Comparing Coffee Standards

Sooner or later, it has to happen. The raters are rated. Jorrit Reintjes has written an excellent M.A. thesis for Rotterdam's RSM Erasmus University on "How Do You Take Your Coffee Production?" He rates eight standards for sustainable coffee supply chains. Coffee is a good product to start with. It's legal, calorie-free and is addictive yet has healthful properties. They say that when human life becomes extinct on earth the beetles will survive. In the same vein, at an NYU Stern seminar last week, the consensus among panelists was that in the deepest recession, coffee sellers will thrive.

The eight coffee standards are FairTrade (FLO), Utz Certified, Common Codes for the Coffee Community (4C), Rainforest Alliance, Globalgap, Organic (EKO), SA8000 and Sara Lee's Global Standards.

The five overall criteria for rating the raters are: scope of standards, rigor, embeddedness, compliance information system, and non-compliance response system.

As might be expected, the single-company standard fell short in every category. The three top-performing standards were FairTrade (FLO), Rainforest Alliance and SA8000. One characteristic of these three standards is that the organization sponsors are long-term members of the ISEAL Alliance and they know what it takes to develop, institute and enforce a global multi-stakeholder standard. Some of the other organizations have joined ISEAL and can therefore be expected to be moving in the right direction.

Jorrit deserves huge praise for this detailed and thoughtfully executed study. His professors at RSM Erasmus University also deserve commendation. As Jorrit notes, there is room for further work in this area. Meanwhile, this is a major contribution to the field.

New Report: Workplace Conditions in China, India, Turkey

A new collection of three corporate citizenship case studies has just been published by the Center for International Private Enterprise (CIPE). The report is called: "From Words to Action: A Business Case for Implementing Workplace Standards". The case studies review workplace conditions in factories in three countries - China, India and Turkey. The report was prepared with the assistance of Social Accountability International (SAI).

Evidence from all three factories supports the idea that better working conditions support a healthier, better trained, and more loyal staff. A better workplace supports better quality products and a sustainable company.

The companies profiled include a mid-size garment factory in China, a large textile company in Turkey, and a world-renowned steel manufacturer in India. All three used the SA8000 system for managing and being certified to ethical workplace conditions.

"Business attains corporate sustainability when all three bottom lines - financial, environmental, and social - are addressed in an integrated fashion," said Eileen Kohl Kaufman, Executive Director of SAI.

Disclosure: I worked on one of the case studies, that of Topkapi Iplik, the Turkish textile company.

Green Spaces, NYC

Green jobs are on President Obama's agenda. He is committed to creating five million new green jobs via subsidizing energy alternatives and conservation. An estimated $100 billion of the stimulus bill will be spent on green projects. The same commitment is occurring at the New York State and City levels. On January 26 New York’s Governor David Paterson told wa conference on green jobs that he intended to convert 45 percent of the state's energy use to alternative sources by 2015.

Do New York City's green entrepreneurs have "shovel-ready" business plans? The Sallan Foundation, which focuses on environmental issues in New York City, has asked me to look at the green movement through the prism of a new (less than a year old) eco-incubator in Brooklyn called Green Spaces.

I come to the assignment having worked on the 1999 study of the New York City software industry undertaken by the then City Comptroller, Alan Hevesi. From that study, I became enamored of Henry Etzkowitz's concept of the "Triple Helix" -- bringing together government, business and university resources to create new companies.

Later, I spent more than half a year working in the incubator of the NY Software Industry Association at 55 Broad Street. Green Spaces is located on less expensive real estate, yet easy to get to from Manhattan via the 2, 3, 4 or 5 train to Nevins Street, right across from the incubator building. See bottom of Google map below. I note approvingly the proximity of universities -- a campus of Long Island University is a block away and northwest of that is tech-mecca Brooklyn Polytechnic, just recently absorbed into NYU.
View Larger Map Green Spaces occupies the fifth floor of 33 Flatbush Avenue (name on the building is Metropolitan Exchange). The intercom directory shows all the tenants. I am buzzed in, take the elevator up and meet the founder of the space and resident manager, Jennie Nevin. I never got to ask her whether Nevins St. was named after one of her ancestors.

The light streams in to the fifth floor from the front and the back of the long industrial-standard floor. The 16 incubatee companies, composed of 1-3 people each, occupy physical as well as business niches. The center of the floor houses an open kitchen that has samples on hand from Kumquat Cupcakes and coffee courtesy of Crop to Cup.

