How I Did It: Timberland’s CEO on Standing Up to 65,000 Angry Activists

You can tell a lot about how your day is going to unfold by the number of e-mails that are waiting for you. I’m a pretty early riser—4 AM most days—so I typically start out ahead of the game when it comes to e-mails. But on June 1, 2009, they kept coming, and coming, and coming. The first one accused Timberland of supporting slave labor, destroying Amazon rain forests, and exacerbating global warming—all in the first sentence. The second was a repeat of the first, as was the next, and the next. I had a funny feeling it was going to be a long day. The fan mail was from Greenpeace supporters reacting to a newly released Greenpeace report about deforestation in the Amazon. The gist of the report was (a) Brazilian cattle farmers are illegally clear-cutting Amazon rain forests to create pastures, and (b) the leather from their cows might be winding up in shoes—including Timberland’s. (A) plus (b) equals (c): New Hampshire–based bootmakers are desecrating the environment. Take them to task. And take us to task they did. The senders didn’t threaten a boycott but said they were “concerned” and urged us to work with Greenpeace to find a “permanent global solution” to both deforestation and climate change. As a CEO, I’m used to getting angry e-mails—most of them along the lines of “You support something I oppose; therefore you’re an idiot.” But these were different. Even though their text was a form letter pulled off the Greenpeace website, it was well written and informed. And it was coming from a potent activist organization, suggesting a problem I wasn’t intimately familiar with. Even in my early-morning haze, I knew that was a bad combination. Throw away the Monday morning to-do list—we’ve got us an issue here. That morning our IT department set up a system to automatically reroute all the activist e-mails from my inbox to a separate folder—not so that I could avoid them (although it was nice to have my inbox back), but because we wanted to make sure each one got a response. Next on the agenda was figuring out how to respond—not just to Greenpeace’s allegations, but to the angry senders, who totaled 65,000 over the next few weeks. I figured if that many people were taking the time to send an e-mail, there must be at least half a million not sending e-mails who were also pissed off. That’s a big number. Our brand’s reputation was at stake. My first response to the e-mails was to be pretty angry myself. Our logo is a tree, for crying out loud. My first response to the e-mails was to be pretty angry myself. Of all the environmental problems Timberland has been actively committed to addressing, deforestation tops the list. We’ve planted a million trees in China; we host community regreening events in cities all over the world. Our logo is a tree, for crying out loud. How much more ridiculous could this campaign be? It would have been laughable—if not for the 65,000 Greenpeace supporters who were buying into the allegations and making clear their expectation that we’d come up with an acceptable solution. The “or else” was implied, but we’ve all seen videos and news articles about big corporate bullies that fall victim to Greenpeace’s wrath. I didn’t want Timberland to be painted as either a corporate bully or a victim. The Origin of Hides Some members of our team, justifiably, thought our primary goal should be to figure out how to end the conversation—meaning get the angry activists to go away. Only about 7% of our leather is sourced from Brazil, so it would have been relatively easy to find another source that didn’t come with strings such as deforestation issues and Greenpeace reports attached. This option became more compelling as other companies, including some of our competitors, started issuing statements in which they vowed to immediately stop buying leather from the region in question. “Let’s just do what they’re doing and say ‘We’re out,’” some colleagues advised. I’m a third-generation CEO. I’m not the first guy into a fight. But I’m also not one to take the politically correct, cut-and-run route when I think something is worth staying and talking about—in this case, the reputation of our business and a serious environmental issue. As much as I didn’t want to admit it, Greenpeace was asking a legitimate question: Where was our leather coming from? Second on the list of things I didn’t want to admit was that we didn’t know the answer. We—our company, our industry—had until then never been asked, or asked ourselves, that question. Sure, we cared whether the leather came from a cow, a goat, or a pig. But where did the animal graze before it went to the slaughterhouse? I’m a bootmaker, not a cattle rancher. That’s not a question that was keeping me up at night—at least not before that June. The fact is, the origin of hides has never been easily traceable: They’re treated as a waste product by slaughterhouses, which are mostly interested in the meat. In some parts of the world, hides are sold in batches of two or three by guys on the side of the road. They’re not tracked the way other materials—pharmaceuticals, for example, and most food products—are. The lack of traceability in our materials supply chain is almost archaic. But the thought of tracing one hide back through the tannery to the slaughterhouse to the cow to the herd to the pasture to the land—multiplied by however many hides make up the 7% of our leather that is sourced in Brazil—is enough to make your head hurt. I was willing to suffer the headache—and impose it on my team—because I thought Greenpeace had raised a good question and that there was value in trying to answer it. I also saw this issue as a battle for the hearts and minds of environmental activists—the ones who believe that private enterprise by definition sucks and the world would be better off if companies burned down. I wanted to confront that notion head-on, to convince them that if they really want to help the rain forest—to make a sustainable environmental impact—they need the help of companies like Timberland. I wanted them to know that it’s possible to be a profitable global business and also be actively engaged in protecting the environment. Frugality Drives Sustainability To understand how we responded to Greenpeace, it helps to understand the role that stakeholders—and