WEBVTT - Bloomberg Businessweek Weekend-Favorite 2020 Conversations 0:00:00.480 --> 0:00:05.680 This is Bloomberg Business Week with Carol Masser from Bloomberg Radio. Hi, 0:00:05.760 --> 0:00:08.800 I'm Carol Master. Welcome to a special holiday weekend edition 0:00:08.840 --> 0:00:11.840 of Bloomberg Business Week. This week, some of the highlights 0:00:11.920 --> 0:00:14.960 from twenty in a year that was like no other 0:00:15.520 --> 0:00:20.000 health pandemic, dual crises of racial and social injustice, fights 0:00:20.040 --> 0:00:22.960 for equality, and yeah, we had an election. It was 0:00:23.000 --> 0:00:26.079 a year filled with struggle, in strife, and with inspiration 0:00:26.120 --> 0:00:30.600 and innovation. Some of our memorable conversations included three leaders 0:00:30.640 --> 0:00:34.479 where sustainability is in their company's d n A Yesper Broden, 0:00:34.560 --> 0:00:37.760 president CEO of INCA Group and Ikea on making the 0:00:37.800 --> 0:00:41.600 business case for climate action, plus Jenna Johnson of Patagonia 0:00:41.680 --> 0:00:45.760 unconscious sustainability, and then managing through a crisis with Chipotle 0:00:45.880 --> 0:00:49.400 CEO Brian Nicol. We begin with someone who understands real 0:00:49.520 --> 0:00:51.919 estate politics and making a difference to create a more 0:00:51.960 --> 0:00:55.800 equal and just world. Don Peoples, Founder, chairman and CEO 0:00:55.840 --> 0:00:58.960 of the People's Corporation, a privately held national real estate 0:00:58.960 --> 0:01:02.040 and development company. He's also worked for the Obama campaign 0:01:02.040 --> 0:01:04.880 and was former chairman of the Congressional Black Caucus Foundation. 0:01:05.160 --> 0:01:07.720 Our conversation last fall began with a look at where 0:01:07.760 --> 0:01:10.520 we are in real estate. You know, interestingly enough, we're 0:01:10.520 --> 0:01:13.800 still seeing a lot of tail winds for a single 0:01:13.840 --> 0:01:17.640 family real estate. I think single family homes are very 0:01:17.680 --> 0:01:21.840 strong interest rate stories at historical lows, and so it's 0:01:21.880 --> 0:01:24.440 propelling a lot of buyers who are able to do 0:01:24.520 --> 0:01:27.720 that take advantage of it or out in the market buying. 0:01:27.959 --> 0:01:30.720 So that continued to be a bright spot. I think 0:01:30.760 --> 0:01:34.320 we're seeing um in some places. What was very interesting 0:01:34.800 --> 0:01:39.800 is in Los Angeles the condo sales market is actually 0:01:39.840 --> 0:01:43.640 doing well and uh at a surprising bright spot in 0:01:43.680 --> 0:01:47.920 the marketplace. And UH and that's again because people want 0:01:47.960 --> 0:01:50.280 to get out of their cars, they want to live 0:01:50.400 --> 0:01:53.640 closer to where they work, and uh in their economy 0:01:53.680 --> 0:01:55.440 is to getting an open back up. I think the 0:01:55.680 --> 0:01:59.200 challenge in the industry in real estate overall will be 0:01:59.680 --> 0:02:03.000 the obvious, which is retail. Brick and mortar, retail and 0:02:03.480 --> 0:02:08.360 hospitality sectors are a very challenge right now, and the 0:02:08.480 --> 0:02:11.320 office is kind of a wait and see right now. Hey, 0:02:11.360 --> 0:02:15.800 donn As, you're well aware there's this existential discussion going on, 0:02:15.880 --> 0:02:18.680 argument going on about the future of New York City. 0:02:18.760 --> 0:02:21.720 Does it have a future? Help right, is it? Uh? 0:02:21.840 --> 0:02:24.040 What are your thoughts? Of course? I think New York 0:02:24.040 --> 0:02:26.800 City definitely has a future and it will always be 0:02:26.840 --> 0:02:28.440 a bright future at the city of eight and a 0:02:28.480 --> 0:02:32.079 half million people. That being said, about a hundred thousand 0:02:32.400 --> 0:02:36.079 residents have left Manhattan, which is a significant number out 0:02:36.080 --> 0:02:39.760 of two million residents. UM. I think what we're seeing 0:02:39.840 --> 0:02:45.000 in New York though, is a a perpetuation and continuation 0:02:45.120 --> 0:02:47.640 of a trend that was beginning to happen before, and 