Savvy CEOs Respond Quickly to Corporate Crises

Lately the headlines seem to be full of corporate crises. Mattel and Graco have been forced to recall products, pharmaceuticals have been withdrawn from the market. CEOs seem to be constantly apologizing to customers for potential product liability issues. Or even for untimely price cuts, as Steve Jobs did when angry customers protested on the Internet about price cuts on the iPhone.

Some of these crises could have been averted, but most could not. However, they can all be monitored and responded to in a timely fashion that lowers the risk for the company and preserves its image with stakeholders.

Notice how fast CEOs have to respond these days. Years ago, when Johnson & Johnson found that some bottles of its product Tylenol had been tampered with, the company made its crisis a case study through the swiftness of its response. The company responded within days, recalling the product and getting out information to its customers.

But that was before the widespread emergence of online communities. Companies no longer have days to respond to a health and safety crisis, whether inside their own companies or externally for their products. A crisis plan must be in place. It must allow for immediate response, and it must respond within the new parameters of sustainability and stewardship.

For this reason, it’s a good idea to have integrated software systems with the ability to monitor, predict, and communicate potential problems. In our own company, we are working hard to make our products more predictive, proactive, and analytic rather than merely responsive.

It’s imperative that we control risk as best we can, and when we can’t, we must have the quickest, most effective response.

Add comment September 28th, 2007

Study Shows Pollution Can Increase Risks of Heart Attack and Stroke

Last week, the Blackstone Institute, which is dedicated to solving pollution problems in the developing world, released its list of the ten most polluted placed in the world. That list includes many places most people don’t commonly visit, but also includes several in the former Soviet Union and Russia. Here’s the list:

• Sumgayit, Azerbaijan
• Linfen, China
• Tianying, China
• Sukinda, India
• Vapi, India
• La Oroya, Peru
• Dzerzhinsk, Russia
• Norilsk, Russia
• Chernobyl, Ukraine
• Kabwe, Zambia

Why is this of more than passing importance? For the past few weeks I’ve been concerned with reports that the Beijing Olympics could be impacted by that city’s air quality. I have already blogged that several teams aren’t going to train at the site of the Olympics, which is quite uncommon.

But now new medical studies have come out saying that particles of air pollution can actually trigger blood clots in the heart and lungs. I think it’s important enough to quote from Reuters so you won’t have to follow the link:

“Large population studies have shown pollution from the exhaust of trucks, buses and coal-burning factories increases the risk of fatal heart attacks and strokes.

Apparently the inflammation from air pollution tells the lungs to release an immune system compound that causes the blood to clot.

Up until now, we have only had anecdotal evidence that air pollution can kill. Now we not only know it can kill, but actually how it does so. And we have the tools to clean up the air, by monitoring emissions and making changes in how we drive, live, and conduct our businesses.

Add comment September 27th, 2007

Investors, Environmentalists Form Coalition for Climate Change Risk Reporting

You know the seriousness of the climate change issue for the enterprise when the New York Times runs a story that a coalition of environmental groups and investors has asked the SEC to compel companies to disclose risks to their business models from climate change. This comes on the heels of a story widely reported about the disappearance of ice in the Arctic and the surmise that the Northwest Passage, which was sought but never found by generations of explorers, might end up being an open channel for intercontinental shipping. The Arctic has less ice than at any time since measurements began.

More than half of the S&P 500 are inadequately reporting climate change risk, according to Ceres, the coalition of investors and environmental groups. And New York attorney general Andrew Cuomo has begun an investigation of five energy companies to find out if they were adequately reporting their risk from the operation of coal-fired plants, which are known to emit gasses that cause global warming.

This is just the beginning of a trend to acknowledge that business will be threatened by climate change. And it’s why I believe that business will take the lead in trying to reverse its effects.

1 comment September 24th, 2007

ESS Joins Emerging Tech Companies at Going Green Conference

I’ve spent the beginning of this week at the AlwaysOn Going Green conference. It’s been like a time warp, because just last week I was in Jakarta. I travel so much lately to visit our global partners and customers that I think I am seeing more than the average person about how the world is responding to environmental pressures.

