By TANYA MOHN
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Enquiries

• Kristine Duckett, Credit Suisse, Tel. +1 212-325-6830, kristine.duckett@credit-suisse.com

Source: Credit Suisse

The LOHAS marketplace is fundamentally changing the structure of the American economy—and not the other way around – By Eric Peterson

Today’s LOHAS marketplace is the economic equivalent of a big, adolescent puppy, steadily growing and irrepressibly moving … somewhere. The head doesn’t always know what the tail is doing, and its paws are too big for the rest of him, but nevertheless his coordination is improving. This is a marketplace that is clearly getting bigger and better. Indeed, argue some of its keenest observers, it is changing the structure of the American economy. But observers also say it’s impossible to pinpoint exactly what’s next. “We are looking at a structural change in the American economy,” says sociologist Paul H. Ray. The San Rafael, Calif.-based Ray, who coined the term Cultural Creative in 1995 and wrote a book on the phenomenon in 2000, The Cultural Creatives: How 50 Million People are Changing the World, identified the subculture that spawned the LOHAS movement. LOHAS consumers—people who tend to make their purchasing decisions in keeping with their values of social and environmental responsibility—were quantified in work completed in 2002 by Conscious Media and the Harleysville, Pa.-based Natural Marketing Institute.

Such sweeping change makes economic prognostication difficult. Nonetheless, “In the long run, say a 20-year time horizon, we’re talking about a major, major shift toward everything LOHAS stands for,” Ray predicts.

Ray says the ranks of Cultural Creatives in the United States are growing at a rate of 1 percent a year. But the number of dollars annually going into the market–now at $355 billion –is escalating about 10 percent a year, according to Ray. “What we’re getting is a lot of people coming into the market more confidently and aggressively,” Ray explains.

But mere numbers don’t tell the real story of the LOHAS phenomenon, because it’s not just about growth, it’s about change, Ray asserts. “There’s a big difference between quantitative growth and structural change, and LOHAS is going through structural change,” he says. “We’re not just getting bigger, we’re moving toward new criteria of what makes a good product. The bumper-sticker kinds of explanations don’t work when you’ve got a structural change in progress.”

And structural change usually comes in fits and starts. “We’re being successful, but not in the ways we predicted, and, by and large, we’re predicting wrong again and again,” Ray says. Translation: The future of the LOHAS market won’t be clear until, well, the future. Ray’s two cents worth for LOHAS-oriented businesses in 2004: “Be very responsive and nimble on your feet.”

Each of the five key LOHAS market segments–Sustainable Economy, Healthy Lifestyles, Alternative Healthcare, Personal Development, and Ecological Lifestyles–is maturing at its own pace, as is socially responsible investing, also a key component of LOHAS. And each of these segments has a unique set of circumstances shaping its structural change. Here we take an individual look at what factors are at work influencing growth in each LOHAS sector.

Sustainable Economy

LOHAS’s Sustainable Economy segment is a growing annual market approaching $150 billion. It’s not exactly about a specific category of products or services but rather a self-sufficient, ecologically friendly philosophy shared by a disparate set of businesses. And it’s catching on fast, not only because it’s the right thing to do: It’s also a more lucrative path than the status quo, as Amory Lovins, L. Hunter Lovins and Paul Hawken eloquently argued in their 1999 book Natural Capitalism.

“All the way across the board, there are stories and examples that this is a good idea,” says Christina Page, a member of the Commercial & Industrial Services team at the Snowmass, Colo.-based Rocky Mountain Institute (RMI). “It is possible to be both ecologically sustainable and economically profitable.”

Page points to a striking example. In the late 1990s, British oil titan BP (NYSE: BP) announced a plan to decrease its carbon emissions to 10 percent below 1990 levels by 2010. The company accomplished the task seven years ahead of schedule and saved money in the process. “Everybody assumed it was going to cost money,” Page says.

Another sign of the rise of sustainable business practices is the emergence of relevant consultancies. For example, Page says her team at RMI has worked with a significant number of the Fortune 500 companies. “It tends to have a snowball effect; in a lot of industries, nobody wants to be first, but everybody wants to be second,” Page says.

But not every facet of the Sustainable Economy sector has had such a relatively smooth entrance into the mainstream. Beginning in mid-2000, renewable energy, for example, “was a minefield … a very difficult place to invest in,” says Matt Patsky, co-manager of the Winslow Green Growth Fund in Boston.

Patsky points to fuel cells to illustrate. “We had a false start for fuel cells. The expectation was that the market was going to materialize quicker,” he says. The booming stocks of fuel cell companies in 2000 and 2001 were the result of “euphoria,” he maintains.

But misplaced euphoria has changed to qualified acceptance now. While Patsky says full acceptance of fuel-cell technology won’t exactly happen tomorrow, it is happening. “The [fuel cell] group in general has turned the corner,” he says, adding the caveat that there’s still a lot of risk to be had in fuel-cell company stocks.

