Environmentalism is playing a critical role in business objectives and corporate strategy for a growing number of companies.
The $45 billion private-equity deal for Texas energy company TXU - the largest leveraged buyout in US history - is playing out like so many other large deals these days, with environmentalism at the forefront.
"TXU had been going through a pretty public and intense scrutiny of its efforts to build 11 new coal plants in Texas," when the buyout offer came in, says Lisa Singleton, TXU director of corporate communications.
TXU's proposed 11 coal power plants angered environmentalists concerned with global warming. Environmental Defense (ED), which has an office in Texas, began a PR campaign to stop the energy giant from building what it called polluting, dangerous plants.
TXU chose not to comment further for this piece on the grounds that the leveraged buyout has not yet occurred.
ED and its PR partner Russell/Shaw, an Austin, TX-based integrated marketing agency, created the StopTXU.com Web site, drawing the attention of journalists from the Waco Tribune to The New York Times.
The group bought full-page ads in the Dallas Morning News, The Wall Street Journal, and other papers that read: "Good news: some power companies are decreasing global warming pollution. Bad news: Yours is about to double it. StopTXU.com."
ED wrote and sent regular e-newsletters on the TXU plans to journalists in order to keep them updated on the situation.
And right before Christmas, ED's PR team went out in Austin and had men dressed as Santa's elves hand out lumps of coal to people on the street. They provided cards and envelopes, encouraging the public to mail their coal to Gov. Rick Perry (R-TX) and TXU CEO John Wilder, with the message, "Keep your dirty lumps of coal for Christmas - Texans don't want any more dirty coal plants." The team taped the event and posted it on YouTube to thousands of downloads. Local television broadcast news stations also picked it up.
This was an integrated campaign, using paid media, earned media, events, and a huge online component, says David Shaw of Russell/ Shaw. The online work in particular allowed this campaign to reach a huge audience, something that ED never could have afforded before the days of the Internet.
"Online work is the great equalizer," he says.
Soon, a nationwide coalition had formed, pressuring TXU to rethink its expansion plans. And as a result of the campaign, the buyer agreed to cut the number of new TXU coal plants from 11 to three; to support a US cap on greenhouse gas emissions; double its wind power purchase, and commit $400 million toward energy-efficiency programs.
In March, former Vice President Al Gore, who created the Oscar-winning global warming film An Inconvenient Truth, mentioned the new TXU plans on C-SPAN.
"The story has reverberated nationally," says Colin Rowan, then communications director for the ED, who deemed the effort a resounding success. "The TXU announcement further illustrates to our leaders in [DC] and companies around the US that global warming is a business variable they must account for in the future."
Change takes time
Shaw says it took some time for TXU to take global warming seriously, but that it, along with other global corporations such as General Electric and Duke Energy Company, is changing its attitude.
"Finally, the new buyers realize that ... [the environment is what] businesses need to think about in what they plan for the future, just as they plan for upswings and downswings in the economy," adds Rowan.
When addressing environmental issues on behalf of large corporations, a number of factors need to be taken in to consideration.
It is of great benefit for PR pros to melt down the scientific facts into understandable language, says Howard Lalli, SVP, group head of the real estate, sustainability practice at Edelman Atlanta.
"[It's] crucial to boil the message down in a very accessible way," he says, adding that some other key issues are speaking to investors in terms of opportunity, versus risk.
With so many alternatives, another consideration is talking about your sustainable energy practice without denigrating others'. And all of this needs to be framed within the terms of public policy as business decisions, not altruistic ones, Lalli explains.
"It frames to everyone why you are doing it, why it's important, and sets reasonable expectations," he adds. "Environmentalists can come back to it with, 'Why don't you do more to benefit the environment?' And you can come back with, 'We are balancing it within a business model.'"
The proposed TXU buyers, private equity firms Kolberg Kravis & Roberts and Texas Pacific, along with Goldman Sachs, are now viewing global warming as something they need to address in their business plan, Rowan explains.
"The truth of the matter is they see it as a critical business component," he says. "And ignoring it and hoping that it goes away is like playing Russian roulette with your investors' money. Smart companies like Texas Pacific aren't willing to do that."
How green is your company?
Other notable companies using high-profile PR campaigns to promote the use of alternative energy:
Reports on its own performance in managing its environmental impacts and emissions from its operations.
Has a goal to be supplied 100% by renewable energy, with existing stores 25% more efficient in seven years and new stores 30% more efficient in four years.
A sponsor of Stanford University's Global Climate and Energy Project, a multimillion-dollar collaborative research project to develop alternative and next-generation energy technologies.
Began taking action against global climate changes over 10 years ago, it has reduced its global greenhouse gas emissions by 72% versus 1990 levels.
Actively manages greenhouse gas emissions in its worldwide operations such that by 2010 GHGs are still 5% or more below its 1990 levels. By the end of 2002 Shell had met its first GHG target, reducing emissions by over 10% compared to 1990.