Industry Panel on Sustainability - Aug/Sep 2011

The concept of sustainability has evolved considerably over the years, but the amount of information available today, in some ways, has made the issue more confusing than ever. What makes a product or company green? Or better yet, what makes a product or company greener than another down the street? The answers to these questions aren’t easy, but that doesn’t mean a lot of people aren’t trying.

We asked a panel of experts from leading flooring manufacturers to weigh in on the subject: Jenny Cross, Mohawk’s senior sustainability manager; Dave Kitts, Mannington’s vice president-environment; Paul Murray, Shaw’s vice president of sustainability; Kim Matsoukas, Bentley Prince Street’s sustainability manager; and Tim Cole, Forbo’s director of environmental initiatives.

Q: A comprehensive sustainability program requires a broad focus that encompasses a company’s economic, social and environmental practices. How do you go about prioritizing those elements?
Kitts: We avoid ranking these practices in order of importance, because they’re all important. You don’t want a stool with three legs of different length, or different importance. Sustainability is the same way—requiring a more balanced approach and mindset. What works best is finding the right mix of actions to support a broader sustainability fabric, and is consistent with our company culture and values.

Cross: The key to a successful sustainability platform is recognizing that people, planet and profits work together. They are not separate initiatives, but rather completely interconnected. We do not prioritize one over another; we do our best to balance all three. Planet or environmental practices get the most attention, frankly. They are rather easy to capture clear economic value, and most of the time they have a very quick impact. The people or social initiatives are sometimes more difficult to determine ROI and the impact period might be longer, but the metrics to capture performance are certainly there. One of our primary focuses in the last few years has been building those metrics to better manage that area of sustainability.

Cole: Our sustainability policy states that we will take a triple bottom line approach in all that we do. We first separate our concentration of goals into organizational and operational, or people and factories. All project managers are to ask specifiic questions for each project they work on: Does this project create a lower environmental impact than the previous process or current condition? What economic value does this offer the organization and our stakeholders? What impact will this have on our employees, and our stakeholders? A negative answer to any of these question creates a “no go” decision.

Matsoukas: Bentley Prince Street measures the costs and benefits when evaluating a new sustainability initiative or project. However, we do strive to take the long view and measure benefits not found on a balance sheet when analyzing a project. For example, will the project help us meet our Mission Zero 2020 goals? Will it help to educate our associates and customers about sustainability? Will it help us to attract and retain the best talent? These questions ensure that we are being comprehensive in our approach to decision making.

Murray: We use the “three pillars” of sustainability—corporate governance and social responsibility; operational and environmental excellence, and innovative products and services—as a platform from which to drive sustainability throughout our entire organization. Established in 2007, our Growth and Sustainability Council guides our strategy and management approach for each of the three pillars, ensuring our sustainability objectives and goals are aligned with our long- and short-term corporate objectives. The council is comprised of senior leadership from across the organization. Six charter teams, which report to the council, then drive initiatives and tactical execution through individual divisions and departments. We then report our progress through an annual corporate sustainability report.

Q: What are some of the issues regarding looking at sustainability from bio-based versus petroleum-based perspectives?
Cross: No one can argue that we must reduce our dependence on oil and create alternatives. Bio-based products and fuels are one way to achieve that goal. The carpet side of our business is particularly petro intensive due to the polymers used, but I have been very encouraged by the innovations I have seen in the bio-industry to create material alternatives in major polymer categories that do not alter performance. SmartStrand is an excellent example of one such product—partially bio-based with amazing performance. Many people assume that bio-materials must be crop based, but that is simply not true. Experts agree that as the industry grows, the sourcing will move to sources such as biomass materials and non-crop plants such as algae. This is a long-term proposition with significant impact, but impossible to achieve without support. It is estimated that if biomaterials were used from available biomass alone, with no food substitution, that they could replace over 5 trillion gallons of petroleum each year.

Kitts: One fundamental issue is that, at face value, bio-based is perceived as good and petroleum-based is perceived as bad. But the facts are more complex and dynamic than a simple yin-yang issue. If a bio-based material requires a great deal of petroleum to manufacture—perhaps even more by volume than the petroleum product being replaced, then it is a step backward. The feel-good factor can be deceiving.

Murray: While bio-based ingredient materials may eventually offer a promising alternative to their petroleum-based counterparts, they currently have yet to meet—let alone exceed—the performance and quality standards of their petroleum cousins. In addition, a limited number of available polymer types also make availability a significant issue, and the use of food-grade grain-based sources for these polymers is another very serious issue. Given current and projected challenges with world food supply, we need to be working toward finding non-grain based sources of feedstock for these new polymers.