In addition, while solar energy is “still difficult” economically, wind energy is now, on a relative basis, economically viable as an alternative source of energy in most parts of the world, Patsky says.

This clearly bodes well for LOHAS’s Sustainable Economy sector. “What you’re seeing broadly is that technological innovation is making renewable energy more cost-effective, while dwindling supplies and escalating recovery costs are making nonrenewable energy sources more expensive,” Patsky says. “Sooner or later, we get to a point where it’s all cost-effective.”

Healthy Living

Natural and organic foods make up a large portion of the LOHAS market’s Healthy Living sector, and historically it’s been one of the total market’s hottest growth categories, racking up double-digit annual sales increases for more than 20 years. It also is a prime entry point for new LOHAS consumers. According to Nutrition Business Journal, however, annual growth has cooled into the high single-digit territory since the turn of the millennium; still, sales have surpassed $40 billion a year.

“We’re seeing a continual increase in new consumers coming to the market, but it certainly isn’t anywhere near as quickly as over the last 10 years,” says Steve Demos, president of soy-products maker White Wave, a unit of Dean Foods (NYSE: DF) in Boulder, Colo. “To some extent there is a slowing of growth, but that doesn’t mean that growth is going away.”

The early adopter phase is over, Demos says. The core market “has embraced the concept. As an industry, we’re all adolescents now. We went through our big growth spurt and now we’re settling into being adults.”

To push future growth, Demos believes natural foods companies need to relate to the average consumer better. “To presume that we’re going to sit here and keep doing what we’re doing and see an acceleration in growth rates is naïve and ignoring the life cycle,” he says. “Either the industry will continue to grow in the 8- to 10-percent range and everyone will be happy, or it will approach the mainstream and attract enormous growth.

“The best thing for the LOHAS community right now would be for someone to make an enormous amount of money … as a demonstration that profitability based on all of these values is superior to profitability not based on these values,” Demos says. “It would be a big springboard into the mainstream. If it isn’t growing, we’re basically standing on a big soapbox, preaching to ourselves. Everybody that was at Woodstock is already eating our stuff. We need more of everybody else.”

Another Boulder-based natural foods veteran, Barney Feinblum, now president and CEO of Organic Vintners and formerly CEO of both Celestial Seasonings and Horizon Organic Dairy, points to one company as the Healthy Living sector’s prime catalyst. “Clearly what’s been driving the whole industry is Whole Foods Market [Nasdaq: WFMI],” he says. “You now have a $4 billion retailer approaching 150 stores. Their bigger and bigger stores are accommodating more and different LOHAS products. The retailer is really bringing consumers in and meeting more and more of their needs. Eventually, they’re going to sell environmentally friendly paint.”

Feinblum is upbeat on the future, expecting double-digit growth for at least the next decade. The organic category now accounts for 1 to 2 percent of the food market; by 2014, it should be 5 to 10 percent, he says. “Twenty-five years ago, you didn’t even have the word organic’ But now, you’ve seen it compound at 20 percent growth for 25 years; you know it’s not a fad.”

Alternative Healthcare

As a category, Alternative Healthcare has enjoyed stellar growth in recent years, but the segment hasn’t quite been able to crack the mainstream. Currently, the sector is stuck between a rock (the rising costs of mainstream healthcare) and a hard place (the often inflexible medical establishment).

Stephen Bolles, a chiropractor and executive director of the Minneapolis, Minn.-based Collaboration for Healthcare Renewal Foundation, says that the Alternative Healthcare sector will move forward only when it is integrated into the larger mainstream-medicine establishment. When the Foundation began operations in 2000, there were “few if any viable business models for the delivery of integrated healthcare,” Bolles says. “There are many more failures than successes from a business standpoint. At some point, they’ve got to figure out how to make money.”

The irony here is that alternative healthcare is good healthcare business. “In every study of cost-effectiveness that has been done … there has been overwhelming evidence that these alternatives save money,” Bolles says. “The most expensive form of medicine is mainstream medicine.”

Part of the problem with the U.S. healthcare system, Bolles adds, is that there is no mechanism by which to adopt cost-saving processes. “Insurance companies have no pressure to look for lower-cost alternatives,” he says. Bolles says the current conundrum is rooted in the traditions of empirical science. “The system is struggling to understand what these therapies do in light of comparison with fact-based medicine,” he says. “Traditional medicine’s dirty little secret is it doesn’t have a lot of evidence for what it does, either.”

Regardless, or perhaps as a result, Bolles believes that a strong future for alternative medicine remains in the cards. “Academic medicine is moving ahead pretty steadily to make integrated healthcare part of the curriculum,” he says. “You’ve also got people going to medical school who have been more exposed to alternative healthcare.” And, it’s now become a marketplace advantage for clinics to have acupuncturists and massage therapists on the team, he notes.

“The locus of power in the healthcare system has shifted,” Bolles says. “It hasn’t settled on consumers, but it sure is heading that way. What is not progressing as quickly is collaboration on the managed-care side.”

