Getting gold out of green

In the 1990s, corporate America’s embrace of the green movement was led mostly by free-spirited, maverick companies such as Ben & Jerry’s, Starbucks and Whole Foods.

Now, mainstream giants in markets spanning consumer products, banking, airlines and chemicals have sweeping programs to shrink their companies’ impact on the environment — and cash in on consumers’ desire to go green.

Many see doing so as a virtual necessity as regulators consider limits on greenhouse gas emissions and consumers demand environmentally friendly products.

U.S. companies also realize they must follow Europe’s lead on environmental issues to compete in a global marketplace, says Jack Geibig, director of the Center for Clean Products at the University of Tennessee.

“I think we’re beyond the fad point,” he says. “People are buying hybrid vehicles, they’re concerned about global warming, they’re more engaged than ever.”

Hybrid cars from Toyota and Honda have grabbed headlines, as have Wal-Mart’s green initiatives, such as plans to double the fuel efficiency of its truck fleet during the next 10 years and push its 60,000 suppliers to produce eco-friendly goods. But in ways large and small, the notion of “going green” is also reshaping product development and marketing strategies.

Discovery is launching an eco-friendly channel. Method, which makes housecleaning products with biodegradable ingredients, saw sales nearly double last year to $60 million. NEC has developed a new plant-based bioplastic for mobile phones and laptops.

Venture capital investments in alternative energy, biofuels and clean technologies jumped from $491 million in 2005 to $884 million last year, according to Dow Jones VentureOne and Ernst & Young.

America’s largest companies, meanwhile, are seeking to both cut pollution and save money.

PHH Arval, which manages the vehicles of about one-third of Fortune 500 companies, says it’s in discussions with dozens of them about switching to more fuel-efficient models under PHH’s GreenFleet program.

“Two or three years ago, it was a little tough getting people’s attention on this,” says PHH Chief Executive George Kilroy. “Now everybody’s interested.”

DuPont typifies the evolution of many big corporations. The chemical giant’s initial brush with conservation came while slashing greenhouse gas emissions at its factories by 72 percent since 1990 through both energy efficiency and better pollution filters.

The initiative saved $3 billion in energy costs, but now DuPont wants to go further, viewing the environmental movement as a key lever to increase revenue.

“We felt the bigger societal contribution and bigger shareholder value was in finding new products to bring to the market,” says Linda Fisher, DuPont’s chief sustainability officer.

So the company is making solar-panel materials, more energy-efficient building insulation and air-conditioner coolants that emit fewer greenhouse gases.

By 2015, the $27 billion company plans to boost revenue from such products by $10 billion and double research spending to $450 million.