I am most interested in the green companies that have a strong technical component and are scalable, i.e., can expand quickly if they get the model right. On this basis I pick half of the 16 tenants to interview:

- Sea to Table
- Crop to Cup
- Sustainable Edge
- My College Calendar
- Ecosystems
- Translate Media
- Catch Interactive
- Global Workers Justice Alliance

I would also have liked to interview SunOne Solutions, which helps make a carbon trading market, but the principals were in Washington.

My general observation about Green Spaces is that it's a nice place to work. Everyone here, it seems, has a laptop that they treat with the highest respect and affection. Just as someone walking a dog is easy to approach if you admire their pet, so also a quick way to break the ice here is to admire the incubatee's laptop.

Didn't see any large computers. If green entrepreneurs are cowboys and their laptops are their horses, they seem to prefer Shetlands to Clydesdales.

But this is no rodeo. It's more like a study room, with all the incubatees hard at work on their theses. Their collective thesis is that business can make the world a better place. These entrepreneurs are studiously engaged in envisioning more environmentally friendly systems and then making them happen. They are engaged in God's work.

Sea to Table

The first incubatee I interview is Sean Dinkeloo [seriously] Dimin of Sea to Table (www.sea2table.com). His business card has a slogan on both sides. One side says: "Direct from fishermen, delivered overnight." The other side says: "Connecting fishermen with chefs." These slogans leave out what is most important for a green company, the fact that Sean is deeply concerned about overfishing and handles orders only for wild fish, sustainably harvested and delivered direct. He seeks out fish certified to the standards of the Marine Stewardship Council.

Sean provides fish advice to large restaurants in New York City and elsewhere in the United States, and he has associates in four other cities providing the same service. He has a list of large restaurants and another list of fishermen (Sean insists that the word is not sexist; it is "gender neutral") and he puts the two groups in touch with each other.

Sean has two large posters over his desk. One is of "billed fish" like marlin (is that a nephew of mine up there?). The other poster shows various kinds of tuna. His main fish he sells are Tobago Wild, Alaska Wild and Dixie Wild (from the Gulf and Southeast Atlantic). These fishermen fish with hand lines.

He is able to bypass the markets by relying on email and phone and keeps track of everything on his laptop. Deliveries are made via FedEx with gel ice (FedEx won't take dry-ice packaging).This is a green business because of great benefits to the environment:(1) Only one trip, from fisherman to restaurant, meaning less of a carbon footprint (and less cost); (2) Shipping is consolidated with other shipping, eliminating fish trucks; (3) Assurance by Sea to Table that no endangered fish are being purchased, with MSC-certified fish; (4) No fish market is required; and (5) Much less waste and fresher fish.

Incubators are for babies that will grow bigger. What is the growth trajectory for Sea to Table? It needs to expand supply by working with more fisheries. It needs to expand demand by adding more large restaurants in more cities. The sustainable model takes longer to catch fish and so they are more expensive. I would bet on the idea that people are going to care increasingly about where their food comes from.

Crop to Cup

The second incubatee is Crop to Cup (www.croptocup.com), which is a small ethical trading shop that imports coffee and sells both unroasted "green" coffee to roasters around the country and roasted coffee on its website. It also sells the coffee wholesale to restaurants, grocery markets and the food service industry.

Ethical trading is quite simple means paying small farmers in a developing country more than market price for their products. The consumer gets quality coffee that competes on price with similar quality coffee, with the additional pleasure of knowing that the farmer is being well treated. I have tasted the Crop to Cup coffee at Green Spaces and at home and it's good.

There are quite a few such ethical trading efforts under way, and coffee is a product that is very likely to be ethically traded, especially coffee sold in coffee shops. Once it is known that a coffee shop, say Starbucks, is selling only ethically traded coffee, who would want to be seen drinking coffee in a coffee shop that denied farmers the extra money for their labor under the hot African sun?
Crop to Cup's unique selling proposition is that its coffee that is branded with the photo of the farmer from whom the coffee is purchased. I'm looking at a baseball-card type handout showing us Topista and Joseph Namisi, two Uganda farmers who have a farm in Gabagi Village, Bugisu, Uganda. The card tells us that they have 2,000 coffee trees and six children. Topista also teaches in the local elementary school. The link to the local farmer is a very nice touch that is likely to be imitated in future if it isn't already.

