In a motorcycle dealership in downtown San Francisco, on an autumn evening in 2011, a group of automotive engineers and market researchers stood staring at several unusual-looking black-and-silver motorbikes. The mystery vehicles were about to be put to the test by a dozen motorcycle enthusiasts.
The bikes had no markings to show who had manufactured them. More remarkably, they did not have standard petrol engines but electric motors, with panels where the cylinders should be. This design element was a contentious choice for the manufacturer, as the proximity of the rider to a loud petrol engine is generally regarded as part of a motorbike’s appeal. A researcher explained that these were new electric vehicles, designed for a proper riding experience and not just a short-hop urban commute. They invited each person to take one of the models for a test ride.
After the ride, the researchers asked the testers about the bikes; the feedback was positive. They then wanted to know how the riders’ attitudes would be affected by branding: would the bikes seem more exciting and innovative if they were made by, say, Honda or Tesla? As the researchers ran down their list, the engineers held their breath. Finally, the big question: what if they were made by Harley-Davidson?
“They loved the idea,” says Harley-Davidson CEO Matt Levatich, speaking from his Milwaukee office eight years later. He still remembers that in the report, one attendee had actually exclaimed, “Wow!”
Levatich admits he had initially been apprehensive, because “Harley might well have been the last brand in the world you would expect to go electric”. However, the tests in San Francisco (and subsequently Atlanta, London, Berlin and Tokyo) revealed that, provided the ride experience was good enough, the brand had sufficient strength to make electric seem not a compromise, but an exciting innovation.
It would take eight years and the work of a thousand engineers to fully realise the product, but the Harley-Davidson LiveWire, the company’s first electric model, was finally due to go on sale at $30,000 (£28,995 in the UK) in September 2019. Levatich credits the LiveWire with reviving optimism about Harley’s future at a time when motorcycle sales are in decline. It has attracted generally favourable reviews in the motorcycle media, and Levatich says: “It made me think,’Look what this brand can do. Look what this company can do. Look what we could become. We could transform things.'”
But Levatich is keen to share the credit. Harley-Davidson fans shouldn’t just thank him, he says. They should also thank Jochen Zeitz.
Zeitz is a 56-year-old executive and entrepreneur with a formidable set of achievements to his name. In 1993, at the age of 30, he became CEO of Puma – making him the youngest ever CEO of a German company at the time – and turned the near-bankrupt business into one of the world’s top three sports brands. The company was acquired by luxury goods conglomerate Kering in 2007, and a few years later Zeitz served as Kering’s Chief Sustainability Officer. He now sits on the boards of Harley-Davidson, financial services company Cranemere, and the Kenya Wildlife Service, as well as running his own charitable foundation and co-chairing The B Team, a non-profit that he co-founded with Richard Branson in 2012 to promote sustainable business practices. He has won the Financial Times Strategist of the Year award three times, been awarded the German Federal Cross of Merit, and co-authored two books – one of which, a dialogue with Benedictine monk Anselm Grün called The Manager and the Monk: A Discourse on Prayer, Profit and Principles, has been translated into 15 languages.
Across his many endeavours, Zeitz has one overarching aim: making businesses sustainable in a way that improves both society and the natural environment, and that creates economic growth. Sipping water in a pub in south-west London, where he keeps one of several homes, Zeitz cuts a benign figure: bearded, dressed in greenish cords and T-shirt, and sat next to the acoustic guitar he’s brought with him, he looks more like a 1970s singer-songwriter than an influential business leader.
In soft, measured tones, he explains how he sees business as moving from an industrial revolution model based on extraction to one based on the regeneration of resources. “My belief is that every company has an opportunity to innovate by creating business solutions for services or products that significantly reduce your impact and create more demand for your product,” he says. “Well, unless you are an extracting business. In that case, you’re a dinosaur and you’re dying.”
Central to Zeitz’s vision is redefining the role of business in society in a way that promotes sustainability on all fronts: social, environmental and financial. The new definition, he says, needs “to create a kind of shareholder value that is socially just and environmentally sustainable. I believe that creating shareholder value is necessary because it creates jobs and all the things that we need on a planet with a rising population. But it can’t be at the expense of everything.”
The solution is to marry sustainability with growth. “It’s a question of what we grow and how we grow, and how we can reduce our impact significantly and still grow,” he says. “We have to grow within planetary boundaries.” In practice, this means that instead of making short-term profits that may incur costs later on (an obvious example being depleted resources leading to higher raw material prices, or social inequalities reducing at-work performances and purchasing power), businesses need to spread some of that growth to the wider world around them, for the sake of the planet – but also themselves.
