Dr Otto, you love nature and like to travel off the beaten path in foreign countries. Luxury hotels aren’t your thing, are they?Spot on. I love natural adventures. When I encounter people in remote places, I achieve a level of relaxation that I don’t find anywhere else. I am able to leave everyday stress behind and reflect on my life. When I return, I find that I am refreshed and everything is back in perspective. That’s why I would rather ride a horse the Tian Shan Mountains in Kyrgyzstan or cross Mongolia with a caravan than lie in the pool of some five-star hotel.
Did this affinity with nature play a part in your initiative to set up Foundation 2°? What led you to get involved?There really was a decisive experience that aroused my interest in the subject. When I read The Limits to Growth, the first report published by the Club of Rome back in 1972, I was shocked. The report made it crystal clear that the way we do business does not take into account the finite nature of the world’s resources. From today’s perspective, the report may well have gone too far with some of its forecasts; other predictions, however, were probably not gloomy enough. As the report made such disturbing reading, I felt it was all the more important to do something.
Environmental protection has been a corporate goal of the Otto Group since the 1980s. What has changed since then?
Environmental protection and social responsibility have been core elements of our corporate strategy ever since that era. For me, it has always been important to do business in a way that doesn’t put future generations at a disadvantage. When I added environmental protection to our corporate goals back in the 1980s and strategically enshrined it into our corporate governance, everyone derided me as a naive tree hugger. Nowadays, specific environmental targets are set out in the Otto Group’s 2020 sustainability strategy. These relate to aspects such as the responsible sourcing and processing of resources such as wood and cotton, as well as the reduction of CO2 emissions at Group sites and in transport logistics. In the 1990s, the issue of socially responsible business practices in the countries of origin was added to the mix. Nowadays, the annual variable remuneration of all members of the Group’s Executive Board is not only linked to economic KPIs, but also depends on the sustainability targets being reached, such as a 50 per cent reduction in CO2 emissions by 2020. Unlike in days gone by, the issues of environmental/ climate protection and social responsibility are at least on the agenda at many companies, even if they are not exactly embraced.
Nevertheless, many companies still regard climate protection as a cost factor. What’s your take on that?
Sustainable business practices don’t just cost money; they also help save it, too. Energy costs are a prime example. Energy avoidance and high levels of energy efficiency are very much in companies’ commercial interest. This is illustrated not only at our sites, but also in terms of our transport logistics. Here, for example, we are working on continuous reduction of the already low level of CO2 emissions and airfreight by transporting more and more cargo by boat and rail. However, we also attach great importance to the economical use of natural resources such as water, wood and energy across our entire value chain.
And where do you stand on the issue of growth?
It is perfectly possible to achieve economic growth that respects the scarcity of natural resources and that is compatible with social progress. But long-term strategies are called for. Globally speaking, we can’t do without growth. Developing and emerging nations need growth to improve the living standards of their people. Industrial nations, however, have to move away from quantitative growth. We need qualitative growth. In other words, we need products that last longer. Businesses and society at large have to change in this regard.
Do companies use climate protection and sustainability to boost their image?There are still companies who confuse sustainable business practices with charity work. They fund environmental and social projects from profits that have not been earned in a very sustainable manner. These companies may well use the issue to boost their image. For me, however, sustainability is about responsible corporate governance. Sustainable business practices have to be an integral part of the corporate ethos. Any company that is serious about this issue becomes more credible, thus automatically enhancing their public image.
What makes Foundation 2° different from other business initiatives?
With this initiative, we want to set ourselves apart from the established representatives of business interests. A bit like a convoy, they have to try and take even the slowest members of the group with them, which is why they have been somewhat cautious in the past in terms of adopting an ambitious climate protection policy. However, ambitious aims unleash creativity and ingenuity. And we have plenty of both those things in Germany. And I have no doubt whatsoever that we can more than hold our own in the global competition for the best climate protection ideas.