I participated on the panel on energy efficiency. Because this was primarily a technology conference, the energy efficiency panel dealt with the way energy is used in data centers. Most of the panelists focused on methods of increasing domestic energy efficiency. However, that doesn’t necessarily address global issues because a significant portion of industrial production has moved offshore, while the US has shifted to become a service economy.

In order to make a significant dent in the planet’s environmental footprint, and mitigate the effects of climate change and global warming, there needs to be a greater focus on helping organizations in emerging economies manage emissions—especially GHGs. That’s why ESS is building relationships in the Asia Pacific region, where there is significant growth in manufacturing. We’re working with organization heads throughout the region to show them how they can both reduce emissions and improve their business performance.

Among other things, I told the audience that 56 percent of all the energy used in any commercial building is in the HVAC system, and that saving 10 percent in this arena alone is enough to equal taking 30 million cars off the road. Watch the entire panel session.

AlwaysOn showcased 100 new, private greentech companies that are transforming the global energy, water, agriculture, transportation, construction, manufacturing and resource recovery establishments.

The GoingGreen 100 winners were honored at GoingGreen, a summit held at the University of California, Davis Graduate School of Management. Check out the archives from the event. I was asked to be a participant as a panelist, since our company is the market leader in the EH&S software space.

Add comment September 21st, 2007

Experts Say Beijing’s Air Quality May Affect Olympic Athletes

Maria Cheng, the medical writer for the Associated Press, recently wrote about the potential implications for athletic performance of the air in Beijing. Apparently, even the government’s effort to clean up the air by taking half the cars off the road for a day didn’t do enough. According to CNN, the government removed about a million cars a day from the city’s streets during a four day test. But the air was still, the humidity and temperature were high, and conditions were still gray and hazy.

The Olympic Committee has already warned China’s government that it would change the date or location for events if an athlete’s health was endangered. This is obviously most dangerous for marathoners, cyclists, and practitioners of other endurance sports.

Typically, athletes in training for the Olympics do their best to train in a climate as similar as possible to the one they will compete in. But for the 2008 Olympics, that won’t be the case. According to Cheng’s article, Japan’s softball team, France’s judo team, and all the Australian athletes are avoiding Beijing as much as possible until they have to be there for the games.

“The difference between these super-elite athletes is a very small line,” said Dr. Todd Schlifstein, a sports medicine expert and assistant professor at New York University School of Medicine. “If they are really sensitive to the pollution in Beijing, that could inhibit their performance and have a big impact on how close they come to a medal.”

That was true a couple of weeks ago at the world track and field championships, where heat and humidity both in the ’90s meant that a full one third of the people who started the marathon did not finish. Several runners collapsed.

I’ve spent quite a bit of time in Beijing, and the air has never been good. But I can’t believe the government of China would invest this much in getting the Olympics and not make major strides in cleaning up the pollution. And once it is done for Olympics, it can be done permanently.

Add comment September 14th, 2007

U.S. Proposal Calls for Accelerating HCFC Phaseout

Twenty years ago, the Montreal Protocol was signed, and over a hundred companies pledged to reduce a family of chemicals called hydrochlorofluorocarbons (HCFC), which were already known to deteriorate the ozone layer and contribute to global warming. Soon after the passage of that Protocol, I realized there would be a need to enable organizations to track, manage, and minimize their ozone depleting refrigerant emissions, and this was the first software product created by Environmental Support Solutions, the global company of which I’m proud to be the CEO.

So it was with a bit of nostalgia that I read the article in Environmental Leader that the Bush administration plans to push for speedup of the global phaseout of chemicals that destroy the ozone layer and contribute to global warming.

The article quotes a Wall Street Journal story (paid content, accessible only by subscription) that the administration’s proposal will be presented at a Sept. 15 meeting in Montreal, where representatives from 191 nations will discuss toughening the 20-year-old Montreal Protocol, designed to reduce the use of chemicals that create holes in the ozone layer.

According to the article, the U.S. plan would shift the deadlines for phasing out HCFC to 2020 from 2030 for industrial nations and to 2030 from 2040 for developing nations. In addition, the proposal would require developing nations to shrink their production of the chemicals by stages before the 2030 deadline.

This has probably come about because it is common knowledge that global warming is advancing faster than we thought it would when the original protocol was passed.

Add comment September 11th, 2007