Meanwhile, the alternative healthcare community is trying to prepare itself for the broadest set of consumer interests. Bolles says the system is trying to recast itself as being more relevant. “If we can hang on a few years, we will come out of this with a much more integrated system,” he says.

Personal Development

Numbers are hard to come by, but techno burnout and other travails of 21st century life appear to be fueling the growth of LOHAS’s Personal Development sector.

“There’s been a sharp uptick in the perceived value of self-inquiry,” says Stephan Rechtschaffen, CEO of the Omega Institute in Rhinebeck, N.Y. As evidence, he says, the Institute’s year-over-year enrollment keeps increasing, as does the size of its course catalog.

“These days, everybody’s stretching themselves. They’re looking for something in daily life that’s an antidote to that,” Rechtschaffen says.

“People are more interested in quieter, more contemplative disciplines,” echoes Nancy Lunney-Wheeler, executive director of programs at the Esalen Institute in Big Sur, Calif. She says the Esalen catalog has more yoga, meditation, and arts seminars and workshops than ever before.

As at the Omega Institute, enrollment at Esalen continues to grow year after year. Lunney-Wheeler says the demographics of Esalen’s students also have become broader, both in terms of age and nationality.

Broader demographics clearly bode well for the Personal Development sector. Lynn Powers, president of Boulder, Colo.-based lifestyle products company Gaiam (Nasdaq: GAIA), says one out of four Americans is practicing some form of mind-body fitness. “The top-selling videos on Amazon.com are regularly yoga and pilates videos, and the number of health clubs offering yoga classes has doubled in the last 10 years,” she says.

In 2002, the most recent year for which figures are available, Gaiam sold more than 5 million mind-body fitness videos. In that year alone, it launched 45 new video titles.

Ecological Lifestyles

Americans’ quest to escape the rigors of this new century for a while has not translated into growth in eco-tourism, however. Eco-tourism is a prime component of the LOHAS market’s Ecological Lifestyles sector, and while the category as a whole is growing, ecotourism’s growth has decelerated in recent years. In 2002, the World Tourism Organization reported that the U.S. international eco-tourism market is about 4 percent of the overall market and is growing at a similar annual rate as the overall market. But, like the overall tourism market, the $60 billion ecotourism niche has been challenged in the post-9-11 landscape. A 2004 report by the International Ecotourism Society labeled consumer demand for responsible tourism as “strong, growing, but largely passive.”

However, as the tide for all tourism slowly has begun to turn, so it has for eco-tourism. Despite continuing international turmoil, “The 2004 outlook is the best in three years,” says Tim Warren, president of Adventure Business Consultants in Forestville, Calif. “The ecotourism segment should be growing at the same improved rate as mainstream travel.”

On the other side of the Eco Lifestyle sector, eco products, from organic cotton T-shirts to environment-friendly cleaning products, are racking up hefty increases in sales. “There is now a wider range of great natural products that are healthy and stylish,” says Gaiam’s Powers. She also asserts that eco-lifestyle clothing products are surpassing their traditional counterparts in quality, style and design.

Powers says organic clothing and housewares are among the hottest Eco Lifestyle consumer products. The Organic Trade Association backs this claim, forecasting 39 percent average annual growth in organic apparel from 2000 through 2005.

Again, the good news for growth in this LOHAS market sector is the widening of its customer base. Powers notes, for example, that more men are buying Gaiam products, as are younger and more mature consumers. “I believe [the LOHAS market] is already mainstream,” she says.

Socially Responsible Investing

Socially responsible investing (SRI) is another shining star of the LOHAS movement. The Social Investment Forum reported the assets in socially screened portfolios growing to $2.14 trillion in the U.S. in 2003, a 7 percent uptick over 2001. This is especially impressive when taken in context: Over the same period, the assets in all professionally managed portfolios dropped 4 percent.

“Investors are seeing better returns with socially responsible investing,” says Joe Keefe, senior advisor for strategic social policy at The Calvert Group in Bethesda, Md. It follows that the pace of SRI growth is quickening. “Word is traveling much faster today,” Keefe says.

And SRI is no longer seen as simply green or moralistic, but as a strategy that involves research that is more complete. According to a recent Harris poll commissioned by Calvert, 84 percent of investors “are more likely to invest in a mutual fund if it engages in ethical business practices in its operations and reporting,” a statistic that reflects “a seismic shift in public sentiment,” Keefe says.

Amy Domini, founder and CEO of New York City-based Domini Social Investments, sees the rise of SRI as irrevocably tied to the rise of LOHAS in general. “People, generally speaking, are drawn to this type of investing for a consistency of purpose,” she says. “They want to bring their investments more into alignment with the way they live their lives.”

Domini says the SRI trend is more clearly seen in how many companies now publish sustainability reports or social responsibility reports. Nearly half of the S&P 500 now do so. “These are things that didn’t even exist 20 years ago,” Domini says.

Investors now know, “Thanks to Enron, that there are lying, cheating, stealing CEOs in the world,” Domini continues. “They no longer have a sense that some sort of government authority is watching out for their better interests.”

