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The P&G Sustainability Vision: Reluctant Response or Strategic Shift?

| Tuesday October 5th, 2010 | 1 Comment

P&G Headquarters - Cincinnati, Ohio

By Sara Herald

Last week, Procter & Gamble, the largest consumer product goods company in the world, announced an ambitious new environmental sustainability vision. The parent company of brands like Tide, Pampers, Bounty and countless others appears to have decided that its business stands to suffer significantly as more and more consumers choose “sustainable” products over traditional offerings.

The vision is ambitious: “using 100% renewable or recycled materials for all products and packaging,” “having zero consumer waste go to landfills,” and “emitting no fossil-based CO2 or toxic emissions” are just a few of the near Utopian statements it includes.  In order to achieve those goals, the company has established a set of benchmarks that are much more realistic.  For example, by 2020 the company aims to have renewable materials account for 25% of product/packaging materials, and for their plants to be powered by 30% renewable energy.  While it’s great that a company whose products are used by more than 4 billion people every day has committed to reducing the environmental impact of its operations, it’s hard not to question the firm’s motives.  If buyers as crucial as Walmart weren’t pressuring the company to reduce the environmental footprint of its products, and competitors such as Clorox Green Works, method, and Seventh Generation weren’t performing as well, would P&G even care about sustainability?

Maybe, maybe not.  But that’s the beauty of CSR in today’s world- it makes business sense to go green, and that’s why companies whose products have been piling up in landfills and contributing to water and air pollution are jumping on the bandwagon.  We’ve shifted beyond the obvious benefits of going green (ie: cutting costs by reducing packaging) to strategic business moves designed to maintain and gain market share.  P&G is fully aware that if more new parents decide to use cloth diapers instead of Pampers, that’s not a positive development for the company.  However, if by reformulating those Pampers as well as other products the company can reach consumers looking to make a difference with their everyday purchases, the company wins.  And who knows, they may even be able to hang on to those parents who are looking into Seventh Generation diapers because they don’t really want the hassle of cloth ones!

Ultimately, it’s great to see a company as powerful as P&G make a serious commitment to reducing the environmental footprint of their products.  Why they did so is irrelevant, because not only do they stand to make a tremendous impact on the environment, but also on the purchasing habits of the average American.  And that’s a vision to get excited about.

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Sara Herald is a second-year MBA student concentrating in CSR Strategy at the University of Maryland’s Smith School of Business.  She is the Vice President of Social Impact for the student government association and serves on the board of the Net Impact chapter.  Sara graduated magna cum laude from Georgetown University with a B.A. in Spanish and English.


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  • Parviz

    Great Article, but I think it IS a Reluctant response.