Operationalize Sustainability for Clif Bar & Company

Introduction

Clif Bar & Company is a family and employee owned American company that consist of the CLIF BAR, CLIF Kid and LUNA brands which produce foods and drinks made with nutritious and organic ingredients. The company was founded in 1992 and is owned by Gary Erickson and Kit Crawford who are married to each other. Clif Bar & Company is committed to sustaining its people, brands, business, community and the planet and believes in building a healthy and resilient company. By doing so, it enables them to invest in the long term, be a catalyst for change, and do more for the world.

On a map, the ‘red roads’ are the busy roads, full of noise, vehicles and exhaust. On the hand, ‘white roads’ are the smaller, less travelled roads full of beauty and great adventure. Clif is a company that has chosen to travel on the white roads. One specific example is when founder Gary Erickson turned down an offer of $120 million to sell his business in 2000. He understood that it was imperative for Clif to stay private in order to grow naturally and to sustain itself over time – purpose guiding profit and patience over greed. “Companies on the leading edge of sustainability strategy will be more likely to succeed in this uncertain world going forward” (Farver, p. 133, 2013). Clif Bar & Company is an example of such a company as it works on reducing their ecological footprint in everything they do.

Neither Erickson nor Crawford care to talk about Clif Bar & Company’s revenue publicly, but the company is estimated to have had a growth rate of more than 20 percent in recent years, with over $700 million in 2016 revenues (Scott, 2017). According to its most recent annual report, the company has a 17% 10-year compounded annual growth rate and holds 31% of the market share in the Health & Lifestyle Bar category (Clif Bar & Company, 2018).

Analysis

Measurement

According to their company website, Clif Bar & Company is a business with “a different kind of bottom line.” The company is guided by their values, which Clif Bar & Company refer to as their Five Aspirations and it is clear that there is a definitive presence for sustainability within the organization. Farver (2013) emphasizes that “Mainstreaming sustainability throughout a company is simply good business” (p. 5). Clif Bar & Company realizes that running a company based on their Five Aspirations – ‘Sustaining Our Business, Our Brands, Our People, Our Community, and the Planet’ – is a challenging way to do business. (Clif Bar & Company, 2018). Clif Bar & Company is committed to this business model means balancing their investments for the long term, creating brands with integrity, helping their employees thrive, empowering their communities, and conserving and restoring the resources they depend on.

In the text, The Necessary Revolution, the authors state that “the successful companies of the future will be those that integrate business and employees’ personal values” (Senge, Smith, Kruschwitz, Laur, & Schley, 2010). Based on their performance over the past twenty-five years, Clif Bar & Company is a great example of a successful company of the future. Clif Bar & Company is no stranger to being awarded for its commitment to sustainability. In 2017, the company received two 2017 Green Power Leadership awards — one for Excellence in Green Power Use from the US Environmental Protection Agency (EPA) and a second for Leadership in Green Power Education from the Center for Resource Solutions (Baking Business, 2017). Most recently, Clif Bar & Company was recognized as the recipient of the 2018 Rabobank Award for Leadership in Sustainability (Rufus, 2018).

Social

“Leaders are people who ‘walk ahead’ and are committed to making deep changes in themselves and in their organizations. They naturally influence others through their credibility, capability, and commitment (Senge et al, 2010, p.159). In addition to the Five Aspirations, the company also adheres to Five Ingredients as well: Create, Connect, Inspire, Own It, and Be Yourself (Clif Bar & Company, 2016). The ingredients are carefully chosen words and phrases that remind their employees that they are a big part of the success at Clif Bar. The ingredients encourage their 1,100 employees to standout as individuals, to listen to one another, and to connect with each other through their values, ideas, and points of view. ""When the creative orientation is primary, life becomes a journey of bringing into reality what you truly care about and addressing the many practical problems that arise along the way"" (Senge et al, 2010, p. 50). Former CEO Kevin Cleary adds that being employed at Clif Bar & Company is not only about supporting the company’s purpose, it about finding your own purpose, bringing it to life, and sharing it with others (Clif Bar & Company, 2016). “To achieve a just society, we have to reason together about the meaning of the good life to create a hospitable public culture” (Sandel, 2010, p. 261).

The company is a dog-friendly and child-friendly workplace with subsidized onsite day care for kids up to 6 years old. Through their Sustainability Benefits program, the Clif Bar supports their employees on their personal journeys toward sustainability by offering cash incentives to employees for the purchase of fuel efficient hybrids or electric vehicles (over 430 purchased to date), commuter bikes, and energy-saving home improvements (Clif Bar & Company, 2018). Fiscally speaking, the company provides a 100% match of up to 5% or the employees annual earnings in addition to Clif Bar & Company’s Employee Stock Ownership Plan (ESOP) which is a generous retirement benefit created by the owners and is directly linked to the success of the company (Clif Bar & Company, 2017). Other perks of the company include 2.5 hours per week to work out at the company gym, Friday morning bike rides for everyone from 9 to 11 am, the company incents the employees to contribute a minimum of 20 hours a year towards charities within the community as well. All these incentives and benefits have contributed to a high retention percentage, with a voluntary turnover rate of less than three percent (Quackenbush, 2017).