issues like the environment—play in how Timberland operates. It also helps to understand that activist groups like Greenpeace have a unique operating model of their own. Timberland’s Financials Despite falling revenues, Timberland’s net income is on the rise. Our environmental sensibility stems from being a frugal Yankee outdoor company. In Timberland’s first factory, my grandfather used to walk around picking up the bobbins that fell off the machines to reuse them; every time, he’d say, “That’s a penny.” Leather came wrapped in thick green paper, and instead of throwing the wrapper away, my grandfather would smooth it out and make patterns from it. He wasn’t recycling to save trees—he was thinking about not having to pay for the stock to cut a pattern. Today we do a variety of things to minimize our use of resources—because my grandfather’s frugality runs deep, and because we’d rather leave a light footprint on the earth than a heavy one. Our efforts to be environmentally responsible—from powering our facilities with renewable energy to calculating the carbon footprint of our footwear—made Greenpeace’s allegations hard to swallow. Furthermore, we actively participate in cross-brand collaborations to address industry issues, and we host stakeholder calls once a quarter so that anyone concerned about the impact of our business can share questions and criticisms with us. It’s not always comfortable to be bumping elbows with our toughest competitors or to sit in the hot seat during those calls. But we benefit from outside perspectives. That’s another reason why Greenpeace’s guerrilla tactics—accuse first and engage later—felt like such an affront. For Greenpeace, guerrilla tactics are supremely effective—something I was naive about when all this began. There’s no question the organization cares about saving rain forests, but it also cares about recruiting new members and collecting membership fees. Making headlines by attacking companies helps it do that. For Greenpeace, guerrilla tactics are supremely effective—something I was naive about when all this began. If Greenpeace wanted to start a dialogue with the footwear industry about how our supply chain might be hurting rain forests, I strongly feel that someone there should have picked up the phone. The organization could have convened the industry’s CEOs to talk about these issues and craft a solution—and then held a press conference where it took credit for getting us to address the problem. There isn’t one executive in our industry who wouldn’t have wanted to be at that press conference. But phone calls and press conferences aren’t as sexy as an attack campaign and wouldn’t have riled up Greenpeace’s member base, which is part of what drives its revenue. So it came at us instead, leading us to waste a ton of energy fighting a goopy mess rather than making meaningful progress. We called Greenpeace within a few hours of receiving the first e-mail, but it took days to get someone knowledgeable about the issue to come to the phone. While we waited for the organization to talk to us, our supplier tried to get some answers. To illustrate its claim that ranchers were illegally clear-cutting the Amazon forest, Greenpeace published pictures from Google Earth showing cows grazing in places that had been forest just a month before. In conversations with our supplier, we learned that it didn’t actually know where ranchers were pasturing their cattle—so Greenpeace might be right. Hmm…not the answer I was hoping for. My next question for the team: If our supplier didn’t know where the cattle originated, could we start figuring it out? Could we track where specific cows were grazing? Our engineers concluded that the task was arduous but not impossible; although there wasn’t a system in place to capture and manage that data, there could be, given enough time and resources. What would make it impossible, they said, was if the companies further up the supply chain—the cattle ranchers and the slaughterhouses—were unwilling to go along with it. It’s called a supply chain for a reason: There are a lot of links—ranchers, slaughterhouses, tanneries. In the scheme of things in Brazil, we’re a very small player with very little leverage. To its credit, Greenpeace understood this. So it didn’t come after shoe companies only—it also targeted companies that buy beef, including Wal-Mart and other grocery chains. It applied pressure to Brazilian politicians, who turned to Brazilian law enforcement, which began going after the ranchers who were breaking the law. Greenpeace effectively brought a coalition of pressure against every link in the chain simultaneously—a powerful tactic, and one it knew would work. Our supplier had little choice but to take this seriously: All its customers were asking the same hard questions at the same time. We didn’t have to threaten to cancel our contracts—the threat was implicit. The supplier knew it was going to have to step up. Crafting a Response Dealing with the supply chain would take weeks, if not longer—but in the meantime, we had 65,000 love notes to respond to. Bill Clinton likes to say that when it comes to winning votes, you need to consider two kinds of people: the Nos and the Maybes. Now, the Nos are against you all the way; you can’t win their votes, so you shouldn’t waste time trying. Every election, he says, is won or lost on the Maybes—they’re your fighting chance. Even though we had no way of differentiating Nos from Maybes, given the cookie-cutter e-mail, we knew we had to craft a response that had the best possible chance of winning the Maybes (provided there were any in the bunch)—those who might, just might, see that we were trying to do the right thing. Our response ended up evolving over time (see the sidebar “Finding the Right Tone”). Writing an e-mail response may seem like a no-brainer, but we worked really hard to get it right. For instance, if an e-mail had come from an Italian internet address—even if the message was in English—we replied in Italian. And we watched how many senders replied. We never expected that everyone would write back and say, “Wow, we never realized you were great guys!” but we did hope to hear from activists who appreciated our response. And some of them did. Finding the Right Tone When Timberland faced an implied boycott threat from Greenpeace activists, it attacked