0:02:47.680 --> 0:02:50.880 it started with the salt. Once the state and local 0:02:50.919 --> 0:02:54.840 income tax deductions were taken away, it started encouraging more 0:02:54.919 --> 0:02:59.360 high net worth individuals to relocate to more tax friendly 0:02:59.440 --> 0:03:02.959 environment and then there was a diminishment of quality of life. 0:03:03.160 --> 0:03:06.600 The city got a bit dirtier, crime was creeping up 0:03:06.639 --> 0:03:09.040 a little bit, and then with this pandemic, it has 0:03:09.080 --> 0:03:13.200 accelerated that. So I think on the high end, ultra 0:03:13.320 --> 0:03:18.000 luxury side, the residential market is going to struggle. Their 0:03:18.360 --> 0:03:23.200 sales volume for residential condos is down significantly and vacancy 0:03:23.280 --> 0:03:26.839 rates are at you know, um, all time highs um 0:03:26.960 --> 0:03:29.880 right now, vacancy rates for partners in Manhattan or New 0:03:29.960 --> 0:03:32.520 York City as a whole over five percent, which is 0:03:32.200 --> 0:03:35.200 a very big number. And uh, and then and then 0:03:35.200 --> 0:03:38.080 there is about almost twenty million square fi of sublet 0:03:38.120 --> 0:03:40.920 office space. And we're seeing a shift. And what we're 0:03:40.960 --> 0:03:45.080 also seeing now is millennials coming of age of having 0:03:45.760 --> 0:03:50.080 being married, having kids and seeking out places that are 0:03:50.120 --> 0:03:53.760 more conducive to that where the public school systems are 0:03:53.840 --> 0:03:57.200 more predictable and uh, a little better quality of life 0:03:57.200 --> 0:03:58.839 and lower costs. So I think we're going to see 0:03:58.840 --> 0:04:02.280 a shift of what New York City looks like. Well, 0:04:02.400 --> 0:04:04.760 so what does it also the mean for You've got 0:04:04.800 --> 0:04:07.840 the gateway cities and then you've got secondary tertiary cities. 0:04:07.880 --> 0:04:09.800 I mean, is that where you want to be investing 0:04:09.800 --> 0:04:12.600 at this point? Maybe not the gateway cities so much 0:04:12.920 --> 0:04:16.440 or I don't know, how do you see it done? Yeah, 0:04:16.000 --> 0:04:18.760 I think it's very challenging right now to make any 0:04:18.800 --> 0:04:22.000 kind of strategic long term investment in New York City. 0:04:22.240 --> 0:04:24.320 I think if you look at the emerging markets, the 0:04:24.360 --> 0:04:26.960 ones that are the what would be the tertiary cities 0:04:26.960 --> 0:04:29.320 that are emerging, and they're going to become much more 0:04:29.400 --> 0:04:34.000 dominant players. I would say Charlotte, North Carolina, has significant 0:04:34.000 --> 0:04:38.200 good news recently. Uh, they just got a new corporate 0:04:38.200 --> 0:04:40.880 relocation that's going to spend about two billion dollars on 0:04:40.920 --> 0:04:46.440 the headquarters. UM. You have UH, Tennessee, especially Nashville, UH 0:04:46.600 --> 0:04:50.760 continuing to do well. South Florida is on a great run, 0:04:50.839 --> 0:04:54.720 both on a single family side and attracting more entrepreneurial 0:04:54.760 --> 0:04:58.039 financial services firms down there, and some of the bigger 0:04:58.080 --> 0:05:00.000 banks are beginning to look at back a house there 0:05:00.000 --> 0:05:03.719 there as well. So I think that those types of 0:05:03.760 --> 0:05:06.640 markets UH, and then some of the other I think 0:05:06.720 --> 0:05:09.160 the VATA is gonna begin to pick up. In Texas 0:05:09.240 --> 0:05:12.479 is often doing very well, will continue to do very well. 0:05:12.640 --> 0:05:16.120 I think it's the New York that in the Chicago's 0:05:16.240 --> 0:05:19.800 um that are in the city, the major gateway cities 0:05:20.080 --> 0:05:22.760 are going to struggle. Boston being an exception to that, 0:05:22.800 --> 0:05:26.760 because life sciences and the strong intellectual capital in that 0:05:26.800 --> 0:05:31.320 marketplace are saving it from what would be catastrophic results 0:05:31.440 --> 0:05:33.400 like what New York is beginning to see right now. 0:05:34.600 --> 0:05:37.440 So don't just quickly tax You mentioned the tax policy. 