JOHN SHEGERIAN: Welcome back to Green is Good, and we’re so honored to have with us today Carol Sanford. She’s the CEO of the Essence Alignment Company. Welcome to Green is Good, Carol. CAROL SANFORD: Well, thank you so much for inviting me. JOHN SHEGERIAN: Hey, Carol, before we get talking about all the great work you’re doing at Essence Alignment Company and your website, CarolSanford.com, I want you to share please the Carol Sanford story. What does your journey and story look like leading up to the founding of your company and the great work you do today? CAROL SANFORD: There are probably three key points. The first one was I was raised in the panhandle of Texas in a very, very racist community and family and even as a child, it didn’t make sense to me. I got in lots of trouble as a result, but I think part of me decided I was gonna change that part of the world as I grew up and then there was a set of challenges to go through, but I finally met in my early 30s the team that had founded the Procter & Gamble systems that are still some of the most copied systems and most studied systems in the world and I spent years learning how it was that they changed the idea of people are to be used like the machines to understanding the science of human motivation and human transformation. That allowed me to eventually create my own company and I think probably the first time it all really, really came together was about 20 years ago when I got to work in South Africa the two years before the elections for the new Republic of South Africa, and a couple years afterwards, I was able to be a part of teams that received awards from Mandela for changing not only the social systems, but the ecological systems using a corporation, which was Colgate-Palmolive, and watch the lives of people who lived in townships, watch them be able to take on and lead change, and it lifted me in a way that I could see things I’d never seen and I’ve been applying it everywhere I can touch. JOHN SHEGERIAN: And you’ve written two great books that are award winning, The Responsible Entrepreneur and The Responsible Business, and for our listeners out there, you can buy them either on her website, CarolSanford.com, or at Amazon.com, BarnesandNoble.com, or other fine bookstores around the world. Carol, talk a little bit about green and your business and the changes you’re seeing in green and what are you doing with regards to green and green business today? CAROL SANFORD: So, this might sound really weird, but I don’t talk about green. What I talk about is how to think and one of the big changes that I see going on right now is that it’s coming back — now, that’s gonna sound strange — back into people’s thinking and 40 years ago when I started this work, people naturally thought about that they’re a part of a natural system that humans aren’t separated from, they aren’t even responsible for, they are the system, and I’m seeing that come back around and one of the ways it’s really showing up is that the entrepreneurs who are inside of large corporations who are able to engage and share, like Google, like DuPont, like Intel, those folks are beginning to have people who are not only authorized, but encouraged as a part of a business to really take on what it means for their business, the whole way, not a separate program, to really make things work and so for me, it’s always been about how do you be whole as a person. That’s the reason I use the word responsibility. It’s like my grandmother said to me when I was a kid, “Don’t you ever think about anybody else?” and you don’t when you’re a kid. That’s what I teach business. JOHN SHEGERIAN: Gotcha, so responsibility is one of the keywords that you keep driving home. Talk a little bit about what’s going on with companies now and board of directors. What motivates them to change, if anything, nowadays? CAROL SANFORD: Well, I’m seeing some really great things happening there. I want people to feel hopeful about this. Chad Holliday, when he was President, CEO, and Chairman of the DuPont Corporation, I knew him and worked with him from the time he was a maintenance manager in their Nashville, Tennessee, operation. He had an idea, which luckily, I got to be an exciting part of, which is putting together task forces for every major business unit within the company. They were people from outside the company. We had priests from Mexico. We had mothers who were coming out of South America and they were given free reign into every part of the business to then write a report which they submitted to the board of directors. Now, these reports were not necessarily everybody having to agree but they were intelligent people who were asked to look at the effect of DuPont’s decisions and DuPont’s actions on communities and on the planet. Now, because these were not advocacy documents, they were education documents, and there was no recrimination — we worked to make sure they were written in a way they were just sharing information personally — the board began to move and it allowed Chad to be able to be one of the three creators of the UN Global Compact so that businesses were doing this on a global scale, reporting what they do without condemnation. It was amazing to me to see how much authority the board of directors at DuPont because of this education process that wasn’t an advocacy process. JOHN SHEGERIAN: You know, our friend, Jeffrey Hollander, who’s been on the show now many times, and he’s the co-founder of Seventh Generation, he talked about his work with you. He said it made him a better value-based leader. Can you explain what that means to our listeners and what you try to do with regards to your great work? CAROL SANFORD: Yeah. I love Jeffrey. He’s one of my favorite all-time people, not just client. So, what that really means to make someone a better values leader, is actually to connect them with Essence. Essence is an idea that seems a little strange but when Jeffrey was born, he was born unique and distinctive as each of us are but we lose track of that over life. We become socialized. We start to try and do what others think we should do so I took him back to who he is at his core, what make him really distinctive, and a couple of things were true for him, which was he had since he was a kid pointed out systemic dissonance so you say you’re gonna