Working Toward Zero Waste with Procter & Gamble’s Len Sauers

May 12, 2014

JOHN SHEGERIAN: Welcome back to Green is Good and today we’re so honored for the first time ever to have Procter and Gamble on. We’ve got Len Sauers. He’s the Vice President for Global Sustainability at the iconic and legendary brand, Procter and Gamble. Welcome to Green is Good, Len Sauers. LEN SAUERS: Thank you, John. I appreciate it. JOHN SHEGERIAN: Well we appreciate you and we appreciate Procter and Gamble and before we go into all the great work you’re doing at Procter and Gamble, Len, can you share please first with our listeners around the world the Len Sauers story? Talk about how you even got here. What led up to this position at Procter and Gamble? LEN SAUERS: Thank you, John. I appreciate the opportunity to talk about P&Gs sustainability program. I’m actually quite honored to be the head of sustainability of a company like P&G that sees sustainability as a responsibility and as an opportunity. I’ve been with P&G nearly 30 years now. I have a PhD in toxicology and started with the company back in the late 80s in our product safety organization doing risk assessments for our new ingredients and new products to make sure they weren’t going to cause adverse effects to people or the environment. I developed a great love for that kind of work and over the years, have had the opportunity to advance the science of sustainability through jobs that I’ve had and then the opportunity to work externally developing partnerships with NGOs and governments to advance sustainability so when the job of Vice President of Sustainability opened up, I was a natural fit for it because of the background that I had. JOHN SHEGERIAN: Gotcha, and that’s wonderful and for our listeners out there that want to follow along visually and also see some of the great work that Len is doing at Procter and Gamble, you could go to www.pg.com/sustainability. I’m on the site right now and first of all, it’s gorgeous. It’s so well done and laid out and colorful and inviting. I got to tell you it’s a beautiful website and I want to talk to you about the things I’m seeing on it but before we get there, we just passed this week the wonderful yearly event of Earth Day. What did P&G do to celebrate Earth Day this year? LEN SAUERS: Earth Day, it’s a great day for Procter and Gamble. We try to have Earth Day Celebrations across all of our sites around the world, trying to engage our well over 100,000 employees in this event. We see it largely as a celebration in some ways, the celebration of all the great work that’s being done by P&G employees around the world, the great work being done by our R&D employees as they develop products that enable consumers to lower their environmental footprint, the great work by our people in operations as they drive eco-efficiency in our plants and reduce the footprints of our plants and then the great work that our employees do every day as they lower their footprints within the office space and we take this celebration a step further because it is a unique time where we can educate our employees at the same time, since we have contact with them and we can educate them to understand that the decisions they make every day that they do their jobs that they drive sustainability into the company and can really create a better tomorrow for all of us. JOHN SHEGERIAN: I love that, a better tomorrow for all of us. That sounds great. On a macro corporate level at P&G, what are the goals for P&G sustainability on a corporate level? LEN SAUERS: We try to integrate sustainability into the rhythm of the company’s business because we see it both as a corporate responsibility. We want to grow responsibly. We see that as the right thing to do but we also see it as an opportunity to build the company’s business by driving down costs through eco-efficiency and creating new products that can drive top line share so for us, we’ve set a long term vision for the company in environmental sustainability. We want to ultimately be the company that uses 100% renewable materials or recyclate in all of our products and packaging and have those materials go to plants that are run on 100% renewable energy, have those plants create products that enable consumers to lower their footprint, and then on the backend, have zero consumer and manufacturing waste going to landfills. JOHN SHEGERIAN: I love it. That is so awesome. Talk about the journey. Len, you and I know that sustainability is a journey. What does the journey look like leading up to your 2020 goals? How are you going to achieve all the things you just laid out? LEN SAUERS: Well, if you think about this vision that I laid out for you there, it really comes around three key areas; the idea of conserving resources, the idea of driving renewable resources, and then the idea of finding value in waste so we’ve set a series of 2020 goals that are kind of focused in those areas. One goal, for example, is to replace 20% of all petroleum-based raw materials with renewables so we have basic research programs going on throughout the company with those new renewable technologies. We set a goal of 30% renewable energy by 2020 so we have our individuals working in our product supply organization, finding opportunities to develop solar power, wind power, geothermal power at our manufacturing facilities around the world. We’ve set a goal of 20% reduction in packaging and we have very senior packaging engineers evaluating all of P&Gs packaging today, looking for opportunities to make eco efficiency changes in them and make less packaging, more environmentally friendly packaging. We have 12 of these 2020 goals with programs around each one of them, taking the expertise of senior P&G people and dedicating them towards working towards improvements there. JOHN SHEGERIAN: Wow, and I’m on your site here, and again, for our listeners that want to follow along, it’s www.pg.com/sustainability. On the site, I’m reading the words zero waste and our listeners hear that all the time. What does zero waste mean at Procter and Gamble? LEN SAUERS: This is a program that we have within our manufacturing right now of driving to zero waste out of those sites. Any manufacturing