0:05:38.839 --> 0:05:40.640 What can states like New York and New Jersey and 0:05:40.640 --> 0:05:43.440 some others do. I mean, they just simply try to 0:05:43.440 --> 0:05:47.440 get more efficient a combination of things. I mean, I 0:05:47.440 --> 0:05:50.240 think that I mean were they. New York has to 0:05:50.279 --> 0:05:53.360 recognize and New Jersey has to recognize that they are 0:05:53.440 --> 0:05:57.159 losing residents by the moment. I mean, we just launched 0:05:57.160 --> 0:05:59.919 a new private club in Miami Beach called the Bath Club, 0:06:00.120 --> 0:06:03.200 which is a private beach club, and we are getting, 0:06:03.720 --> 0:06:06.600 you know, flooded by applications of people coming from New 0:06:06.680 --> 0:06:09.200 York relocating down you know, just kind of almost for 0:06:09.440 --> 0:06:12.640 the moment. So they've got to So New York, New York, 0:06:12.680 --> 0:06:16.240 New Jersey have to recognize they've got to compete for residents. 0:06:16.240 --> 0:06:18.360 So they've got to be much more efficient and take 0:06:18.800 --> 0:06:22.080 a freshman look at what role the government has, especially 0:06:22.080 --> 0:06:23.640 in New York City. What is the role of the 0:06:23.720 --> 0:06:26.680 municipal government. It can't be everything to everybody. It's got 0:06:26.680 --> 0:06:31.320 a right side and workforce quickly, um and and this 0:06:31.400 --> 0:06:33.960 administration has been reluctant to do that. And then I 0:06:34.000 --> 0:06:37.320 think it has to think about longer term tax policy. 0:06:37.760 --> 0:06:40.640 New York should be in the business of reducing taxes 0:06:40.680 --> 0:06:45.599 and spent advising a job generation and productivity. That was 0:06:45.640 --> 0:06:48.960 People's Corporation CEO Don Peebles. Don also served on the 0:06:49.040 --> 0:06:52.039 National Finance Committee of President Obama and was a former 0:06:52.120 --> 0:06:55.279 chairman of the Congressional Black Caucus Foundation. You're listening to 0:06:55.279 --> 0:06:58.559 Bloomberg Business Week. Coming up from real estate to filling 0:06:58.600 --> 0:07:02.039 homes and buildings with assist annable goods. Ikea knows about that. 0:07:02.320 --> 0:07:05.480 We'll hear from INCA Group President and CEO, yes Per Broden. 0:07:05.760 --> 0:07:11.720 This is Bloomberg. This is Bloomberg Business Week with Carol 0:07:11.800 --> 0:07:15.960 Masser from Bloomberg Radio. Another conversation that stood out for 0:07:16.040 --> 0:07:18.320 us this year is a company and a leader who 0:07:18.360 --> 0:07:21.040 every day is making the business case for climate action. 0:07:21.480 --> 0:07:24.840 INCA Group President and CEO, Yesper Broden, home to some 0:07:24.960 --> 0:07:28.440 three v i Ka furniture and retail stores in thirty 0:07:28.480 --> 0:07:32.200 countries with more than two hundred thousand workers. He joined 0:07:32.280 --> 0:07:34.840 us from the Bloomberg Green Festival this year, and like 0:07:34.920 --> 0:07:37.520 so many of our conversations, we started off by talking 0:07:37.520 --> 0:07:40.200 about how his company has changed as a result of 0:07:40.200 --> 0:07:44.200 the pandemic. For us, like for everybody on this planet, 0:07:44.240 --> 0:07:47.280 we have been through a very special journey this year, 0:07:47.560 --> 0:07:49.440 and I must admit us I share with you too. 0:07:49.840 --> 0:07:51.920 To be traveling about again, I felt a bit like 0:07:52.000 --> 0:07:55.320 the old movie Castaway when they're coming back to the office, 0:07:55.320 --> 0:07:59.880 seeing people and enjoying that also, I must say at 0:07:59.880 --> 0:08:04.160 the same time, obviously, um, we just like everybody else, 0:08:04.160 --> 0:08:07.440 have figured out new ways of leading. We have figured 0:08:07.480 --> 0:08:11.200 out that we we didn't have a map for this situation, 0:08:11.200 --> 0:08:13.760 but we had a very strong compass I think with 0:08:13.880 --> 0:08:16.280 the way we like to lead and our values that 0:08:16.440 --> 0:08:20.680 helped us. Actually, I think take many good decisions. But 0:08:20.800 --> 0:08:23.640 it's been a ride. It's been a ride, no doubt 0:08:23.680 --> 0:08:25.320 about it. It's interesting that you say that, and we're 0:08:25.320 --> 0:08:28.240 going to get into kind of your sustainability strategy that 0:08:28.400 --> 0:08:31.600 is so much the IKEA and corporate culture here, But 0:08:31.680 --> 0:08:34.640 I do wonder having so many of those measures in place, 0:08:34.960 --> 0:08:37.640 are there any specific anecdotes that you can tell us 0:08:37.679 --> 0:08:42.320 that helped you guys get through this crisis because of 0:08:42.360 --> 0:08:47.319 those green initiatives or sustainable initiatives. Well, you can say, 0:08:47.360 --> 0:08:50.480 I think the it's all enter tangled, right, people, plan 0:08:50.559 --> 0:08:53.160 at and business, and you can't take out any of 0:08:53.160 --> 0:08:57.160 these from the equation. So what happened obviously to us 0:08:57.920 --> 0:09:01.880 was that we had periods of dramatic closures in our 0:09:01.920 --> 0:09:05.640 stores and we had to find ways to to both 0:09:06.360 --> 0:09:10.280 protect ourselves, our people, our customers. Uh. And then on 0:09:10.320 --> 0:09:11.840 the other hand, we had to make sure that we 0:09:11.880 --> 0:09:14.360 could save the jobs for the future. And the way 0:09:14.520 --> 0:09:16.199 what actually happened in the end of the day was 0:09:16.240 --> 0:09:19.440 that we were speeding up everything around multi channel and 0:09:19.480 --> 0:09:23.280 online and we went from a good year to a 0:09:23.440 --> 0:09:26.800 record loss forecast to actually coming back on half of 0:09:26.800 --> 0:09:29.960 our estimate the profit in the end of the day, 0:09:30.040 --> 0:09:32.280 and that was thanks to I think the entrepreneurship of 0:09:32.400 --> 0:09:36.600 getting things right quickly. Do you think we're through it? 0:09:36.880 --> 0:09:40.800 Do you are you guys getting ready for another wave? Well, 0:09:40.880 --> 0:09:43.440 you know, I think at a certain moment we were. 0:09:43.600 --> 0:09:48.400 We were quite early on forecasting different scenarios and the 0:09:48.480 --> 0:09:51.160 period that we have just entered we called the new normal. 0:09:51.679 --> 0:09:54.280 And I think it's a bit of a deceptive term 0:09:54.320 --> 0:09:56.200 in a way, because the way we see it is 0:09:56.640 --> 0:09:58.640 that for at least a year to come, we need 0:09:58.679 --> 0:10:03.200 to be very agile, very prepared for outbreaks. I think 0:10:03.200 --> 0:10:06.480 the term second wave could be misunderstood. So we like 0:10:06.600 --> 0:10:10.880 to plan for outbreaks and how to deal with that 0:10:10.960 --> 0:10:13.800 in the best possible way, both for jobs, for business, 0:10:13.960 --> 0:10:16.640 uh and for everything we do in society and contribute to. 0:10:17.240 --> 0:10:21.800 And obviously it's clear for all of us that you know, 0:10:21.920 --> 0:10:24.600 one year later again, it's still going to be learning. 0:10:25.120 --> 0:10:28.480 There will be things that we will be um you know, 0:10:28.640 --> 0:10:30.880 doing differently, and that will be a lot of I 0:10:30.920 --> 0:10:33.240 think amazing things that we carry with us from this 0:10:33.320 --> 0:10:36.760 period as well, hopefully including the way we realize the 0:10:36.800 --> 0:10:40.360 importance of investment in sustainability and the opportunity of doing 0:10:40.360 --> 0:10:43.760 that right. Well, let's get to that, because despite this 0:10:43.880 --> 0:10:47.520 being a crazy year, a tumultuous year, you guys are 0:10:47.520 --> 0:10:49.480 on track. And forgive me, I'm gonna read from my 0:10:49.480 --> 0:10:50.760 notes because I want to get it right. You're a 0:10:50.800 --> 0:10:53.120 track to achieve and exceed a goal to produce as 0:10:53.200 --> 0:10:56.680 much energy from renewable sources as you consume. By you 0:10:56.679 --> 0:10:59.560 have made massive investments about two and a half billion 0:10:59.600 --> 0:11:03.360 euros in wind and solar power. You've set a goal 0:11:03.360 --> 0:11:05.600 to be climate positive, meaning you're going to reduce more 0:11:05.600 --> 0:11:09.720 gas emissions than you admit you are in you know, 0:11:09.800 --> 0:11:12.440 