As Calvert’s Keefe puts it, “We’re living in a different world.” Indeed. And if Paul Ray is correct, it is a world that, admittedly in fits and starts, will increasingly adopt LOHAS marketplace values.

About the Author

–Eric Peterson is a Denver-based freelance writer who covers business and travel for a number of publications. His latest book, Roadside Americana, is available at bookstores.

SOURCE: LOHAS.COM

Commenting Penny Shepherd MBE, Chief Executive of UKSIF, said:

“The study shows impressive growth in the SRI market across Europe, offering increased opportunities for UK asset managers to compete for this growing demand from clients. UKSIF data, released as part of the survey, shows the SRI market in the UK continues to grow and develop with a 19% increase in assets under management in the two years to the end of 2009. This contrasts with the broadly static level of total UK assets under management reported by the Investment Management Association for the same period. It is mainly due to increased engagement on behalf of clients.

“Strong growth on the continent has seen the UK share of total European SRI assets fall from one third to one fifth, with France (at 1.8 trillion euros) overtaking the UK (at 1 trillion euros) as the largest SRI provider in Europe. Meanwhile the UK is bucking the trend towards bonds as the preferred SRI asset class with the highest allocation to equities and the lowest to bonds of any European country in the study.”

Read the full press release.

Read the European SRI Study 2010.

Source: UKSIF

“Opposing views of human nature are at the heart of the climate change debate”

Justin Rowlatt, the BBC’s Ethical Man, recently did a programme for Radio 4 investigating the proposition that the green movement is somehow responsible for the collapse of public confidence in the science of climate change.

I often feel inclined to hurl things at the radio, and the urge on this occasion was overwhelming.

Justin seemed astonished that the green movement is not “at one” on how best to engage with the general public on climate change. He’d spotted that there are huge differences in the advocacy and strategies of different organisations, many of them incompatible.

Obviously! The green movement has always been a very broad ‘church’ – an analogy worth considering. After all, if the Church of England can embrace gay-bashing, science-trashing creationists on the one hand, and tree-hugging, hell-denying vicars on the other, why shouldn’t the green movement be home to an equally diverse range of persuasions?

It’s easy to see how this impacts views on climate change. Some organisations are convinced we can ‘techno-fix’ our way into alow-carbon world, through an apocalypse-defying combination of energy efficiency, carbon capture and storage, renewables and (for a growing number of people) lashings of nuclear power.

Others have long since come to the conclusion that there is no solution to climate change within today’s growth paradigm, and that we should all enthusiastically embrace lives of stripped-down simplicity. Important to that mindset is the conviction that this particular model of capitalism is in terminal decline – even if climate change meant nothing more to us than the difference between one day’s weather and the next.

But Justin was outraged that anyone would consider challenging capitalism to be an essential part of our response to climate change. For him, it was out of the question that climate change should be seenas no more than a symptom (however threatening) of an inherently unsustainable system. He found that asking people to reconsider their behaviour within that system had a “whiff of social engineering” about it, which left him feeling “rather uncomfortable”.

I’m being a bit harsh, but it was frustrating to see the real culture clash between different organisations so superficially glossedover. If you analyse conflicting ideas about how we should be addressing climate change, you will see that, at the heart of the matter, lie opposing views about human nature.

Try it: place yourself on  my ‘human perfectibility ready reckoner’. At one end of the scale we have those arguing that we are all genetically ‘programmed’ to prioritise short-term self-interest at the expense of everyone else, and that conspicuous consumption is simply the latest expression of our primitive drive for status.

At the other end are those who firmly pin the blame for the grotesque profligacy of today’s economy on decades of hugely seductive marketing campaigns on the part of big business, on the loss of a ‘moral compass’ and on the venality of contemporary politicians.

It’s the time-honoured ‘nature-nurture’ debate. Saint Augustine and Pelagius would have little difficultly locating their starkly different views on original sin within it!

But it has a huge bearing on how we address climate change. If you believe that human nature is fixed (and fixed in the wrong place), then passionate appeals to people to consume less, to live more simply (‘so that others may simply live’) and to focus on quality of life rather than quantity of consumption are clearly going to be seen as forlorn. Or patronising. Or even self-indulgent.

But if you subscribe to the view that human nature is not fixed – that dominant cultural values can shift easily (and often have) – then it all looks very different. The priority in this case is to lay out a values-based case for low-carbon living, with the emphasis on intrinsic reward mechanisms, such as feeling good about oneself, one’s relationships and the work one does.

Expect these contrasting positions to become more pronounced over the next couple of years. Both have merit. At the risk of sounding ‘third-wayish’, they could almost certainly rub along together – as long as politicians know what they are trying to achieve through different policy interventions.

It’s all a bit abstract, of course. Difficult to pin down. So much easier to make programmes about greens hurling mud at each other, and destroying the case for action on climate change in the process.

Source: Our Future Planet

Some want tighter restrictions on tourism to Antarctica. But shouldn't everyone who wants one get a first-hand look?

