Warning: Companies may be less green than they appear

Last week, IBM announced plans to cut greenhouse emissions 7 percent by 2012. Then yesterday, HP unveiled a broad plan to cut its 2005 level of energy usage by 20% come 2010. Notably, it used the announcement as a platform to talk up some of its recent “green” initiatives, such as delivering 33% more energy-efficient business PCs; releasing its Dynamic Smart Cooling energy management software for data centers, which HP says can cut energy consumption by up to 45%; and redesigning print cartridge packaging, which HP says will cut greenhouse gas emissions by about 37 million pounds this year.

While those initiatives are indeed well and good (from a sustainability standpoint), Frank Gillett, a principal analyst at Forrester Research, noted that he was particularly impressed by HP’s stated ambition of reducing energy use by 20%, especially considering that the company has plans to grow in the meantime. “The company is going to be 50% bigger by [2010], so we’re effectively talking about a 50% increase in energy efficiency … . They’ve almost undersold the magnitude of what they’re trying to do,” he said.

Admirable as HP, IBM, and other companies’ purported green aspirations might be, Gillett said he’s generally still not seeing a lot of clear forward thinking nor environmental dediction from some companies. Rather, many are “trying to re-characterize the things they do to save money as being green.”

I think that’s a pretty fair analysis in many cases. True environmental concern isn’t the main underlying motivation for companies looking to develop more energy-efficient hardware, push for stricter environmental standards, or implement virtualization projects. Rather, the eco-friendly aspect is a fortunate and healthy by-product of money-saving, waste-reducing efforts.

Not that “being green” really can be a company’s primary goal. Gillett noted that the most environmentally-friendly thing people could do is stop having children, which is technically true: fewer people means less consumption and less waste. Similarly, the “greenest” thing HP or IBM or Toyota or Pepsi or any company could do is shut down entirely. Think of the energy savings!

But a company’s goal is to grow, to be profitable — but also to be around 50, or 100, or 200 years from now. Adopting a long-term sustainable strategy is a great way to ensure that. Saving a dollar today means having one tomorrow. Saving a kilowatt today means it’s available tomorrow.

But despite all the green talk, there’s still a tendency in the business world to take a narrow, short-term approach to business based on today’s bottom line, Gillett noted. And that’s an important point. For example, if your CFO has a choice to spend an extra $20 per new PC to get 80% efficient power supplies, he or she may say, “Forget it,” despite the environmental considerations (as well as the potential long-term power savings).

Similarly, if a PC maker like HP has the choice of making its more energy-efficient power supplies standard features in its newest line of PCs, rather than charging $20 extra for them, that company’s CFO might also say, “Forget it,” despite the environmental considerations. (This isn’t strictly hypothetical: HP’s is indeed selling optional 80% efficient power supplies with its PCs for an additional 20 bucks a pop.)

I’ll leave the last word with Forrester’s Gillett: “Human beings are not good at making the long-term decision. We want to have the hamburger, not the leafy green vegetables. … What’s the right thing to do in the long run is not the obvious thing to do in the short term. We’re up against fundamental human behavior.”