when it comes to electric electric a hundred percent at 0:11:12.440 --> 0:11:15.360 the time, ahead of targets, when it comes to deliveries 0:11:15.400 --> 0:11:18.400 and Shanghai by e V s um you're doing that 0:11:18.520 --> 0:11:22.280 in Amsterdam, l A, New York, Paris. And here's something 0:11:22.400 --> 0:11:25.320 a goal for everyone who's listening by you guys have 0:11:25.400 --> 0:11:28.439 said your ambition is to inspire and enable one billion 0:11:28.440 --> 0:11:30.920 people to live a better everyday life within the limits 0:11:30.960 --> 0:11:35.120 of the planet. It's really heavy stuff and it's impactful stuff. 0:11:35.520 --> 0:11:39.280 How tough has this been to do? And what has 0:11:39.320 --> 0:11:42.160 been the business case for climate change for you all? 0:11:43.640 --> 0:11:45.800 Or you know? I think I think if you look 0:11:45.840 --> 0:11:47.760 at the I K S history, you can say we 0:11:47.840 --> 0:11:51.560 started out with a founder that was a very thrifty person, 0:11:52.080 --> 0:11:54.400 very smart around resources, and I think that's part of 0:11:54.480 --> 0:11:57.920 us storry so part of this. You know that sustainability 0:11:57.960 --> 0:12:01.480 and being smart about peel and planet is part of 0:12:01.480 --> 0:12:05.960 our legacy. My own story started back in the company 0:12:06.000 --> 0:12:09.400 when I joined in Asia Pacific. At the time when 0:12:09.440 --> 0:12:12.520 we invested in I think what is still today an 0:12:12.520 --> 0:12:15.400 amazing code of conduct when it comes to production. Those 0:12:15.480 --> 0:12:18.280 days we had some discussions about can we afford it 0:12:18.320 --> 0:12:22.520 will drive costs to do the right thing with working hours, salaries, etcetera. 0:12:22.960 --> 0:12:24.600 And in the end of the day it turned out 0:12:24.640 --> 0:12:29.040 to be brilliant for business. We have the most efficient partners, 0:12:29.480 --> 0:12:33.839 happy coworkers along etcetera. So I think we already then 0:12:34.000 --> 0:12:38.200 we saw some myths that were we needed to bust 0:12:38.760 --> 0:12:42.079 and the same goes for for the climate the ghost 0:12:42.120 --> 0:12:45.160 that we have committed to where we we do not 0:12:45.280 --> 0:12:47.200 have all the answers yet, so we still have some 0:12:47.240 --> 0:12:50.120 gaps to be filled to coming years. But we are 0:12:50.160 --> 0:12:54.800 convinced that this is good business for three reasons, or 0:12:54.840 --> 0:12:56.400 you can say for two reasons. One is that I 0:12:57.240 --> 0:12:59.640 coworkers and our customers expect us to take the lead, 0:12:59.679 --> 0:13:01.960 so it would be I would say dangerous to not 0:13:02.040 --> 0:13:06.600 take that lead from from your revenue side. But secularly, 0:13:06.880 --> 0:13:08.800 the business model we are building is the new low 0:13:08.840 --> 0:13:12.520 cost so sustainability shows in case by case to be 0:13:12.679 --> 0:13:16.760 the way we will provide low price furniture in the future. 0:13:18.000 --> 0:13:19.800 You say, you know a couple of things. You said 0:13:19.800 --> 0:13:21.920 it was brilliant for the company, So I'm wondering if 0:13:21.920 --> 0:13:23.800 you can put some numbers on that in terms of 0:13:23.840 --> 0:13:25.960 the business case for doing all of this. But I 0:13:26.000 --> 0:13:28.640 also wonder you said myths to bus because I can 0:13:28.679 --> 0:13:32.320 only imagine some of the internal you know discussions, yesper 0:13:32.320 --> 0:13:34.240 that you folks had it said no, we can't do that. 0:13:34.280 --> 0:13:35.959 I know it's good for the environment, but you know 0:13:36.000 --> 0:13:38.480 it's going to cost too much or we can't recreate 0:13:38.480 --> 0:13:40.679 our supply chain, so give me a little bit of 0:13:40.679 --> 0:13:44.280 that that feel. But absolutely, I think the best number 0:13:44.280 --> 0:13:46.120 I can give you is that last year we're very 0:13:46.120 --> 0:13:48.640 happy and proud that we were able to grow with 0:13:48.720 --> 0:13:52.960 some six percent plus, which is a good, a decent idea. 0:13:53.200 --> 0:13:55.679 And at the same time we