Crop to Cup says that it pays the farmers 20 percent more than market price. In addition, it gives 5 percent of revenues and 10 percent of profits to community development organizations in the areas where the farms are located. Through Crop to Cup's nonrpofit arm, DevelopNet Iganga, which supports Uganda development, the 5 percent of revenue that are reinvested in farmers are treated as donations on behalf of customers. So a wholesale customer sending $5,000 with Crop to Cup in one year can take a year-end deduction from taxable income of $250.

In addition it gives 5 percent of revenues and 10 percent of profits to community development organizations in the area where the farm is located. In addition, Crop to Cup accepts tax-deductible donations to a nonprofit organization (Iganga) that supports Uganda development.

C2C's credibility depends on the individuals who run it. The two young men in the incubator have the eco-credentials as well as the appearance of a well-organized operation. Taylor Mork used to work with Cal Safety Compliance Corporation (CSCC), a worldwide certification body, and therefore understands the importance of traceability and quality and the need for management systems to ensure these elements in the supply chain. C2C is not certified to any standard yet, but neither are most small startups.

Taylor's partner at the incubator is Jose Fernando Aguilar, who grew up in a coffee-growing area. Both of them have cards giving "Farmer Representative" as their titles. They firm has two other partners in Chicago - Jake Elster and Neil Balkcom.

This project is eminently green. Worker conditions are part of the green movement. Taylor's background in the certification business should be very valuable as the organization scales up. However, maintaining contact with the farmers is labor intensive.

A shortcut to expansion would be for Crop to Cup to be acquired by a larger business that wants to sell ethically traded coffee. I like the link to the farmer but predict that as the company gets bigger some shortcuts will need to be made. For example, the supply chain and information on farmers could be connected to a number or name on each bag of coffee. The consumer could then find out about the farmer on the Crop to Cup website or on a poster at each retail outlet.

My other six interviews will be posted on Huffington Post under the Green Edge brand. Green Spaces is a good idea and is well executed.Meanwhile, I have been asked by the Green Spaces Founding Den Mother Jennie Nevin - see photo - to help publicize their green business competition, for which the deadline is March 22. They are giving away three baskets of startup help for the right companies worth $25,000, including up to one year of free desk space at Green Spaces. For more information about Green Spaces, go to . There's a launch for the competition on February 9. Be there - reserve a space first.

Bush 43’s Eco-Legacy – Three Good Things He Did

I've been in government during a dozen political transitions of one kind or another. as a Federal and a City employee and have posted a few comments about transitions, for example here.

Takeaway: Look for the good in the other side. The easy and emotionally satisfying part for the winning new guys is to focus on what the old guys did wrong. After all, that was part of the campaign that brought in the new guys. But you can be sure that the new guys are making big mistakes from the gitgo, and the old guys may (I hate to say it) take satisfaction in seeing the new guys getting it wrong. It's also easy for the old guys to see what the new people are doing wrong, but time will tell who does a better job overall.

The interesting part is: What should the new people appreciate about what the old guys did right (and vice versa)?

In this spirit, now that the election is over and we should - at least for a few days! - put behind us partisan animosity, I was interested to see that the environmental blog Grist decided to look for something good in the environmental legacy of George W. Bush, who is decsribed by edie.com as the "Toxic Texan". Grist asked Jim DiPeso, Vice President for Policy and Communications of Republicans for Environmental Protection, to write a sympathetic story about George 43's environmental legacy. It was posted on January 16, with the title Oceans 43 (get it? Bush 43). It reminded me of the New Yorker cartoon of the dragon addressing a roomful of knights, and beginning his speech (something like): "It is a heartening sign of the great progress we have made in knight-dragon relations that I am able to address you tonight."

Here is an abbreviated summary of three Bush 43 environmental successes as described by DiPeso:

1.Huge New Marine and Other Preserves. There are enormous new federally protected areas on sea and land.

[T]wo weeks before the administration's expiration, relying on a precedent established by Theodore Roosevelt and employed by successors from both parties, President Bush invoked the Antiquities Act to establish three marine monuments that protect some 125 million acres of habitat, history, and beauty in America's Pacific territorial waters. The Marianas Trench, Pacific Remote Islands, and Rose Atoll marine national monuments are a treasure of coral reefs, whales, sea turtles, dozens of bird species, hundreds of varieties of fish, the deepest spot one can go without burrowing into the planetary crush, and weird thermal formations that support the toughest life forms on Earth. Bush's action was the most sweeping use of the Antiquities Act since this somewhat obscure but highly effective conservation law was enacted in 1906. Combined with the Papahanaumokuakea Marine National Monument, which Bush designated in 2006, his marine preserves are equal in size to the combined extent of all national parks, national wildlife refuges, and the National Landscape Conservation System, plus 9 million acres in change. Bush 43 also added some land within the 48 contiguous states, nearly 2.5 million more acres added to the National Wilderness Preservation System.

