Chemical giant DuPont has a mixed history with regard to the environment. In recent years the company has been the subject of severe criticism and, in 2004, a $16.5 million fine from the Environmental Protection Agency for withholding information about C8, a potentially toxic chemical used to make Teflon. But Charles Holliday, CEO since 1998 and a DuPont employee since 1970, has been steering the firm toward greener business pastures for more than a decade. By making changes in its manufacturing processes and cutting back on its energy usage, among other measures, the company has reduced its greenhouse gas output by 72 percent over the past dozen years. And in 2006, Holliday co-founded the U.S. Climate Action Partnership (Uscap), a coalition of ten CEOs, including the chiefs of General Electric and Lehman Brothers, that in January called for federal legislation to reduce greenhouse gases and create a nationwide emissions-trading program. Holliday, who says he believes such a program has a “50 percent chance” of coming to fruition within the next two years, spoke recently with Institutional Investor Senior Writer Loren Fox.
1 Why have business leaders gotten serious about global warming?
At DuPont we’ve recognized that the scientific data is becoming very strong, showing that global warming exists, that mankind has contributed to it, and that there could be negative consequences. And from our perspective there are so many smart things we can do that are value-creating today and are the right things to do for the environment. I think more companies are coming to the same conclusion. And then, you know, Al Gore’s movie didn’t hurt.
2 The Uscap group recommended that Congress create a nationwide program to cap emissions and facilitate emissions trading. How would that help a company like DuPont?
In the early 1990s we started our own internal reduction program. One of the ideas in the Uscap recommendation was to give credit for early action. That’s important to us; we’d like credit for at least part of what we’ve already done.
Second, we have a suite of products and services that can help others reduce their greenhouse gas emissions and energy consumption. So we believe we can grow as a result of this recommendation. And, quite frankly, we don’t apologize for that. I know a couple of folks have criticized us because we might make money doing this. We think that’s actually good.
3 How can you preach green business when you’ve been a polluter in the past?
Good question. “Polluter” is a relative term. Twenty years ago we were what people would call big polluters. But every last ounce of what we put out there was absolutely legal, approved by somebody. What we concluded was, it didn’t feel right to be putting that much stuff out into the environment. So we changed. I’m convinced this effort is going to make us money, and it’s good for our investors. Our mission as a company is to achieve sustainable growth. We start with that.
4 What can be done to ensure that environmental initiatives don’t end up merely shifting industrial activity to developing countries?
I’ve been working in China for about 20 years, and I have seen a big shift. I think the Chinese population is demanding a different environmental strategy, and it’s happening. But I don’t want to minimize the task of getting developing countries on board. If the U.S. shows leadership, I believe we’ll have a seat at the table to tell China and India to step up.
5 What are investors’ reactions to your advocacy of green business?
Investors say, “Show me how it’s going to make me money, and I’ll like it.” As long as we talk about it in those terms, investors love it. If we start talking about saving the world, some like it and some don’t.
