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Socially Responsible Vermont: Beyond the bottom line
by Stephen Morris
Vermont Mystic Pie Co. brings together a "Who's Who" and "What's What" of Vermont companies.
The apples come from local orchards that embrace the most rigorous ecological growing techniques. The butter comes from the farmers of Cabot Creamery.
Vermont Mystic Pie Co. brings together a "Who's Who" and "What's What" of Vermont companies. The apples come from local orchards that embrace the most rigorous ecological growing techniques. The butter comes from the farmers of Cabot Creamery. The flour may not originate in Vermont, but it is supplied by King Arthur Flour, the nation's oldest miller, headquartered in Norwich.
The pie recipes were developed with the assistance of the New England Culinary Institute. Start-up financing came from the Barred Rock Fund, a socially progressive venture capital fund established by Ben & Jerry's co-founder Ben Cohen with money he received from selling his ice cream company to Unilever.
The founder of the Mystic Pie, David Barash, has a background that includes stints with Shelburne Farms, Ben & Jerry's Homemade Inc., Autumn Harp and Stonyfield Farm. He has the good business sense to know that a company can benefit by having either "Vermont" or "Green Mountain" in its name. A touch of whimsy doesn't hurt, either. "Mystic" is to "pie" as "Magic" is to "beer" -- Magic Hat being the name of a popular South Burlington brewery.
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The pie company, headquartered in Stowe, has a mission. In this case it is to help the imperiled local apple industry which has declined more than 40 percent in the past 15 years, due in part to the low-cost competition from China. Vermont Mystic Pie appears to have a social conscience, too. The company will donate 10 percent of its profits to True Majority, the online advocacy community started by Cohen to influence Congress on social and environmental issues. Additionally, 10 percent of the ownership of Mystic Pie has been set aside for a yet-to-be-named, socially conscious nonprofit organization. Finally, the packaging features the artwork of Stephen Huneck, the Vermont artist whose black dog representations are known across the state.
Vermont Mystic Pie is a company that probably could not exist anywhere else in the country. In Vermont, its existence is the result of a networking tour de force, and its shared social, political and business values are as important to the company as the flakiness of its crust.
The pie company got its start thanks largely to Vermont Businesses for Social Responsibility, a business organization, like the Chamber of Commerce, that was formed by various business people with shared interests – in this case wanting to promote certain social and environmental values. The idea was to bring together businesses that ascribed to the "'dual bottom line' -- i.e. profit and socially responsible involvement," according to the organization's chairman Don Mayer, owner of Small Dog Electronics in Waitsfield. "Over the years we have refined this concept and now refer to it as 'multiple bottom lines.'"
The idea of a "Chamber for the rest of us" (no one knows who coined the phrase, but it has stuck) achieved critical mass in the early 1990s when a group of socially-motivated business men and women began meeting informally.
Today, Vermont Businesses for Social Responsibility is a force in the Vermont economy, with full-time staff and offices overlooking Lake Champlain. Spence Putnam, executive director, has announced that membership recently passed the 600 mark. VBSR's 600 businesses and organizations collectively employ more than 30,000 people and now generate more than $4.5 billion in annual revenues.
VBSR's emergence has not come at the expense of the state Chamber of Commerce, according to Chamber officials. With more than 22,000 incorporated entities in the state, there seems to be growth opportunities for everyone. The more mature Chamber was started in the early 1950s and has a membership more than twice the size of VBSR and also is growing, probably at a 1 percent to 3 percent clip, says executive director Duane Marsh. Relationships between the two major business groups are said to be cordial and respectful.
Marsh says Vermont does have a unique political, social and business culture and that VBSR has managed to identify a niche and capitalize on it. But he also says that the more traditional Chamber shares some of VBSR's goals and in no way considers "economic leadership and social responsibility to be mutually exclusive."
Putnam adds: "In the early days, VBSR was viewed as a threat to Chambers of Commerce, mainly because our messages to the Legislature were counter to theirs in some respects (pushing for a higher minimum wage and calling for environmental controls, etc.)." But the sense of rivalry passed quickly, he says, adding that many business people are members of both organizations.