do one thing and you do something else. He could take that to the level of the company and so for him, it was really staying true to this part of him and so it’s even in some ways, the highest value. It’s to be true to our highest self. We then did that with every customer. We did it with the business. We did it with everybody who worked in the company. We looked at how you align these uniquenesses with a place to make a difference so every employee and also, we worked with contractors and suppliers, were able to look at what can we uniquely bring to the market, to that customer’s life, to earth, to the community we live in? That in itself is a fundamental change, which is different than most of the methods we use, which is make a list of values which are outside of us and try to live up to them so that’s part of what Jeffrey’s talking about. There was one other thing, which is I work with creating global imparities, which are statement of what is whole and complete and true when a system is working well so what is, I call it a life shed instead of a watershed because watershed is our water. Life lives there and how does a life shed work when it’s healthy? And, then you work toward that rather than trying to figure out what your mission is to improve something so those two things are things that Jeffrey has carried with him and made a major difference. JOHN SHEGERIAN: The key word in your two book titles, Responsible Entrepreneur and Responsible Business, is the word “responsible” and “responsibility.” How do you define responsibility, Carol? CAROL SANFORD: For me, it is understanding you are a part of a system and that there is a reciprocity, which has to be maintained. It’s the ability to see and intentionally decide to create beneficial effects for the system which you’re a part of so if certain living forms, like if the fish decided it was all about it and the water and it tried to figure out how to extract all it needed of its nutrients for itself, then we wouldn’t have healthy water streams. Same thing for the elk along the bank. What they have to understand is they are interdependent with the water, with all of the other critters that come there and live there, the biota that come to that soil and water. It’s the understanding of that dynamic relationship and knowing that you are a part of it and can make a difference beneficially. JOHN SHEGERIAN: And, what examples can you give of businesses that are responsibly by your own definition? CAROL SANFORD: Well, everyone is on their way to there so that’s a lot of what I wrote the book about but what of the greatest stories that I love was someone in Colgate in South Africa who said, “I want to help build a country while we rebuild a great company,” so we went in and the apartheid era was, of course, it’s certainly not still at an end but it was starting to become blatantly obvious that that was not a whole way to relate to people and so Stamios committed to growing the company and to do it in a way that the townships became healthier, everybody who worked in the company became healthier, and supported every employee and the major thing that he did initially was the constitution in South Africa required that the top management, of which there were like 3,000 employees in the South African operation, at the top of that were all white managers and the constitution required that the top ranks within five years begin to reflect the racial mix, which of course, was 95 to 97% black. We within six months reversed that and Stamios said because the black Africans had not been able to go to school had nothing to do with how intelligent they were so the responsibility there was seeing that the company could not thrive without the communities thriving and the nation thriving. As a result, they got awards but they also grew their revenue 30% a year, which during that era was unheard of. They had no strikes, which was unheard of in that era, and they brought a company from one that he was actually sent there to see if they should close it down for safety and financial reasons to one that reversed the oral health of the children in Sorrento and Alexandria with the support of employees who lived there but worked in Colgate. That, to me, is a phenomenal example of what it means to see yourself as part of a system and know that you only thrive when it does. JOHN SHEGERIAN: So, we can be responsible and we can be profitable if we’re running companies, you’re saying? CAROL SANFORD: Well, actually, you will be. It’s really weird. We’ve gotten this funny dichotomy as though profits were separate from doing good and you know in your own life if you personally decided that you were gonna profit the experience of everybody else you know and everyone you touch, you would not have a job very long. You wouldn’t have friends very long. We now have so much evidence of McKenzie, Arthur Anderson, MIT, all of these people studied and reported and said the question is answered. Profitability is responsibility. There are people who can extractively do it for some periods of time but you can’t do that forever and you will eventually be taken down so if you want a long term viable job, company, and place of respect and profitability, you will do it in a way you understand you’re part of a system. That’s what I teach people how to do, see that the customers lives are in the same system you’re in. The earth’s life and its ability to do well is in the same system you’re in and so you work in way that you’re not asking profitability or whether you get to have enough to keep going; you understand that as the whole gets healthier and works better, then you will do better, too. JOHN SHEGERIAN: For our listeners out there that just joined us, we have Carol Sanford. She’s the CEO of Essence Alignment Company. You can check out more about what Carol is doing and you can hire her at www.carolsanford.com. Also, you can buy her books, Responsible Entrepreneur and The Responsible Business on her website or on Amazon.com and BarnesandNoble.com or other fine bookstores around the world. Talk about responsibility and green. What is the most important thing we have to do to make responsible and green in our companies come together? CAROL SANFORD: I think it’s an education process because right now, you tend to have officers who are responsible for green