It was the exhibition of affluence that prompted Ron Dembo to start a charity to help the environment.
The founder and CEO of Zerofootprint, an organization that helps companies and individuals measure, track and offset their environmental impact, went to a technology conference in Monterey, Calif., in 2005. Among those in attendance were major players such as the founders of AOL and Google.
“It was curious to me that there's a group of people who are changing the world but consuming a lot of the world to do it,” he says.
His theory applied not just to business types: “David Suzuki has got to have one of the biggest travel footprints out there, for example, but he's doing a lot of good in the process.
“I realized, here's this immense problem but no one is using software as part of the solution. It struck me as a very interesting opportunity.”
An opportunity to help the environment, yes. But it would also become a way to help companies make sustainability part of their business model. And that's something, he says, no company can ignore.
“There was a time in the corporate world where you could get away with things. Today that's not the case. Today it impacts financial results,” he says, pointing to giants such as Wal-Mart and Coca-Cola, who have made sustainability a visible part of their operations, even though it is not core to their business or products. “No company interested in longevity can afford to ignore this.”
And the South Africa-born Mr. Dembo knows a thing or two about companies with longevity. After an 11-year stint as a computer science and management professor at Yale University, he took up a post at Goldman Sachs in 1986. He left the financial firm the following year to start what would become the world's largest enterprise risk-management software company, Algorithmics, which he sold for a nine-figure sum in 2005.
His brainwave at the California conference prompted Mr. Dembo to start a charitable foundation with the goal of massively reducing the environmental footprint of non-profit organizations, such as governments and schools. The foundation, which he called Zerofootprint, would rely only on funds raised by the sale of its products and services. In other words, Zerofootprint wouldn't solicit donations – from the government or otherwise.
But a charity charging for its products and services was a concept, he says, “people couldn't get their heads around.”
The confusion meant not enough clients were signing up, and Mr. Dembo realized the foundation wasn't sustainable. But he wasn't willing to walk away from Zerofootprint just yet.
Instead, he decided to sell Zerofootprint's products on the market through a separate for-profit company and funnel a healthy percentage of sales back into the foundation.
Zerofootprint's main software product, Velo, surveys a company's activities, such as travel and waterconsumption, to measure its carbon impact. Then Zerofootprint provides analysis in the form of benchmarking against peers. “It's very difficult to want to change if you don't know how you're doing in comparison to others,” he says. And finally, Zerofootprint makes recommendations to the client on how to offset the impact, whether that's a reconfiguration of office space or more efficient travel itineraries.
In Zerofootprint's case, social good is inherently part of the business model. But Mr. Dembo makes the case that doing good makes sense for any business – no matter its industry, image or product – because it “develops a brand people can trust.” And trust translates into what every company wants: dollars.
“What would you think of a company that has total disregard for sustainability?” he asks. “Imagine I told you that your bank uses paper that comes from sources that are linked to the deforestation of New Guinea and they've been made aware of this but they ignore it. Is that a company you would trust? Would you still want to bank there?” He's betting not.
