By Brad Edmondson
Ice cream brand Ben & Jerry’s was one of the first companies to promote corporate citisenship and sustainability. But the journey has not been easy, as a new book explains.
US ice cream maker Ben & Jerry’s was established in the late 1970s. Over the next decade, it developed an ambitious three-part mission: making the world’s best ice cream; supporting progressive causes; and sharing the company’s success with all stakeholders: employees, suppliers, distributors and customers. Founders Ben Cohen and Jerry Greenfield, friends since childhood, set up the company, managed it as it grew and then eventually, reluctantly, sold it to Unilever in 2000.
In extracts from his new book Ice Cream Social: the struggle for the soul of Ben & Jerry’s, Brad Edmondson outlines how Ben and Jerry’s was an early adopter of progressive company social and environmental policies, and why.
From the start, it was important for Ben & Jerry’s that working conditions for employees improved as financial conditions improved. Surveys taken in 1997 and 1998 showed that employees saw the social mission as a critical part of the company’s success. Every employee was awarded both company stock and stock options in 1998, too. As far as linked prosperity goes, Ben & Jerry’s was walking the talk.
In 1997, the board’s social mission committee asked every department head to set social mission goals for the following year. They were ready to take things to a new level. Co-founder Ben Cohen and other board members wanted to integrate the social mission horizontally by adding it to policies in every department, from manufacturing to human resources, operations, waste disposal, franchise operations, philanthropy and finance. They also wanted to integrate the mission vertically by adding social metrics at every stage of the supply chain. This sometimes meant re-engineering the way the product was made.
One of the company’s projects for 1998 involved shrinking the environmental footprint of the paper it used. Most paper mills in the 1990s used elemental chlorine to bleach their wood pulp from grey to white. The wastewater from this process was laced with several toxic chemicals, including dioxin, an extremely potent carcinogen.
Ben & Jerry’s pint cartons, like many food containers, were made of paper coated with white clay that made them impermeable on the inside and ready to take ink on the outside. The product would be just as appealing to consumers if the containers were made out of coated paper that wasn’t bleached. By eliminating chlorine from the process, this switch would also eliminate a significant amount of dioxin from the waste stream. Cohen was on the board of Greenpeace, and chlorine bleaching was one of the group’s major concerns. But no one had ever made a food container out of unbleached paper before.
The “eco-pint” was unveiled in February 1999 after several years of development. By the end of that year, one-third of Ben & Jerry’s packaging was made out of unbleached paperboard. The company had gone forward with its original plan despite the US government’s approval of a less-polluting alternative in 1998.
A standard-size mill that adopted the new process, using chlorine dioxide as its bleaching agent, would produce between seven and 10 tonnes of organochlorine-laced sludge a day, according to the Worldwatch Institute. This was a big improvement over the 35 tonnes a day produced by elemental chlorine. But the company’s goal was to transform the process, not just to improve it.
Sticking with unbleached paperboard was more expensive. But the company’s goal was to eliminate the use of chlorine bleach to whiten paper. Ben & Jerry’s had been a corporate leader in environmental impact reduction in 1992, when it signed the Ceres principles, and again in 1994, when it added a label certifying that it did not use ingredients produced with bovine growth hormone. The company hoped that with the eco-pint, it might happen again.
Ben & Jerry’s also made changes at the other end of the supply chain, launching a long-term effort to reduce the environmental impact of dairies and other livestock farms. Feed, manure and fertilisers are loaded with nitrogen and phosphorus. These chemicals become pollutants when they wash out of agricultural soils in large amounts and end up in rivers and lakes. In 1999, Ben & Jerry’s joined with a grain company, experts at Cornell University and the University of Vermont, its main dairy supplier (the St Albans co-op), and two pilot farms to look for ways to reduce runoff in small, practical ways.
The goal of the dairy initiative was to make a more significant impact by encouraging people to think in broader terms. Ben & Jerry’s had considered and rejected the idea of producing organic ice cream because of its expense, despite its social benefits. Instead of staying out of the discussion, however, the company decided to double down.
They broadened the discussion by committing to something their academic partners called “sustainable agriculture”. This field was almost unknown in 1999. It does not define success in terms of avoiding all synthetic chemicals. Instead, its goal is broader, using farming methods that follow the principles of ecology.
