing carpet.

TACTILES NEXT GENERATION OF INSTALLATION

~Creates a “Floating Floor”~Install over existing floors ~Tiles adhere to one another, not the floor~90% Lower Environmental Footprint~Eliminates installation waste

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Front 7: Redesign CommerceGreen buildings

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Front 7: Redesign CommerceCarpet & LEED

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MR 4.1 Recycled Content

EQ 4.1 Low Emitting Materials: Adhesive

EQ 4.3 Low Emitting Materials: Carpet Carpet & Rug Institute’s Green Label Plus

MR 6 Rapidly Renewable Materials

MR 2.1 Construction Waste Mgt

ZeroVOCs

<50 mgVOCs

18-31% Post-consumer 32-55% Post-industrial

vs.

Front 7: Redesign CommerceGreen buildings

InterfaceFLOR Atlanta ShowroomFirst LEED Commercial Interiors Platinum Rating

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InterfaceFLOR Shanghai ShowroomFirst LEED Commercial Interiors Gold Rating in China

Front 7: Redesign CommerceBeyond LEED

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Would you choose a ‘green’ product made in a ‘brown’, polluting factory?

LEED doesn’t consider:Performance/durabilityReuse, recycling opportunities at end-of-lifeSustainable Product certificationImpacts on Global WarmingCorporate commitment to sustainability Efficiencies in manufacturing:

water, emissions, waste, renewable energyISO 14001, 9001 certification

• Highest consensus standard on sustainable carpet

• Comprehensive measurement

1. Reducing pollutants and energy use

2. Renewable energy3. Recycled content and bio-based

materials 4. Corporate wide environmental

and social responsibility commitment

5. Product performance, durability, reuse and reclamation

Front 7: Redesign CommerceIndustry Standards

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Sustainable Carpet Assessment Standard

InterfaceFLOR certifications:GlasBacRE: SCS Sustainable Choice Platinum California PlatinumGlasBac: SCS Sustainable Choice GoldNexStep: SCS Sustainable Choice Gold

94% of ’05 sales meet standard

Front 7: Redesign CommerceIndustry Standards

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FLOOR FOCUS DESIGNER SURVEY. Top 250 Design Firms - 2006.

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Front 7: Redesign Commerce

Ray Anderson becomes an unforeseen hero

Front 7: Redesign Commerce

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The World’s Most Socially Responsible Companies

“Interface ranked #1 by sustainability experts as fulfilling responsibilities to society better than others.”

Announces Top 10 'Green' Companies of 2006 Interface ranks #4

Fast Company HIP scorecard: Generate compelling returns and benefit society

Interface ranks #16

Continuing the Journey

The Interface Story and More…

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www.interfacesustainability.com

CONCLUSIONIf we’re successful, we’ll spend the rest of our days harvesting yesteryear’s carpets and other petrochemically derived products, and recycling them into new materials; and converting sunlight into energy; with zero scrap going to the landfill and zero emissions into the ecosystem.

And we’ll be doing well – very well – by doing good.- Ray C. Anderson

THANK YOU