"PRODUCT: THE EARTH - TREAT WITH CARE" (CATALOG HOUSE)

JFS Newsletter No.13 (September 2003)
"TOWARD A SUSTAINABLE JAPAN - CORPORATIONS AT WORK" ARTICLE SERIES Article No. 4
http://www.cataloghouse.co.jp/ (Japanese only)

In the past 20 years, the mail-order business in Japan has emerged and grown rapidly, to reach total annual sales of 2.63 trillion yen (about US$ 22 billion) in 2002. When we think of a sustainable society, what do we see in the conventional and all-too-familiar shopping catalogs? Massive loads of catalogs, sent for free, but soon to be thrown away as garbage. Glossy pictures of products that try to lure more and more consumption. It seems far from sustainable consumption.

Yet, it could also be true that, unlike manufacturers, mail-order businesses may have little to do when it comes to improving products and consumption patterns for the environment. In addition to making the catalog out of 100% recycled newspapers and magazines, or making it tree-free and using plant-based inks, what can a mail-order company can do to promote sustainable society?

A Japanese company, Catalog House is working aggressively to answer the question, with its unique slogan: "Product: The Earth--Treat with Care" In this month's JFS Newsletter, we would like to introduce its corporate philosophies and actions.

Established in 1976, Catalog House is a mail order and publishing company of about 390 employees, with annual sales of 34.4 billion yen (about U.S.$280 million) in fiscal 2002. Its catalogs are "Tsuhan Seikatsu," (priced at about $1.50, issued quarterly) and "Pikaichi Jiten"(about $5, issued annually). Despite the fact that, unlike other catalogs, you must pay for them, they have a remarkable circulation per issue of about 1.5 million and 1.95 million, respectively. You can see how remarkable this number is from the fact that, for monthly general magazines in Japan, even the largest circulation is only about 650,000.

With half of its space filled with original articles having a spirited attitude, this catalog has from time to time ignited heated debate by dealing with the pros and cons of issues such as the ninth article of the Japanese Constitution (which renounces war as a means of solving international conflicts), Japanese corporations' involvement in dam development projects in Southeast Asian countries, and a food assistance program for North Korea. It is a retail catalog filled with journalistic articles that are interesting to read in themselves. Catalog House calls this "retail journalism" and this approach led them to build a unique brand image that is not constrained by the mail-order industry.

In the context of environmental issues, they looked at the problems of mass-consumption society and their company's role in it, and searched for ways to improve the situation. In their corporate philosophy, they write this:

"The mail-order industry, which has been functioning as a consumption-stimulating system, is at a turning point." "Do not think of yourself as just a consumer of products. You are consumer of the Earth--turning the environment and resources of the Earth into products and consuming them." "Achieving a balance between the environment and business is the largest challenge of today's consumption-oriented society, and the industry that embodies this challenge most directly is the mail-order industry."

And it continues, "The time has come for us to stand firmly on the pursuit of both 'business satisfaction' and 'earth satisfaction'." "Yet, as we think about it, we can see that having a catalog, which is effectively a store, directly delivering information to a large number of "Earth consumers" at once, the mail-order industry is in a better position than other retailers to make the case for "Earth satisfaction," and we recognize our responsibility for this."

Based on the above thinking, they have made the "Constitution of Catalog House Environmental Policy" their guiding principles in dealing the challenge.
[Article 1] We shall do our best to sell products that will not harm the earth, its plant life or animals.
[Article 2] We shall do our best to sell products designed to last, that can be fixed instead of being thrown away.
[Article 3] We shall do our best to extend the life of our products as long as possible by finding second users for them after the original owners have no further use for them.
[Article 4] We shall do our best to recycle products that are no longer useful.
[Article 5] The company shall do its utmost to limit its own production of waste and CO2.
[Article 9] We shall not sell nuclear weapons, smart bombs, fighter aircraft, aircraft carriers, artillery or armaments of any kind.

Based on the above principles, what actions are they taking? Now let's see at the "product standard" part referred to in Article 1 and "extending product life" part from Article 2 to 4.

In relation to article 1, they show their commitment to cautionary principle, which means to say that "we don't sell products if there is any doubt." Specifically, they describe detailed standards of product selection and make it clear that they will NOT sell products that use or emit dioxins, endocrine-disrupters, alternative CFCs, timber from an unknown country of origin, and genetically modified organisms.

Especially noteworthy here is their willingness to set their own rules and work with suppliers. They claim that they will not wait for laws and regulations, but make their own set of standards and seek cooperation with suppliers, that is, manufacturers and trading companies. In fact, Catalog House has been working aggressively with suppliers, long before being affected by legislation, to take on such measures as prohibiting the use of timber from tropical forests, collection and reuse/recycling of home appliances after first-users are finished with them, collection and recycling of CFC-type refrigerators, limiting the emissions of formaldehyde, etc. At the same time, they are aware of areas where improvement is needed, including products that emit electromagnetic waves, products using lead solder, and also completely making sure that none of their imported products and parts are made with any connection to illegal child-labor in developing countries.

In relation to Article 2 to 4, they promote the selling of products designed to last, making products longer, and reuse and recycling. In order to link this thinking to customer satisfaction after purchase, they conduct the following measures:

- Ask each customer to respond to a customer satisfaction survey, and try to keep selling products that attain high customer satisfaction levels. They don't change models just for the sake of change.

- In order to encourage longer use of products, deliver "maintenance news," with information on maintenance and repair, to customers a year after purchase.

- They offer a repair service for products even after the manufacturer's free repair warranty has expired. And they request manufacturers to keep spare parts for repair as long as possible.

Here is what they say: "Owners of unwanted, re-usable, Catalog House products may return them to our used-products store. We will purchase them at a modest price, check and re-condition them as necessary and sell them to second users at a modest price, with a full year's free warranty."

It is not too difficult to see that setting their own high standards ahead of legislation could, if the information is not communicated well, lead to opposition from industry, suppliers, and in certain cases, even the customers themselves. One of the measures Catalog House takes to prevent problems is by offering thorough information disclosure. From 2003, they decided that if subscribers of the catalog request more environmental information (including main materials, additives, CO2 emissions from manufacturing and during use, and product origin, etc.) than the digest information listed for each product, they will disclose all the relevant information and documents they have.

For instance, a subscriber may want to know the test method and data for formaldehyde, data on the name and frequency of agricultural chemicals used, or inspection documents (or the manager's submitted documentation) of wastewater from a factory. Upon request, the company will disclose such information, with the exception of data such as the ratio of ingredients in soaps or additives for plastics that the manufacturer does not disclose for fear of product copying. And if they cannot disclose the information they will explain the reason.

Catalog House's "The Constitution of Environmental Policy," along with information on the results and the future of environmental activities they are taking, is issued annually as their "environmental report." This report is distributed to 1.5 million subscribers along with the spring issue of the quarterly catalog "Tsuhan Seikatsu." Unlike many conventional environmental reports, it is written in an excellent style that attracts and keeps the readers' interest to the end. With their philosophy summarized in the phrase, "Product: The Earth--Treat with Care," pioneering their own high standards well before legislation, and excellence in communication, Catalog House is certainly becoming one of the leaders in "bringing information to consumers of the Earth."