NEW YORK — The globe’s icy poles took center stage in Washington last week at the first joint meeting of those international bodies governing — or trying to govern — the ever-more fragile Arctic and Antarctic regions.

According to the U.S. State Department, the joint conference brought together 400 diplomats and assorted regional managers from 47 countries last Monday — all keenly attuned to one latitude or another, as represented by either the Arctic Council, which tends to things up north, or the Antarctic Treaty System, which keeps watch down below.

Much was on the agenda — including the implications of a warming Arctic and the emergence, amid the northern thaw, of new commercial shipping routes where once there was only ice. But it was almost certainly the Antarctic tour operators in attendance who perked up when Hillary Rodham Clinton, the U.S. secretary of state, delivered her keynote address.

“The United States is concerned about the safety of the tourists and the suitability of the ships that make the journey south,” she said.

“We have submitted a resolution that would place limits on landings from ships carrying large numbers of tourists.”

Ms. Clinton also called for “greater international cooperation” to avoid further degradation of “the environment around Antarctica.”

Certainly, tourism to the region is on the rise. In 1992, about 6,700 tourists visited Antarctica, according to data from the International Association of Antarctic Tour Operators. For the 2008-2009 season, the association estimates the number will exceed 34,000.

What effect that increase is having on the Antarctic environment is difficult to measure — though certainly a spate of inadvertent landfalls (two tourist ships ran aground last season) and the widely reported sinking of a Canadian tourist ship in 2007 (no one was injured) have raised concerns about fuel spills and other eco-blights.

Add to that data from the United Nations Tourism Organization, which estimated last year that tourism was responsible for about 5 percent of global greenhouse gas emissions, and Mrs. Clinton’s call for stricter controls over Antarctic adventures would seem to raise a more fundamental question: How to strike a balance between appreciating the natural world through firsthand experience and protecting it by staying away — and staying at home?

“I think it’s fair to say that ‘sustainable tourism’ is an oxymoron,” said Auden Schendler, the executive director of sustainability at Aspen Skiing Co. in Colorado and the author of a new book “Getting Green Done: Hard Truths from the Front Lines of the Sustainability Revolution.”

“In a sustainable world,” Mr. Schendler wrote in an e-mail message, “we’re probably not flying all that much, or flying to ski, for example, or taking cruise ships to the Antarctic. But the problem now is, we don’t have a moral magic wand that allows us to banish certain energy-intensive activities — like skiing,” he said. “And even if you had that magic wand, where would you draw the line?”

In the case of the Antarctic, the question might also be, “Who should draw the line?”

Steve Wellmeier, the executive director of the International Association of Antarctic Tour Operators, said last week that the limits discussed by Mrs. Clinton — which, among other things, would forbid ships carrying more than 500 passengers from allowing any of them to disembark and put foot on the continent and would limit the size of groups from smaller ships to 100 in any particular spot — have been observed by members of the Antarctic tour organization for some time.

The problem is, not every ship operator is a member of the industry association — and even for those who are, there is really no mechanism in place for enforcing the rules. The Antarctic, after all, has no internationally recognized governance, which leaves the 46 members of the Antarctic Treaty System — with widely ranging national interests and an only mildly binding rule-making apparatus — as the next closest thing.

“There are no policemen, per se,” Mr. Wellmeier said. “It’s largely an honor system — but there are many things in our society that function that way.”

That honor system has functioned well enough so far, according to Bruce Poon Tip, the chief executive and founder of G.A.P. Adventures, a Toronto-based member of the tour operators group that includes Antarctica among its destinations. (It was a G.A.P. ship that sank in rough waters off the continent in 2007.)

“I don’t know if my views are very popular,” said Mr. Poon Tip, who seemed to agree in spirit with the idea that tighter regulations might be needed for Antarctic travel. But he also worried aloud that blanket regulations were wrong-headed, given that all travelers are not alike.

“There are two types of travelers who go down there,” he said in quibbling with the visitor statistics published by the tour operators group. Those numbers, Mr. Poon Tip said, do not distinguish between visitors who make landfall (a number that has increased little, he argued, and usually includes careful, eco-minded travelers) and those merely riding cruise ships through the area.

The latter group is where things are growing, Mr. Poon Tip said, adding that “mainstream tourism is naturally not as sensitive to fragile ecosystems.”

The fragile ecosystems themselves might not make the same distinction.

At least one study has shown that, even in protected areas where human activity is carefully managed, the effect on biodiversity can be profound.

Writing last year in the journal Conservation Letters, Sarah E. Reed and Adina M. Merenlender, both researchers in the department of environmental science, policy and management at the University of California, Berkeley, reported that even “quiet, non-consumptive recreation” — defined as things like hiking, biking and horseback riding — “may not be compatible with biodiversity protection.”

Their study, which looked at the presence of mammalian carnivores in 28 parks and preserves in northern California, suggested that those comparatively low-impact activities still led to a steep decline in the density of native carnivores.

