Please give a rod do you think
that's going to I guess.

Thank you.

Thank you Mansoor
appreciate in addiction and

I'm anxious to meet that guy that's
going to speak that has seen it all and

done it all so I look forward to it
very much before I begin Congratulations

to Georgia Tech and her stance here
magazine as listed Georgia Tech

as Number eight in its cool schools two
thousand and thirteen for sustainability.

Good news thanks and
that today was paying attention but

another local school by the name
of Emory was ranked sixteenth in

University Georgia
didn't make the list so.

For what it's worth now I also understand
they're taping the event today and.

I think we should all aspire to be the
second video from Georgia Tech to go by

real this week what do you think.

Seriously I appreciate the opportunity
to be here the impact series has a great

reputation and I'm honored that you
allowed Georgia to be a part of it

especially on a topic new and
in my heart that sustainability.

You heard the introduction.

And I met shell I did not grow up wanting
to be a chief sustainability officer.

I started out doing securities and
mergers and acquisitions all.

Moved into becoming an environmental
compliance attorney and

then moved to a general counsel and
now a chief sustainability officer and

the process I went from
Kansas City Missouri.

To Wichita Kansas to St Simons
Island Georgia and now to Atlanta.

I represented issuers and underwriters.

Moved to heavy manufacturing
nuclear waste trying.

protégé Sion and
super fun then to petrochemicals and

hydrous ammonia cattle feed rats and
asphalt.

And now so
you can paper tissue Talum gypsum.

My would do if is Susan I
have four children.

Two in college at.

Baylor and open once a football player and
once a basketball player and

I have get to still in high school I've
got boys on each and the girls so.

And I am thrilled to be here and.

Now I'd like to tell you
a little bit about your tips.

Because for primary businesses.

Consumer products building products
packaging and a business called C.P.

Harmon recycling the Consumer Products
business is comprised of a retail business

so the products you see in grocery
stores and club channels G.P.

professional is another line of business
those are the largely tissue Intel

products you'll see in office
building schools stadiums and

food service products and
the communication paper cut sheet

copy paper business the building products
business is comprised of three businesses

a wood products business which is sheeting
plywood and it was be dimensional lumber

and engineer lumber then there's our
gypsum business which is dry wall and

if you guys have driven by
buildings under construction and

seen that gold sheeting on
the outside that said and

glass dense glass cold revolutionary
product that Georgia Pacific invented

that is fiberglass it prevents mold
from building up on organics so

leads to better buildings and
quicker construction we have

another business that we cleverly
called cellulose containerboard and

packaging that's comprised of
a cellulose business contain.

Airport business and packaging business.

And then as I said Harmon recycling
you can see a number of employees and.

And our tagline is making
life's some necessities and

that's what we do here
is a picture of where we

operate in the United States and
I've limited it to the United States.

And the nature Robbins
business lends itself to

sustainability we start with
the renewable resource from trees.

There are more trees in the United States
more acres of trees than there.

Were at that one thousand in
one thousand nine hundred

in the last fifty years there's twenty
five percent more trees in America and

if you look at when
the Europeans came to America

the last acreage to forest is not due to

forestry it's primarily due to
his Asian cities and agriculture.

Why is that important.

Because it's companies
like Georgia Pacific.

That turn trees into dollars that provides
incentive for people to plant and

grow trees and we will only turn them into
dollars if they plant them sustainably

grow them sustainably and
harvest them sustainably and so

we believe we play a big role in companies
in the forest products businesses like

Georgia Pacific in keeping Forestry
a viable economic alternative for

land in the United States and
we also use a lot of biomass few

fuels in addition to having our
primary feedstock be renewable.

About sixty five percent or
more of our manufacturing energy comes

from renewable bio that's a waste and
byproduct for us that week.

Could throw away or
find alternative uses for but instead for

energy the Forest Products
business is we believe the largest

user of renewable energy for
complex manufacturing in the world.

Our products are primarily
in two areas shelter and

hygiene very important areas areas that
touch people's lives on a daily basis and

we believe make their lives better
from building products to shoot.

The clearly promote health and
hygiene to put use for

feminine hygiene products and
disposable diapers and medical.

Devices to paper that help you
communicate that you learn to read

your first book on and that you made
your first card to your mom and

dad on in fact it's tough
to go through a day without

using one of our products or products
like ours to make your life better.

And then finally recycling.

A little known fact is that
last year in the United States

over sixty five percent of all paper
manufactured was recovered for recycling.

The next closest to that would be metal
and down below that is plastic and glass.

Why is paper recovered because it's
a process Roma Tiriel that's valuable and

it's traded globally and those markets
provide the economic incentive to

recover and
use it where it's appropriate today G.P.

is one of the largest tissue manufacturers
using recycled fiber in the world we use

of about three million tonnes in our
own processes in G.P. Harman recycling

our recovery business recovers about
seven million tonnes annually.

