The Footprint of Print and Digital Media Supply Chains

Print has  profoundly changed the world since the days of Johannes Guttenberg, but  now due to the prodigious volumes of energy and materials consumed and  mountains of waste produced the printing industry is challenged to  profoundly change itself. Current patterns of print and digital media  production and consumption are unsustainable and must be reconfigured if  we are to enjoy the essential services and benefits they provide to  business, government and society.

Most of us think about the flows of energy and  materials associated with print and digital media the way fish think  about water. This is despite the fact that large organizations typically  spend between 5% and 35% of every dollar spent (exclusive of labor) on  paper and printing. To put the amount of energy involved in context,  According to the Energy Information Administration (EIA) the US  papermaking industry used 75 Billion kilowatt hours of energy in 2006… second  only to the petroleum industry.

It is  unlikely that print can or will be replaced be digital media. Packaging  is still a major use of print that cannot be replaced, and digital media  also consumes prodigious amounts of electricity. During the same period  in 2006 the EIA reports that data centers and servers in the US used  over 60 Billion Kilowatt hours of electricity.

However, print as we know it must be reinvented so  that it can be used to package knowledge and goods for human consumption  in ways that also address the challenges of sustainability, energy  security and climate change. The reinvention of print and digital media  will require a new “greening”.

In order for  it to succeed this new greening of print can neither be based on the “Greening  1.0” moral-ethical imperatives urged by environmentalists,  nor on purely emotional appeals. The “Greening 2.0” of print and digital media must be based  on a conceptual framework called “sustainability”  that is being used to redefine the way business is done by Fortune 1000 companies… one that  balances economics, the ecology and social equity employing emotional  appeals grounded in a triple bottom line business case.

Sustainability, energy security and climate change are  challenging issues that compel every business, every government and  every individual to rethink the ways in which they employ energy and  manage waste. This article raises more questions than it answers, but  that is primarily because the printing industry has not yet responded to  many of the questions raised to the degree called for by urgency of the issues at hand.

Sustainability,  energy security and climate change are also becoming mainstream  corporate governance priorities among the largest corporations in the  world… and supply chain sustainability is now the focus of a  growing number of companies that are also dependent on print for the  packaging, promotion and advertising of their products. In response to  initiatives from organizations such as the Carbon Disclosure Project,  The Carbon Trust and the Climate Group, corporate and publishing giants  like Wal-Mart, Procter & Gamble, Time Incorporated and NewsCorp are beginning  to press their supply chains to reduce their carbon footprints and  reconfigure their products and services to measure, manage, report,  verify and continuously improve their “triple bottom line”  performance.

In response, printers and their suppliers will need to  rethink what they say about being “green.” More importantly, because papermaking and other print  related processes are among the largest industrial uses of energy in the  world, print supply chains will need to reconfigure the flows of  energy, materials and waste associated with printing if they want to win  the business of such Fortune 1000 clients.

Addressing the new green priorities of business will  require that printing companies and their suppliers look beyond cost,  productivity, print quality. They will also have to reach beyond  superficial measures undertaken to “green up” the image of a company in a hurry. Companies that fail  to understand and address the issues of climate change, energy security  and sustainability in measurable and material ways are more than likely  to be shunned for “greenwashing”.

A key  question is whether investor, consumer and print buyer priorities will  demand the greening of print supply chains in ways that exceeds the  ability of the graphic arts to respond in a timely and effective manner.  To a great extent the answer to this question will depend on printers  receiving clear and unambiguous market signals from print buyers that  sustainability, energy security and climate change are priorities in  their vendor selection criteria and purchasing decisions. An example of  such a signal is aligning the reward and recognition buyers and  suppliers with innovation and the achievement of triple bottom line  benefits. It will also depend on graphic arts firms sending clear  signals to their suppliers that they require more and better  standards-based information about the environmental aspects and impacts  associated with the goods and services that they buy. An example of  would be requiring ISO 14040 based lifecycle analysis of all input raw  materials to the printing process.