reduced our absolute common 0:13:55.720 --> 0:13:59.600 footprint across the whole scope one, two and three with 0:14:00.000 --> 0:14:02.600 more than four percent, so it was possible to show 0:14:02.920 --> 0:14:07.120 healthy growth and at the same time decarbonized if you like. Obviously, 0:14:07.160 --> 0:14:09.640 we are very humble and respectful to the future to 0:14:09.720 --> 0:14:12.920 continue that journey with the plan, but that was I 0:14:12.960 --> 0:14:16.640 think the first year of proof for us. But then 0:14:16.679 --> 0:14:18.280 you can say to the myths. I think there are 0:14:18.320 --> 0:14:21.560 three myths that I see over and over again. One 0:14:21.640 --> 0:14:24.360 is that purpose and profit don't go hand in hand, 0:14:24.880 --> 0:14:27.800 which I think and we think is the opposite. And 0:14:28.520 --> 0:14:31.080 there is a very strong if that sustainability should come 0:14:31.080 --> 0:14:34.040 at the premium, which I think is very dangerous because 0:14:34.080 --> 0:14:37.120 then this is a mass movement that needs to involve 0:14:37.160 --> 0:14:39.960 everybody on this planet, so therefore it should be rather 0:14:40.040 --> 0:14:43.240 seen as the new low cost And and finally, there 0:14:43.240 --> 0:14:46.120 are a lot of myths around that consumption is all 0:14:46.200 --> 0:14:49.480 bad and there is bad consumption, but there is also 0:14:49.560 --> 0:14:52.520 sustainable consumption. So these are the type of topics that 0:14:52.640 --> 0:14:55.160 sometimes lie in the way for taking the right type 0:14:55.160 --> 0:14:58.360 of action. Purpose and profit don't go hand in hand. Well, 0:14:58.400 --> 0:15:01.040 dispelling some myths well, also helping to create a more 0:15:01.080 --> 0:15:04.480 sustainable planet. That was INCA group president and CEO, Yes 0:15:04.520 --> 0:15:08.280 for Broden. Coming up staying on sustainability with another company 0:15:08.280 --> 0:15:11.240 that has made it a priority from its inception, will 0:15:11.320 --> 0:15:14.600 check in with Patagonia ahead Jenna Johnson. This is Bloomberg. 0:15:17.680 --> 0:15:22.200 This is Bloomberg Business Week with Garrol Massier from Bloomberg Radio. 0:15:22.440 --> 0:15:25.240 We'll bring you some of our memorable conversations from this year, 0:15:25.320 --> 0:15:27.680 some of the highlights, and we've heard from our past 0:15:27.720 --> 0:15:30.600 two guests a lot about sustainability and when you think 0:15:30.640 --> 0:15:33.840 of conscious sustainability, one company that has it in its 0:15:33.920 --> 0:15:37.600 DNA is Patagonia and at this year is Bloomberg Sustainable 0:15:37.600 --> 0:15:41.720 Business Summit. Patagonia Inchead Jenna Johnson talked about what makes 0:15:41.760 --> 0:15:46.160 her company's culture different. Patagonia is a really interesting and 0:15:46.280 --> 0:15:50.000 unique culture. I've never worked at a company before where 0:15:50.680 --> 0:15:54.920 um the internal employees, the culture is so strong because 0:15:55.080 --> 0:16:00.440 everyone has very intentionally chosen to come to Patagonia. UM. 0:16:00.440 --> 0:16:02.800 Certainly there's a lot of locals who work at the organization, 0:16:02.840 --> 0:16:05.360 but a lot of people have actually moved to one 0:16:05.400 --> 0:16:08.920 of our headquarters specifically to work for us because they 0:16:08.920 --> 0:16:11.320 believe so much in our mission. And when you get that, 0:16:11.400 --> 0:16:16.080 you get this really special energy um humming about the 0:16:16.160 --> 0:16:21.280 organization as everyone is trying to think as creatively, um 0:16:21.320 --> 0:16:24.920 and intelligently as we can about this you know, massive 0:16:25.000 --> 0:16:27.600 goal that we're trying to go after in bringing our 0:16:27.640 --> 0:16:30.920 planet back to health. Well, let's talk about I think 0:16:30.920 --> 0:16:32.560 it was about a year ago. You guys change your 0:16:32.560 --> 0:16:34.160 mission statement, and I want to read it so that 0:16:34.200 --> 0:16:36.800 I get it right. It went from build the best product, 0:16:36.840 --> 0:16:40.440 caused no unnecessary harm, use business to inspire