When Zeitz was encouraging Levatich to think about sustainability, for example, he focused not just on the moral justification for electric engines, but on the needs of Harley-Davidson customers to have healthy natural landscapes in which to ride. Levatich remembers talking about “what every rider loves about the ride – it’s the environment they’re riding in, isn’t it? After that, it was easy to get brand alignment, and then you’re right into using that argument to support [sustainability] as part of the brand.” Eventually, Harley-Davidson devised a new mission, turning the brand’s historic celebration of freedom into a desire “to preserve and renew the freedom to ride”.
Zeitz manages to convince business leaders to his vision because he himself has repeatedly led by example. At Puma, he increased the company’s share price by 4,000 per cent while also introducing two procedures that have since influenced businesses across the world. In 2008, he created PUMAVision, an ethical code of behaviour that applied to company staff, its business dealings and its relationships with external organisations. Three years later, he developed the environmental profit and loss account, which set a monetary value on the natural resources used by Puma across its supply chain. (Zeitz could even tell you the environmental impact of the aglets – the little plastic tips on the shoelaces of Puma trainers.) This meant that “natural services”, as they were called by academics at the time, could be brought into accounting spreadsheets.
At Kering, Zeitz introduced environmental profit and loss accounting to all companies, including Gucci, Yves Saint Laurent, McQueen and Balenciaga, and at the same time he pushed through sustainability standards in supply chains that set the group apart from its competitors. While he was with the company, its share price rose 150 per cent.
At The B Team his advisers include Salesforce co-CEO Marc Benioff, former PepsiCo CEO and chair Indra Nooyi, and Danone CEO Emmanuel Faber. They are pushing the idea of “business as a force for good” – the group was thanked by then British Prime Minister David Cameron for pressing the 2015 Paris climate conference to adopt the first ever legally binding climate change deal, under which 196 countries committed to limit the increase in global average temperature to 1.5°C. The B Team is now bringing together businesses and organisations with the aim of eradicating anonymous shell companies and associated corruption (which it estimates costs $2.6 trillion, or over two per cent of global GDP, annually). Two hundred companies are currently working with The B Team, and some, including Unilever and Brazil’s Natura, have opened up their ownership structures as a result of the campaign.
Levatich characterises Zeitz as both inspirational and practical. When Zeitz introduced his environmental profit and loss accounting to Harley-Davidson, he says, it was a crucial moment. “That’s the tool that we use to ensure we do the right thing and the best things we can do,” he says. “It’s important to point out that this didn’t cost us money – it saved money.”
Zeitz was born in Mannheim, Germany, in 1963, to a gynaecologist father and dentist mother. His parents had strong values; he remembers his father almost being fired when he insisted on introducing mammography at his hospital when the Christian medical authorities objected. Zeitz grew up a time when the Green Party and the anti-nuclear movement were enjoying strong support in Germany, and that, together with the time he spent at the family’s lodge in the Odenwald forest, planted the seed of his interest in environmentalism. He says he was a “pretty regular” kid, though, into American football and westerns, and interested in becoming a doctor. It was only when he enrolled on a business course to fill in time before starting medical school that he developed an interest in commerce.
After an early job with Colgate-Palmolive, he was headhunted to work on Puma’s marketing. “The company was a total mess, basically,” he says. “It had made no money since going public in 1988. I worked with three CEOs in two and a half years, and there was no marketing department. I had to build it up, and when I produced a marketing plan they looked at me as if I was from another planet.”
Zeitz has been characterised as impatient and demanding unrealistic standards (at Kering, he was known as the “sustainability Taliban”), and has learned that good ideas can easily founder on the reality of supply chains. “You have to get your hands really dirty,” he says. “We can theorise a lot of things, but to see the impact, especially far down the supply chain, you have to see the real impact on the ground. It’s that that tells you if something’s working or not.”