For most  printers, being green used to mean complying with the law and “doing the  right thing” for the planet, whether or not it was good for  business. However, the new meaning of green is as much about “doing things right things for business”  as it is about doing the right things for  the planet. The greatest challenge that the printing industry faces is  shaking off outmoded ways of thinking about environmental or “green” issues,  and developing new ways to identify, analyze and act on information  relevant to sustainability and climate change.

According to Professor Kenneth Macro Jr. of CalPoly’s Graphic Communication program “It seems that many if not most of the printers that I  talk to are unfamiliar with the concept of sustainability, and they seem  to hope that this preoccupation with climate change and things green  will blow over. This is no time to be thinking like an ostrich. Instead  of putting our heads in the sand we need to be putting our heads  together to take action and ensure that our industry is sustainable and  that print is seen as a responsible medium.”

While  historically being “green” referred to environmental regulatory compliance, the  new green is about “beyond compliance” sustainability that seeks to continually  improve the environmental, social and economic performance of a  business, a product or a service. Green products historically have been  expected to cost more and to have lackluster performance, but the  promise of the new green was perhaps best described by Wal-Mart CEO Lee  Scott at a recent meeting of over 700 senior executives at a meeting of  the Wal-Mart Sustainable Value Networks in March of 2007 “A working  family shouldn’t have to chose between a product that they can afford  and a sustainable product.” The new green being championed by companies like  Wal-Mart, GE, Timberland, Bank of America, Unilever, Starbucks and  others create and deliver value for money and are designed to do a  better job of satisfying the primary needs sought. Greener printing must  do the same.

The new wave  of green sweeping over business is the crescendo of a movement that has  been under way for over a decade, and there is little evidence that it  will subside. According to John Grant, author of the “Green  Marketing Manifesto[1]”, the new interest in green not likely to fade because  it is so strongly linked to a climate change agenda that is scientific.  Grant maintains that on top of climate change there are a related set  of issues: “water shortages (not just from low rainfall, but  because we have seriously depleted the underground aquifers), seas holding only 10% of the edible fish stocks they did 100 years ago, soil erosion, storms, spreading diseases. Add war, economic turmoil, food shortages, water shortages and social disintegration and you can see why some call the impending (climate) crisis a global Somalia.”

According to  Michael Longhurst, Member of the United Nations Environmental Program  Advertising Advisory Committee, Senior Vice President, Business  Development, McCann-Erickson “Sustainability is not green marketing. It is not a  social program. It is not energy saving. It is all of these things and  more. Sustainability is a collective term for everything to do with  responsibility for the world in which we live. It is an economic, social  and environmental issue. It is about consuming differently and  consuming efficiently. It also means sharing between the rich and poor,  and protecting the global environment, while not jeopardizing the needs  of future generations. …Sustainability is an issue for governments, for  industry, for companies and ultimately for consumers.

There has been a sea change in the degree to which  sustainability, climate change, energy security and corporate social  responsibility are on the lips and on the minds of consumers, Fortune  500 CEOs, institutional investors, judges and politicians. Three time  Pulitzer Prize winning New York Times Columnist and author Tom Friedman  recently described conservation and energy efficiency as a national  security imperative, and rebuffed criticisms that environmentalism is a  concern of the “girlie man” calling it “the most tough-minded, geo-strategic, pro-growth and  patriotic thing we can do.”

Proactively addressing the challenges of climate  change and sustainability will position your company to meet the growing  demand for greener products and sustainable supply chain partners. On  the other hand, failure to identify and reduce the greenhouse gas,  energy and resource footprint of you business operations and supply  chain may put your business at risk.

The  sustainability of print will depend on the degree to which printing  companies and their suppliers respond to the following questions:

  • Can your company quantify and communicate how the  print-related products and services that it offers are economically,  environmentally and socially preferable to non-print alternatives?
  • Is your  company prepared to provide buyers with a lifecycle greenhouse gas  inventory or footprint analysis of your operations and of the goods and  services that you sell to them?
  • Is your company prepared for significant spikes in the  price of energy or of materials that depend on the affordable and  available petrochemicals and fossil fuels?
  • Is your  company prepared to address the likelihood of state and or federal  legislation to “cap and trade”  greenhouse gas emissions?
  • Is your  company prepared to take advantage of a Green Employment Tax Swap (GETS)  in which a tax on carbon dioxide (CO2) is used to rebate federal  payroll taxes?
  • Is your company prepared to pay a premium on insurance  and or loans for failing to implement a comprehensive  IS09000/14001/26000 quality/environmental/social responsibility  management system?
  • Is your company prepared to tell a prospective high  potential employee about how your company’s dedication to sustainable business practices will  improve their quality of life and career opportunities?

