The Truth about Green Business

Gil Friend, founder, president and CEO of Natural Logic Inc., a consulting firm specializing in sustainability, recently wrote The Truth about Green Business, which reveals 52 strategies “to green your business and grow your profit.”Friend is a founding board member of the Sustainable Business Alliance, Sustainable Berkeley and the California Sustainable Business Council and serves on the executive board of and the advisory boards of CleanFish, WattBot and Green World Campaign. He has also served on San Francisco Mayor Gavin Newsom’s Clean Tech Advisory Council and has worked in the California Governor’s Office, developing early sustainability policies and programs.Friend talks to MHN Associate Editor Erika Schnitzer about an integrative building approach, the importance of multifamily businesses to not just build green but also to be green, and just how green is good enough.MHN: What are the first steps multifamily companies should do when considering greening their businesses?Friend: The first step is to drop the assumption that green will cost you more money.  Understand the business drivers that you face now and that you will face in the future, including energy prices and the rising demand of expectations of customers. Given those two, put the challenge to the design and management team to say, “how well can we do this?” Ask, “is this good enough in terms of the competitive market situation, and is it good enough in terms of what’s possible?” We would encourage clients to take the design team and bring all players to the table—architects, engineers, customers, financiers. Bring them together before the site is designed—ideally before the site is chosen. We have found in situations like this, where a really broad constituency is brought to the table and is inclusive and looking at sustainable and economic factors, we see significant improvements of both environmental and economic performance.The challenge is that developers will think it’s going to frontload the design process, but the evidence is the investment upfront pays off in the building and design process later. If you have everyone thinking clearly of what you want accomplished, it accelerates the process. We are looking to save clients money on both D&C costs, as well as operating costs.MHN: Why is it important for those in the multifamily industry to not just build green but to also green their businesses? What message does this send to their clients?Friend: One is that you put money in your own pocket. That’s money you pay to yourself and your partners and shareholders instead of vendors. It’s basic good business sense. Your customers are expecting that of you and they are expecting integrity. They want green building built by a green firm. The reason for that is when a company takes it on for their own operations, there is a brain shift. People inside are asking different questions and noticing different things because the questions they are looking at inside and outside are the same. I think you’ll find that that will drive the creative and innovation process and result in better work.MHN: How green is good enough when it comes to the building industry?Friend: Greener than you’ve got. It’s a trick question. The point of the question is, don’t settle for what you think is good enough because the bar is rising rapidly. What you think is good enough—someone should do better next month. The question is, how green can we get it and how can we do it better? The challenge standard is zero net energy buildings. We have already seen zero net energy buildings in England in a climate that you would think is not favorable. It’s a big design challenge, but if you look at the living world, what’s the energy budget of a tree? Can we have buildings as good as a tree? A tree is probably good enough.MHN: How important is green branding and messaging when it comes to selling potential residents on your “green” property? How can you convince prospects that you’re not just greenwashing?Friend: I think it really varies with the market, so you have to be sensitive. But the expectation is rising across every market, so it is valuable to communicate it. It’s important not to overstate. We advise to say less rather than more. Ultimately, it’s your brand and trust that’s on the table.MHN: In your book you say, “LEED certification doesn’t guarantee a high-performing building.” Why should we bother certifying our buildings?Friend: It’s a business decision you need to make. It makes sense to build the greenest—it’s a business decision. In most cases it will probably be valuable to provide assurance to the customer, whether it’s a bank or REIT or tenant. We see some companies who think it’s worth doing and some who think it’s not. I expect we will see more and more, and the process will be streamlined, so the cost of certification will be less.MHN: What is an integrative whole building approach and why is it important?Friend: It’s bringing everyone to the table to talk about everything early in the process. What has become the traditional approach in modern times is that the developer picks the site, the architect designs the building, etc. These are separate tasks and you don’t optimize the building. When you bring everyone together—the architect, engineer, builder, owner, financier, tenants, neighbors, and environment adversaries—you determine what you are trying to do and what your expectations are. We find that process brings better buildings. The benefits could be how long it takes to get a permit, or whether you get sued. Taking the time to get an agreement early on can pay off in spades on that time to market question.MHN: What is the best way to engage employees—and residents—in green practices?Friend: First of all, invite them. Second, make it as clear and as easy as possible. That means designing convenience into the process. In addition to making it easy, make it fun, creative, challenging, rewarding. Recognize that you are thinking about the internal side. It’s to say, “hey, we are a company full of creative people who design things. How do we design this together?” Employees are an enormous resource; they have the motivation and knowledge and having their cooperation is a powerful resource. In the case of residents, be clear that you don’t have a tradeoff. You don’t need to trade off environmental performance against luxury or quality performance. Don’t ask them to suffer in the dark or be uncomfortable. These are comfortable buildings and there is no reason to trade off. In fact, they can reinforce each other.