Environmental

In Farver’s (2013) view, protecting the environment has both social and economic benefits (p. 96). In regards to the environment, Clif Bar & Company believes in conserving and restoring the planet’s natural resources by growing a business in harmony with nature. The company is headquartered in the EmeryTech Building in Emeryville, California which they have called home since 2010. The 115,000 square-foot headquarters has received LEED Platinum Certification and exemplifies Clif Bar’s core values as the space functions as a medium to narrate their story of community stewardship, while visibly promoting green design strategies that reduce its environmental footprint (DPR Construction, 2012). The company is 100% green power for electricity used at all facilities with approximately 80% of the electricity at their headquarters is generated by a 500-kW rooftop solar array (EPA, 2018). When the rooftop ws installed in 2010, it was the largest smart solar array in North America.

According to the company’s 2017 Annual Report (Clif Bar & Company, 2018), to date the company has avoided over 850,000 miles of truck driving by switching to rail transport, which reduces carbon emissions by 70% over conventional trucking. Additionally, the Clif Bar & Company have been moving towards zero waste at its headquarters, bakeries and distribution centers with a 2020 goal of 90% or more waste diversion from landfills and incineration. As of 2017, the company announced that it has almost reached its goal by achieving an 89% waste diversion in 2017 (Clif Bar & Company, 2018). Furthermore, the company has utilized 100% recycled paperboard cartons since 2003 and implemented a 10% packaging reduction of Clif Bar’s wrapper in 2016. Finally, Clif Bar supported the development of 36 renewable and energy efficiency projects, including five school-owned wind turbines in Indiana, inspiring a new, statewide clean-energy curriculum available to grades K-12 (Clif Bar & Company, 2018).

Conclusion

I agree with Erickson who stated, ""I think the most important lesson a small business can learn is to be patient for growth, but impatient for profitability"" (Smith, 2017). Clif Bar & Company has gone above and beyond the traditional triple bottom line; it has engrained the values into how they conduct their daily business through their Five Aspirations which serves as their business model. Additionally, the company is a champion of taking the road less traveled as they continue to resist the corporate greed which surrounds them, as evident of rival companies being bought out by industry giants such as Nestle and General Mills.

The one concern that I do have regarding company is their plan of succession as a leadership transition can be a vulnerable time for companies. Great preparation and development is vital for this company to have continued success; planning that make take years even to include an overlap period where both Erickson and Crawford may monitor the progress of potential candidates. Succession planning is about managing risk associated with any type skills or knowledge gap and it ought to be an intentional and thoughtful process. One way to achieve succession planning is by creating an organizational talent pool which consists of their current employees whose values are aligned with the succession strategy, coupled with the potential to step into the future role (Talent Guard, 2018). This company is a true diamond in the rough and it would be a shame for such a great company to place in a positon they failed to prepare for.

References

Baking Business. (2017, December 24). Clif Bar wins two Green Power Leadership awards. Retrieved from https://www.bakingbusiness.com/articles/32914-clif-bar-wins-two-green-power-leadership-awards

Business Wire. (2017, March 02). Clif Bar & Company receives 2017 Climate Leadership Award for Supply Chain Efforts from the US EPA. Retrieved from https://www.businesswire.com/news/home/20170302006137/en/Clif-Bar-Company-Receives-2017-Climate-Leadership

Clif Bar & Company. (2018). All aspirations annual report 2017: Growing a different kind of company. Retrieved from https://issuu.com/clifbar/docs/clif_all_aspirations_report_2017

Clif Bar & Company. (2017). All aspirations annual report 2016: Growing a different kind of company. Retrieved from https://issuu.com/clifbar/docs/aareport_2015

Clif Bar & Company. (2016). All aspirations annual report 2015: Thank you for 25 years of adventure in business. Retrieved from https://issuu.com/clifbar/docs/2016_all_aspirations_report_final

DPR Construction. (2012, May 17). Clif Bar & Company's headquarters - LEED platinum. Retrieved from https://www.dpr.com/media/blog/clif-bar-companys-headquarters-leed-platinum

EPA. (2018, October 09). 2017 past award winners. Retrieved from https://www.epa.gov/greenpower/2017-past-award-winners

Farver, S. (2013). Mainstreaming corporate sustainability. Cotati, California: GreenFix, LLC.

Quackenbush, G. (2017, March 03). Clif Bar's happy employees mean happy customers. Retrieved from https://www.northbaybusinessjournal.com/northbay/marincounty/6730951-181/clif-bar-marin-conference-business-journal

Rufus, A. (2018, December 12). Clif Bar wins sustainability award. Retrieved from https://www.oaklandmagazine.com/Clif-Bar-Wins-Sustainability-Award/

Sandel, M. (2010). Justice: What’s the right thing to do? New York, NY: Farrar, Straus and Giroux.

Senge, P., Smith, B., Kruschwitz, N. Laur, J. & Schley, S. (2010). The necessary revolution: How individuals and organizations are working together to create a sustainable world. New York, NY: Broadway Business Publishing.

Smith, S. (2017, April 21). Gary Erickson guided Clif Bar's rise by taking the road less traveled. Retrieved from https://www.investors.com/news/management/leaders-and-success/gary-erickson-guided-clif-bars-rise-by-taking-the-road-less-traveled/

Talent Guard. (2018, October 10). Building an organizational talent pool to support your succession planning. Retrieved from https://talentguard.com/building-an-organizational-talent-pool-to-support-your-succession-planning/

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