In the waste management business, what you tell employees, customers, investors, and the public about your environmental footprint shouldn’t be garbage.
“We have to be transparent about our impact on the world around us, and that’s going to build credibility,” says Tara Hemmer, senior VP and chief sustainability officer with WM.
At North America’s largest residential recycler, responsibility for gaining that trust falls to CSO Hemmer. “I’m the ultimate educator, integrator, and influencer,” she tells me from Houston.
Hemmer, who joined WM almost 26 years ago and became its first CSO in 2021, has a lot on her plate besides reporting and disclosure. She’s also growing the 40,000-employee company’s sustainability business, which spans recycling, renewable energy, an organics and food waste program, and consulting and advisory services. Annual revenue: about $3 billion.
As she draws on her operations experience to build that arm of WM, Hemmer also aims to “embed sustainability into the fabric of who we are as a company.”
Customers have their own sustainability goals, she notes. Often, WM’s work on the waste side is their Scope 3 emissions. “So we have to make sure that we have the right platform in place where we can provide really credible information to our customers.”
For example, WM must be clear that its largest emissions come from landfills. “We have a heavy Scope 1 emission source, but what we’re trying to do is capture more landfill gas and convert that landfill gas to renewable energy,” Hemmer explains.
To do that, WM is building 20 renewable natural gas plants across the continent. That fuel can help power its fleet of compressed natural gas vehicles, the biggest in North America.
When it comes to measuring and reporting environmental impact, WM’s efforts include a climate target approved by the Science Based Targets initiative (SBTi). The goal for 2031: a 42% reduction in Scope 1 and 2 greenhouse gas emissions compared to a 2021 baseline. WM is making progress. Last year, it shrank those emissions by 12%.
WM began publishing a sustainability report more than two decades ago, Hemmer says. It soon followed that with an online sustainability data center. “We recognized investors, customers, regulators wanted information from us in real time, and they wanted to be able to access it.”
The company has worked with investors to improve its public disclosure too, Hemmer adds. Several years ago, it created a map showing where all the materials related to its recyclables—plastics in particular—end up, versus those handled by other businesses.
If WM isn’t meeting a sustainability goal, it doesn’t try to hide the truth, Hemmer notes.
“You’re going to have blips in your journey,” she says. “You just need to be clear and transparent about what’s going on, why it’s happening, and what you’re doing to change.”
A company might set aggressive targets, but employees and the public know when something isn’t believable, Hemmer warns.
“If it’s going to be a moonshot, then call it a moonshot,” she says. “Call it what it is, that you’re going to need help, creativity, innovation to help us get there.”
WM did just that with landfill emissions, which are tough for the waste management industry to directly measure, Hemmer says. The company partnered with some 20 other businesses to explore how to make such metrics more effective—and how that can help it better manage its operations.
Asked what advice she has for companies that want to build trust by improving their environmental impact disclosure, Hemmer suggests seeking a variety of opinions from inside the business and beyond. “When you live this every day as a sustainability leader, you can lose perspective sometimes on how things are viewed outside the company.”
Besides getting feedback from WM’s finance partners, Hemmer participates in forums with fellow CSOs. They “provide great counsel and guidance on some of the things that have happened within their own organizations,” she says. “It’s been incredibly helpful as we’ve thought about how we adapt and evolve our disclosures over time.”
Ideas worth recycling.
Nick Rockel
nick.rockel@consultant.fortune.com
IN OTHER NEWS
Early promises
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Less is more
The four-day workweek just got a vote of confidence. In a study of 45 German companies adopting that schedule, several benefits emerged, Ryan Hogg reports. Participating businesses saw average revenue climb 36% over the previous year, employee resignations drop 42%, and burnout shrink 64%. Also, on average, workers in the trial slept and exercised more than their five-day peers—which seems to have dramatically lowered their stress levels. One wrinkle: Only a third of participants actually cut their working hours by 20% a week. Old habits die hard.
Pick a number
Take it from him—with a grain of salt. Seeking to boost trust in a listless economy, Chinese Premier Li Qiang said he’s “fully confident” his country will hit its growth target of about 5% this year. So far, stimulus measures like interest-rate cuts and looser homebuying rules have failed to provide a much-needed spark. Trade tussles with the U.S. and Europe—tariffs on Chinese electric vehicles are a flashpoint—won’t help Beijing bounce back either.
Digital know-nots
Turns out people don’t have much trust in their leaders’ tech savvy. Employees are losing six hours a week to manual tasks that the right AI tools could easily automate, a new survey reveals. Almost two-thirds of respondents blamed the boss—mostly because they’re “digitally illiterate.” Ouch. While employees in non-tech industries might not get official access to the automation they crave, some are rolling the dice. Apparently, one in five workers is an “underground” AI user. Talk about living on the edge.
TRUST EXERCISE
“Welcome to the BANI world—Brittle, Anxious, Nonlinear, and Incomprehensible. This new paradigm has replaced the familiar VUCA (Volatile, Uncertain, Complex, Ambiguous) framework. The shift from VUCA to BANI is evident in three key areas. First, the speed of change has accelerated dramatically. While VUCA acknowledged constant change, BANI recognizes the increased velocity of change. Second, BANI acknowledges the complexity created by the interconnectedness of our global systems. In a deeply intertwined world, risks are nonlinear and contagious in ways that are often unpredictable. Finally, the emotional impact of change has intensified. BANI highlights the widespread anxiety and polarization of our era, in which responses can accelerate crises.”
Not much fun, right? But that four-letter word is the new reality, argue Raj L. Gupta, former Chairman and CEO of Rohm and Haas Company; Lisa B. Woods, executive director of the Gupta Governance Institute; and Mukul Pandya, an associate fellow at the University of Oxford’s Said Business School.
Fortunately, this trio sees opportunities as well as challenges. While newly bankrupt Tupperware fell victim to BANI, for example, tech darling Advanced Micro Devices (AMD) found a way to reinvent itself—and then some.
For businesses wanting to build trust that they can succeed in the BANI world, Gupta, Woods, and Pandya share a five-point plan. Boards, CEOs, and C-suite executives must rethink their roles, with an emphasis on agility, adaptability, and collaboration. A strategic approach to AI is crucial too, for boosting efficiency, keeping and attracting customers, and exploring new markets and business models. Organizations must also redefine how they measure success, by focusing on long-term value creation and taking all stakeholders into account.
I know, that’s a lot. But at least it’s comprehensible.