Until just a few years ago Vermont was better known for its cows and skiing than its business opportunities. There is a near consensus in business circles that one big catalyst for this change was the migration of the tens of thousands of young people to the state in the early 1970s, members of the Vietnam War generation, who were inspired by the back-to-the-land movement. As a collective group they had long hair, tended gardens and built primitive homes in remote locations. They loved their chosen state, but as they grew older and wanted more material comforts they realized that Vermont was not necessarily the easiest place to make a living.
"If you wanted to stay at the party, you had to invent a job," says John "Sucosh" Norton, currently chief operating officer at Controlled Energy, a company in Waitsfield that sells energy efficient appliances and systems. This company was one of many businesses that bubbled out of a caldron of entrepreneurial activity in the Mad River Valley in the late 1970s and early 1980s. Small Dog Electronics, Northern Power, Wall/Goldfinger and Vermont Castings were among the other well-known Vermont companies whose lineage is traced to this time and place.
About the time these firms were becoming established in central Vermont, another group of young entrepreneurs in Chittenden County were starting Garden Way, a multi-faceted enterprise that actually catered to those 1970s back-to-the-landers. Eventually the company, in the mid-1980s, moved its headquarters to Troy, N.Y., but many of its most enterprising employees, schooled in the entrepreneurial traditions of Garden Way, started their own businesses – including such well-known companies as Gardeners Supply, Country Home Products, Storey Publishing, Vermont Teddy Bear, Magic Hat Brewing and Seventh Generation.
Simultaneously, a couple of counter-culture ice cream makers by the name of Ben Cohen and Jerry Greenfield launched Ben & Jerry's Homemade. It grew from little more than a Burlington ice cream parlor, located in a former service station in Burlington, to a major corporation now employing hundreds of people at its Waterbury and other plants.
By the 1990s all of these upstart, non-traditional enterprises were past adolescence, but not yet ready for middle age. They had the same networking needs as other businesses, but were not stylistically well-suited for the more buttoned-down, traditional relationships fostered and encountered through the Chamber of Commerce. A murmuring began about "a Chamber for the rest of us."
The result was VBSR.
The organization's first meetings were held in the offices of Seventh Generation, a mail-order marketer of alternative lifestyle products. That company was founded by Alan Newman, a Garden Way alumnus and later the founder of Magic Hat Brewing Co.
Most of the founding members of VBSR are now easily recognized members of the Vermont business scene. Bruce Seifer, now Mayor Peter Clavelle's assistant director of economic development, was part of the formative group. Among the other key organizers, he says were: Peg Devlyn and Pat Heffernan, co-presidents of Marketing Partners, a Burlington marketing and public relations agency; Ben Ptashnik, founder of the importing company Via Vermont, and Matt Rubin, now a leading proponent of building wind generators in the Northeast Kingdom.
The group decided they wanted to promote notions of social responsibility in the business community, although they stopped short of defining what exactly "social responsibility" meant. "We decided the members would define the term over time by their actions," says Seifer. "And that's what seems to have happened.
"I do not think that there was any precipitating event that began the movement," says Small Dog's Don Mayer. The organization was formalized in February 1991, and Ben & Jerry's and the city of Burlington provided seed capital to help the organization through its formative years.
Almost from the start VBSR advocated for programs often opposed or at least ignored by more traditional businesses. VBSR, for example, supported Family Leave legislation, which would required businesses to offer employees time off during family emergencies. In the early 1990s VBSR hired a public policy director, Julie Davis, to fight to increase the minimum wage, and over the years the organization has defended Act 250, the state's major development-control law. Membership originally grew by "fits and starts," according to Putnam, but by 2002, when he came aboard, it had reached 415 members.
Without existing models, members learned from each other. "We spent a lot of time doing write-ups called 'Best Practices,'" says Seifer, referring to the ethics guidelines that can now be viewed on VBSR's official Web site. "We held regular meetings called 'circles' where we would discuss and debate topics that would help members become more socially responsible," he says.
A business group that advocated treating workers better? An organization that said all workers deserved a "livable wage" so that they could afford the basics of life? To say the least, these were novel notions in the more staid free-market, bottom-line driven business world. In Vermont, however, the ideas began gaining acceptance.
Early policy decisions were key. The organization would first focus on business needs and trends, not so much on social agenda. There would be no screens or criteria to determine who could join. You pay your dues, you're a member. It became obvious that if you liked the political and social positions that VBSR was taking, you would be inclined to join. So, membership essentially was based on self selection.
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