To address  the questions posed above it is important to understand some of the  powerful forces that have been at play in recent years. Among the major  factors redefining what it means to be green are profound shifts taking  place in the attitudes and behaviors of investors, consumers and  business leaders with regard to sustainability in general as well as  energy security and climate change in particular.

Major corporations are being driven to re-examine the  standards of conduct and measures of performance that determine how they  do business. Demand and action frameworks for sustainable supply chain management and procurement are arising from individual companies like Wal-Mart, from industry consortia such as the Sustainable Packaging Coalition, the Sustainable Advertising Partnership and the Sustainable Green Printing Partnership as well as from organizations such as the Institute for Supply Management and the Supply Chain Council. As a result, the worlds largest corporations are scrutinizing the corporate social responsibility performance of their operational practices and supply chain business practices ...including what they print, how they print and how print-related products and services are valued.

For many of companies in sectors such as  pharmaceuticals and automobiles the greening of their supply chain  practices began a decade ago with a focus on their “tier one” suppliers.  Despite the fact that printing can represent 20% or more of every  dollar spent by most corporations, it is not typically considered a “tier one” supply  chain function. As a result, printing has only recently come under  scrutiny now that the “lean and green”  sustainability initiatives directed at tier one supply chain purchase are beginning to yield diminishing returns. While there is heightened interest in familiar topics such as the use of post-consumer recycled content, two new topics coming under coming under scrutiny are the “carbon footprint”  associated with printing and  print-related logistics as well as the fiber source “chain of  custody” associated with paper.

While debates about the relative merits of FSC, SFI  and PEFC forest product certification have been making headlines in the  trade press of late, climate change, energy security, corporate social  responsibility and carbon disclosure are the issues of greatest  significance in the business press. Business leaders from companies like  Exxon, BP, Wal-Mart, Target, General Motors, Toyota, Procter & Gamble, Kimberly Clark, The New York Times and Time Inc. are feeling growing pressure from investors, markets and regulators to address the challenges of sustainability and the impacts of climate change on business, society and the environment. For example, a coalition of 382 institutional investors with assets of more than $57 trillion called “The Carbon  Disclosure Project[2]” has called on over 2,500 of the worlds largest  companies to voluntarily report on the greenhouse gasses emitted by  their operational and supply chain activities.

While some may see voluntary reporting of greenhouse  gas emissions as a burden or a risk, others see the process of  conducting greenhouse gas inventories and transforming business  processes to reduce their carbon intensity providing them with critical  expertise and experience for what is likely to be a dramatically  different regulatory environment in the next three to five years. While  the majority of Fortune 500 companies now publish voluntary corporate  social responsibility or sustainability reports in accordance with the guidelines established by the Global Reporting Initiative[3], that disclose their greenhouse gas emissions and other non-financial performance data, few printing companies are aware of them or publish such reports.

Congress is  currently considering several bills that would establish caps on  greenhouse gas emissions and then allow businesses to "trade" credits in  order to stay below those limits. In addition, the governors of five  western states recently agreed that they would coordinate efforts to set  caps for greenhouse gas emissions from their region this year and  create a market-based, carbon-trading program within 18 months.[4]

In March of 2007 a group of 50 major U.S. investors  including Merrill Lynch and the California Public Employees' Retirement  System with over $4 trillion under management asked Congress to enact  tough federal legislation to curb carbon emissions and dramatically  change national energy policies. They called for the U.S. to "achieve  sizable, sensible long-term reductions of greenhouse gas emissions” and recommended three policy initiatives: 1) realignment of energy policy to foster the development of clean technologies, 2) directions from the Securities & Exchange Commission (SEC) specifying what companies should disclose to investors on climate change in their financial reporting, and 3) a mandatory market-based solution to regulating greenhouse gas emissions, such as what has come to be known as "cap-and-trade."[5]