the problem on two fronts: working with its Brazilian supplier to ensure that its practices weren’t hurting the environment, and communicating with the Greenpeace e-mailers respectfully and transparently about its efforts to be part of a collaborative solution. Below are edited excerpts showing how the company’s response evolved during the course of the campaign. June 1 On the morning of June 1, 2009, the e-mails began flowing into CEO Jeff Swartz’s inbox: Dear Mr. Swartz, I am concerned that, given your company’s dependence on leather to make shoes sold around the world, you may be supporting forest destruction, slave labor, the expulsion of indigenous groups within the Amazon Rainforest, and global climate change…. As a consumer, I want to be confident that when I buy your shoes I have not contributed to Amazon destruction and climate change….I look forward to hearing what steps you will take to help solve this problem. Sincerely, June 1–4 During the first four days of the campaign, Timberland replied with a lengthy, somewhat defensive e-mail: Thank you for your inquiry….We take our environmental and community impact very seriously and work hard to do our part to preserve the planet by planting trees, reducing our contribution to global warming, developing environmentally-conscious products and encouraging civic action….We do source some leather from Brazil, but we have been assured that the material is not sourced from deforested areas….We share your concerns about deforestation…Timberland’s tree planting initiative has resulted in more than one million trees planted across the globe since 2001….We plan to plant another million trees by the end of 2011…. June 5 Starting on the fifth day, Timberland decided a less-is-more approach might be more effective: Thank you for your inquiry….Timberland is committed to minimizing the environmental impact of our business operations. We’re interested in engaging with Greenpeace and others in our industry about this situation…. July 24 After striking an agreement with Greenpeace, Timberland crafted a new message on July 24: …For more than 20 years, Timberland’s approach to supplier relationships has been one of active, mutual engagement…we have an unflinching commitment to work with our value chain to address failures….Our principles apply in the Amazon, and so we are working closely with our supplier in Brazil to ensure they have an action plan in place that addresses their commitment to an immediate moratorium on deforestation in the Amazon Biome, and of course refraining from sourcing products from indigenous or protected lands or entities that engage in slave labor…. October 30 On October 30 Timberland sent a lengthy e-mail update signed by CEO Jeff Swartz to everyone who’d contacted the company on this issue: …Three months later, real progress to report….Last month [our supplier] publicly announced their official Amazon cattle moratorium…and is working aggressively to meet traceability targets to ensure the origin of all the cattle they source is acceptable and not contributing to Amazon deforestation….For its part, Greenpeace has done an outstanding job gathering data, creating a complete and compelling case for the issue, and mobilizing its tens of thousands of supporters….Their effort has driven change into the system. We applaud their activism…. By July, we’d begun to make progress in working with our supplier and in consulting with our competitors and with Greenpeace. Although Greenpeace had hoped that we’d simply come out with a high-level statement agreeing with its position, we wanted to really understand the problem—and to make sure our supplier had a system in place that could be implemented and sustained. On July 22, Nike announced that it would require its Brazilian leather suppliers to certify in writing that their hides hadn’t come from deforested areas. Now, Nike is huge—a much bigger player than we are in terms of leather sourcing—and its suppliers would have to start mapping and tracking ranches all over the country. A few days later—seven weeks after the e-mail onslaught began—we reached a similar agreement with our supplier. Implementing the agreement has been just as hard as we expected—even harder. Our leather supplier was acquired by a larger company last fall, which has predictably slowed things down. But our supplier has committed to certifying, in short order, that the hides it buys from large cattle ranches aren’t coming from deforested areas—and to having smaller ranches mapped by 2011. At the end of July 2009 we issued a statement praising Greenpeace for bringing the matter to the industry’s attention, and it was able to declare victory. In return, it issued a statement saying that Timberland had taken a leadership position on the issue, which was as gratifying as praise from an organization that has painfully put you through the paces can be. Here are some things I learned from the experience: When angry activists come at you, don’t stand there with your arms folded and your mind closed. You may not agree with their tactics, but they may be asking legitimate questions you should have been asking yourself. And if you can find at least one common goal—in this case, a solution to deforestation—you’ve also found at least one reason for working with each other, not against. On the other hand, don’t greet them naively with open arms. For every common goal, half a dozen personal agendas are in play. Greenpeace’s include selling membership subscriptions as well as saving the world. If that weren’t true, the organization would be making more phone calls and fewer sexy headlines. In times of tension, watch and listen. That’s when you learn just how committed you are to your principles—and how committed your team and your partners and even your competitors are to theirs. Did any of this make a difference for the issue of deforestation in Brazil? The jury’s still out and probably will be for a while. But I believe there’s real value in the outcomes we’ve already seen and in the lessons I’ll take with me as I continue to work to make Timberland a more responsible and sustainable organization—the same path I was on before the first e-mail came in, and the same path I’ll be on tomorrow.

How I Did It: Timberland’s CEO on Standing Up to 65,000 Angry Activists

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