“Demand for recreation and nature-based tourism is forecasted to grow dramatically around the world,” the researchers concluded, “and our findings suggest a pressing need for new approaches to the designation and management of protected areas.”

Which gives added impetus to Mrs. Clinton’s call for stricter regulations on tourism to the Antarctic last week — though both Mr. Poon Tip and Mr. Schendler emphasized that it was fundamentally unrealistic to expect people to stop globetrotting.

The trick, they both said, is to minimize the environmental and climate impacts of doing so — whether it’s a ski vacation in Aspen or an adventure tour to Antarctica.

“There’s a compelling argument to be made that eco-tourism is a huge piece of the conservation movement,” Mr. Schendler said, “which would drop off if the travel stopped.”

“You protect what you know, what you can see and feel,” he added. “That’s why solving climate is so hard.”

Source: The New York Times

For Dave Jakubowski, vice-president of business development for Internet service provider United Online (UNTD ) Inc., the job isn’t what it used to be. Instead of an unlimited expense account and stays at the plush Chateau Marmont, the 31-year-old Manhattanite now brown-bags his lunch and stays at a Hyatt when he’s in Los Angeles on business. He logs 18-hour days to help his Westlake Village (Calif.)-based company hit its quarterly sales targets of around $8 million. How to cope? Jakubowski is no breathe-like-a-tree kind of guy. “I’m in business,” he says, “and I need results.” So he recently turned to a mat and 60 minutes of silence. “It’s amazing,” he says of his new meditation practice. “I’m able to sort through work challenges in this state of calm much faster than trying to fight through it. And I make fewer mistakes.”

Increasingly, the overstretched and overburdened have a new answer to work lives of gunning harder for what seems like less and less: Don’t just do something — sit there. Companies increasingly are falling for the allure of meditation, too, offering free, on-site classes. They’re being won over, in part, by findings at the National Institutes of Health, the University of Massachusetts, and the Mind/Body Medical Institute at Harvard University that meditation enhances the qualities companies need most from their knowledge workers: increased brain-wave activity, enhanced intuition, better concentration, and the alleviation of the kinds of aches and pains that plague employees most.

It doesn’t hurt that meditation has some high-profile corporate disciples, including bond-fund king William H. Gross, of Newport Beach (Calif.)’s Pacific Investment Management Co., who often meditates with yoga before a day of trading at his $349 billion money-management firm. Tech outfits like Apple Computer (AAPL ), Yahoo!, and Google, which already offers an organic chef and an on-site masseuse, are also signing up. So are white-shoe, Old Economy outfits like consulting firm McKinsey, Deutsche Bank, and Hughes Aircraft.

There are no hard numbers on how many companies have added meditation benefits, but the anecdotal evidence is mounting. And it’s no surprise that more employers are seeking a new corporate balm. The National Institute for Occupational Safety & Health finds that stress-related ailments cost companies about $200 billion a year in increased absenteeism, tardiness, and the loss of talented workers. Between 70% to 90% of employee hospital visits are linked to stress. And job tension is directly tied to a lack of productivity and loss of competitive edge. “Stress is pretty much the No. 1 health problem in the workplace,” says Eric Biskamp, co-founder of WorkLife Seminars in Dallas, who has begun teaching one-on-one meditation skills to executives at Texas Instruments (TXN ), Raytheon (RTN ) and Nortel Networks (NT ).

Meditation quiets mental chatter, explains coach Tevis Trower of New York’s Balance Integration Corp., which develops meditation and yoga programs for large corporations. “It lays the foundation for better decision-making and communication,” she says. Adds Viacom (VIA ) International Inc.’s manager of work/life and training, Lisa Grossman: “These programs sound a little out there. But they have a positive impact.”

Sometimes meditation classes are offered as a gesture of thanks for a job well done. Consider AOL Time Warner Inc., where the sales and marketing group was reduced from 850 to 500 people three years ago. Meditation classes were incorporated to help employees deal with the new 12-hour days.

Other companies have added classes to help break up the drudgery of day-long meetings. AstraZeneca (AZN ) Pharmaceuticals in Wilmington, Del., now offers three meditation courses aimed at energizing its 5,000 employees during and after marathon powwows. “We usually had a coffee and a Danish on our meeting breaks and would go right into a sugar slump,” says spokeswoman Lorraine Ryan.

The icing for companies is that meditation programs come cheap. “Everybody is dealing with limited dollars,” says Grossman. “It’s important to keep things going when times aren’t so good.” So employees can breathe easy: This is one perk that isn’t likely to get axed.

Source: Business Week

Our unique survey of almost 21,000 employees shows how much they want to be green with a rise this year in the average employee green score to 73.4% from 69.8% in 2008.

“This is a significant shift,” says Will Ullstein, director of innovation with Munro Global, the market-research group and partner with The Sunday Times in producing the Green List. “Underpinning this overall rise in companies’ green scores are fundamental changes in corporate practice covering reducing waste, improved environmental training, encouragement of good green working practices and bosses willing to lead from the front.