Fourteen years ago, he decided to put his ideas into practice by starting his own business – Segera, a 50,000-acre luxury holiday retreat on the Laikipia plateau in Kenya’s central highlands. “I felt you can’t preach what you don’t live,” he says. Kenya was where Zeitz found his mission. Growing up watching the natural history documentaries presented by Bernhard Grzimek, the “German David Attenborough”, he had been fascinated by the Africa and in November 1989 went on a budget safari to Kenya and Nigeria. It wasn’t all he had hoped for; he remembers being taken to see a lion and finding there 30 other minibuses full of people looking at it. He saw the negative environmental impacts of business and mass tourism, and felt his perspective changing. In the evening, he watched footage of the fall of the Berlin Wall back in Germany, but he felt more of a connection to his present surroundings. “I just fell totally in love with the continent,” he says, “and I knew I wanted to make it my home.”
He now spends about three months of the year at Segera, living in a bungalow in the central area. When he took it over, Segera was a cattle ranch that had been run down by a previous owner, who went bankrupt. Its soil fertility had been reduced by overgrazing, there was little relationship with local communities, and illegal poaching of wildlife for meat and fur was common; in his first year there, Zeitz would find the bodies of giraffe, buffalo and elephant that had been shot and trapped.
At the time he set up Segera, he also created his philanthropic Zeitz Foundation. He and Segera manager Benaiah Odhiambo set to work creating a business framework by making baseline studies of the community and the environment, and talking to zoologists, conservationists and local people with knowledge of the land. He brainstormed the “4C” concept of conservation, community, culture and commerce. “The secret is to create wins for everybody,” Zeitz says. “You can’t just preserve the environment by putting a big fence around the property and casting the community aside, because you need the community to sustain the property. You need culture because cultural shifts help to transform people’s mindsets. Commerce is the driver of everything because you can’t run something on philanthropy forever.”
Using the 4C plan as a framework, Zeitz and Odhiambo developed five-year goals. Thirteen years later, the central part of Segera consists of a ten-acre circle of grass in the brushland, with eight guest cottages (costing up to $2,400 a night) on stilts, interspersed with open-air baths, cacti and contemporary African art, and a water recycling plant with an 800,000 cubic metre capacity. The land has been rewilded and is again home to giraffes, elephants, impala and other game, and local people graze their animals on the land on a rotational basis. Writers and activists have praised Segera for the depth of its engagement with the community – although at the beginning, Zeitz’s team were unpopular, because they weren’t, as one director told the Financial Times, “doing the conventional thing of throwing sweets over the fence”.
The complex employs 240 people, and has opened up access to markets for other businesses such as bead-makers and food producers. The Zeitz Foundation has also collaborated with aid agencies to build local “climate-smart” schools; these have roofs designed to drain rain runoff into tanks, where it can be filtered to make clean drinking water. One of the most interesting initiatives is an anti-poaching unit staffed entirely by local women. “They are tough ladies, and fully trained, but the idea is to get them to communicate what we are doing at Segera to help the communities, and to explain that preserving the wildlife is more of an opportunity than exploiting it.”
Zeitz has launched other projects in Africa: the Zeitz Collection of contemporary art from Africa and its diaspora; the Zeitz Museum of Contemporary Art Africa, a complex of 100 galleries in a 1920s granary in Cape Town converted by Thomas Heatherwick, which houses work from both its own and Zeitz’s collections: and The Long Run, which rates sustainable tourism projects according to the four Cs.
A great deal of Zeitz’s work now involves supporting businesses who have realised they need to transform, but lack the confidence to proceed. Jean Oelwang, a senior B Team partner and president of Virgin Unite, the Virgin Group’s entrepreneurial foundation, says leadership is the single most important commodity for The B Team; it was set up, she says, “partly because when the founders started to think about the need for change, they saw that leadership was what was scarce”.
Business leadership works differently during a transformation, because, Zeitz says, bosses are less able to rely on practices that previously insulated them from criticism. He points to market research. “Traditional consumer goods companies are very research driven, and don’t really decide on action until research tells them to change – but the reality is that research doesn’t always tell you what the consumer wants, because you ask the consumer, and then the product comes out two years later.
“If you’re evolving slowly but surely, it works well, but if you’re trying to change you need a different approach, especially in today’s world with technology, where everything can change so much more quickly than it used to, and entry barriers to markets are lower in terms of costs. Nowadays you need to think more about using a product to create a new demand, not satisfy an existing one.”
That’s what he did at Puma, where the research told him “to just give up, as the company had no future”. It’s easier now, he says, because VCs and private equity funds are more willing to back entrepreneurs, although there is also more pressure on CEOs, because they are increasingly required to act ethically as well as ensuring the health of the company. This expectation is a key part of The B Team’s premise. Its leaders believe that organisations seeking to effect changes in society can do so only if people trust them, and people now tend to trust businesses more than politicians.