Q: If you could change anything about LEED in terms of making sure the right activity was being rewarded, what would you change?
Matsoukas: I think LEED needs to move away from awarding attribute-based credits to materials used on a project. For example, projects currently earn a credit if 10% of the material used on the project is recycled content. But the amount of recycled content in a product does not tell one anything about the environmental impact of that product. It would be nice to see an approach that’s based on lifecycle thinking, rather than attributes.

Kitts: Reconsider the wisdom of pilot credits. The original intent of trialing concepts via pilot credits may have quickly run its course. LEED, as a powerful force on the market, continues growing in dimension and complexity. Part of LEED’s elegance, and benefit, in its early years was its simplicity. It was not perfect, but today’s “LEEDscape” includes nine different systems, and more than 40 pilot credits. USGBC continues to try to be very collaborative and all-encompassing, but it might be creating an oversized, overly complex set of systems that, in fact, slows down progress.

Cross: It is encouraging to see that LEED has taken steps to measure and reward ongoing performance. The actual performance of a building is what is important, not the intended or estimated performance. The notion that, once a building is certified, all the work is done is frankly contrary to the principles of sustainability, which include continuous improvement.

Cole: Buildings are made from products, so the materials and resource credits should have the most robust criteria in LEED. These credits have not been changed since the first version of the rating system. The credits should eliminate any opportunity for greenwash by product manufacturers. They shouldn’t recognize certifications and standards that are not consensus based, transparent and third party certified. MR credits should reward products with the lowest environmental impact. LEED should reward product manufacturers that offer transparency, third party LCA data, address human health impacts, and show a commitment to social responsibility.

Murray: The latest version of LEED is starting to address one of the rating system’s key issues, and that is the weighting of points according to how challenging or difficult those points are to attain. In earlier versions of LEED, some very easy-to-achieve points carried the same weighting as very hard-to-achieve points. The newest version of LEED is addressing this issue.

Q: When it comes to product development factors like lifecycle analysis, carbon footprint, recyclability, resource utilization, how does your company decide how to set the right priorities?
Murray: Not unlike our approach to third-party certifications, when it comes to product development factors we again look at the business case for implementing these initiatives, prioritizing investments that will help further drive sustainability improvements for our products and processes and also help meet the needs of our customers.

Cross: Lifecycle analysis is really a tool that we use to look at the other product factors like carbon footprint, embedded energy, recyclability and the like. We use it to determine where we can improve our products, and it certainly helps us to focus on multiple aspects of our products with the goal of building the best possible product. It is important to note that LCAs are not a complete representation of sustainability, since the social aspect is not part of the equation.

Kitts: The same way we set all of our business priorities: healthy internal discussion and goal setting, along with collaborations with key partners outside of our own four walls—all with a view to where we’re headed as a company and what priorities are best suited to keep us on our long-term path to success.

Matsoukas: Bentley Prince Street believes that lifecycle assessment is the best approach to understand the environmental footprint of a product during its development phase. That said, other environmental factors like indoor air quality must also be considered along with the usual facets in the product development cycle like cost and ease of manufacture.

Cole: With all product development, be it for product improvements or new product development, we follow a process with buckets of technical criteria to be met in various stages of the development process. Each stage ends with a “go, no go” decision point. It’s no different when incorporating sustainability and environmental impact criteria into this process. Many refer to this as design for the environment. All criteria, be it technical or environmental, must be met in each stage in order to move to the next stage in the development process. The main goal is to ensure that your improvements or new products always have a lower impact than the current products.

Q: By the end of this year, NSF will likely have completed product category rules (PCRs), paving the way for environmental product declarations (EPDs) for every type of floorcovering. Do you expect most flooring companies to embrace EPDs? And are EPDs the most comprehensive way to illustrate sustainability?
Cole: I hope that all product manufacturers will embrace EPDs. This is nothing new to Forbo as EPDs have become the norm in Western Europe. This also would mean that manufacturers must embrace LCAs, as the LCA data is necessary for the creation of an EPD. EPDs illustrate environmental impacts, which is just one third of the triple bottom line. EPDs don’t represent long-term human health impacts or social responsibility.

Matsoukas: A PCR for carpet, laminate, and resilient flooring already exists and has been in use since 2008. NSF is developing a PCR that adds additional flooring types like wood and ceramic. Bentley Prince Street published the first EPD for broadloom in North America and is committed to publishing EPDs on our products because we believe they are the best way to eliminate greenwash. They are the only environmental label that provides the lifecycle impacts of a product in a standardized, third party verified format. The limitations of EPDs are their complexity and the lack of participation by others in our industry.