And we believe one of
the benefits of that business and

the value it creates to society is.

Connecting high quality so.

Which is a recovered biber with
high valued and uses so now.

Let's think about sustainability but

first I would like to put it
in the business context so.

Business when I want.

Write a business this.

Well let's start here
how many of you heard

someone say somewhere along the line
something to the effect of let more put

main stream out of business
let me see a show and a.

Fair number of you heard that.

Is that true do you think.

Is so.

How did they do.

And why did they stop with Main Street.

And its simplest times the question is.

What is needed for
a business to start and succeed.

And in its simplest terms
there are two things

you need an entrepreneur with an idea and
a vision who is willing to take risks.

But they don't do so well on their own.

They need customers who
prefer the products and

services they provide over the available
alternatives in the marketplace.

So as we go back to the question
about Wal-Mart putting Main Street

out of business.

Assuming for the sake of this discussion
that Main Street is out of business.

Who did it.

And why did they do.

Well I think the answer to
that is lots of folks really.

What I would.

If.

If when Mark opened and

shoppers were happy to continue
shopping and Main Street.

Main Street would still be in business.

It was shoppers with dollars
that want to choices

that decided they were better served
they had a higher value alternative.

Than what the alternatives they
had before Wal-Mart showed up.

So.

As we think about then
why business exists and

society they they exist to
create value for society.

And they fail when they
don't create sufficient.

So.

Who gets to decide if they create and
I found.

Well again simply just for the sake
of time there's a lot of people that

play a role in that a lot of
business play a role in that but

there's three groups that have pretty
big impact on their shareholders.

Right.

And if shareholders don't make a profit or

more importantly if they
lose their investment.

They're not happy now how how does
a shareholder lose its investment

well if a business takes in more
him put in the value of those

is higher than the value it creates with
those input that's how they lose money.

And they're destroying society's
resources when they lose money.

Profit.

Against if we operate in a rule of law.

Is just a measure that people are creating
superior value to the inputs the human

capital the real property and the raw
materials that they use in a business.

There's also customers we talk about those
the customers have to decide they like

your products better than other people no
one has to buy Georgia Pacific products.

We hope they do and
we hope you'll buy quilted norther and

Brawny paper towels and
Dixie cups and plates and cutlery and

we have people in lots of houses and buy
plywood No it's B. and gypsum wallboard.

But we're competing to be
the best alternative for

people that buy products like
ours in the marketplace and

then there's governments government's
role is to make sure people meet

minimum society standards as they
compete in the business world.

So.

What does all this really
have to do with sustainable.

Well I would suggest.

It has everything to do a sustainable.

I've been to the Coke family of companies
for a little over seventeen years and

shortly after I showed up I was
in a meeting with Charles Koch

who is the chairman.

Of the company.

And I've heard him say something like this
many times this is out of a book that

he published a few years ago successful
companies create value by providing

products or services their customers value
more highly than available alternatives.

They do this while consuming fewer
resources leaving more resources available

to satisfy their needs in society value
creation involved making people's lives

better it is contributing
to prosperity in society.

Now he did not make that as an L.
truest statement.

He made that as a statement of fact.

To express his view of why he
believes business exist and

why they are successful and when I was
approached at the end of two thousand and

seven about taking this
role I said down with.

The C.E.O..

And he said Bill would like you consider
taking this role what do you think.

And since.
And attended such a fine academics school

is Georgia Tech I thought for
a second and I said well you want me to.

And without smiling and

responding he goes Well that's
what we want you to figure out.

And so as I went in search to try to
say well OK what is sustainability and

how should we use it and
what does it look like when we see it.

I kind of went back to this
statement on value creation and

realize that if you change one word.

Successful to sustainable.

I pose that you've got as fine
a working definition of sustainability

as there could be.

Because sustainability is not
about always doing more with less.

I would venture that if we could take
our current mills that make tissue.

And create a cure for cancer.

Except it used ten times the wood
in ten times the energy in ten

times the emissions.

For each dose.

Of cancer treatment.

Then it would be sustainable but

most sustainable thing we could
do to go to market with the cure.

And trust the market that they will drive
efficiencies over time in those processes.

And so it's about what creating value

through choices now consuming
fewer resources why because that

leaves more resources available to
satisfy other needs in society.

And at the end of the day it's about
making people's lives better again not

because it's a noble cause
that is a fine reason to do.

But I would venture to say that for most
business the most sustainable reason to do

it is your competitors will beat your
brains out if you're not very good at it.

And if you don't stop to think
why do people buy our stuff and

think it's better than the other
stuff like ours they can buy.

That you're missing the first big
opportunity in sustainability

Whenever to make that factual
statement something real that G.P.

can use in everyday businesses we created
what we call the sustainability framework.

And this is it.