and implement 0:16:40.720 --> 0:16:44.040 solutions to the environmental crisis, to the new mission. We're 0:16:44.080 --> 0:16:47.000 in business to save our home planet. I mean, you're 0:16:47.040 --> 0:16:49.000 still adhering to the old mission, but there is no 0:16:49.080 --> 0:16:51.000 doubt about what's at stake. I know you and I 0:16:51.040 --> 0:16:53.640 talked to the prep call. I mean, we need to 0:16:53.680 --> 0:16:56.640 be thinking about our environment because everything we do is 0:16:56.680 --> 0:16:59.560 impacting it, either negatively or positively, and we need to 0:16:59.600 --> 0:17:03.080 be more positive in terms of impact, because there's no 0:17:03.160 --> 0:17:05.840 going back. If we don't have an environment, then none 0:17:05.840 --> 0:17:10.479 of this matters. It's so true. You know, you often 0:17:10.560 --> 0:17:13.000 here there's no business to be done on a dead planet, 0:17:13.000 --> 0:17:15.879 and that's exactly how we feel. UM. As you mentioned 0:17:15.880 --> 0:17:18.959 our old mission statement, it was really important to us, 0:17:18.960 --> 0:17:21.720 and it continues to be really important to us. UM. 0:17:21.760 --> 0:17:25.959 Those three main pillars are still very much UM rooted 0:17:26.000 --> 0:17:27.720 in the work that we do every single day. They're 0:17:27.720 --> 0:17:30.679 actually part of our B Corp UM values and our 0:17:30.720 --> 0:17:33.679 b Corp pillars, so we are still held accountable to 0:17:33.760 --> 0:17:37.440 those UM. But we really felt like although the organization 0:17:37.720 --> 0:17:43.440 and the company had galvanized around these important pillars, we 0:17:43.640 --> 0:17:47.560 really knew that we needed to sharpen our focus right 0:17:47.560 --> 0:17:51.000 now more than ever. We are running out of time. UM. 0:17:51.000 --> 0:17:54.840 We absolutely need to turn this climate crisis around, and 0:17:55.320 --> 0:17:57.920 we have to use our business and we hope others 0:17:57.960 --> 0:18:00.240 will use their business in order to focus on this. 0:18:00.400 --> 0:18:04.199 And you know we often said, like, yes, the mission 0:18:04.280 --> 0:18:06.880 statement that we're in business to save our home planet. 0:18:07.040 --> 0:18:11.240 It is bold, it is fairly audacious, it is UM. 0:18:11.280 --> 0:18:13.720 It puts a lot of urgency under each of our steps, 0:18:14.040 --> 0:18:16.800 and we won't be able to achieve that mission on 0:18:16.840 --> 0:18:20.160 our own, and our hope is that other businesses see 0:18:20.160 --> 0:18:23.439 that mission. And we imagine a world in which every 0:18:23.480 --> 0:18:26.760 business would take on the same mission statement. And then 0:18:26.880 --> 0:18:29.760 what we could do together if all of us were 0:18:29.880 --> 0:18:35.399 using our business to influence our individuals, the communities, UM 0:18:35.440 --> 0:18:38.359 and bring again, you know, our planet back to health. 0:18:38.760 --> 0:18:43.000 It won't happen just with Patagonia. We're not naive to that. Um. Yeah, 0:18:43.000 --> 0:18:45.200 but we hope other businesses join us in our mission. 0:18:46.080 --> 0:18:48.120 So how easy is it to do? Because you guys 0:18:48.119 --> 0:18:50.200 are a profitable business. You've been around for a long time. 0:18:50.240 --> 0:18:53.240 I know your private company, so you don't necessarily have 0:18:53.320 --> 0:18:56.679 to release numbers. You donate one percent of your sales 0:18:56.720 --> 0:19:00.960 everywhere every year to environmental efforts and non off it specifically, 0:19:01.280 --> 0:19:04.399 how easy or has it gotten easier to be a 0:19:04.440 --> 0:19:08.120 sustainable company? You know, to create a supply chain that 0:19:08.119 --> 0:19:10.359 that is that way that it was when you guys 0:19:10.440 --> 0:19:13.400 and Von started the company years ago. You know, it's interesting. 