United Nations Global Compact
Former President Fuji Xerox Co., Ltd.
It was a very unfortunate incident. A number of used Fuji Xerox products were found littering the Japanese countryside. Fuji Xerox had been operating a lease scheme for its photocopiers for some years and had hired independent contractors to handle the recycling of used machines, but now – as had happened before – the recycling company had chosen to get rid of the machines by dumping them in the mountains instead. It was cheaper.
Even though Fuji Xerox was not directly responsible, it was still its name on the products and the company – and Toshio Arima who at that time, 1993, was head of the corporate strategy office – learned a very early lesson about the damage a brand can suffer from the insufficient end-of-life management of its products. Something had to be done.
“Our European counterpart Rank Xerox had just started in-house recycling, I believe it was the year before, so it was all at a very early stage, but I visited them to investigate and back in Japan I created a task force to start recycling our own products,” says Arima.
Recycling was a dirty business, and not just due to the habit of some companies of dumping waste instead of recycling it. The toner dust in photocopier cartridges can pose a health risk and Fuji Xerox had to figure out how to recycle it while maintaining high safety standards.
This was very far from the cheapest solution at the time. The logistics of gathering, breaking down and separating more than 70 different components was challenging – both technically and commercially.
“It was very costly. It would have been much cheaper for us to buy new parts, but this was a strategy choice. We believed we could solve the problems and turn recycling into a business opportunity,” says Arima.
Two years later, the strategy’s initial goal was reached when the first line of products incorporating recycled parts was launched. It was still more expensive to reuse and recycle parts than to buy new ones, but the company stayed with the strategy and adopted a zero waste policy the next year.
In 2003, Fuji Xerox’s bet on recycling really started to pay off. The company had cracked the code and was now able to make recycled machines and cartridges more cheaply than new ones. By then, Arima had become President and Representative Director of Fuji Xerox. Today, he has no doubt that the efforts to adopt recycling and zero waste as a company strategy have made Fuji Xerox a much stronger company. Not least because of the innovation the process spurred in the organization.
“It took us eight years to change the whole process of reuse, recycling, design and production to achieve this. We changed a lot – big and small things, and our employees came up with many of the ideas for how to go forward. In the process, we filed more than 200 patents and managed to integrate concerns about the economy, health and society,” he explains.
According to Arima, this constant orientation towards integrating the economic, social and human dimensions is what differentiates Fuji Xerox from other companies.
“There is often a conflict between human, societal and economic needs. The conflict is real, but we shouldn’t try to make an easy trade-off between these needs. The basic philosophy must be to overcome the conflict. To do that, we need new inventions, new ways of thinking and new technologies. This integrated way of thinking is what drives innovation in an organization,” he says.
EDUCATION FOR ALL
Toshio Arima believes that education needs to be put at the forefront of our strategy to create a more sustainable economy. The Global Compact Network in Japan runs courses for senior executives to embed sustainability in their thinking and he himself teaches corporate social responsibility at college and university level. However, education must first and foremost be extended to the poorest members of the world’s population.
“We’re facing huge issues of disparity between countries and between people within countries. Unless we improve their situation, their future will become even more difficult. The key is education and increasing knowledge,” says Arima.