So again that being a Georgia Tech
read I thought I could draw a picture

on a Power Point and I would have
the answer and it didn't work so well but

it was a good start because
what this teaches us is that

when we talk about sustainability
we must do it in three dimensions.

Any one or two of those dimensions are
fine to focus on and talk about but unless

you're talking about all three you're
not having a sustainability discussion.

Because when we look at these
three dimensions well recognize

we didn't create these a straight
out of the Brant one commission and

a whole bunch of work ever since then.

What we said is look our job is done or
stand the social benefits and drawbacks.

To our operations and
products in society and

we want to maximize the benefits and
minimize that Rob.

Now we can do that and the first thing
you have to ask in social is how

do our products especially a particular
product make people's lives better.

And that's helping people's lives.

Be better through the products we make
supporting our communities there's a whole

bunch of things in there especially when
you get into human rights dealing in

countries that don't have the rule
of law on the social structure.

We haven't in the developed world.

So it's not easy but that's that's where
you look through the lens to find those

issues the second
dimension is environmental.

That's using resources wisely
complying with laws minimizing waste.

And the third dimensions is economics.

That has to do with cost it has to
do with profitability that has to

do with the competitiveness of
our products in the marketplace.

And the going to looking at those.

Issues in these three dimensions is to.

Create value through the optimal balance.

Of the factors in those three dimensions.

Because if you try to maximize
the value in any one or

two you do it to the detriment of.

The others.

And what you find is your products are no
longer acceptable in the marketplace now.

This is a mental model and what
a mental model does is take complexity.

And make it manageable to where
we can make decisions about.

There are some phenomenal models
that don't always work very well.

Like weather models.

Right they're very sophisticated
they just aren't very good and

accurate at handling all
the complexity that determines

whether you can have your wedding
outside on Saturday or not.

So we think that this model this
framework actually captures

what the marketplace is doing in
a series of very complex decisions.

So let's look at a few examples.

Of this in action by playing a game.

And that I call sustainable or not.

So up a show of hands.

If you have a cup of coffee.

Who thinks a permanent ceramic
cup is more sustainable

than a paper cup Let's see hands for
a moment.

Let's see as for paper.

Well.

If you go back.

To this frame or.

The question is why what do
people want out of a coffee cup.

I would venture that it's very different

if you're sitting at a French restaurant
with tablecloths you just got engaged they

just brought up to souffle you're going
gazing lovingly into your fiance's eyes.

And the waiter says Can I
get you a cup of coffee.

In that situation you
probably prefer what.

Question Why.

A statics image right you don't mind
if your fingers a little too big for

the little hole and

that you know you have to fill it up with
like you're not there to drink coffee.

But if you're not to go to work

get in on my company a car
if I don't land a traffic.

Well you want to have in your hand.

Why convenience.

You have more of it.

Will keep him warm longer.

And I would say there's
also hygiene difference.

If you haven't gotten a paper copy
Cup with lipstick stains on it.

So when I asked him a question which
is more sustainable we want to

get some facts in the environmental
dimension because what we find is that.

People tend to sit.

They're involved in the disposal
of paper food service products.

They tend to believe they have
a negative impact on the environment.

So we did a study.

Called the life cycle assessment.

And there's international standards and I
so standard we're doing a couple of them.

I'll say standards.

And what we've learned is that.

The paper cup.

Is superior from an environmental
standpoint to the ceramic cup.

Until the fourth use of
the ceramic cup between wash.

US So think about that if that's
the coffee cup on your desk.

That's probably OK with you.

But if your customer two three four
five in the restaurant that's not so

OK with you.

Now.

What people fail to think about
is that in this trade off one's

from a renewable resource the other
is from a depleting resource.

They also often fail to take into account
the water the heat the energy washing.

Those over and
over which is part of the equation.

Taken in one.

Paper.

Pushing paper from new trays or
recycled paper.

Which is more sustainable.

I will make you do a show of hands again
this time but it's not really an either or

question.

We're a large manufacturer of Virgin
products paper tissue tell and recycle.

And we like.

And then the trade offs and uses the big.

Problem often in recycling is when.

Content mandates so states or
businesses or governments decide they want

to mandate a percent content of recycled
material because in that situation

what it often does is accentuates the
inefficiency of where paper is collected

to where it has to go to be manufactured
and where has to go to be sold.

The market is very efficient at
those trade offs prices them in.

Paper is traded on a global market
the price setter in the world is China.

So force a manufacturer in the U.S..

To use a ton of recovered paper

they typically outbid China in
the marketplace so there's two reasons

people usually like recycle paper one
because they want to keep paper at all and

only talked about that over sixty
five percent of it was recovered

all grades of paper manufacturing I States
when you think about it all your notebooks

the books on your show you don't buy
a book to read it and then recycle.

You don't get photographs printed
to look at them and recycle.