0:19:13.560 --> 0:19:15.840 In some ways it's easier and in some ways it's 0:19:15.840 --> 0:19:18.760 a whole lot harder. Um, it is not easy. I 0:19:18.840 --> 0:19:22.119 won't live We wake up every day and we're dealing 0:19:22.160 --> 0:19:25.000 with probably one of the most complex businesses in the 0:19:25.040 --> 0:19:29.040 world trying to be profitable work in an apparel and 0:19:29.119 --> 0:19:33.760 equipment industry and UM and do it in a way 0:19:33.800 --> 0:19:38.119 that has you know, zero impact, if not positive impact 0:19:38.240 --> 0:19:42.440 on the trajectory of this climate crisis. That is a bold, 0:19:42.560 --> 0:19:45.919 UM and big challenge every single day we come in 0:19:45.960 --> 0:19:48.679 to do our business. But it is not impossible and 0:19:48.720 --> 0:19:52.399 it actually makes life UM very interesting. Were never bored, 0:19:52.400 --> 0:19:56.399 we say a pentagon. There's always were done, always a 0:19:56.400 --> 0:19:59.399 new challenge to tackle. UM. You know, back in the 0:19:59.480 --> 0:20:05.240 day when we first started UM, including in for example, 0:20:05.320 --> 0:20:10.560 recycled polyester into our collection. UM, nobody else was using 0:20:10.640 --> 0:20:14.920 recycled polyester. Was it incredibly difficult. Yes, it took years 0:20:14.960 --> 0:20:19.000 and years and years of working and building relationships within 0:20:19.040 --> 0:20:22.360 the supply chain in order to get people to make advances. 0:20:22.840 --> 0:20:25.960 So in some ways today recycled polyester is a lot 0:20:25.960 --> 0:20:29.520 more available UM. But the hard part is the more 0:20:29.640 --> 0:20:33.520 you learn, the harder the challenge becomes. So we know 0:20:33.880 --> 0:20:37.959 that although recycling is critical and an important part of 0:20:38.000 --> 0:20:41.879 the waste pollution problem out there, we also now understand 0:20:42.080 --> 0:20:45.119 a lot more about the impact of our business than 0:20:45.160 --> 0:20:49.200 we did back in for example, and so the issues 0:20:49.280 --> 0:20:52.639 become really complex as we start looking at our carbon 0:20:52.680 --> 0:20:57.080 footprint overall and measuring the company's impact on the environment 0:20:57.119 --> 0:21:00.280 remains definitely at the forefront of Patagonia's priori of these. 0:21:00.480 --> 0:21:03.880 That was Jenna Johnson, head of Patagonia Inc. Coming up, 0:21:04.200 --> 0:21:06.320 we mentioned that we had a trio of CEOs that 0:21:06.320 --> 0:21:09.520 are focusing on sustainability. Well, that includes our next discussion 0:21:09.560 --> 0:21:13.480 with Chipotle CEO Brian Nicol. He talked about managing through 0:21:13.680 --> 0:21:21.680 the pandemic. This is Bloomberg. This is Bloomberg Business Week 0:21:21.880 --> 0:21:25.159 with Carol Masser from Bloomberg Radio. Well, someone who I 0:21:25.160 --> 0:21:27.840 got to talk to a couple of times throughout is 0:21:27.920 --> 0:21:31.240 Chipotle Mexican Girl CEO Brian Nicol. He was featured in 0:21:31.280 --> 0:21:34.200 the magazine as a Bloomberg Business Week Talks this year. 0:21:34.640 --> 0:21:37.920 He also stopped by for our Bloomberg fifty Virtual celebration 0:21:37.960 --> 0:21:41.440 in early December, just before the emergency approval and roll 0:21:41.480 --> 0:21:44.720 out of the COVID nineteen vaccines. I began by asking 0:21:44.760 --> 0:21:48.520 if Chipotle would make vaccinations mandatory for its employees. You 0:21:48.720 --> 0:21:52.679 we would not require people to take the vaccine, Obviously, 0:21:53.040 --> 0:21:54.640 I would want to do everything I can to make 0:21:54.640 --> 0:21:58.119 sure that they have access to the vaccine, especially those 0:21:58.160 --> 0:22:00.480 that are in those high risk groups. And I think 0:22:00.760 --> 0:22:06.119 you know, your health and wellness is ultimately your personal decision, UM. 0:22:06.200 --> 0:22:09.720 Whatever your decision is. Though, if you aren't feeling healthy, UM, 0:22:09.800 --> 0:22:13.000 and you happen to have COVID, we do need you to, 0:22:13.160 --> 0:22:15.880 you know, take those precautions to not get other people infected. 0:22:15.960 --> 0:22:18.880 But I'm focused on trying to stay in touch with people. 0:22:18.880 --> 0:22:22.800 So I understand when vaccines get approved, how they will 0:22:22.840 --> 0:22:26.840 be distributed and how I best get our employees access 0:22:26.880 --> 0:22:29.560