Tom Chappell spoke like a great philosopher as he conveyed his message of “common goodness” to an eager crowd of Dartmouth students and faculty on October 16 in Collis. “Goodness is an entity; a living being that has inherent worth and dignity,” he argued. These words were particularly refreshing coming from the lips of a prominent business man such as Mr. Chappell. With years of experience in the cutthroat business world, Tom Chappell has somehow managed to keep his values close in the face of corporate greed. He has incorporated these values to successfully build a “value centered,” financially successful business¬Tom’s of Maine.

Chappell graduated from Trinity College in Hartford, Connecticut with a BA in English. After years in the business world, Chappell’s philosophical and religious interests led him to Harvard Divinity School where he graduated with a Masters in Theology in 1991.

His evolving educational pursuits were accompanied by a series of physical and corporate relocations. In 1968, Chappell and his wife Kate left corporate Philadelphia to “move back to the land.” They now reside in Kennebunk, Maine with their five children. When the Chappells reached Maine in 1968, their desire to use only “unprocessed foods and simple, unadulterated products” was challenged because they could find no personal care products that fit their definition.

Without any suitable alternatives available, the Chappells decided to produce their own line of natural personal care products. A $5,000 grant from a friend sent the Chappells on their way to producing “products for home use that would not harm the environment.” Clearlake was Tom’s of Maine’s first product and “the country’s first non-phosphate liquid laundry detergent.” According to Chappell, “The refillable containers were labeled with a postage-paid mailer so that customers could send them back to be reused.”

By 1983, Tom’s of Maine’s sales approached $2 million, and today the company produces over 100 products lining the shelves of some of the country’s largest pharmacies, including Brook’s and CVS. Even with Tom’s of Maine’s success, Chappell still operates his company based on the principle that “people and nature deserve respect. ”

Although Chappell’s principle of respect resembles the marketing ploys of companies attempting to cash in on an environmentally friendly image, Chappell differentiates Tom’s of Maine through the development of a business strategy incorporating values into every aspect of operation. Chappell labels this innovation values-centered leadership and discusses it at length in his book Managing Upside Down: The Seven Intentions for Values-Centered Leadership. Tom’s of Maine provides an interesting case study of how intentional values-centered leadership can produce responsible business operations and a windfall of profits. Tom’s of Maine operates around nine specific beliefs that affect the day-to-day management of the company. These beliefs all relate to the importance of placing value on nature, people and the relationship that exists between the two.

The foundation that supports Chappell’s value¬centered operation is his workforce. Tom’s spends about one and a quarter percent of sales on their training process-recognizing that a company is only as responsible as its employees. Chappell seeks to hire individuals who share values similar to those of the company and who are open to being re-educated to make decisions based on more than just cost-minimization. Chappell describes the training and hiring processes as an attempt to instill the notion that good operational decisions are “intentional about including values along with all other metrics.” This training process is constantly being improved, but the operational record of Tom’s of Maine speaks well ofthe program’s competency.

Tom’s of Maine’s training program sets the stage for responsible operation, but Chappell believes strongly that “sustainable employment comes down to individual accountability.” The company reviews all employees three times each year to ensure that they are operating in an appropriate manner. Chappell says that this review process “helps people clearly understand what their role is and what is expected of them in the next four months.” He values this review system because “trust and accountability go hand in hand; if you trust people with certain roles, they inherit the accountability to perform in those roles.” Chappell describes his preferred system as one “based on individual accountability that holds [employees] accountable not only to performance of tasks but to cultural competency.” He continues, “We have what’s called cultural and role competencies in the role descriptions so that they know what they are accountable for in both respects, in the way they work with one and other and what’s expected of them. ”

With this strict accountability comes a series of benefits consistent with satisfying the human value component of Chappell’s beliefs. The employees at Tom’s receive lifestyle hours in the summer resulting in a work week that begins on 8am on Monday and ends at noon on Friday, allowing employees to spend more time with their families. Tom’s also volunteers five percent of each employee’s paid time to a community service project of his or her choosing. The combination of all of these employee programs is what Chappell describes as “enormous efficiency, productivity and innovation … through an inclusion of values in the overall goal setting and objective setting ofthe business.”

Tom’s of Maine has demonstrated Chappell’s hypothesis that “good deeds build better business.” Chappell rests the whole of the company’s success on the shoulders of the training program and its effectiveness in promoting responsible, informed management decisions. While this innovative business strategy is certainly environmentally and socially beneficial, it is also very profitable. Chappell and other managers are experts at finding and executing Pareto improving business strategies.

One such program was a recent toothpaste promotion in personal care stores. This initiative promoted the National Rivers Awareness Program, a joint effort between Tom’s, the River Network, National Park Service and The Nature Conservancy to “draw attention to our nation’s troubled rivers and watersheds.” The partnership between Tom’s of Maine and the nonprofit organizations was fostered through Chappell’s Common Good Partnership program, developed to “fulfill the dual aims of running a profitable business and contributing to the common good.” The Partnership program asserts that “By partnering with retailers, non¬profit organizations, and [consumers] to support an important cause, we can work together to make the world a better place.”

This particular promotion asked retailers to provide Tom’s with a prominent location to place a display containing information, including a free DVD, about the National Rivers Awareness Program. The display also offered Tom’s toothpaste at a sale price. The promotion helped attract attention to the precarious state of the nation’s watersheds, while the moral appeal of the program allowed Tom’s of Maine to secure a prominent toothpaste sale location that their market share would normally prohibit. Chappell uses this promotion as an example of how “values enhance the efficiency of everything we do.”

Through strategies similar to the National Rivers Awareness Program promotion, Chappell is doing what other businessmen and economists have long thought impossible-operating in way that is mutually beneficial to the environment and to profit margins. The personal care products market does afford Tom’s of Maine a lucrative, unfilled natural care niche in a low price market where product differentiation is important relative to price. But nonetheless, Tom’s of Maine’s amazing growth (twenty-five percent last year) and profitability shed light on the fact that social and environmental degradation do not necessarily accompany financial success.

Chappell is hopeful for the future of responsible business management and cites Johnson and Johnson as an example of a major company whose increasingly values-centered operation is putting pressure on others to follow suit. Chappell believes that sweeping, market-wide environmental and social improvements will come from responsible companies and from consumers demanding that dependent companies operate responsibly. Chappell himself says, “I’m for demonstrating that good deeds build better businesses.” Through his initiatives with Tom’s of Maine, Chappell is leading the way by example.

Travis Keller ‘05 is an Economics and Environmental Studies major. He s currently in Australia reporting on socially conscious investing at the Institute for Sustainable Futures in Sydney.