2007 was the year that America’s business pages turned green. Everybody wanted to get into the act. Companies from well-known leaders like Whole Foods and Toyota to historical laggards GM and ExxonMobil were touting their plans to save the planet.
There’s no question that there is a lot of hype out there. But underneath it all, I do think that we have undergone a fundamental change in thinking--in a way that we have not seen the start of the environmental movement almost 40 years ago.
For generations, American industry treated “the environment” as a cost of doing business.
Now we’re seeing a new generation of leaders who understand that the environment is an opportunity to grow their business. That solving environmental problems brings profit rather than pain.
This is something I plan on talking a lot about in the coming months. In a speech last week at San Francisco’s Commonwealth Club, I mentioned that more than 200 years ago, Adam Smith--the founding father of economics--described the power of markets as the Invisible Hand.
Today, we are proving that the invisible hand can also have a green thumb. Here are just a few examples:
- Last year, we saw global warming become a centerpiece in one of the largest single business deals in American history: the $44 billion buyout of TXU, whose new owners rejected plans for eight coal-fired power plants in favor cleaner, more efficient, and more competitive business model.
- On February 4, Citigroup, J.P. Morgan Chase and Morgan Stanley--decided to attach new terms to the hundreds of millions of dollars they typically loan to utilities. These heavy hitters will now focus on energy-efficiency and renewable energy before backing dirty coal plants.
- A recent study by consulting firm Emerging Energy Research estimates that as much as $65 billion will be invested in new wind power from 2007 to 2015; Morgan Stanley estimates the global renewable energy sector has a market cap of around $170 billion.
The profit motive is an incredibly powerful force for change. NRDC’s first commitment is to protecting the Earth. But within that work, we will try to ensure that economic change benefits the environment, and that it is good for all of us and good for the generations that will follow in our footsteps.