The boxes you have they're still doing
the purpose of storing stuff for you.

So there's a lot of paper that's meeting
its intended use plus tissue and

Talbott a lot of which we don't
really want to recovery right so

when you think about what the top end of
that market is sixty five percent we're

diving pretty deep in the dumpster as
an industry right now to get paper

right so for people to say always we
say because I want to collect more.

I would say that's not really
driving up collection rates.

Alternatively you hear people
say they want to save a tree.

We talked about that China is
the price setter in the world so

just in simplest terms.

If we use the tonne of.

Paper.

In the US.

And we're not saving a tree we're just
shifting it from being harvested here

in among the most sustainable
forestry basins in the world.

To being cut for use in China which
comes from a lot of sources but

the most likely ones are China Russia and
Indonesia.

And I would say those are among some
of the more questionable forestry

basins in the world.

So again but facts of sustainability
sometimes don't match the perceptions.

Now we actually did a life cycle
assessment on Virgin and recycle.

And actually this one surprised

all of us I think a little bit when we
thought it would be relatively close.

Because where it is
recycled paper come from.

Virgin paper right recycled paper grows
on trees just like regular paper.

And so there's a burden that has
to be borne by the recovered fiber

because it just didn't go to
from tree to recovery paper so

when we look at the life cycle assessment
for that and others have done this as well

what they basically find is that
virgin paper is actually beneficial in

fossil fuel in which would be greenhouse
gases and global warming potential

typically how that's nominated
in CA's in water quality and

in a better quality recycle
disfavored in human toxicity and

in the rest of the excuse me parameters

basically water use of solid waste there
was no significant difference between.

So whether you prefer burgeon.

Or recycle paper products have no
fear they both have their place and

you can feel very good using
either one of them now.

That's all that leading drip.

To think a bat and do well one of our

businesses has historically had
a sales value proposition go to market

that look like this they would talk
about these factors to their customers.

QUESTION You sustainability
hygiene image productivity.

And over the last few years what they've
realized is all those are factors

in sustainability and instead of going
to market with sustainability as a topic

they could go to market and offer
sustainable solutions across a portfolio.

And allow the customers to decide
what attributes in their products

in our portfolio that they like the best.

And so what ends up happening is
the same things get talked about but

now you make more transparent for

customers what the trade offs are in
their products and that should give us

greater visibility into what they
value most in our portfolio and

likewise what they don't value that should
be an opportunity for us to improve.

So quick examples of this in action.

I think is pretty powerful
chart right here this chart and

I'm going to be a little circumspect
on this one so bear with me.

This shows two classes of commodity
products that Georgia Pacific

makes they are true commodities and

in the marketplace very hard to stand
wish not only across our portfolio but

among our competitors portfolio which
means they often sell based on what.

Price cost right.

Price to use.

By focusing on the sustainability
attributes and

delivering attributes that
our customers preferred.

We created advantaged
products in two categories.

Across those commodity lines and
what this shark chart chart shows is that.

That Our percent of profits for
both categories is more than

two times in excess of what
the volume of sales would predict.

And that's with our data.

Not compared to the general
marketplace so.

What we conclude from that is that.

Sustainability is valuable
in the market and.

In a disciplined fashion
we try to determine what

the marketplace values most and
if we deliver better alternatives.

To the marketplace that we can take
even in a commodity space we can create

advanced products.

Now I'll give you a real
life example that.

Hopefully you guys are familiar with.

Hopefully by now everyone has seen and
used and

in motion dispenser I encourage
you to wave your hand in front of

there a few hundred times
when you go into a bathroom.

But this is interesting.

And I've got to tell you a little story
that one of the people that hired me years

ago in my career when I was
had the opportunity to go to

the first piece of the Forest Products
business at the misfortune to tell

my family had moved from Wichita Kansas
to St Simons Island Georgia and.

But he called and

he said Hey I hear you take a new job and
I said yeah and he said Well.

What are you going to do and

I said well I'm going to go with
these business and he said.

Why don't they make like stuff for diapers
and toilet paper and hand towels he said

that's not very sexy you're right and
it was actually interesting because.

Really it's just the opposite
when we sell point zero.

Sells on every continent in
the world has paper machines.

And you know you can see every
emerging market through Pope sales.

You know what.

Because shoppers in most
societies are women.

And when they can have access to feminine
hygiene products and disposable diapers

with enough income to get it
immediately makes their lives better.

So here's my lesson for
all the students out there

you think we're going to Apple school and
you know what it may be.

But when you make stuff that people
use in their lives every day and

it makes a real difference.

Don't think about it as
a boring old business think

about it as an opportunity to add
value and improve lives in society.

So that's when we did hear what
happens when you go into the bathroom

going to the bathroom for
whatever reason you wash your hands.

And then you're faced with what dilemma.