The company’s commitment to job training was also changing. It had set a goal of opening five new PartnerShops, which was its term for ice cream stores that were operated by not-for-profit groups as job training programmes, in 1998, but various barriers and complications kept it from opening any. Even though Ben & Jerry’s opened four shops owned by non-profits in 1999, Liz Bankowski, then director of social mission, was rethinking the whole idea. “The PartnerShops worked best when they trained teenagers,” she says. “The jobs they created weren’t as suitable for a single mother with two kids.”
One problem was that Ben & Jerry’s ice cream stores worked best in places with a lot of upscale foot traffic, and the rent for these places was often expensive. Small not-for-profit groups often couldn’t sustain the substantial effort and resources needed to keep a shop alive. Bankowski decided to start seeking partnerships with local economic development agencies instead.
Ben & Jerry’s also took steps in 1999 to integrate the social mission into its overseas operations. It adopted global operating guidelines aimed at protecting the brand’s image and the three-part mission in other countries. The company said it would look at each country’s human-rights record and take steps to address any issues, and it would also try to express its activism in ways that respected local cultures.
“We tried to imagine how we would translate the mission to other countries back then,” says Helen Jones, then director of brand development, UK and Europe. “We had so few resources that we didn’t really have a chance to test our theories. But we talked about all kinds of things.”
At the end of 1999, the company tried to tie all these ideas together at a higher level. Senior employees from the international division joined others from marketing, purchasing, public relations, research and development, information systems, finance, human resources, retail operations, sales, environmental, and the Ben & Jerry’s Foundation in an interdepartmental values council, which was charged with reviewing the company’s progress on social initiatives, generating new ideas, and encouraging cross-departmental cooperation. The council’s first quarterly meeting happened in December.
Also in 1999, a national survey found that Ben & Jerry’s was one of the best-regarded companies in the US. The public gave it the fifth-best reputation in the country, which was particularly significant because the top four finishers (Johnson & Johnson, Coca-Cola, Hewlett-Packard, and Intel) were so much larger. Coca-Cola probably spent more on public relations than Ben & Jerry’s spent on salaries.
Ben & Jerry’s was a small company whose impact was huge. In its 1999 annual report, social auditor James Heard wrote: “Ben & Jerry’s most impressive achievement regarding its social mission is the way in which it has institutionalized the company’s values into decision-making. The company’s values are reflected in matters small and large … Social mission objectives are part of every manager’s job, from the chief executive officer on down, and these objectives have also been incorporated into the company’s strategic and operating plans … While the company may sometimes have fallen short in achieving its social mission goals, it demonstrates a commitment to progressive values that few companies can match.”
Heard didn’t know it, but he was writing a sort of eulogy. He submitted his audit in March 2000, just a few weeks before the company was sold to Unilever.
A surviving ethos
Ben & Jerry’s co-founders Ben Cohen and Jerry Greenfield, along with Jeff Furman, director and eventual board chairman, led the company with the idea that business could be a force for progressive social change as well as a machine for making money.
The company became a leader in the movement to make businesses more socially responsible, and the company pursued what it called a “double bottom line” while operating as a publicly traded company from 1984 until 2000. It was among the first companies to adopt policies that are now widely practised, such as paying a living wage, publishing audited reviews of social and environmental performance, and teaming up with not-for-profit organisations, to name a few.
The company took radical, crazy-sounding ideas and proved they could work. It made it easier for other companies to try these ideas. And behind all its efforts was one big idea the company called “linked prosperity”. As the company prospered, it said, all of the employees, suppliers, customers, and other living things that had contributed to its success should prosper as well.
The company’s mission had three parts that were equal and interrelated. It wanted to make the world’s best ice cream, to pursue progressive social change, and to provide fair reward to employees and shareholders alike. Ben & Jerry’s stuck to these principles as it became an international brand with passionately dedicated customers.
But the company eventually grew beyond the managerial abilities of its board, and after years of struggling, the board was forced to sell the company to Unilever. Cohen walked away from the deal with $41m; Greenfield got $9.5m; and Furman got about $1m. Yet Cohen and Greenfield have also said that losing control of their company was one of the worst experiences of their lives, and they still don’t want to talk about it.
The social mission did survive the sale, however. The founders and the board accepted Unilever’s offer only after negotiating a detailed agreement that guaranteed them a continuing role in the company and gave them legally enforceable powers.
Under the agreement, Unilever is the sole shareholder of Ben & Jerry’s, and it controls the company’s economic and operational decisions. But Ben & Jerry’s also has a separate board of directors that is not controlled by Unilever. This board elects its own members, and it exists in perpetuity. It acts as a watchdog and has the legal authority to block proposals that lessen product quality or the social mission. As sales increase, investment in the social mission must also increase.