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by Susan Thomas
April 2008
A sign that corporate citizenship is truly coming of age: it took three people from convening sponsor Toyota to tell the company's corporate citizenship story at the Boston College Center's annual conference.
Their three stories were remarkably aligned with the Center's Corporate Citizenship Management Framework, which outlines four domains of the business to be considered in corporate citizenship management: corporate mission and values, community engagement, operations, and products and services
Presenting the Toyota story were Pat Pineda, group vice president for philanthropy and president of Toyota’s U.S. foundation; Bill Reinert, national manager of advanced technology for Toyota Motor Sales, USA; and Kevin Butt, general manager and chief environmental officer of Toyota Motor Engineering and Manufacturing, North America.
Together the three provided an inside view of how the company incorporates sustainability in all it does.
The Toyota Way
 Toyota has very strong set of values - called the Toyota Way - which guides it in everything it does. The Toyota Way is based on two pillars: respect for people and continuous improvement.
Underlying the two pillars are the Toyota Principles, which encourage Toyota employees to demonstrate respect for people but use the power of teamwork, making decisions as if a customer is standing next to you, and embracing the responsibilities of citizenship wherever you do business, explained Pat Pineda.
The principles also emphasize continuous improvement by abolishing waste and revering efficiency, realizing that perfection is never possible, but improvement always is.
"Sustainability is a belief that runs through all facets of our business," said Pineda. "We believe that in order for Toyota to be successful we must build sustainable relationships with all of our stakeholders, employees, customers, suppliers, dealers, philanthropic partners and anyone else who makes our business move forward each day."
This philosophy applies to Toyota's philanthropic giving and is epitomized by its long-term philanthropic partnership with the National Center for Family Literacy. The company has developed a three pillar national strategy that focuses on education, safety, and the environment, and is currently engaged in two new environmental philanthropic partnerships: one with the Pew Center on Global Climate Change, and a recently announced five-year alliance with the National Audubon Society called TogetherGreen.
Sustainable Manufacturing
Sustainability means different things to different people, said Kevin Butt. "When we talk about sustainability we look at the six Rs: Reduce, Reuse, Recycle, Recover, Redesign, and Remanufacture."
Toyota's goal is to make its production system No. 1 in the world when it comes to environmental performance: the lowest emitters of air emissions, noise and water. Reducing its environmental footprint applies to many areas:
- Reduce energy. Toyota has reduced the amount of energy consumed in its manufacturing processes by 22 percent since 2000. "We do it by designing better at the beginning of our process," explained Butt, from reducing the length of conveyors, to the size of motors, to the amount of energy that goes into paint booths.
- Reduce CO2 emissions. These have been reduced 11 percent since 2000
- Reduce waste that goes into landfill. Toyota's target is zero landfill from its manufacturing operations. That's an ambitious goal for a company that makes 1.5 million cars in the U.S., but it is already 97 percent achieved.
- Reduce non-salable waste per vehicle - Toyota also has a zero target for waste generated by its production system.
- Reduce water consumption. "Each of our manufacturing facilities designs their process systems so they use the least amount of water that's absolutely necessary to do the job," said Butt. "For example, our Texas facility was designed to use almost all recycled water. Overall we've had a 20 percent reduction of our water use since the year 2000."
 Another R is recycling. At Toyota, recycling efforts extend to many areas, from waste at its cafeterias, to process waste (such as dust covers that go on engines and transmissions before they are put into place), to any cardboard, plastic or metal used in its production or administrative offices.
At its Georgetown, Ky., plant, organic waste such as grass trimmings go into a 60-acre garden where the company grows thousands of pounds of produce, much of which is donated to homeless shelters and those in need. Also on-site is a geodesic greenhouse where the company grows plants and vegetables in the compost it creates.
For Toyota, continuous improvement also means experiments in innovation that are then expanded throughout the company.
Last December, Toyota President Katsuaki Watanabe announced to the world that Toyota would create a number of model sustainable plants, which the company would learn from "and spread those great processes to all the rest of our facilities," said Butt.
Toyota's model sustainable plants in North America are located in Tupelo, Miss., (currently under construction) and Huntsville, Ala.
"We've also asked our partners and suppliers to join us in our efforts. We issue green supplier guidelines and they've embraced that concept as well," said Butt.
The final R, explained Butt, is remanufacture. "Every time we design a product or design process, sustainability has to be considered, as well as reducing the footprint by which it consumes energy and our natural resources. This is the way we think when talking about product and product development and process development in Toyota."
Dr. Doom
"I'm known as Dr. Doom internally because I reinforce with our executives that the first law of thermodynamics is true, and that the third law of Disney isn’t true," began Bill Reinert. The first law of thermodynamics is that energy can’t be created and you're always going to waste some when you use it, he explained. "The third law of Disney is that wishing makes it so, but that's just not true. And we all have to worry about that."
So what does Dr. Doom worry about?
 He worries about increased consumption of fossil fuels around the world. "That's because the population is becoming more mobile and because of our increased industrialization, especially in developing countries. So now we see increased climate change, we see issues with energy and fuel diversity, we see exhaust emission issues and urban congestion."
He also worries about climate change and CO2. By 2030, with increased vehicle use in Russia, Brazil, India and China, the number of cars on the road could double or even triple. This will require building roads, building factories, and building electric power plants to supply all this. "When you look at CO2, it’s not just the tailpipe of the cars, it’s a longer tailpipe," said Reinert.
Reinert is even worried about the Prius, Toyota's highly successful hybrid that has set the standard for U.S. auto manufacturers.
"In the United States where most of my work is focused, we've got about 16 million customers a year. This is a diverse customer group that wants to drive a lot of different types of vehicles – trucks and SUVs, not just Priuses. Our goal is to make the best car for the customer in the cleanest, most environmentally sustainable plants in the world."
Toyota is trying to ramp up its product evolution as quickly as possible, said Reinert, but still keep mass market appeals. "We have a million hybrids on the road right now, which is by far more than the other manufacturers added together. We have announced that by the next decade, we will sell a million hybrids a year. More than half of those will be in the United States. We're looking literally at hybridization of every model Toyota makes; every truck, every car, no matter how big or small."
But, as he said, Dr. Doom is also worried about the first law of thermodynamics. Many thought corn-based ethanol was the answer, but the tradeoffs in terms of land use, CO2 production and water consumption are just too high.
"You have to keep in mind all of these life cycle assessments," said Reinert. "Our production engineers have a life cycle assessment budget for each car they design. And each time they design a car, that budget gets smaller and smaller."
"Sustainability is not a product," he concluded. "It’s not something you're going to do once. It’s a journey, a way of life. And it’s a process. And like every process, you could continually improve it."
"In the years to come, every one of us is going to face challenges from resource depletion, from energy security and climate change. The road ahead is going to be difficult, but if you don't do something, what is the message you're leaving to your children and your children’s children and the children after them?"
 View a video of Toyota's keynote presentation. (Members and conference participants only; login required)
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