“All the companies on the Green List have realised that you can’t achieve lasting change if you don’t bring your workforce with you.”

The employees of our greenest businesses say there is plenty of evidence this year of businesses changing long-established working practices. The score for companies not being perceived by employees to be producing too much waste is up from 56.5% last year to 63%, the 6.5 percentage point rise being one of the sharpest in year-on-year scores.

They say environmental issues are at the heart of how their companies do business, the 74.2% green score here representing a 4.3-point rise on 2008 — which is both encouraging and necessary with the Carbon Reduction Commitment due to come into force for up to 20,000 of Britain’s largest organisations from next year (see panel below).

More workers are being encouraged to car-share or use public transport to get to and from work, the score rising from 54.8% to 61.7%, up 6.9 points in the past 12 months with the same rise achieved for staff receiving adequate environment training, up from 63.3% in 2008 to 70.2% now. Internal communications about green issues are also improved, up 6.2 points on last year to give a green score of 78.8%.

Perhaps as a consequence of better training and communications, employees are showing a greater literacy with environmental issues, evidenced by a 5.6-point rise to give a green score of 65.8% for improved understanding of carbon footprints.

Richard Caseby, managing editor of The Sunday Times, said: “We might have expected staff interest with green initiatives to decline as they and their bosses coped with economic distractions. The reverse appears to be true.”

High levels of engagement are reflected in the total of 99 companies that registered for this year’s competition, which was open to all businesses in the UK. We received many more approaches from firms that considered entry but held back, perhaps put off by the level of detail required about corporate practices or the searching nature of the employee survey.

All the firms making the top 60 were subjected to rigorous data verification by Bureau Veritas to ensure they were achieving the levels of recycling and energy consumption claimed in their submissions, and that their environmental management systems were as described. Where discrepancies were found, scores were adjusted. Many were subjected to a site visit from Bureau Veritas environment consultants.

“It takes a brave chief executive to submit their business to the level of scrutiny required of this competition,” said Caseby. “Only the most scrupulous, making genuine changes to their environmental footprint, made the final cut.”

Within the overall competition that produced the Green List five smaller contests took place:

- Big and mid-sized companies (with more than 250 employees) with high environmental impact (14 companies in this category made the overall top 60);

- Big and mid-sized companies with medium environmental impact (11 companies);

- Big and mid-sized companies with low environmental impact (11 companies);

- Small companies (with between 50 and 249 employees) with high and medium environmental impacts (18 companies);

- Small companies with low environmental impact (six companies).

Two new awards will be made this week recognising the special challenges facing larger companies trying to be greener:

- Best big company for corporate environmental strategy;

- Best big company for employee engagement.

And from them all, one firm will be chosen for the ultimate accolade: best green company in Britain.

The competition attracted businesses ranging in size from supermarket Tesco with 185,000 employees to office-supplies firm Wiles Greenworld with 50.

The top 60 remained balanced in terms of size with 12 big companies (with 5,000 or more employees), 23 mid-sized firms (with 250 to 4,999 employees) and 25 small enterprises (with 50 to 249 employees).

The range of environmental impacts was also wide, taking in several construction firms — such as Carillion, Skanska, Willmott Dixon, Wates Group and Morgan Lovell — as well as small, low-impact concerns such as Explore, the travel agency.

Across the Green List as a whole there are 16 high-impact companies, 27 medium and 17 low-impact firms, again reflecting the equality of opportunity for businesses of all sizes and impact to succeed in this list.

Meaningful changes to environmental practices were what really scored in our survey. Alongside energy consumption (gas and electricity) we recorded water use for the first time this year. The proportion of companies achieving at least a 3% year-on-year reduction in consumption of these services was 30%, 42% and 43% respectively. Meanwhile, three-quarters of the top 60 companies achieved either a 10% reduction in waste produced or a 10% increase in waste recycled in at least one of three waste streams nominated for examination in the survey.

Improvements like these could be achieved by many other companies. And the evidence provided by employees of the firms that made it on to our list suggests that other organisations which are still hanging back, reluctant to embrace green issues, might soon find themselves forced into action by the concerns and demands of the people they employ.

Additional reporting by Alan Copps

Staff make it happen

IF you want to “green” your company, there is no better starting place than your staff. That was the view taken by the London office of Mediacom, the global media-planning business, in an initiative that is now being copied by its branches in several other countries.

“Once a year we have a consultation called ‘If I ran the company’,” said managing partner Gavin Duke, “and a couple of years ago the winning entry said ‘We want to be carbon neutral’. The case was well-argued so we decided to make it happen.”

The first step was a carbon audit. This established that the UK operation, which turns over about £1 billion a year and has 600 employees, was producing emissions equivalent to 2,300 tons of carbon dioxide a year. “We examined the sources — electricity use, transport, waste and so on, and then set about each in turn, methodically, using the principles reduce, re-use, recycle,” said Duke.