site will generate waste. I mean, it’s just an inevitability and it’s something that happens across our 140 operations around the world. As we started looking at this a couple of years ago, we found that about 1% of the raw materials that were entering a P&G plant were leaving as waste and it was usually product that was off specifications that we couldn’t sell, scraps, maybe ingredients we didn’t use anymore, and this stuff was all going to landfill. Now I use the term 1%. You may not think that’s a lot but for a company the size of Procter and Gamble, it’s a really a lot of materials and it was a true waste and that’s why it’s called waste. It was a loss of value to the company, to our shareholders and it was also a negative on the environment so we set up a program within the company to find value in this waste that we were sending to landfills. We put together a group of a couple of dozen individuals, bright creative individuals that went to each of our manufacturing sites and worked with the people at those sites to understand the waste that was going to the landfill and see if they could find a stream of value for that waste so it could be diverted and repurposed and there’s just been wonderful opportunities created out of that so for example, as you know, P&G makes disposable diapers and we had scraps from the processing there that was going to the landfill. Those scraps now, instead of going to landfill, are being used to make trash cans, parking lot dividers, and hangers. We have a tissue/towel business, which has some paper scraps associated with it. Instead of going to landfill, they’re now being turned into newspapers and legal pads. We had waste from our beauty care plants that is now being reformulated into leather care products and I can give you hundreds of examples of waste at P&G that had been going to landfills that is now being repurposed and diverted into something of value. We’re very proud of the fact that right now, 60 of our plants are zero waste to landfill and although there’s environmental benefit to all of that, I will add one point about the business value of this. This program, over the past five years, has brought $1 billion of value to Procter and Gamble because not only are we selling the waste that used to go to landfills, but we’re not paying the landfill costs so $1 billion in value just by handling our waste better. JOHN SHEGERIAN: So really, Len, let’s go back then to the top of the show and recap this. The truth of the matter is that you’re making sustainability part of the DNA and culture of Procter and Gamble, therein everybody there feels good that they’re making a better tomorrow for themselves, their family, their communities, and the world but also there’s a massive economic benefit that your leadership team can turn around and then share with the analysts, the street, and its investors around the world. LEN SAUERS: You are 100% correct and when you look at it that way, that’s when you’re most successful. We look at sustainability as an opportunity to do good things for the consumer, good things for our business, and good things for the environment and when you’re able to do all three of those things, that is really the sweet spot that ensures success. JOHN SHEGERIAN: It’s so fascinating and for our listeners out there that just joined us, we’re so honored to have for the first time ever, Len Sauers, Vice President of Sustainability of the iconic and legendary brand, Procter and Gamble, very important brand. When they do things, people listen around the world and they’re making the world a better place and so let’s talk about this. Five and a half years ago, when I started Green is Good, people would come on the show and they would have to make the argument that going green is not only the right thing to do but it’s not more expensive. The whole discussion has moved now, as you’ve laid out. It’s not even not more expensive. It’s actually a profitable endeavor. As you say, it’s the sweet spot of sustainability. LEN SAUERS: Exactly and for a company like Procter and Gamble, 4.8 billion people use our products every day so think of the opportunity in something like that, where if you can develop products that enable those consumers to drive down their environmental footprint, you’re making great strides and a great contribution to sustainability but if in the process of enabling those consumers to drive down their footprint, you can enable them to reduce their water use, reduce their energy use, reduce their greenhouse gas emissions, reduce solid waste, you are also providing a value for those consumers so if I think of a product like Tide Coldwater, for example, which we came out with several years ago, that enables consumers to use cold water for laundry instead of hot and still get excellent cleaning performance, you’re causing that consumer now not to have to heat that water in their home. That provides a great value and cost saving to them as individuals so here’s an example of where, for 4.8 billion people, we can reduce their greenhouse gas emissions by having them use cold water. We increase sales by creating a product that they want and then the consumer saves on this by having a reduction in their utility bill. JOHN SHEGERIAN: It’s such a win-win-win on every level and that’s so cool about what you do and what Procter and Gamble does is you do lay it out numerically. Four-point-eight billion people a day use your great products and so when you make a decision and when you educate or engage your consumers, you really get to move the needle in all the environmental sectors around the world in making the world a better place but talk about consumer engagement, Len. How do you, in this world of short term memory and social media, and we’ve evolved from Facebook and Twitter now to Snapchat, how do you engage your consumers with regards to your great products? How do you constantly stay in front of them and keep them educated to the importance of what you’re laying out for us today? LEN SAUERS: Very good question and actually, it is a difficult one to answer at times. P&G has an expertise in consumer understanding and we went through a series of studies to understand consumer attitudes