2.Higher Fuel Standards. Vehicles must be engineered to limit further poisonous emissions.

[Bush 43 adopted] tougher fuel and engine standards to control harmful emissions from non-road diesel-fueled equipment. The sooty gunk that shoots out of exhaust pipes from bulldozers and other non-road vehicles is bad news for hearts and lungs in cities across America. The standards, adopted in 2004, are expected to prevent 12,000 premature deaths, 8,900 hospitalizations, and 1 million lost workdays.

3.Phaseout of HCFCs.

The president has taken steps to limit HCFCs. [Bush 43 succeeded] in securing approval of a proposal to bring forward by 10 years the Montreal Protocol's phase-out of hydrochlorofluorocarbons (HCFCs), a refrigerant with a heat-trapping potential hundreds of times more powerful than carbon dioxide. The accelerated phase-out could reduce greenhouse-gas emissions up to 16 billion metric tons of CO2 equivalent. That's more than two years' worth of U.S. CO2 emissions.

Although he wasn't asked to comment on Bush 43's biggest failure, DiPeso can't resist:

[After 9/11] Bush had an opportunity to give U.S. energy policy a hard corrective turn. It was a moment of clarity. At last, the dangers of oil dependence had broken through the fog of political inertia and narrow agendas. Had Bush seized that moment, he could have begun shifting the American energy economy away from oil, away from conventional fossil fuels, away from waste, and toward safer, cleaner, more efficient energy choices. For a Texas oilman to do that would have been a Nixon-going-to-China gambit; actually, it would have vastly overshadowed Nixon's diplomatic coup. But the moment passed. Nearly seven years were lost. Only when gasoline prices had reached painful levels [did Bush] put his name on overdue legislation strengthening motor vehicle fuel economy standards. Even so, the administration did not accept statutory limits on greenhouse-gas emissions. It continued pushing aggressive growth in domestic fossil fuel production offshore, in Alaska, and in the Intermountain West. It made repeated runs at weakening the Clean Air Act's pollution control requirements for old coal-fired power plants. A week before clocking out, the administration finalized a regulation easing controls on mountaintop removal coal mining, about as destructive a fossil fuel production method that can be found anywhere.

One week after the post there were six comments, mostly about whether or not CO2 emissions cause serious pollution or add to the greenhouse effect.

U.S. Presidents - Progress on One Front

One year ago, the United States seemed likely to get our first woman president or our first non-lily-white president. It wasn't clear which. In fact the U.S. women's rights movement has before moved in parallel with the anti-slavery and civil rights movements, especially in presidencies #11, 18, 28, 35 and 36:

#11, James K. Polk. The 1848 women’s rights convention at Seneca Falls was convened by abolitionist women who came to champion their own rights. But it took Frederick Douglass, who had himself just escaped from slavery ten years earlier, to convince the cautious women to embrace suffrage as a goal. Susan B. Anthony, who joined Elizabeth Cady Stanton not long after the convention as co-leader of the suffrage movement, was also an abolitionist.

#18, Ulysses S. Grant. In 1870, the 15th Amendment was ratified, prohibiting states from denying the vote to a “citizen” (i.e., a man at that time) on the basis of “race, color or previous condition of servitude.” Some women leaders were outraged that the proposed amendment did not enfranchise women. During the second term of the 18th president, Frederick Douglass became the first African-American nominated as a U.S. Vice Presidential candidate, running on the Equal Rights Party ticket with Victoria Woodhull, the first woman to run for U.S. President. But after that burst of effort, progress for the next 40 years was slow.

#28, Woodrow Wilson. During the 1910s, a new wave of woman suffragists became active, led by Quaker Alice Paul, Catholic Lucy Burns and freethinking New Yorker Inez Milholland, whose Presbyterian father (one of the last of the Lincoln Republicans) was the first Treasurer of the NAACP. When Wilson arrived at Union Station for his first inauguration, the only people to meet him were a few escorts sent by President Taft. Everyone else was at the huge woman suffrage parade, led bravely by Inez Milholland in the face of violent opposition by opponents of suffrage. Milholland intervened on behalf of a Howard University group that was being denied a place in the parade. Milholland died three years later during a strenuous suffragist campaign against Wilson in the West. Her death inspired a final push by women to get the vote that turned public opinion and then Wilson around. The last state ratified the 19th Amendment in 1920.