You know you're going to
touch that yucky thing.

That Who knows who else
was in there touching

I wish remember the old crap towels that
you pulled down and they were damp and

you want to be sure what happened with
them yeah right and that's not fun or were

or they are dollars who like so it's like
a thousand people sneezing in the bathroom

without covering their mouths over and
over right I mean it's kind of gross.

So we say look they just wash their
hands What's a social dilemma

they just wash their hands
their hands are clean

they don't want to touch something
dirty What do we do about it.

I wonder if we can make
a Talbots touchless.

OK well let's do that wait a minute.

You can't make a tallis we make
how will you make a tallis

touchless we're not going to touch it
that's how they'd rather have it so

we had to focus on a lot of dispenser
when only thing about dispensers.

So it took someone stopping and
thinking outside.

Box.

So then.

What we did with that dispenser is we
control two things actually three.

One there's no telling.

So the stone towel stays more
hygenic waiting to be used.

Number two.

We can control the portion
of how they get and

number three we can control
how fast it recharges.

So guess what you do
then you eliminate waste.

I know none of you have ever done it but
with four kids There's times you go in and

you just grab a chunk and pull as hard as
you can and some fell on the floor and

you know it's a bloody nose or a milkshake
all over some way or whatever it is.

And that's waste and
that happens over and over and

over again so guess what we could
show compared to the traditional

three fold how we can save twenty to
thirty percent hell uses for customers.

Guess what that means to them.

They buy less tops right.

And guess what here's a little secret
all the places where you go and

wash your hands.

None of them are in business
to wash your hands.

That's a cost to serve a certain
ancillary service or provide.

We can save the money and
guess what we can also do back to

the environmental dimension that's
less waste going out the door.

And if you back it up that's less housing
the supply chain that's less stocks for

them that's less times where
employees have to stop and

recharge one of those things and
put something in it.

And now we have a value proposition
to go to the market that so

done well what did we
create a better talent.

OK I think we did.

That in fact we now know that and
now we can give you tell

we give you a bleach we give you
numbers least when give you so.

If I don't sort of five and give you one
of the patent on it not a patent on it

will give you a thicker
one of the thinner one.

But what we delivered is
a more sustainable solution

to an every day occurrence.

And I would say maybe it's just me.

But the first time I saw one of those and

I didn't work for
Georgia Pacific I did it like four or

five times because I just thought it was
kind of cool little sound and you know so.

That's sustainability in action.

Now.

Let me just close and
I'll take some question with you things

what I see as challenges and
sustainability I actually see a lot.

Because what I've just told you about
sustainability I would not say that's

a common view of sustainability
by most businesses.

In the United States or in the world.

And I think you can see that by.

Businesses tend to.

Look at sustainability and as a way to use

less to make more and as you know there's
a piece of that that we agree with.

But I would also suggest that.

When they made when Apple
came out with the i Phone.

And I don't know this I
haven't looked at the data.

But I believe that it had to use
more raw materials more reverse and

more energy to make an i Phone
than any other per phone.

But when the marketplace voted
by what phone they chose.

There was one that they so
far have thought overwhelmingly

is the most sustainable choice to
fulfill their needs now that's changing.

And if you've seen what Samsung's done
it's pretty interesting what's going.

And that market so I say that to set up
some of these challenges run a prescribed

view of sustainability by that I mean we
have a lot of customers that come in and

they want us to do a certain thing
that they say is most sustainable.

And you know that they may or
may not be right.

I would tell you often times.

We struggle with the thing
they want us to maximize.

Because we're very aware of
the second third order effects

if the market goes in that direction.

And so.

And as with my porcelain and
paper analogy or

my virgin recycled the facts matter
in this because this isn't about

one thing to do good it's in fact
what impacts do we have on society

in creating value and
using resources wisely.

To two new focus.

When people say sustainability for
us is about these four things.

Well I immediately think of all the
thousands of other things out there how

did you get those.

Now you've got to have priorities
you can't do everything.

But I would also venture to say
sustainability is not an absolute truth.

And I'll give you an example.

If you're a Georgia Tech student.

And you've got a choice
to head off to college.

In a Prius.

Or a four wheel drive suburban.

Where you think best serves
your needs at Georgetown.

Was probably not a universal answer.

But I would suggest for
a lot of students Prius takes less gas.

You can hold as many piece.

You don't get stuck driving a big group
all the time it's easy to park right.

But now you go with your
friends on spring break and

you have to top of the mountain getting
good powder and you break your leg.

And you call for the ambulance where you
want to show up Prius or the suburban.

It depends situations change.

Resources that are scarce and
some areas are plentiful and others.

Saving not is not the same everywhere.

If you are in the head water
of the Mississippi River.

And ninety percent of your
waters one time pass through and

you discharge it without
creating any quality issues

you might be highly inefficient but
I've been operating cost who cares.

