Jeffrey Hollender, a founder of Seventh Generation, spoke at the MIT Sloan School of Management today. Apparently he spoke several times around campus, but we caught him at a lunch time talk billed as “creating a game plan for transition to a sustainable economy.”
During a compact introduction, Dean David Schmittlein noted that introducing the notion of corporate responsibility into one’s business as Seventh Generation has, “adds complexity.” Hollender’s talk delivered some of that complexity.
Hollender is the “chief inspired protagonist” of Seventh Generation (some founders get to pick their own titles). As someone whose role at the company revolves around thinking, it’s no surprise that he started and ended his talk with words about consciousness in the most basic sense: the decisions you make are based on what you pay attention to. In world full of unintended consequences, he argued, “what you pay attention to helps you end up with more of the consequences you want.”
The consequences Hollender wants, for his business, his society, and his planet, are “revolutionary. Many of our problems will not be solved by the sort of incremental change that we see in the political process and in business.” He went on to diagnose our current predicaments (economic, environmental, and moral) and offered some possible ways out. Although the audience was a mix of students, faculty, and staffers, it was clear that it was the students he was talking to. “We don’t want to sustain the world we have,” he said. “We want to change it.”
“The single greatest challenge we face,” he said, “is the system we have created, embodied in academics and business. We have taken a world that is endlessly interdependent and divided it into countless pieces. There are two million NGOs that have taken a piece of the problem, same in business, but failed to realize that everything one does affects the other.” He celebrated cross-disciplinary collaboration (citing the global sustainabile food lab associated with MIT Sloan’s Peter Senge) and identified what he said are the “keys that are critical to what kind of solutions are necessary”:
- He talked how how business money in politics is “negative and disruptive, and it prevents the transition to a sustainable economy.” He advocates full public financing of elections.
- He argued for full cost accounting. “In our society, good things cost more than bad things. Why? Government rules lead to an incredible distortion in the economy … if you’re a business and you do the right thing you get no benefit from an institutional perspective.”
- He laid out an argument against the current structure and ownership of business and financial markets. “Things get more expensive even when there’s no increased demand. The purpose of business has become misguided, immoral even … we need the influence of government to be in line with the interests of society. Right now the deck stacked against sustainable businesses.”
Hollender’s proposed solutions are those he has made in print and in person before — businesses should practice radical transparency, treat their employees as their greatest assets, and exert leverage through supply chains (he spoke at some length on how WalMart has become a de facto regulator). During a brief question-and-answer session, he emphasized that his own company has far to go to live up to its own values. “Out biggest failure as company is that we have failed to make even marginal impact when it comes to justice and equity… We make compromises every day. The key is to be transparent about them.”
And Hollender concluded with a note about the contradictions inherent in the economics and politics of our time. He spoke of meeting a representative of the Service Employees International Union, who told him that, to get an acceptable return, “the SEIU pension fund invests in mutual funds that are full of companies who want to put labor unions out of business.” It’s quite complicated.
3/21/2010 – Update: Courtesy of MIT World, you can now watch Hollender’s complete address.