Money doesn’t grow on trees. At least that’s what my father said a quarter of a century ago. My father was, and remains right. I can’t go out and pick a Franklin, Hamilton or Grant off of my 80 year old Maple tree. However, in a world that is increasingly constrained by carbon and looking at everything from reforestation to offset CO2 to the use of waste wood products for biofuel production from conversion of cellulosic material, the notion of money not growing on trees is taking on a new meaning. The human relationship with the natural world is disingenuous, distant and devoid of long-term social consequence. We’re the ants, marching one by one, building our financial nests but often forgetting how the interplay between money and markets hinges upon the long-term health and vitality of ecosystems.
In this new century a child is born into a world of media frenzy world where the speed of information and money transaction is measured in milliseconds. We’re seeing real-time multi-billion real estate, finance and private equity transactions occur daily before our eyes as the movement of money is at an all time high and its impact on social and environmental needs is also at its greatest.
The latest installment of this dizzying money culture is the “GE Green Card”, a credit card based way for consumers to “keep the change” for the environment. Titled the “Earth Rewards MasterCard” the GE financial tool may sound a bit gimmicky, however its intentions are routed in this new economy we term ‘social response capitalism’ where the tools, processes, services and products of our past are now being innovated from scratch or redeployed to provide social and environmental value like no other time in history. In addition, GE is educating consumers about the environmental impact of their daily lives, whether from use of their car, their home, or their day to day consumer purchases.
Using the GE Earth Rewards MasterCard consumers will be able “to dedicate one percent of their purchases to fund projects that offset carbon dioxide emissions”. GE will use its finance empire to pool the monies and once a year they will invest them in projects that reduce carbon dioxide.
The GE concept is not that bad of an environmental finance tool. There are other organizations like 1% For the Planet whose business members dedicate 1% of their annual revenues to environmental organizations. 1% For the Planet has 682 members who have contributed more than $21 million.
We have traditionally placed monetary value on the utility that earths natural resources provides us, but not on their depletion, waste or value to produce – including the cost of CO2. What is the value of the earth producing a gallon of petroleum over geologic time? What is the value of a pristine forest land on the top of a West Virginia mountaintop versus the value of coal removed from mining and earth blasting? With GE and other financial institutions testing the consumer demand to use financial tools to help mitigate carbon emissions, we will likely learn to valuate CO2 much quicker – particularly in this era of immediate transaction.
In his recent blog on the GE Earth Rewards card, renowned speaker, writer and corporate environmental strategist Joel Makower smartly asked, “Can all of this actually transform our consumptive behavior? Is GE joining the teeming masses of marketers seeking to encourage consumers shop their way to environmental redemption?”
Joel Makower also noted…“It's too early to tell, of course, but Earth Rewards has the potential to catch on with the large middle market increasingly concerned about climate change but willing to make only small, incremental
changes, if that. (GE envisions a potential market of 25 million Americans.) Earth Rewards doesn't require consumers to change habits: It's a conventional credit card with a green sheen. Some would say that's a bad thing -- consumers need to make radical changes in their daily habits -- but it's also a realistic approach”.Joel Makower’s thoughts are in step with World Inc. While some companies like Toyota and HP take more radical steps to innovate new products for social response, other firms like GE find a niche in redefining existing services, like their credit and financial service, to provide social and environmental value to those consumers that are willing to take smaller actions. While it may be necessary to take even more proactive approaches to climate change, we must understand that not every consumer has the financial or political power to make sweeping change. Thus, some consumers prefer tools, like the GE Earth Rewards card, as a way to contribute to a better world.
The success in the GE Earth Rewards card is already here in our view. Sure we can debate how much money actually goes to carbon sequestration or renewable energy projects, but the fact that GE is pushing the envelop across all of their product segments, be them big engines – power production – appliances – or financial tools. GE embodies its notion of ecomagination and is redefining its future through careful, targeted and strategic launch of social response products and services, World Inc. style.
Mark C. Coleman
Senior Associate & World Inc. Case Leader, AHC Group, Inc.
Mark@ahcgroup.com
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