and corporate responsibility and then you have leadership who is responsible for strategy marketing, etc. This fragmentation of organizational structure and particularly the way we take on doing business makes it really difficult to accelerate the idea of responsibility, so I suggest that corporate responsibility officers or corporate citizenship or whoever those are become educators to the organization but not responsible for the delivery of those things. If we don’t have the CEO, all the executives, all the senior leadership seeing it as their responsibility to be whole, seeing it as part of their bottom line, then what we’ve got is a separate report and you doing people then increasingly, the businesses, seeking to prove that they’re doing good by donating money, by having reports that show that they’re doing less harm, but they aren’t really improving like we did in South Africa. They aren’t really improving the community and the ecology of what’s going on and so getting this fragmentation out would help and one of the best ways to do that is to start and have everything unified around the customer’s life so everybody’s mind goes from inside and what my internal responsibility is to externally and we’re all aligned and reconciling every conflict or confusion or difference to what will it do to improve the customer’s life? That’s how Apple works. They say what’s going to happen to the kids in the dorm? What happens to the people who are working in a business? And everything was designed backwards for, they call it user interface, but what it really means is how do you make their lives better? JOHN SHEGERIAN: Talk a little bit about CSR as we know it today or corporate citizenship officers and sustainability officers. Are they making a difference now in corporate America or is that just window dressing for Wall Street? CAROL SANFORD: It depends on who you’re talking about. There are certainly some places where it is, if not window dressing, it certainly is ineffectual. There are some companies where the people who are in those roles are having entrepreneurial spirit and they’re actually out working with officers and business unit leaders with a profit and law, a P and L, responsibility. Where they’re doing that and helping them understand how they have the whole of their business work on it, they’re starting to make a difference, but I think that right now, as I said earlier, I think that the very idea- The reason I don’t talk about corporate responsibility or corporate citizenship is to me, that is a natural part of the leader of the organization and as long as we’re still having it separated out, people at the top feel like it’s their job. That’s the reason I think it’s more of a problem where the intentions are not good and I hear people talking a lot about making it part of strategy but still it’s counted as a separate strategic thrust so until it is embedded in how people think, they ask the question every time they’re making a decision; How does this advance global imparities, making something healthy? How does it advance society? How does it advance democracy? And, that’s a part of how they make every decision, not a separate defined arena of responsibility. JOHN SHEGERIAN: We’re down to the last three minutes or so, Carol. Let’s talk a little bit about the importance of education. Two big trends that I see right now in the United States is the proliferation and growth of the M.B.A. student and the feeling that if someone gets an M.B.A., then they’re set. I also see the growth of entrepreneurship, both entrepreneurship being taught in higher education and also people wanting to become entrepreneurs. Talk a little bit about that. Is the growth and the proliferation of all the M.B.A. students good for our economy, good for our business, and is the entrepreneurship and the growth of entrepreneurship in the United States something that’s learnable or is that just something that’s in someone’s DNA and people are born entrepreneurs? CAROL SANFORD: See, I think everyone is born with personal agency. Personal agency is what is at the heart of entrepreneurship. It means I feel moved all the time to speak my mind and you see it in children. Of course, we socialize it out of them. The whole idea of going back and getting an entrepreneurial degree or an M.B.A. or almost any degree is in some ways should be trying to wake that up. I don’t see that happening, but I do know that anyone who takes it on has to do the personal development work to reawaken their will and connect with something they care about, which is what we tend to associate with entrepreneurship, but entrepreneurs don’t all move toward this responsibility idea. It’s the reason I wrote the book, to show there’s different kinds of entrepreneurship and until you understand what the nature of those are, then you may be learning old fashioned traditional tools applied to entrepreneurship and most M.B.A. programs are based on really traditional how you get rich, so I don’t know. I’m not real excited about what I see going on in most. I do think there are a few that are moving to a more systems view and I have hope. JOHN SHEGERIAN: For the M.B.A.s, are you hopeful about all the M.B.A.s graduating? Is this good for business and good for where we’re going as a country or not so much? CAROL SANFORD: Not so much. I tell people that you will be better off usually if you study some other program and then study business, like you study anything from philosophy to psychology to English literature and read all the classics because what you’ll come in with is a more holistic mind and I know there’s a trend going against that saying go specialize. Don’t do liberal arts colleges, but when I look at people who have a morality, have an ethic, who think in a broader way, they usually have been studying history and literature and psychology and philosophy so I don’t know. I teach in M.B.A. programs and I’m usually kind of a lone voice, so not so much. JOHN SHEGERIAN: Gotcha. Well, Carol, thank you for coming on Green is Good today. For those of you who want to learn more about Carol or maybe even buy her books, go to CarolSanford.com. You can also hire her to work with your company or speak at your events. Thank you, Carol, for being an inspiring responsibility expert. You are truly living proof that green is good.