Electricity was by far the greatest source of emissions. The company signed up to a green tariff for its Holborn office, installed long-life lightbulbs, movement-sensitive floor lighting and programmed computers to hibernate after 20 minutes. Paper usage was cut by curbing unnecessary printing, increasing double-sided printing, ending subscriptions to unwanted magazines and newspapers and increasing recycling. Staff were encouraged to cut down on business travel and cycle to work.

It was not possible to wipe out the carbon footprint entirely, so the company bought carbon offsets to achieve the neutral goal. “The offsets cost us about £20,000 a year but that is more than compensated for by the savings we have achieved, I would estimate them at about £40,000,” said Duke.

The latest venture is turning office balconies into vegetable gardens, planting grow bags with tomatoes, chillies and pumpkins. Mac Stephenson from the international department was picked to run this scheme because he has an allotment. “Staff are divided into teams and there will be a ‘best-looking tomato’ contest at the end of the summer,” he said. “It shows people how easy it is to grow vegetables.”

“It’s a bottom-up approach with serious management support. It’s what people wanted here,” said Duke. “But it’s not an overt thing when we’re dealing with clients. However, when they come into the building they notice the difference, and we’re now seeing questions about sustainability creeping into tender documents and so on.”

Forced to cut carbon

THE Carbon Reduction Commitment comes into force in April 2010. It is designed to stimulate energy efficiency across the economy, including large companies, local councils, universities and other public-sector bodies. They will be obliged to join its carbon-trading scheme, calculating their carbon emissions and then buying carbon credits against future emissions. Failure to comply will result in penalties of up to £500,000. Companies will be named and shamed in league tables showing who is doing most to cut emissions.

The shiny Jaguar XJ was fresh off the production line — the newest member of the ministerial fleet. With a fuel consumption of 40 miles per gallon, however, it did not quite suit the new government’s eco-friendly ethos.

Now Jaguar has a green alternative. The Limo Green is an electric XJ with a petrol engine to keep its batteries charged. It has the fuel economy of a small hatchback — 57mpg — and a carbon footprint close to that of a Toyota Prius.

It can run silently with zero emissions for up to 30 miles. Furthermore, it can accelerate as briskly as the big diesel saloons from Audi, BMW and Mercedes and cruise all day on a motorway at well beyond the legal limit.

The Sunday Times has followed this project from its inception and a few days ago I was among the first to test-drive Jaguar’s prototype.

Apart from the stickers on the sides indicating Jaguar’s partners in the project, it looks like any other XJ. It drives like one, too, though it is quieter. Limo Green’s rear wheels are driven by a 145kW electric motor fed from a lithium-ion battery pack under the boot floor.

A number of electric cars have been unveiled recently and are being readied for sale next year, when they will qualify for a £5,000 purchase incentive. The bulk, weight and expense of the lithium-ion batteries restrict the size and power of these pure electric cars. Nobody is offering an electric saloon the size of a Jaguar with the performance, long range and rear-seat comfort of a limousine and for good reason: the batteries needed would weigh nearly four tonnes.

The Limo Green is a new type of hybrid that Jaguar believes provides the answer. The wheels are always driven by the electric motor but the batteries are kept charged by a small petrol engine, which acts as a generator. This means there is no danger of being caught with a flat battery. Yet the car can also be plugged into the mains and charged overnight.

The forthcoming Vauxhall Ampera works on the same principle but will run on electricity alone until the batteries are depleted. Limo Green can go for 30 miles and up to 50mph as a pure electric but the petrol engine cuts in to boost the power whenever the driver demands vigorous acceleration or higher speed.

The car’s occupants scarcely notice when the engine starts, or when the two-speed transmission shifts into higher gear. From the driving seat, Limo Green is like a conventionally powered XJ but at low speed the loudest noise is the whoosh of tyres on asphalt.

At 1,750kg, Limo Green is only 50kg heavier than the Ampera but is a significantly bigger car. That is a tribute to Jaguar’s lightweight aluminium body and chassis construction that was pioneered with the XJ. Additional weight-saving measures, including special ceramic brakes and a carbon-fibre sub-frame, were contributed by Caparo, one of Jaguar’s partners in the Limo Green project.

The £4.2m two-year research programme, part-funded by the government’s Technology Strategy Board, also involves the Motor Industry Research Association, which has long experience of electric and hybrid vehicles, and Lotus Engineering, which has produced the light and compact 1.2-litre three-cylinder engine designed to run at a constant speed as the on-board generator.

Driving Limo Green, there seems no downside but then one is reminded that this prototype cost more than £1m. The cost is only one of several problems to be solved before an electric Jaguar appears in the showrooms.

The motor industry remains divided over the pace of electrification. The cost of lithium-ion battery packs keeps the price of small electric cars high and sales may stall after the initial wave of enthusiasm. Inevitably, a production Limo Green would be more expensive than the conventional XJ, which starts at £53,775.

Tata, owner of Jaguar Land Rover, has sanctioned a worldwide test involving up to 200 cars, starting in 2012. It will need to see positive results from this before it commits the £500m needed to move to full production.

Source: Business Times Online