Because you're not depriving anybody
water that's a very different answer

if you're in southwest
Georgia operating a facility.

So be careful to never focused issues in
one size fits all government intervention.

And I say this This isn't to say
government interventions bad.

The problem is it's almost always one
size fits all and it is slow to respond.

And so what happens is
a minimum expectation set and

innovation and competition around that
almost come to a grand second over and

over with environmental innovation and
I'm not saying that's bad.

I just don't think it's
the best way to get

the results in sustainability
because once the government says

thou shalt thou shalt not in my view it's
no longer sustainable it's compliance.

And it's about optimizing a way around the
constraint not creating a better solution.

And then I think the whole issue of
transparency here about transparency

the fact is.

There's a lot of transparency that.

Well there is so much data in our business
it's hard for those of us in the business

to really get meaningful information
out of the data something.

And I would venture to say that a lot
of the information being asked for

an area of sustainability is a good
check the box exercise but it may not be

that helpful to business decisions and
there is a cost every time information is

provided and that ends up coming back
to consumers in the marketplace.

So the whole transparency movement and

again I'm not saying these are bad
I'm just saying these are challenges

that I see coming up and last but
not least supply chain accountability

do I believe there needs to be a supply
chain accountability yes I do.

We have expectations for our suppliers.

Just like we hope our customers
have expectations for us.

But when you start trying to
expand the role of a business

to in essence be an insurer.

Of nonaffiliated business is that they're
just in a contractual relationship with.

Not only significant legal
issues around there.

But it's very difficult to
think about when that stops and

I'll just give you one example.

To leave you with if you think
about an issue like child labor.

Very serious issue.

I would also venture that anyone who ever.

Babysat for someone on their street or
at their church when they were thirteen or

fourteen or fifteen or
mowed their yard engaged in child labor.

In that transaction now
it's not forced labor.

So why do we think it's OK to have
a neighbor kid to watch our child.

While we go out on an over.

Three days my wife and I are responsible
they were good and we paid it.

But we set an arbitrary standard
in a foreign land that.

There's a certain age but which you
cannot work when you're with your dad and

mom on the family forest or
the family farm or

whatever it is I am not
saying those are easy issues.

I'm saying when we really look
at how to benefit societies.

And protect rights.

And act with integrity.

The issues can become cloudy and it gets
tough sitting in a developed country

in air conditioned offices drinking
coffee hopefully out of paper cups.

Drying our hands in a sanitary condition.

And really think through all
the implications of some of

the supply chain issues.

So.

Business when I want to
sustainability all and

however much time I am happy
to take some questions.

I feel the questions.

My.

Big question I have for you is
relates to some of your challenge your

challenge points that you laid out and how
they interact with each other specifically

supply chain accountability versus
the fact that you do have some

very different views on how you or
your writing at your sustainability.

Calculations the lack of a better word so
do you yes thanks to prescribe

views so if they have a different
view from yours how do you

how do you force them to accountability
realizing they have other customers.

Now turning it into as you said
the sustainability versus compliance issue

no that's that look that's
an excellent question and

I listed those challenges because I
don't have great answers for a lot of

you know here's here's what I'd say and
you touched on some of it first of all.

Most of our suppliers
have many other customers

now as Georgia Pacific we're little bit
unique we are a very integrated company.

We are the only I believe tissue
Intel company in the United States

that still operates pulp mill so
we buy our trees here we know where

they come from we know the supply chain
we get them into our mills right and

we we have that part of the process a lot
of people are buying paint from different

places where we buy some point it's not
a big percentage of our overall fiber.

But when you start looking at things
like I'll tell you one we have companies

largely responsible name
brand companies that say hey

we're going to send you our supplier
guidelines and principles and

we want you to agree with these we want
you to post them in your plants we want to

train your employees on them and we want
the ability to audit you want an ounce

when we want well that's one of those that
sounds good sitting in a conference room.

But we may have a box plan or tissue
plant that has thousands of customers

how many of those can we do that for
before we become Disney World and

do guided tours through
our plans right and

how many sets of standards can we
actually train our employees on.

Right and so.

I think there are better ways I think
too often what businesses do is and

what I challenge all or should do is let's
not just look at what makes our life easy

let's look at what we're trying to achieve
and let's look at the alternatives for

trying to get that result and
see how we can do that.

Right there are some
parts of the world where

we one hundred percent of the time
when we go in and have a new vendor.

We will send people in there and

we will assess their facility before
we'll even sign agreements part of

the negotiations then other parts of the
world like in the United States mostly.

Western Europe where we may or
may not do that because we

trust the institutions of society and
the rule of law that we're not going

to find slave labor forced
labor you know the kind of

violations that you just don't want to be
a part of in other parts of the world so

some societies they have those structures
in place and you can take some cough it's

about it's not a blank check that's not
saying we don't have responsibility but

just trying to find the end point
of where that responsibility is and

how far do we go and
how many resources do we put toward that.