around sustainability and what we found is that there’s a small niche of consumers, say about 15 to 20%, and these are people that are really, really into the environmental movement and to the sustainability movement, such that they are willing to accept some sort of tradeoff, either a higher cost or a decrease in performance, in purchasing products that claim to be green. We find that there is a huge middle stream , main stream consumer, about 70%, they’re really aware. They really want to do the right thing but they are not willing to accept a tradeoff. They will not accept an increase in price or a decrease in performance to use a product that claims to be sustainable and then there’s another group off to the side, again, about another 15% that are just value conscious consumers and really aren’t engaged in this debate so we decided as a company that we were going to focus on that mainstream consumer, that 70%. We thought that’s where we could make the biggest impact but in order to do that and meet the needs of that consumer, you have to enable them to be sustainable but not ask them to accept a tradeoff in cost or performance so when I talked about Tide Coldwater a few moments ago, we actually had to go through extensive R&D efforts to boost the performance of our laundry detergents in cold water because the heat of water does provide some cleaning benefit so we had to give the consumer a product that met their needs on performance and also, it didn’t cost more so it met their needs on value so when we engage these consumers like this, we’re giving them what they say they want when it comes to sustainability and fortunately, with 9,000 R&D people, we have the ability to develop these products that meet all their needs. JOHN SHEGERIAN: I love it. That makes so much sense. How you just broke it down makes so much sense. Talking about your great consumers that love your products, I being one of them, my family being one of them, we love talking about solutions on this show, on Green is Good. What are a few things people can do to lessen their environmental footprint when it comes to engaging in consumer goods, Procter and Gamble’s consumer goods? LEN SAUERS: When I think of environmental footprint, as you just said it, as sustainability person, I think of energy, greenhouse gas emissions, solid waste, and water. Those are those major environmental metrics that kind of drive everyone’s footprint and as we look at our products and how we can develop those, we focus on opportunities to reduce in those areas so you think of Tide Coldwater, really one of our first executions in this area. It helps you save energy. When you save energy, reduce greenhouse gas emissions so the one thing I would tell all of your viewers right now: start washing your clothes in cold water using P&G’s products, Tide Coldwater, Tide Pods. That is the one single thing I think anyone can do that’s simple and really adds a meaningful benefit. We’ve also put out products that reduce water use, for example, our Cascade Platinum, very high performing product for the dishwasher, allows you to skip the pre-rinse, allows you to operate the dishwasher on the eco-cycle, tremendous reduction in water when you do those kinds of habits, thousands of gallons a year that a consumer can save. Our Pantene dry shampoo just came out not too long ago, keeps hair fresh, healthy without having to wash it, saves water there, and I would just add, finally, any product that’s been compacted in some way. Compacted products really provide great sustainable benefits across their entire life cycle. We came out with Mr. Clean liquid muscle, which is a 2.5X concentrated product. That product, in and of itself, because it’s concentrated, has great sustainability benefits, so seek out those compacted products. JOHN SHEGERIAN: Got it and Len, we’re down to the last two minutes or so. I read about P&G’s Children’s Safe Drinking Water Program. Can you explain some of the latest milestones you guys have just achieved and talk about water and safe drinking water? Because that’s also become one of the major topics around environmental studies in the world now besides climate change. Having drinkable water is critical. Please talk about P&G’s recent victories with regard to Children’s Safe Drinking Water Program. LEN SAUERS: Children’s Safe Drinking Water Program, I think, is one of the ones that we are most proud of. There are many, many people around the world that don’t have access to clean drinking water, children, individuals that live in the developing regions. When there’s disaster like floods and natural disasters, clean water becomes scarce and if you think about it, in many ways, drinking water should be seen as a right for all so we have developed the technology that this program is based on that enables you, through a very simple packet, which we call the P&G Purifier of Water, it can be put into the most nonpotable of water and make it drinkable in 30 minutes and we have been working with partners around the world to get these packets, these P&G Purifier of Water in the hands of people that need it around the world, that don’t have access to clean drinking water and we just hit a milestone with this program, which we started in 2004, has just delivered its seven billionth liter of safe drinking water. Seven billion liters now we have delivered around the world. JOHN SHEGERIAN: Congratulations. LEN SAUERS: And as part of the P&G’s Clinton Global Initiative Commitment, which we made a couple of years ago, we have committed to save one life an hour with this program, providing this safe drinking water to children in need around the world . JOHN SHEGERIAN: That is just wonderful and Len, I just want to say thank you so much for coming on today and I want you to come back. You’re doing so many great things at Procter and Gamble and our listeners need to hear more about these great things because this is really just another great example of an iconic and amazing brand like Procter and Gamble. When you guys make decisions, the world truly changes. Len Sauers, thank you and Procter and Gamble for making every day better for people and the planet. You are truly living proof that green is good.