Ecological Intelligence

General Business

Thursday 15 April 2010

Dr Daniel Goleman

Ecological Intelligence: Winning in an age of radical transparency

Blue Fin Venue, London

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Daniel Goleman doesn’t cut an imposing figure on the podium, but when he speaks, people listen. Best known for his book, Emotional Intelligence, the noted psychologist and author has now turned his attention to one of the most pressing issues of our time: the environment. Specifically, how we as consumers and producers have created the world we live in through our behaviour; and how we must deal with the consequences.

Talking to a select group of business and industry leaders at the London Business Forum (LBF), Dr Goleman outlined his vision of a consumer society driven by what he calls radical transparency, where the total environmental cost of an item is readily apparent and factors into everyone’s purchasing decisions. His latest book, Ecological Intelligence, deals with this new economic paradigm.

Stimulated by the emerging field of industrial ecology, Goleman is asking us to re-evaluate the way business and industry look at the environmental impact of what they do. He asked the audience if they know how much of a yoghurt carton’s global warming impact is recouped by recycling. The answer: five percent. It’s not just the carton we need to take into account, but every step in the manufacturing process, from the methane expelled by the cows, to the toxic by-products of the carton itself. This life cycle assessment (LCA) of products and services is the key to ecological intelligence.

“Green today, is a mirage,” he stated. Labels, like organic and fair trade, are only telling one small slice of a product’s life cycle assessment, but this is changing. New initiatives, such as goodguide.com and earthster.org, aim to bring LCA data to the public in an easily understandable format. “If consumers know the true impact of what they are going to buy, they will favour something that’s better, and tell everyone about it.”

Goleman argues that LCA information will become so crucial to people’s buying decisions that it will soon be displayed next to the price on the retail shelf. The companies that are able to show that they are truly conscious of their product’s LCA are the companies that will prosper.

“The average British woman uses 515 chemicals on her skin every day.” Many of those chemicals may turn out to be carcinogenic. As ecological consequences become transparent, and the information becomes increasingly important, Goleman believes that we need to rethink everything. “We may even need to reinvent everything.” He went on to explain that anyone who makes anything today is using legacy methods. Every industrial process, platform and chemical that is standard operating procedure has been developed in an era before we had a metric and a lens for LCA, let alone transparency about it. Many of these chemicals will be banned in the future.

“Our kids are growing up in a state of Eco-shock,” said Goleman. “They’ve had a unique generational trauma.” They’ve all had unprecedented exposure to the ecological melt down through television, movies and the internet. We might not care enough to change our purchasing behaviour, but tomorrow’s shopper will. So if the market leaders today want to keep their position in the future, they are going to have to make environmentally lead business decisions. He illustrated this with a surprising example: Walmart. The biggest retailer in the US is demanding detailed LCA information from all their suppliers. If the suppliers don’t provide it, they won’t be stocked by the retail giant. Strangely, it’s not the consumers driving the green revolution, but the retailers and manufacturers who are prescient enough to see what’s coming.

Although the statistics he quoted are fairly depressing, Dr Goleman is optimistic. He believes that radical transparency could lead to a virtuous cycle in business decision making, where positive ecological decisions make sound business sense. He closed off his talk by saying that we’ve all been participating in a society wide self-deception that is thankfully coming to an end. When asked why he had moved his focus from social interaction to industrial ecology, Dr Goleman replied with one word:

“Grandkids.”