Those are tough issues.

A question for you out there Sean thanks
very much for coming in today and

I think you know next case for
the sustainability of Georgia Pacific's

products we consider the total cost of
production total constant use such I think

also talking about farm labor was wrong
but could you explain what perhaps it was

you produce trying to do so in the last
few years when Georgia Pacific good deals

were started in Europe on substance you
know for example where you do in regard to

your quality you know what a call to you
know I'm not sure if you're like most or

not it's part of your own soon to be
produced spelling and things like that so

when you guys do things just you know you
really are smelly but the ones I'm going

to write about the social mindset
of what you're breaking down to but

you know what's interesting about
that by the way that's called

noncombustible gas is that you smell right
so you can't buy to make it right and

I want to see interesting aside when I
talk about government regulation one of.

One of the first kind of second order
effects of government regulation that

required you to collect all of us the
problem is now if you have any malfunction

in that collection system there's so
concentrated that the order

goes in a hurry I mean it's just it's just
a new set of problems try to do it but

us first of all energy management OK
most people read as that that the U.S.

is the world leader in reducing greenhouse
gases approach on it percentage of G.D.P.

the world leader right now.

Did did did the economy have some do with
it yep did fracking and that gas coming

on have some do with that yep but guess
what else to do it high energy costs.

Right as energy costs get higher
want to business say we got to start

wasting less energy.

So now it's worth it to go look for
that next truck.

And with out.

Widespread greenhouse gas legislation and
regulation the U.S. leads the world.

So.

You know I think that's an example
of the marketplace acting

very rationally efficiently in
our energy management program.

I'll just give you a broad terms if I can.

And you know you've got to take
pricing volatility out of it and

with the economics up and

down what you run and how what rate
you're running on but in big numbers.

By On average a billion to plus or
minus and purchased energy OK.

And that's with over half of all of
manufacturing energy being biomass is not

included in that right so we started
looking it well a few years ago two years

after I got in this role that what can we
do to better manage energy and capture.

The.
Quality projects and levers learning.

And we have kicked off
a program that we think.

We would be somewhere down a round I think
and in the first three years we're about.

Seven.

Seven and
a half percent down comparing comparables.

In energy use on an intensity basis so

we're very happy with that we do not
handicap projects they compete for

capital like every other project Now
obviously there are some projects if we're

saving money we feel like there's less
risk We'll take a little bit lower return

than if you're investing in something
new You've got a lot more risk but

we don't handicap and say you know well
except very low return sustainability

projects we just don't do that so there's
one on a case by case basis we've done

things in mills especially a lot
of water in areas of curtailment.

In some cases where we've run for

four to six months at like thirty percent
of the normal water facility to run with

now there are consequences to
that that probably don't make it.

Beneficial to do long term.

But.

You know back a couple years goes
hard to believe this year where it

feels like Seattle around here but
you know what when water was short

there were a number of facilities that
that we need to really look at water use

because the area was being impacted and
we're trying to do our part and cut back.

And then in forestry I mean we do we do a
lot of forestry mission a lot of trainers

are forced through because that's that's
pretty key to us and the last one I'll

say is on the supply chain we introduced
a supplier sustainability purchasing

guidelines where we basically said
here's our minimum expectation.

And we're going to start assessing
how much suppliers according to this

this set of guidelines and try to move.

The the our suppliers up and

to the right in terms of their
performance across three dimensions and

we did it in three dimensions
social environmental and economic.

It really is I mean you know it's like
anything who's going to own it and and

you know it's kind of like if in the old
remediation model at the syllabus you had

you had people kind of spending three
three to five o'clock on Thursday

afternoon stop in their operation roll and
talk about remediation and

so you probably never really got expertise
Senate you never got really good because

you didn't see the problem a second
third time so that's what happened

businesses were doing it independently
they wanted to bring it together.

And so by creating the role we now
have a corporate capability that

that's only about six people and then.

We have we created some positions in the
business that would have decision rights

within those businesses and capability so
that we know who owns it in that area

there's probably another fifty five to
sixty people company wide in those roles

and subject matter roles and so that's all
affective sustainability organization.

We've got two more questions and
that would be three and

some just going to pass this one and
that last one for their.

First thank you for speaking to us
he spoke a lot about market forces

being the primate one of the key
drivers of sustainability and

he will have specific examples of many
social and ethical responsibility

taking precedence over market forces and
driving sustainability.

I guess can you give me an example and
I'm I'm trying to.

Know what I'm trying to say because
the way we would look at it is not

market forces we don't look at market
forces in the economic dimension

now the fact of the matter is
in business right the equation.