In addition to investor pressure for greenhouse gas  reporting, consumer attitudes toward climate change and the environment  have also changed. A recent nationwide poll conducted by Knowledge  Networks[6] asked American consumers how much they have heard about “the problem  of global warming or climate change due to the buildup of greenhouse gases,” 72 percent said a great deal or some (22% and 50% respectively), up from 63 percent a year ago, when 15 percent said a great deal and 48 percent some. Those who said “not very  much” or “not at all” dropped from 38 percent to 28 percent. 75% embrace the  idea that global warming is a problem that requires action. Perhaps  most interesting, when asked to “suppose there were a survey of scientists that found  that an overwhelming majority have concluded that global warming is  occurring and poses a significant threat,”  the percentage saying that they would  favor taking high-cost steps increased sharply, from 34 percent to 56  percent.

Evidence of  this change, there are an estimated 63 million adults in North America  who are currently considered “LOHAS” Consumers[7]. LOHAS stands for “Lifestyles  of Health and Sustainability” and describes a $226.8 billion U.S. marketplace for  goods and services focused on health, the environment, social justice,  personal development and sustainable living. One of the factors that  caused Wal-Mart to see sustainability as a “game  changing” business growth strategy was the overwhelming and  unexpected response of consumers to an organic cotton yoga outfit! The  other was the inspiring response of Wal-Mart employees to hurricane  Katrina.[8]

As businesses  wrestle with these issues, they are finding that climate change, energy  security and the intensifying focus on sustainable business practices  can have a significant impact on how they do business; on who they buy  their equipment, energy and materials from; on their ability to attract  and retain talented and motivated employees; on which markets they have  permission to operate in and which customers they are valued by. As the  world reaches consensus on the scientific understanding of climate  change and the importance of striving for sustainability in the supply  chains of business, companies are increasingly looking at how to manage  sustainability’s “triple bottom lines[9]”, navigate a “carbon neutral[10]”  path and position themselves for success  is an increasingly complex and carbon-constrained world.

For a myriad of reasons a growing number of large  corporations, publishers and government agencies are under pressure to  manage the sustainability and climate change impacts of the supply chain practices. As a result, major corporations like Wal-Mart, Nike and Bank of America are rewriting their vendor qualification scorecards, putting new environmental management and greenhouse gas emissions information requests in their RFIs and new sustainability reporting and verification  provisions in their RFPs.

Increasingly  printing companies can expect to be asked:

  • How do you measure, manage and report on your company’s  environmental performance and its carbon footprint?
  • Does your  company have a dedicated director of sustainability and a published  sustainability policy as well as a formal environmental management  system that tracks energy and materials use, greenhouse gas emissions  and waste?
  • How much time does your senior management spend  guiding your company’s sustainability policy and its sustainability  performance strategy?
  • How is your senior management recognized and rewarded  for achieving your company’s sustainability performance objectives.
  • Does your  company document the environmental lifecycle impacts, energy use and  greenhouse gas emissions associated with of the products and services  that you manufacture and purchase?
  • What is your company doing to develop continuous  improvement strategies addressing climate change and sustainability in  its supply chain practices?

The world depends on print to a far greater extent  than is commonly understood, and yet, as print is currently specified  and purchased by most it is not sustainable. This is not a time for the  graphic arts to rest on its laurels and wait for buyers and specifiers  of print to change their priorities. Rather it is a time for graphic  arts print service providers to redefine themselves and work together to  identify, analyze and act on making print sustainable and addressing  the challenges presented by global warming in timely and innovative  ways.

Addressing  the issues at the nexus of commercial opportunity and sustainability  presents the graphic communication industry with new opportunities to  re-invent the ways in which the industry packages knowledge and goods  for human consumption. There is opportunity to create new fortunes and a  sustainable future for print. Our common future will largely depend on  our ability to communicate and collaborate, as well as on our ability to  design, produce and distribute knowledge and goods in ways that manage  their lifecycle costs, measure their triple bottom line impacts and  create significant quality of life benefits.