Oelwang points to to the Edelman Trust Barometer, an annual international survey by the US PR firm Edelman of 33,000 people and the degree of trust they have in various professions and institutions. In recent years trust in politicians and public institutions has fallen, while faith in employers has remained strong; in 2019, only one in five people felt the system was working for them, and 76 per cent felt CEOs should take the lead on change without waiting for government to impose it. That, says Oelwang, is why actions taken by business can sometimes achieve greater social change than that taken by politicians. One might ask, for example, if the Harley-Davidson testers who took to the electric bike would have been as ready to embrace a government initiative encouraging people to adopt cleaner engines. Perhaps this faith in business is likely to increase, because younger demographics tend to be more jaded about mainstream politics, and have higher expectations of CEOs when it comes to ethical decision-making.
For The B Team, environmental and social sustainability have to go hand in hand, and much of its work is based on improving the way workplaces function. Its 100 Percent People project, for example, saw 350 companies, including Unilever, Zappos and Natura, sign up to a rolling series of experiments in HR practices, geared towards improving equality, respect, growth and a sense of purpose among workers. These businesses carried out experiments and then pooled their results in order to share their findings.
In New Zealand, financial services company Perpetual Guardian trialled a four-day week based on a “100-80-100” rule – 100 percent remuneration, for 80 percent of time in the office, meeting 100 percent of agreed productivity. Staff stress levels lowered (from 45 per cent pre-trial to 38 per cent post-trial) and satisfaction with work-life balance increased (54 per cent to 78 per cent). By 2019, the four-day week was on the agenda at the World Economic Forum in Davos.
In the US, Greyston pioneered a programme of “radical inclusion”, which meant people were employed without having to show a CV or have any background checks done, and the HR department partnered with employees to remove obstacles around issues such as childcare or safe housing. Greyston branded the idea as “open hiring”, and is committed to supporting other companies curious about the approach.
The questions Zeitz gets asked most often around sustainability are “How do we do it?”, “Is it a responsibility or is it more?” and “How do we justify the expense?”. Answering these often requires a change of culture within an organisation: leaders may need to alter the way they think about their employees – shifting emphasis from shareholders to all stakeholders, for example – or adjust pay structures that incentivise short-term profits at the expense of environmental or social benefits.
CEOs looking for a place to start, he says, could try getting rid of quarterly reports, which lead to companies looking for immediate gains rather than working out kinks in the business. “Transforming your business is an investment, just like you invest in R&D or marketing,” he says. “It’s investing in sustainability and developing new materials, and it’s not going to come for free, so I look at it as part of my operating expenses… The argument that sustainability should pay for itself is a short-term argument that I do not think is correct unless you are a business where it is relatively easy to transform.”
Zeitz admires boldness, and the ability to make things happen quickly. At Kering, he watched in admiration as CEO François-Henri Pinault decided he wanted gender equality on the board, and promptly replaced three men with three women.
As for the future, he sees the increasing tendency of investors to look for sustainability in business plans as a sign that things will continue in the right trajectory. “Money will show you if something is going to happen, and usually it’s just a question of time,” he says. “Especially now, because there is smart money out there looking for opportunities with strength. Money finds the opportunity, and it sees that opportunity before anybody else.”
But getting there won’t be quick or easy, requiring a cultural shift beyond just consumer behaviour. “I am a very impatient person, but I have learned that we can’t shift culture overnight,” he says. “The environmental movement requires such a cultural shift that you can’t assume it will happen in a decade or even a couple of decades.
“Of course I am very pessimistic looking at today’s politics in America and I’m terrified of what’s happening in Brazil and other countries, but I am a realistic optimist. Look at the UK supermarkets: the plastic bags are disappearing. Look at the plastic bottles at Glastonbury – just because there were plenty left on the ground doesn’t mean we haven’t saved a million. It’s the signal effect these things have that will change things.”
He shoulders his guitar, and steps out into the late summer sun. “The important thing is for businesses to see this as a necessity and an opportunity,” he says. “They would be absolutely stupid if they didn’t.”
More great stories from WIRED
⏲️ What would happen if we abolished time zones altogether?
🍎 Prepare Yourself for the Biggest Apple Launch of All Time
🏙️ Inside the sinking megacity that can’t be saved
💰 Meet the economist with a brilliant plan to fix capitalism
🎮 Long Read: Inside Google Stadia