"Link," A monthly PricewaterhouseCoopers internal newsletter, published an interview with Peter Senge in their February 2004 issue. The following excerpt is reprinted with permission.

Link: In a nutshell, what is the main mission for Society for Organizational Learning?

Peter: The basic idea is very simple: that world organisations can do together what they can't possibly do by themselves. SoL sets out to enable collective or collaborative change, and reveal knowledge that can be as widely shared as possible. The whole area of sustainability is a prime example. There's very little that any one company by itself can do to lead industrial societies toward a way of living that conserves rather than destroys our social and natural capital.

Link: Can you give us some examples?

Peter: Well, one example of what's going on in the sustainability consortium is the materials pooling project. That tackles a very, very complex change process where no company by itself can make much headway. The basic idea is, how can we learn to collaborate across very complex supply chains so as to systematically identify and eliminate sources of waste and toxicity? If companies work at it together and create a demand for environmentally sound alternatives, then something may be really changed.

Our goal right now is to see if we can make some headway around three or four material platforms. For example, we're trying to get a good cross-section of auto industry people and others that use dangerous anti-corrosion metal treatments and companies that supply those customers. We're also concentrating on leather –– the standard processes for tanning leather are pretty horrific. They cause a lot of fatalities around the world and produce lots of chemicals that are very destructive to ecosystems.

Link: But how do you make a business case for improving the situation?

Peter: If you look hard at any long-term investment or new technology, the idea that there is a cut-and-dried quantitative business case is nonsense. There's an argument you can make, but lots of times you're wrong. What's the business case for investing in your people? What's the business case for a major acquisition? There's never a cut-and-dried business case for any significant long-term investment, but we make such investments nonetheless all the time.

But there are some investments that companies are used to making. Others, they're very unused to making. So I think the main issue here is that this is unfamiliar territory.

I can give you one example of how companies come to some reasonable determination. One of the largest sellers of fish products and agricultural goods in the world is also one of the largest users of water. They look at global practices in fishing, agriculture, and water, and they basically say, the business case [for sustainable development] for us is survival. That's one type of business case, and believe me, it's very compelling.

Link: Do you think the sustainability movement is changing? How do you see the next 10 years?

Peter: I think this decade is a crucial decade. I think it's probably going to see more dramatic social or political and environmental disruption. These two are always very closely connected. Look at the tragic case of water. Increasing numbers of people in the world are headed toward situations of severe dehydration. Meanwhile, the soft drink industry collectively already controls probably close to 10 percent of the world's drinkable water, and it's growing rapidly. I think you're going to see some significant shifts starting to occur.

Consider materials. You know, it's not bad luck that cancer rates are going through the roof in all the advanced countries. There are two obvious sources of this -- our food and our products. I expect to see more class-action suits. All of a sudden, business is going to go, "Oh, my God. We always used the cheapest thing we could use from a materials standpoint, if it provided some functionality we desired. And we can no longer think about it that way."

Link: Where do you think the political leadership in sustainability is coming from?

Peter: Europe has clearly taken leadership in some areas, such as end-of-vehicle-lifetime directives. If you sell a car in Europe today, for example, you are responsible for taking the car back at the end of its productive life. Similar legislative initiatives are taking shape with other products, like consumer electronics. So I think in this decade we should see some real breakthroughs, with a significant percentage of products being designed for remanufacture and recycling, so less and less toxic material will end up in waste dumps.

China is also creating major ripples, for example in the auto industry. Will they elect to develop manufacturing capacity focused on traditional internal combustion technology, or seek to "leapfrog" to far more environmentally sound options? In many ways they are in a commanding position, given the enormous growth in private cars predicted.

I think the Chinese government may get more and more vocal in making very strong demands for the partnership contracts with western multinationals that focus on next-generation technologies in core industries.

The other thing that's very interesting today is the way economic activity is integrated around the world. So any major trading block has a lot of leverage. For example, the European Union (EU) end-of-vehicle lifetime mandates are in fact becoming global mandates. If you're an auto manufacturer, you're going to go through all the trouble of figuring out a way to eliminate mercury from your switches for the cars you sell in Europe and not do the same for the cars you sell all around the world. You've worked for years to build integrated product platforms, and you really can't afford to have totally different switches around the world. The same will probably be true of many of the materials changes that the EU is driving.

One interesting thing about that is it means the US political process, which has been so stalemated on most environmental issues, is becoming less and less relevant. That, to me, is one of the most important dynamics starting to play out in the world. The US electorate seems so unmoved by problems like global warming. But people in other parts of the world are very moved. I expect other major trading blocks to take more initiative, from demanding alternative technologies to enacting tariffs or other penalties for those who generate large amounts of carbon dioxide emission.

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