Cross: EPDs are another tool to illustrate the environmental impact of a product but they do not cover every angle, and, like LCAs, cover only the environmental impact of a product. The social and economic indicators are not involved so it is not a true sustainability measurement. Our work with EPDs has already started in Europe. There is concern that a company is risking proprietary information or possibly a competitive advantage with the issuance of an EPD.

Murray: EPDs are growing in popularity and the success will be predicated on the product category rules that still need to be developed. The issue is being evaluated and no decision about whether or not we should proceed will be made until the PCRs are complete.

Q: How do you approach conflicts between your firm’s profitability picture and doing the right thing socially or environmentally?
Cole: We believe that being environmentally responsible is both the right thing to do as a responsible corporate citizen and the right thing to do in business. We work to “compliance plus”—a commitment to go above and beyond government regulations and requirements. We believe investments in people, process and product that further improve our environmental performance are investments for our future, not a cost of doing business.

Murray: We use a triple bottom line to measure our company’s progress for a reason. Sustainability, by its nature, requires that we balance our commitment to social and environmental responsibility with sound economics. If our environmental and social responsibility initiatives do not also make good business sense, they will not be sustainable for the long term. Rather than take an either/or approach to profitability versus sustainability, our Growth and Sustainability Council is responsible for ensuring our environmental and social initiatives also make good business sense.

Cross: This is, frankly, something we do not have to deal with often. Our sustainability initiatives make good business sense with tangible and sometimes intangible benefits. Again it is a balance. A business that makes decisions without a healthy respect for the economic impact is not a sustainable business long-term.

Matsoukas: We have found that the conflict between profitability and sustainability is rare when you look at the larger picture. Yes, certain things may cost more money in the short-term, but those same activities often generate benefits in the market or with our internal associates that more than make up for the added cost.

Q: Most research tells us that consumers put environmental factors well below economic and fashion criteria when selecting floorcovering here in the U.S. What can be done to urge consumers to prioritize sustainability when purchasing flooring?
Matsoukas: Education is always the key. In the commercial sector, LEED has really been the driving force in moving the conversation toward green.

Kitts: We believe many consumers still place price and fashion ahead of environmental considerations. That being said, we also believe protecting the environment is more important to consumers today than it has ever been and will certainly keep growing in importance.

Cross: What we have learned over the last several years is that creating a beautiful, healthy and safe home is most important to our buyers. This is truly the essence of sustainability if you think about it holistically, with a nod toward social, environmental and likely economic factors as well. So I do not think it is so much that the consumer does not prioritize sustainability as the industry not presenting it in the right light.

Murray: Education is key! It is our responsibility to help educate the general consumer and to lead the market in this arena. Shaw’s involvement with the HGTV Green Home is one example of how we can help move the needle in terms of promoting a general understanding of the environmental issues facing the world today, and also demonstrate that environmental responsibility and great design are not mutually exclusive.

Cole: Performance, color, price and design are all prerequisites in the mind of the consumer. The environmental story is just the tipping point in the decision process for those with some commitment toward sustainability. You can’t make people care about the planet and its resources. In the flooring business one of the leading environmental drivers is the impact of flooring on indoor air quality. So education on the environmental impacts of flooring materials will help create change.

Q: When it comes to alternative energy sources, which solutions make the most sense from an economic and environmental perspective?
Cross: We have had tremendous success with biomass within our hard surface operations. This process serves as an outlet for our wood waste generated internally as well as a fuel source for our boilers. We are continuing to investigate solar and other energy alternatives, but, with a few exceptions, the return on investment and cost-value relationship are simply not there yet. As technologies develop, we expect these options to become more viable.

Murray: Right now, most alternative energy sources are a bit more expensive than brown power, so we need to help new industries create fuels that help reduce our petroleum-based energy consumption. That’s why we have invested substantially in our new Re2E facility, converting post-consumer carpet into steam and electricity for two manufacturing plants in Dalton, Georgia.

Cole: There is no black and white answer to that question. Where you are in the world helps make that decision. In some places hydro makes sense. In other places geothermal. The same is true for solar and wind.

Matsoukas: We’ve found that the economic feasibility of a project is usually determined by the incentives provided by the state and local utility. In California, biogas is becoming more readily available and that’s something we are looking at utilizing. Solar has also gotten a lot more affordable, with tax credits and incentives and creative financing options like power purchase agreements. Still, Bentley Prince Street has found that we can still get more bang for our buck—environmentally and financially—by focusing on energy efficiency.

Kitts: There is no silver bullet or single solution. The challenges are broad and dynamic. The solutions must also be broad and dynamic.

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