#35 and #36, John F. Kennedy and Lyndon Johnson. The civil rights movement blossomed in the 1960s, putting a spotlight on Jim Crow laws. The federal government put itself behind enforcement not just of voting rights but broader civil rights. The women's liberation movement grew in tandem, led by writers like Betty Friedan and Gloria Steinem, peaking perhaps in 1970 with the anniversary-year march of 10,000 people down Fifth Avenue.

#44, Barack Obama. What can we expect now? Maybe, human rights for everyone. A year ago, in a post for Huffington Post, I wrote:

Vote for Hillary Clinton, but not on the basis that someone of color has no right to occupy the White House. Vote for Barack Obama, but not on the basis that no woman has a right to become president.

My rights are not secure until they are secure for everyone else.

Wal-Mart's CSR Steps

Wal-Mart is the world's largest retailer.

Its business model is clear and simple. It aims to be the lowest-cost retailer wherever it operates.

This has made it the target of a coalition of groups, including unions. I would summarize their concerns under three headings:
1. Wal-Mart's impact on smaller competitors in the communities where it operates.
2. The company's labor practices, especially its opposition to union organizing (except in China, where Wal-Mart employees become members of the official Chinese federation of unions).
3. Its tough negotiating with suppliers, who are offered large orders on condition they cut their prices significantly, and its lack of interest so far (compared with virtually all of its European competitors) in the conditions of work at the factories and farms from which it buys its products.

On the labor front, a Wal-Mart executive told me that with more than one million employees, a $1 increase per hour would destroy its profitability in some years. So as a low-cost seller, it has to watch its labor costs. That should surely not require interference with freedom of association, but this leads us into alternative interpretations of specific events that is not the focus of this post.

My purpose now is to give credit to Wal-Mart for the CSR programs it has introduced, primarily in the disaster relief and environmental areas. Wal-Mart has found that green packaging and green distribution initiatives have actually saved it money. This is a win-win-win for the environment, Wal-Mart's bottom line and the communities it serves.

Here is an announcement of three short videos in which Wal-Mart makes it pitch.

In late October 2008, Lee Scott, President and CEO of Wal-Mart Stores, Inc., reaffirmed Wal-Mart’s strong commitment to social responsibility. As a part of our commitment, we fund the International Development Program (IDP) to help factory workers and their families across the globe move up the economic ladder and enjoy better lives. The IDP has already impacted the lives of thousands of people from providing formal and vocational education to factory workers and their children in China and India to giving hope to HIV-infected orphans and adults in Africa. We believe the International Development Program is making a real difference in the communities where we source our merchandise.

Wal=Mart has created three video clips to communicate what it has done: (1) Wal-Mart and the U.N. Millennium Development Goals (3.6 mins.), relating to the U.N. Millennium Development Goals; this video features Amir Dossal, Executive Director of the UN Office for Partnerships. (2) Hope Worldwide in India (1.5 mins.), featuring Marie David, Wal-Mart’s Director of Social Responsibility. (3) International Disaster Relief (1.3 mins.), featuring Suze Francois, Wal-Mart’s Manager of Social Responsibility. The videos are downloadable at http://walmartstores.com/Video/?c=503.

Don't Give Lottery Tix to Kids

I hadn't thought about it much before, but it makes a huge amount of sense: Don't give lottery tickets to children. The National Council on Problem Gambling in Washington has joined with the Canadian International Center for Youth Gambling Problems and High-Risk Behaviors -- and individual lotteries in both countries -- to warn parents during the holidays about the risks of giving lottery tickets as gifts to minors.

The collaborative campaign -- so far not including the New York Lottery (shame on us) -- also received unanimous support from the Responsible Gaming Sub-committee of the North American Association of State and Provincial Lotteries.

The campaign says:

Research shows that the majority of adolescents gamble at least occasionally, and that lottery products may be a gateway to problem gambling. Gambling also is linked to other risk-taking behaviors. Studies indicate gamblers and problem gamblers are prone to engage in other addictive behaviors such as smoking, drinking and drug use.
“We know that playing the lottery at a young age can increase the potential for problem gambling later in life,” said Dr. Jeffrey Derevensky, co-director of the centre and a renowned expert on problem gambling among young people.

For more information, go to www.ncpgambling.com www.youthgambling.com oir contact Keith S. Whyte of the National Council on Problem Gambling at keithw@ncpgambling.org.