The right side of the equal signs is
always dollars Right that's how we make

decisions it's not like a life you know I
don't welcome to my kids' birthday party

and go I love you here's fifty bucks
right when I get my high going to

kiss a dead proud of you write that that's
a currency and that if I did that after

a business meeting I would probably
have a lawsuit filed against me right so

but and I don't I say this kind of funny
but I mean it's just true right there with

value is always subject I mean
it's amazing the way my work so

when we think about market forces we
want to market forces play in all three

dimensions and what we what we
advocate is let's drive competition so

that if you are customers consumers or
end users you tell

us what you like now don't just tell us
we're going to watch what how you act with

your dollars right because people say they
buy you a lot of things when you watch you

don't seem to value very much right so
we pay attention that we want to compete

in that marketplace because we think we
compete with the best in the world in

that marketplace but
when there start becoming constraints

mandates laws things that may work in some
situation you just want innovation and

it's harder to really distinguish
yourself in the business world is that

I don't think that gets your question so
let me let me give you another shot it.

Last was wondering if it
was less profitable and

less economically feasible you guys
still chose to make a decision on

a more socially responsible I
think Leader element yes so.

I won't give you a real specific because.

Just reliability reasons.

But we sometimes find issues along
the line say hearing loss in.

When you factor in facilities where
there's a lot of noise people don't wear

P.P. and
a lot of other parts of the world.

Personal protective equipment isn't
either very good or very available.

We have in.

A couple of situations
I know of in the last

two years going into places like that and.

And really sat down and
talked about changes and what alternatives

are moving business right now a lot
of places work hours get really long.

And especially in Asia and
going in and saying if you work on

our stuff we want to limit the weeks
of people that work on our stuff and

what we're finding surprisingly that
sounded like a good solution for

those people are taking
time off on our stuff and

then literally going to a plant across the
street because they want to keep working.

So it didn't quite work out
the way we wanted it to but.

You know you got to set
some some limits and

what we think on that is when you say
well we trade off the economic dimension.

We don't think long term we're trading
off that dimension we think long term

that's the most valuable place for
our business to be now the future will

determine whether we're right or not and
we don't have a crystal ball so we

may take a short term hit because we think
long term it's most valuable place to.

Get things just this
last question over here

yeah I was wondering do you find that
your sustainable product innovation

has ever come out of a on sustainability
or are they more a byproduct

of focusing on fixing other problems
like you're in motion now this so yeah.

Well just from where we are right now I
mean a lot of the examples I'd give you

people weren't sitting around saying what
a sustainability tonus do because when

these products were being developed coming
to market no one was using that term right

but I think as a slide that showed the.

Framework.

You know and talk about kind of
five topics that they would run

through versus a sustainability frame or
I think what we're seeing and

what the businesses are saying is they
wouldn't call it sustainability and

they don't always think about
a sustainability what they're coming to

the realization as is the reality
it is sustainability.

They've just been balancing those trade
offs as kind of a one off and not being

very disciplined at trying to understand
the impacts in the three dimensions

right and so what they're starting to do
is embrace those tools to say OK this

gives it's not magic fairy dust it doesn't
tell you the right answer right but

it just gives you a disciplined repeatable
way to say as we're making bets I

mean if you think about sustainability
sustainability as a future condition world

trying to achieve right and we're doing
it making decisions today about our

actions tomorrow to try to be
sustainable in the future so

as you're doing that you need some
tools to say gosh there's a whole

gob of stuff that we've got to get right
we've got it to spec on our product

right we've got to have feedstocks if it's
raining it's hard to get in force we've

got to have would you know what can we
what when our backup plans only say but

when you balance them it comes down
to what are customers consumers and

end users going to buy what do
they see what do they want.

And what do they want us to do to
minimize in the products we're

delivering and I think it's that focus if
you look at kind of where we are right now

organization organizationally
what kind of getting that risk

piece coming into focus and
I think it's helping us there I think

we've got some more opportunity to kind
of move up and say OK how can we use this

to really create advantage because
frankly those don't come along that.

You know especially you know we're not an
IP company that's constantly rolling out

new products that's.

It's not what we've traditionally been so.

So you know.

We're doing some things and we doing some
things that are extensions so for example.

We really looked at it on in motion
when it came out has been very popular.

But we started looking at OK how
are we making that cabinet and

what's happening to those dispensers
after they get old in the marketplace.

So a couple years ago we kicked off a
dispensary recovery program where we take

them back right and that made us rethink
OK how they manufacturing these so

that we can recover them easier not only
materials that are more recyclable have

value on the other end but that we can we
can take them apart more efficiently and

get them to recycling and reuse right so
you know that process I don't think

you're never there you know it's
something we keep working on so

I would like to tell you that
that we're really good at it but

we're working hard at it every day and
we get a lot better.

So I just wanted to thank you be
happy that your tech community for

coming to talk to us Can I get
a round of applause propelled thang.