Last week I spent three days facilitating a Sierra Club summit on global climate change in which 100 of the Club’s top leaders and thinkers struggled with the impending catastrophe and what to do about it.

At that meeting I was stunned by the enormity of the challenge ahead. So, you can imagine my excitement when I read in the papers that the structure of the largest leveraged buy-out in history — valued at $45B — is being driven in part by environmental concerns. The buyers, and their bankers at Goldman Sachs, are insisting on a greener company before they buy TXU, the Texas-based utility that is the subject of this deal. Eight planned new coal plants will be scrapped, and hundreds of millions will be spent on research into alternative energy.

The key to the deal, of course, was the intervention of Environmental Defense and the Natural Resources Defense Council, which negotiated the concessions in exchange for not opposing the sale.

At least two lessons can be learned from this event:
• First, if you can make enough trouble for a corporation, they will want you as a friend.
• Second, and more important, is the long-term value of getting corporate leaders to serve on nonprofit boards. Two of the leveraged buy-out leaders are past and current board members of World Wildlife Fund. I have to believe that the experience of serving on that board made them more sensitive to the environmental issues involved in this deal and also gave them a friendly back door through which they could approach ED and NRDC.

All in all it was a good day for the planet.

Tags: nonprofit

This entry was posted on Monday, February 26th, 2007 at 11:31 pm and is filed under Recommended Reading, Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.